Simmethod ibm case study, was ibm 2013 performance predictable

SIMMETHOD™
Industry Reports and Risk Alerts
Technology, HR and Social Media
IBM 2013 Case Study
A new way to measure and predict
Corporate Risk and Performance and
fend-off current and future competitors
7/11/2013 1
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SIMMETHOD™
Risk and Opportunity Alerts
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SIMMETHOD™
Was IBM’s Performance Predictable?
• “IBM on April missed Wall Street
estimates for the first time since 2005
and started to laying off thousands of
employees” Business Insider
• “Where we have not transformed
rapidly enough, we struggled. We have
to step up at all levels” IBM’s CEO
Virginia Rometty
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SIMMETHOD’s Case Studies
2013 Industry and Business Trends
IBM 2013 Case Study

SIMMETHOD™
Risk and Opportunity Alerts Case Studies
Table of content:
• Methodology
• C-Level Industry and Business Trends
• C-Level Business Competitive Intelligence
• HR Contribution to Business Value 2012 to
2013
• Sales and Marketing Contribution to Business
Value 2012 to 2013

SIMMETHOD™
Methodology
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The Way We Measure Corporate
Performance Is Broken
Why do
Businesses
fail?
Blockbuster
Borders
Circuit City
Mervyns
Wachovia
Washington
Mutual
Linen n’
Things

The CEO’s Lament in the Business
Analytics Market
• We did not see it coming. All my
Divisions’ Analytics pointed
North while my Business as a
whole (in comparison to new
competitors and the Best-In-
Class in multiple industries) went
South.

The Employee’s Lament in the
Business Analytics Market
• We did not see it coming. All our
HR’s Analytics pointed North
while our Business as a whole (in
comparison to new competitors
and the Best-In-Class across
multiple industries) went South.
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Disrupting the Way we Measure
Corporate Risk and Performance
There are three main problems:
1. The lack of a single industry-agnostic scale to
measure and predict Corporate
strategy/execution (competitive advantage)
leads to erroneous and inconsistent C-Level
decision-making
2. Silos-analytics lead to erroneous C-level
decisions based on many versions of the truth
3. Lack of C-Level risk and performance visibility
accentuated by inward-looking industry metrics

Silos Analytics Lead to Many Versions
of the Truth and Erroneous Decisions

Towards a Single Index to Measure
Competitive Advantage
• Comparing the elephant legs or ears against
peers’ legs or ears leads to incorrect
conclusions (This is what traditional
benchmarking does)
• The strategy/execution or competitive
advantage of a Business can only be assessed
holistically and it is not the sum of its parts

Towards a Single Index to Measure
Competitive Advantage
SIMMETHOD’s industry-agnostic algorithm holistically
finds the Best-In-Class Businesses in each Business
Sector and only then calculates a Best-In-Class and a
low performance profile. These Best-In-Class and Low
Performance profiles are used as a GPS to:
• Alert you of your risk and opportunities within and
outside your Business Sector,
• Predict your performance against your peers and the
Best-In-Class across multiple Business Sectors and
• Fend-off current and future competitors coming from
inside and outside your industry.

Towards a Holistic Index of Corporate &
Value-Chain Performance and Risk
• Currently, there is no single
industry-agnostic scale to measure
and predict Business or Value-Chain
strategy/execution (competitive
advantage).
• Conventional Benchmarking
measures silo by silo (ratio by ratio)
and then adds up the sum of the
parts but the problem is that (a star
team is not the same as a team of
stars)

A Star Team (Strategy/Execution) Is
Different Than a Team of Stars
• Unlike conventional analytics
that measures 11 players
independently, SIMMETHOD’s
algorithm finds the Best-In-
Class teams first and only then
prepares a predictive C-Level
and functional profile of the
Best-In-Class players

Lack of Business and Value-Chain
Leading Indicators and Risk Alerts
Company
view
SIMMETHOD™
industry view
indicators &
alerts
SIMMETHOD™
value-chain
view, leading
performance
indicators &
alerts
SIMMETHOD™
global market
view leading
risk/
performance
indicators &
alerts database
Inward-
Looking
Analytics
Maximum
Risk,
Minimum
Visibility
Value-Chain and Market
Leading Indicators and Risk
Alerts
Minimum Risk and Maximum
Visibility

The Leading Indicators and Risk Alerts
of the Best-In-Class
Why do you need Industry Agnostic Leading
indicators and Risk/Opportunities Alerts?
• In an interdependent Market (like the Planets
in the solar system) your current and future
risk and performance are impacted by an
ecosystem of constantly changing
competitors coming from inside
and outside your Industry.

