100 days of IBM Malaysia, and maxing out the headroom: Page 2 of 2

Taking a bite with Apple

That need to remain flexible on models will certainly be given a test with IBM’s July announcement that it had entered into a strategic alliance with its longtime rival from the early days of the personal computer revolution, Apple Inc.
 
IBM said it will partner exclusively with Apple to sell iPhones and iPads loaded with applications geared at enterprise clients, and will release more than 100 apps targeting industries such as retail, healthcare, banking, travel, transportation and telecommunications, Reuters reported.
 
IBM also plans to develop cloud services optimised for Apple's iOS operating system, the news agency added.
 
How is the Apple partnership going to roll out in Malaysia, seeing that the Apple operations here is essentially a small sales presence?
 
Moung admits that IBM Malaysia hasn’t met with the Apple people in Malaysia yet. “It’s an unfolding story.”
 
“Obviously both sides want to leverage on the strengths of the different companies. IBM has been physically present in Malaysia for 52 years now, and we have relationships with many companies here.
 
“We have the ability to deliver service and support, which is what enterprise customers want, so I would say that’s what they would be expecting of us where-ever IBM has the franchise and the footprint,” he adds.
 
The changing tech landscape
 
Change is the only constant, they say, and when it comes to technology, it’s usually also fast and furious.
 
Five years ago, businesses did not have to worry about social media. Today, they not only do but have also started harnessing it to grow their business, not merely ‘manage’ it.
 
Throw in mobile and big data, and it’s a very different technology and business landscape. Is there anything that keeps Moung awake at night?
 
“I sleep pretty well, actually,” he chuckles.
 
“Honestly, a year ago, there were a lot of things I had on my list that I worried about for IBM, which affect me here in Malaysia also.
 
Basically, gaps that we had – and not just gaps in our portfolio, but also gaps, as in: Are we focusing on the right things? Are we retraining or retooling our people with the right skills and tools?
 
“A year ago, I had a long list. And I was worried.
 
“After January of this year, with the new direction we’re taking the company, now we’re really in execution mode,” he adds.
 
In January, with the drop in sales and profit, IBM announced that its executives would forgo bonuses for fiscal year 2013. It also said that it would invest more than US$1.2 billion to expand its data centres and cloud-storage business, according to a BBC report.
 
IBM also said that it expected its operating profit for 2014 to rise by more than 10% as it looks at new avenues for growth.
 
“We will continue to transform our business and invest aggressively in the areas that will drive growth and higher value,” the BBC quoted IBM chief executive officer (CEO) Virginia Marie ‘Ginni’ Rometty as saying.
 
“So now what keeps awake at night is this nagging question: I want to be comfortable that in the Malaysian context, we’re working on the right things, with the right execution of the right actions,” says Moung.
 
“I and my leadership team have always had open dialogue on this – about this idea of not falling in love with your own idea … to re-examine it all the time and keep refining it, and the mental breakthroughs will come,” he adds.
 
So if he were in a private discussion with Rometty (pic), and the IBM CEO asked him what IBM was doing wrong, or what it can do better, what would Moung tell her?
 
“A year ago I had a lot of things on my list; now I have fewer,” he says.
 
“She’s running a company that operates in 152 countries and has more than 420,000 employees … so yes, my feedback to her would be ‘global strategy, country focus’,” he says, riffing off that old ‘think global, act local’ adage.
 
“How do we make that happen? How do we make sure that the people who are executing the strategy and presenting these new value propositions and offerings to the market … don’t do it purely as the ‘IBM Corporate’ way, so to speak, for lack of a better term?
 
“Meaning that, we’re not McDonald’s, you can’t just take the franchise and say, ‘You eat what I serve you.’ It’s not that simple in our business.
 
“How do you do that calibration, on a country level, where the people who are executing have the feeling of empowerment and the feeling that they have some discretion?” he says.
 
Moung says that based on his experience working in other countries, different markets have different needs, and IBM’s management in these countries must feel they can freely propose different takes on the company’s offerings, and not necessarily the full suite.
 
An example would be Watson, IBM’s cognitive computing initiative and set of technologies.
 
“Let’s say Watson’s IQ (intelligence quotient) scales to 180, but somebody only needs Watson at an IQ level of 120 … I must not feel I am not doing the right thing by saying that’s okay, that we don’t need to go into overkill mode,” says Moung.
 
“That’s what I mean by country focus – you need to calibrate it to the customers in the market you’re in, and the current state of evolution of that market,” he adds. “Everybody’s at different stages, so you’ve got to make your offerings consumable and relevant for the level of adoption, innovation and investment that the market is at.”
 
To do this, IBM needs to encourage its subsidiaries to be more forthcoming in volunteering their point of view in how they can achieve the goals set by Hq, “but not in a franchise or purified way, if you will,” says Moung.
 
“That will probably be what I’d tell her [Rometty]. There was a time in our history when that pure franchise approach worked pretty well, but this is not the environment right now.
 
“That’s my role, and those in middle management like me: To bridge that gap between the strategy and ideology, but to also have the courage of conviction to do the things that are right for the market,” he adds.
 
Previous Instalment: 50 hues of Big Blue: IBM’s transformation, according to Paul Moung
 
Next: Cloudy in Malaysia and fundamental flaws
 
 
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