The company's decision to develop its Dublin operation is part of a major worldwide corporate restructuring, writes Sean Mac Carthaigh
By SEAN Mac CARTHAIGH
IBM remained silent last night about the dramatic move it plans for Dublin, but the development dovetails perfectly with its current global restructuring programme. The Dublin operation will form part of a new network, and is likely to be the company's world centre for dealing with a particular sector of business.
As such, it is an investment of major strategic importance for Ireland. Sources said that the new project involves a mix of manufacturing and services and it may also involve some research.
One possibility, according to industry observers, is that Dublin may become a key IBM global centre for customer care, with telephone calls relating to personal computers from anywhere in the world being routed to the company's base here.
Whatever the precise responsibilities of the new plans, it is clear that it will concentrate enormous corporate resources in Dublin. This will in turn drive the development of other IBM business and administration in Ireland, covering most of Europe. IDA Ireland will hope that this not only opens the way to further investment from one of the world's leading computer companies but also attract other investments to Ireland.
The Dublin centre will become a key strategic centre for part of IBM's business. "The marketing operations were based on geographic areas, they're now moving to specific sectors," an IBM spokesman in New York said last night.
He said this would mean that, for example, any IBM business dealing with healthcare computers anywhere in the world would be directed to one centre.
In the case of Dublin, IBM has already established a huge customer care centre in the Dublin's Ballycoolin business park - the firm said in June it would need 750 workers.
One next move would be to switch all telephone business relating to PCs away from the various centres around the world, focusing every call on Dublin.
Behind IBM's restructuring drive is its chief executive, Mr Louis Gerstner. He joined the ailing company in March 1993, made thousands of people redundant, and within two years had turned red ink into black.
Mr Gerstner has returned time after time to the subject of the speed of change in the world of technology, and how corporate structures must adjust to cope with this. In one speech, he remarked that managers the world over now had very similar approaches.
"They are concerned about speed, competitiveness, cycle time, market extension, globalisation. These are all manifestations of what Jack Welsh from GE calls the `white-knuckle competitive environment of the 90s'," he said.
It was such a view, along with generous support grants from IDA Ireland, that led to IBM's decision to expand its Dublin operation.