Your Gap to SIMMETHOD’s Best-In-Class
Determines Your Risk and Performance
Your current
position against
the B-I-C and
competitors
Gap to B-I-C in
your industry
Gap to
Competitors in
a range of
industries
Gap to B-I-C in a
range of
industries
Your original
targets against
SIMMETHOD
Database

SIMMETHOD’s Disclaimer
• The purpose of the SIMMETHOD
Strategy/Execution Performance Predictive
Index, Reports and Risk/Opportunities Alerts
is not to make a Business right or wrong but
rather contribute towards the understanding
of management actions in comparison to
industry peers and the SIMMETHOD Best-In-
Class.
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• SIMMETHOD’s League Table, Strategy/
Execution Performance Predictive indices,
correlations, metrics and risk/opportunities
alerts do not seek to be exact but rather
serve as a conduit to ask better questions
and seek better answers in the performance
improvement, risk minimization and value
creation journey.
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• Sometimes, the value of a metric in itself
does not provide the greatest of insights, but
valuable actionable knowledge is gained
from its ability to provide a trend or a
common comparison yardstick with other
Businesses across a range of industries.
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• This report is for informational purpose only
(with management rather than financial
information) and SIMMETHOD shall not be
liable for the contents of the report or
risk/opportunities alerts or for any damage
incurred or alleged to be incurred to any of
the Businesses included in the Reports as a
result of its content
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SIMMETHOD League Table 2013
Business services, Technology, Software, Social Media, HR
Best-In-Class Top 25%
NHN, Visa, Apple, Mastercard, Checkpoint, Baidu,
Infosys, Netease, Google, Yahoo, Cognizant, Priceline,
Tata, Cielo, Intuit, AOL, Paychex, Wipro, VMware
Best-In-Class Top 50%
Aggreko, Accenture, Experian, Dassault, HCL,
Moody’s, Oracle, Citrix, LinkedIn, Microsoft,
Amadeus, SAP, H&R Block, DKSH, IBM, Salesforce,
Amazon, Ebay, Teradata
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SIMMETHOD League Table 2013
Business services, Technology, Software, Social Media, HR
Mid Range Score
Adobe, Brambles, Thomas Cook, Verisk Analytics, EMC,
Automatic Data, Facebook, Honeywell, Randstad,
Compal, HP, Western Union, Quanta, Alliance, United
Technology, Innolux
Low Range Score
CA, Fiserv, Sodexco, Tui, Netapp, Manpower, Dell,
Computer Science, Fidelity National, Adecco,
Symantec, Capgemini, Atos, Expedia, American
Express
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SIMMETHOD™
Industry and Business Trends
C-Level View
• Are you mistaking any positive growth
for real competitive advantage?
• Your rate of improvement against the
SIMMETHOD Best-In-Class determines
your future risk and performance

SIMMETHOD’s Case Studies: Business Trends
Across the Major C-Level Indices – 2012 to 2013
In the following Case Study, the gaps
between the 2012 and the 2013 graphs
show the areas of the Business where
competitive advantage is being gained
or lost in relation to peers and the
SIMMETHOD Best-In-Class

SIMMETHOD’s C-Level Indices Business Trends
2012-2013
IBM and the Best-In-Class
0
2
4
6
8
10
12
14
16
18
20
SIMMETHOD
Management
Controllable
Resources index
SIMMETHOD Value
Creation Index
SIMMETHOD
Minimum Company
Business Model
index
SIMMETHOD
Strategy/ Execution
Performance
Predictive index
IBM 2012
IBM 2013
Average
2013 Best-
In-Class
An improvement on the Management Controllable
Resources and Business Model indices has not been
translated into Value Creation in the same degree as
IBM’s peers and the SIMMETHOD Best-In-Class

SIMMETHOD’s Business Trends Across the
Major Indices – 2012 to 2013
-6
-4
-2
0
2
4
6
8
10
12
IBM
2012
IBM
2013
IBM’s negative value creation and
performance trends are driven by a
combination of the Sales, Overheads and
Cash/debt indices

Competitive Intelligence
C-Level View
SIMMETHOD’s Case
Studies: Business

SIMMETHOD Competitive Intelligence
In a market where industry-barriers
have collapsed and new competitors
can come from any industry, how do
you measure and predict your
future risk and performance and
fend-off current and future
competitors?

SIMMETHOD’s Strategy/Execution Performance
Predictive Indices:
• Rate your management’s ability to strategize
and execute against its peers and the Best-In-
Class,
• Show the strengths and weaknesses of your
Business in relation to your peers, current and
potential future competitors and
• Are a predictive indication of future
threats/opportunities from within and outside
your industry.

• In a constantly fluctuating Market and unlike
static ratios that do not capture the dynamic
relationships between Businesses and Value
Chains, SIMMETHOD™ industry-agnostic
composite indices measure the interactive
relationships (competitive advantage)
between Businesses and Value Chains across
every Business Sector and provide early
warning alerts of future threats and
opportunities.

2013
-15
-10
-5
0
5
10
15
20
25
LinkedIn
2013
Oracle 2013 SAP 2013 IBM 2013 Average 2013
Best-In-Class
SIMMETHOD
Management
Controllable
Resources index
SIMMETHOD Value
Creation Index
SIMMETHOD
Minimum Company
Business Model
index
SIMMETHOD
Strategy/ Execution
Performance
Predictive index
Each SIMMETHOD C-Level index provides
objective insights into your strategy/execution
against your peers and the Best-in-Class

2013
-15
-10
-5
0
5
10
15
20
LinkedIn
Oracle
SAP
IBM
Each company has
distinctive areas of
competitive advantage
against peers and the
Best-In-Class

SIMMETHOD™
SIMMETHOD Case Studies
HR Contribution to Business Value
2012 to 2013

SIMMETHOD™
• When your rate of performance
improvement is slower than the
SIMMETHOD Best-In-Class your level of
Business risk is increasing.

