Information Technology

Corporations

Company Profiles

The following five companies are top employers in the IT industry in North Carolina. The profiles provide insights to the niches these companies fill in the value chain.

top

International Business Machines Corporation (IBM)
Introduction

IBM is one of the largest IT firms in North Carolina. The international IT powerhouse is involved in computer and computer peripheral equipment and software merchant wholesaling, electronic computer manufacturing, electronic stores, electronic contracting and other wiring installation contracting, physical distribution and logistics consulting services and finally, computer and computer peripheral equipment and software merchant wholesaling.

Headquarters: Armonk, NY
Total Employees (2012): 434,246
NC Employees (2012): 9,136
NC Locations: RTP, Raleigh, Charlotte, Lumberton, Cary
Total Revenue (2012): $104.5 billion
Year Established: 1911
Primary NAICS: Computer Systems Design Services (541512)
Sources: (2; 7; 8)

Brands & Market Segments

IBM has been one of the largest companies and most influential players in the information technology industry since the middle of the twentieth century. However, while the company's profitability and success dates back several decades, the firm's flexibility has ultimately been what has continued the company's momentum. In the early stages of computer development during the 1970s, IBM's value chain structure, like those of many of the other big players in the computer industry, was highly integrated. Over time, the firm's strategy shifted to one that outsourced stages of production processes to outside companies, while keeping high-value competencies, such as systems integration, within the firm. Today, IBM’s key market niches include: software analytics for unique problems facing clients, IT services such as cloud technology, and specialized packages of hardware and software for a data processing analysis.

IBM’s greatest focus is on its server market segment. This is the part of the company that is most branded with a variety of options with varying data processing and analytical abilities. These include the Power System (large data and intense analytics), System X (streamlining dense networks of data), System Z (secure analytics with cloud technology), FlexSystem, Blade Centers and UNIX servers (1).

Additionally IBM has developed an important focus on cloud technology. As a leader in IT data processing, it is no surprise that the firm has created options for clients to employ the highly efficient and powerful means to store data. Every major company involved in data storage offers this option because the idea of having servers that don’t physically exist (data is stored on a “cloud”) is an incredibly tantalizing idea for any business owner.

IBM is also heavily involved in the software solutions/analytics market segment. There is a wide breadth of industries that this part of IBM is concerned with and an even greater number of brands within those industry solutions that a client can access. Some of these industries are aerospace/defense, automotive, education, insurance, life sciences and retail, to just name a few. For example, one of the solutions available for clients within the aerospace/defense industry is Internet Protocol Management (IMP), which allows companies to manage and protect assets (1).

Strategy & Competitiveness

As part of its focus on “core competencies” and high value-added activities, IBM’s strategic orientation has shifted increasingly from manufacturing to the provision of services and “solutions” to clients through data analytics and systems integration capabilities. As part of this strategic reorientation, the company sold its PC and tablet manufacturing division to China’s Lenovo, as a part of the latter company’s drive into electronics manufacturing; this shift in the ownership of the manufacturing chain from IBM to Lenovo has impacted workers in North Carolina, where both companies have a major presence (6).

Global Footprint

IBM has been one of the most important staples of the IT industry in North Carolina due to its lengthy presence in the state, and the relationship between IBM and the state’s broader economy continues to develop. In, 2010 the Research Triangle Park branch of IBM bought AT&T’s Sterling Commerce section so that it could streamline its business networks to facilitate greater communication with customers, partners and suppliers (3). Also in 2010, a subsidiary of IBM (IBM Lender Business Process Services) opened a process service center, thus creating 600 jobs in RTP (4). However in June 2013, IBM laid off 121 workers from its branch in Charlotte (5), perhaps signaling the beginning of a decline in the company’s presence in North Carolina. In early 2014, the company announced another, global round of layoffs, which has affected the company’s North Carolina workforce (6). As a policy, IBM does not share employment data, so the magnitude of the layoffs (or, indeed, the size of the company’s workforce) could not be verified.

