IBM’s Struggle to Adapt to the Cloud Era: Internal Culture, Lack of Innovation, and the SoftLayer Acquisition

IBM struggled to adapt to the cloud computing era due to a combination of internal cultural issues and lack of technological innovation. Despite acquiring cloud computing division SoftLayer in 2013, the company found itself unable to keep up with competitors such as Amazon Web Services (AWS) and Microsoft Azure, due to the limitations of SoftLayer’s infrastructure, a sales-driven company culture that prioritized large customers over technological innovation, and IBM’s maniacal focus on selling Watson, its cognitive computing platform.

Furthermore, SoftLayer was not designed to meet the needs of large corporations, as it lacked many of the resiliency features required at the time, such as availability zones. IBM has since shifted its focus to hybrid cloud and artificial intelligence (AI), but is still largely dependent on its $34bn purchase of Red Hat in order to stay relevant.