From Predictive to Prescriptive
Business and Competitive Intelligence
HR view
• The Strategy/Execution Performance
Predictive Index trend shows that the gap
between the Low Performers and the Best-In-
Class is narrowing. That is to say, the score of
the Low Performers is improving in relation
to the Best-In-Class.

• The next steps are to find out both at the C-Level
and Functional Level from where the
improvement of the Low Performers in relation
to the Best-In-Class is coming from?
• Is it a Business Model improvement? Is
Management getting better at resource
management?
• Are the Functional View Indices providing any
clue regarding the narrowing of the
performance gap to the Best-In-Class?

SIMMETHOD™ Industry and Business Trends
HR contribution to Business Value 2012 to 2013
-5
0
5
10
15
20
25
IBM Strategy
/Execution
Performance
Predictive index
B-I-C Strategy
/Execution
Performance
Predictive Index
IBM HR Index B-I-C HR Index
2012
2013
Although IBM’s HR Index has
improved, it is still below B-I-C
average and not sufficient to
drive its Strategy/Execution
Performance Predictive Index
to average B-I-C level

HR View 2013
SIMMETHOD Case Studies:

HR View 2013
-5
0
5
10
15
20
25
IBM Oracle SAP 2013 B-I-C
SIMMETHOD HR
Index
SIMMETHOD
Strategy /Execution
Performance
Predictive Index
HR Index at below SIMMETHOD’s B-I-C contributes
to Strategy/Execution Performance Predictive
indices at below B-I-C average. However, Oracle
and SAP are unlocking more value from their
Human Capital than IBM

SIMMETHOD™
SIMMETHOD Case Studies:
Sales and Marketing Contribution
to Business Value 2012 to 2013

SIMMETHOD™
• When your rate of performance
improvement is slower than the
SIMMETHOD Best-In-Class your level of
Business risk increases.

Sales Index View
• The Strategy/Execution Performance
Predictive Index trend shows that the gap
between the Low Performers and the Best-In-
Class is narrowing. That is to say, the score of
the Low Performers is improving in relation
to the Best-In-Class.

• The next steps are to find out both at the C-Level
and Functional Level from where the
improvement of the Low Performers in relation
to the Best-In-Class is coming from?
• Is it a Business Model improvement? Is
Management getting better at resource
management?
• Are the Functional View Indices providing any
clue regarding the narrowing of the
performance gap to the Best-In-Class?

SIMMETHOD™ Industry and Business Trends
Sales and Marketing contribution to Business Value
2012 to 2013
-5
0
5
10
15
20
25
IBM Strategy
/Execution
Performance
Predictive index
B-I-C Strategy
/Execution
Performance
Predictive Index
IBM Sales Index B-I-C Sales Index
2012
2013
IBM’s Sales Index is now in
negative territory and continues
to underperform the Best-In-
Class both at Sales Index and
Strategy/Execution Performance
Predictive Index level

Sales and Marketing View
SIMMETHOD Case Studies

Sales and Marketing View 2013
-5
0
5
10
15
20
IBM Oracle SAP 2013 B-I-C
SIMMETHOD Sales
Index
SIMMETHOD
Strategy
/Execution
Performance
Predictive Index
Although the 3 Companies underperform the B-I-C
Sales Index, Oracle and SAP are able to extract more
Business value (and performance) from their sales

SIMMETHOD™
Risk and Opportunities Alerts
• The SIMMETHOD algorithm reviews 1000’s of
Businesses and stockholders decisions across
Business Sectors and builds Industry-Agnostic
indices in order to identify, measure,
correlate and predict your strengths,
weaknesses, risks and opportunities against
your current and potential future
competitors from inside or outside your
industry.
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SIMMETHOD™
The SIMMETHOD algorithm selects the Best-In-Class
performers in Technology, Software, Social Media, HR and
Business Services and produces Risk/Opportunities Alerts
geared to
• C-Level,
• HR,
• Finance,
• Sales and Marketing Executives and
• Investors
showing trends, risk and Best-In-Class profiles and
competitive intelligence in graphical and metrics form and
risk/opportunities alerts throughout 2013.
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SIMMETHOD™
SIMMETHOD receives over 100,000
Business readers per year, has been Hot
on LinkedIn, Twitter and Facebook 28
times and selected by Business Week as
Top Source of Performance
Management Information.
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Jorge Oscar Tabacman
jtabacman@gmail.com
Twitter ID: SIMMETHOD
SIMMETHOD™
A New Way to Measure and Predict
the Risk and Performance of Your
Business and Alert You of New
Threats and Opportunities

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Simmethod ibm case study, was ibm 2013 performance predictable