References
  1. IBM. (2013). Retrieved December 8, 2013 from www.ibm.com
  2. Hoover's. (2013). International Business Machines Corporation [company overview, company description, family tree]. Retrieved December 6, 2013 from Hoover's database.
  3. Smith, R. (2010, May 24). IBM makes big acquisition. Retrieved from www.wral.com/business/story/7656003
  4. Smith, R. & Chou, R. (2010, July 9). Now hiring: IBM subsidiary to add 600 jobs in RTP. Retrieved from www.wral.com/business/story/7925499
  5. Ranii, D. (2013, June 12). Layoffs reported at IBM, union organizers say. Retrieved from www.charlotteobserver.com/2013/06/12/4101430/layoffs-reported-at-ibm-according.html
  6. Ranii, D. (2014, February 27). IBM layoffs hit RTP workers. Retrieved from: www.newsobserver.com/2014/02/27/3658700/ibm-layoffs-hit-us-workforce.html
  7. IBM. (2012). IBM 2012 Annual Report. Retrieved January 27, 2014 from www.ibm.com/annualreport/2012/bin/assets/2012_ibm_annual.pdf
  8. OneSource. (2014). International Business Machines Corp. Company Profile. Retrieved January 27, 2014 from OneSource database.

top

SAS Institute
Introduction

SAS Institute is a major, North Carolina-based provider of software and services, with a focus on business analytics, including both horizontal solutions (achieving greater return on customer relationships, measuring and managing risks, and optimizing IT networks) and vertical solutions (domain expertise to acquire information in context of industry’s unique business processes, such as anti-money laundering solutions for financial services providers). Incorporated in 1976, SAS Institute is the world's largest privately held software company. SAS Institute was founded in North Carolina by CEO Jim Goodnight and fellow NC State colleagues, a group of enterprising young graduates looking to develop statistical analysis software to analyze agricultural research data.

Headquarters: Cary, NC
Total Employees (2012): 13,442
NC Employees (2012): 5,197
NC Locations: Cary, Charlotte
Total Revenue (2012): $2.87 billion
Year Established: 1976
Primary NAICS: Software Publishers (51121)
Sources: (2; 5; 6; 7)

Brands & Market Segments

SAS Institute has one primary niche that it inhabits: software publishing. Since software publishing is such a specialized market with incredible variation between projects, there is no true brand that SAS Institute offers. That being said, they have offered solutions for situations such as intelligence gathering for businesses, customer services, fraud & security, customer services and supply chain monitoring/maximization, just to name a few. SAS also provides analytics for situations ranging from academics (SAS® OnDemand for Academics) to social media (SAS® Social Media Analytics) to text (SAS® Text Analytics) and even visuals (SAS® Visual Analytics) (1).

Strategy & Competitiveness

It is no mistake that SAS Institute is headquartered in North Carolina’s Research Triangle, surrounded by three major universities; as an innovative software publisher and service provider, SAS Institute’s competitive advantage is premised on its ability to attract and retain talent in the labor market. SAS has long been acknowledged as a leader in progressive and worker-friendly human resources policies and was recently named the best multinational workplace by the Great Place to Work Institute (3).

Global Footprint

SAS Institute is headquartered in Cary, NC, though it controls subsidiaries throughout the world. The largest of these is in Copenhagen, Denmark, which focuses on computer system design services and employs nearly 3,000 workers. The company also employs more than 1,000 workers in Mumbai and Pune, India to provide computer system design services. SAS Institute has a major presence throughout continental Europe, where its employees are primarily engaged in providing applications for music and sound recording. SAS has a subsidiary, DataFlux Corporation, with approximately 100 employees located in Cary, NC (5). Overall, SAS Institute is thriving in the local area, and the company plans to expand in coming years. The company announced in 2009 that it would build two new buildings and continue to hire (5).

References
  1. SAS Institute Inc. (2013). Retrieved December 8, 2013 from www.sas.com/en_us/home.html
  2. Hoover's. (2013). SAS Institute Inc. [company overview, company description, family tree]. Retrieved December 8, 2013 from Hoover's database.
  3. WRAL. (2012, November 14). SAS wins world's best multinational workplace honor. Retrieved from www.wral.com/sas-wins-world-s-best-multinational-workplace-honor-/11771824
  4. Smith, R. (2012, October 10). As sales near $3b, SAS keeps hiring, plans two buildings in Cary. Retrieved from www.wral.com/as-sales-near-3b-sas-keeps-hiring-plans-2-buildings-in-cary/11641672
  5. OneSource. (2014). SAS Institute Inc. Company Profile. Retrieved January 27, 2014 from OneSource database.
  6. SAS. (2012). 2012 Annual Report. Retrieved January 27, 2014 from www.sas.com/content/dam/SAS/en_us/doc/other1/2012-annual-report.pdf
  7. SAS Communications. (2014). Personal communication, March 2014. 

top

Lenovo
Introduction

Lenovo is a Chinese multi-national involved in computing technologies, servers, peripherals and accessories. North Carolina’s two facilities, located in Morrisville and Whitsett, constitute a massive portion of the company’s revenue and presence in the US with the former location serving as its US headquarters. Lenovo chose to locate in North Carolina in 2007 thanks to nearly $14 million in incentives from local and state governments, as well as the presence of a construction-ready site in Morrisville. In return for these incentives Lenovo promised the hiring of around 2,000 people over the course of five years (1; 2).

