Suarez | Recalling IBM’s 75 years in PH

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By Ike Suarez

ike

The date was July 20, 1937. On this day, a company called Watson Business Machines Corporation was incorporated in the Philippines.

Its office is a one-room affair within the PNB in Escolta, Manila. It only had four employees, with one more to be added the following year.

Its product lines consist of electric accounting machines, electric typewriters, and time recording machines. These are that period?s state-of-the-art devices, productivity enablers for companies determined to thrive even in the midst of the great economic depression which began globally in October 1929.

The lean times notwithstanding, Watson Business Corp. does good business during the next few years. Among its clients are the Bureau of Census and blue chip corporations such as Insular Life and Caltex. It is a small but prestigious list that enables the new company to prove the worth of its offerings.

In 1946, Watson Business Machines Corporation would be renamed IBM Corporation of the Philippines. By 1954, it would assume its current name — IBM Philippines.

Not only has it undergone a change of name. It has also undergone a metamorphosis in the way it does business in the country. The transformation process began in the early 1990s.

The evolution formed part of IBM Corp.?s painful struggle to reinvent itself as the mother company in Armonk, New York faced a near-death crisis. This challenge to its survival affected all its operations worldwide, the Philippines included.

As in the rest of the world, IBM dominated the country?s market for computers beginning in the early 1950s. These were host-based behemoths, mainframes that only large government offices or companies in the list of the country?s top 1,000 corporations could afford to purchase and install.

IBM Philippines distinguished itself in the country as a vendor for proprietary software and computers. Indeed, the company?s name and the term ?computer? seemed one and the same to the public. So much so that many employees called the room where their mainframe was installed, the IBM Room. This, even if by slim chance, the computer inside had been manufactured by one of the so-called Seven Dwarfs, the company?s smaller competitors.

IBM Philippines, as was its mother company in the US, was much admired then. For many bright and young Filipinos who found employment there, it often served as training ground for top executive positions in other Philippine companies.

But the paradigm shift to personal computers, client/server platforms, and open systems — a sea change in computing that began in the US in the 1980s — started to challenge IBM?s dominance of the global market for computers. By the early 1990s, the company also known as Big Blue, was fighting for its survival.

The struggle could also be felt in the Philippines. Its corporate culture, once cutting-edge, now appeared stodgy and outdated.

Along with other IBM offices worldwide, it had to reinvent itself or face corporate death. But we all know what happened — IBM, led by its maverick CEO Louis V. Gerstner Jr., engineered one of the greatest comebacks in corporate history.

And now it is July 20, 2012. We are at the IBM Philippines executive board room at the 1800 Building in Eastwood City in Libis, Quezon City. There is a media briefing as IBM Philippines marks its 75th anniversary.

This building is one of seven that IBM Philippines calls home. It has another nearby, also in Eastwood. It likewise has others in the Ortigas Center, Makati City, Cebu City, and the University of the Philippines-Ayala Technohub in Diliman, Quezon City.

The briefing?s venue already announces that the company has undergone a corporate metamorphosis. Eastwood City is among the reasons why the Philippines is today a global power in e-services. Most locators there are into this industry.

True, IBM Philippines stills sells hardware and software in the country, mostly for large enterprise systems. And yes, IBM in New York has identified the country as among its top 20 growth markets globally.

But IBM Philippines today is much more than this. Not only does it address the needs of the global market. It caters to the rest of the world also via e-services done in the country.

Which brings us back to the media briefing. Present there is Mariels Almeda-Winhoffer. A balikbayan with 26 years of previous experience in Big Blue?s US operations, she is IBM Philippines? first woman president and country general manager. She is also one of IBM Corp.?s six top women executives worldwide.

Also present are top executives Cassandra Sotto and Dod Peralta. Sotto is is the director for Global Process Services, while Peralta is the head of Global Delivery Center.

Global Process Services is IBM?s term for business process outsourcing or BPO services. On the other hand, Global Delivery Center is its term for the design of proprietary software, configuration of hardware and network systems for these computer programs. Software by other vendors can also run on these systems.

Other IBMers are at the briefing. ?Corporate chic? describes their attire. But no one wears IBM Philippines? ?battle dress uniform? of old: a blue barong Tagalog or a blue suit.

No one, too, is dressed in blue jeans and sneakers, trying hard to look like technopreneurs from Silicon Valley start-ups. Such was many times their public attire during the mid-to-late 1990s when IBM still had to complete its painful process of transformation.

Almeda-Winhoffer sets the tone as she reads a prepared statement: ?IBM?s success has been and will continue to be enabled by transformation through innovation. We will continue to make a positive impact by leveraging on smarter solutions to advance national priorities, collaborate globally to grow our business further and make IBM essential to our clients and stakeholders, here and the world over, 75 years forward.?

Sotto and Peralta follow with their own statements. They amplify on what their president and GM has said.

Sotto points out that IBM Philippines? Global Process Services now serve the needs of over 50 multinational corporations to support their operations globally. Their total reach numbers 85 countries. Their company attends also to such similar services needed by sister IBM offices in 65 countries.

Such services span the fields of finance/accounting, human resources, supply chain management, and CRM or customer relations management. Such services include voice and non-voice categories.

Peralta, for his part, points out that over 50 large multinational corporations worldwide have already been serviced by their company?s delivery of IBM solutions. Their company also does online technical support from the Philippines.

These multinational corporations are into various industries. Some of these are telecommunications, chemicals, insurance, retail merchandising, electronics, and utilities. The solutions provided support these companies? global operations.

These corporations not only have their head offices in the US. Their headquarters are also located in other countries such as Canada, Australia, New Zealand, Singapore, Thailand, Malaysia, Indonesia, France, Netherlands, and Sweden.

At the briefing, Almeda-Winhoffer points out that IBM Philippines is now also into R&D. Thus, its partnership with the Davao City government to develop a smart public safety operations center, the first of its kind in the world.

It has also signed a memorandum of understanding with the Department of Science and Technology to jointly develop IT solutions to meet Filipinos? practical needs. Likewise, its innovation center at the UP-Ayala Technopark will soon mark the third anniversary of its operations.

IBM?s partnership with the Davao City government calls for the leveraging of the LGU?s IT infrastructure — computers, computer networks, and CCTV cameras — to smarten it with purpose-built analytics software .

This will enable the Davao City government to proactively craft responses to public safety concerns such as petty crimes, public disorders, accidents, fires, and other incidents.

IBM Philippines? partnership with DOST, on the other hand, calls for development of IT solutions for flood management, rice production, and education. Meanwhile, its innovation center in Diliman, Quezon City gives technology developers, partners and independent software vendors, and the academe access to cutting-edge technology at no cost. This enables locally developed solutions to be tested and further refined that they may be technically-robust enough for world markets.

That IBM went through a near-death crisis is a fact Almeda-Winhoffer acknowledges. ?I witnessed it personally,? she admits as she recalls her early years with IBM in the US where she worked after graduating cum laude from Fordham University in New York City.

Other executives amplified on this by saying that IBM is now a company transformed. It survived because it reinvented itself to be a solutions developer that has now discarded its go-it-alone policy with regard to hardware and software.

As such, its potential to play globally and thrive as it does so is now recognized and nurtured. And this reflects in Almeda-Winhoffer?s statement which concludes, ?75 years is not simply a milestone. Rather it marks an opportunity to heighten IBM?s commitment to the country as the Philippines remains essential to IBM?s growth strategy.?

These words are well said, Ms. Almeda-Winhoffer. And congratulations to IBM Philippines. No, your company is not 75 years old. Rather, it is 75 years new.

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