Headquarters: Beijing, China
Total Employees (2012): 35,000
NC Employees (2012): 2,500
NC Locations: Morrisville, Whitsett
Total Revenue (2012): $33.8 billion
Year Established: 1993
Primary NAICS: Electronic Computer Manufacturing (334111)
Sources: (2; 7)

Brands & Market Segments

Lenovo is involved in several hardware-oriented market segments. The five primary areas in which the company is active include desktops/laptops, workstations, servers, tablets, and computer-related accessories. Within the desktop niche, Lenovo markets three brands: ThinkCentre, IdeaCentre and Erazer Desktops. The ThinkCentre is the most business-oriented of the three and contains towers, all-in-one systems and safe-saving designs. The IdeaCentre series is focused on sleek design and contains desktops featuring a wide variety of processing abilities. The Erazer series is marketed at gamers and provides the most processing power of the three. In laptops, Lenovo has a similar breakdown in tiers of laptops: ThinkPad (business-oriented and focused on reliability) and IdeaPad (more for personal use) (3).

Within the workstation segment, Lenovo offers two types of products. The first is the ThinkStation series, marketed primarily to small- to medium-sized businesses. The second brand is the W-Series which is Lenovo’s version of mobile workstations. These are intended for portability on the go without a huge setback in processing and graphics (3).

Lenovo also has a great degree of involvement in servers. There are three types that the company offers: racks, towers and business storage. Racks, like towers, are branded under the ThinkServer moniker and are intended for heavy business use featuring large amounts of storage space and quick processing speeds. The tower is a more budget-friendly server intended for small businesses. Business storage, marketed as LenovoEMC, is the most functionally oriented of the server models and is intended for enterprise level network storage (3).

Within the Tablet niche Lenovo offers three main types: Android, Windows and Convertibles. As for Android-based tablets, Lenovo sells the Yoga and the higher-end ThinkTab models. Within the Windows-based niche, the company offers the Miix and the ThinkTab. Convertibles are tablets/laptop hybrids that have flexible necks. Within this section, Lenovo offers the several models with varying processing powers and graphics (3).

Strategy & Competitiveness

Lenovo’s competitive strategy focuses on the company’s strengths in orchestrating electronics manufacturing supply chains. Following the company’s high-profile acquisition of IBM’s PC division in 2005, in early 2014 the company decided to purchase IBM’s server division, as well as the Motorola brand of mobile handsets. The company’s North Carolina activities focus on the final customization of products before shipment to consumers, as well as after-market services such as customer support.

Global Footprint

Since Lenovo’s arrival in 2007 to Morrisville, it has grown its presence locally and nationally. The company announced in 2012 the opening of a small scale PC manufacturing plant in Whitsett, NC (Guilford County) that employs 300 people (4; 6). The Whitsett site serves as a “completion center”; that is, employees at this site perform final assembly and customization for some Lenovo PCs destined for the North America market (4). Additionally, in 2011, Lenovo decided to move its customer-support operations to the Triangle area, creating 300 local jobs (5). In early 2014, Lenovo announced it would more than double its payroll in North Carolina as part of a deal to acquire IBM’s server business (6).

References
  1. Hogan, P. (2006, March 17). Lenovo shifting U.S. headquarters to Morrisville, but will cut 300-350 Triangle jobs. Retrieved from www.bizjournals.com/triangle/stories/2006/03/13/daily27.html?page=all
  2. Hoover's. (2013). Lenovo Group Limited [company overview, company description, family tree]. Retrieved December 8, 2013 from Hoover's database.
  3. Lenovo Group Ltd. (2013). Retrieved December 8, 2013 from www.lenovo.com/us/en
  4. Blunt, K. (2013, June 5). Lenovo shows off new pc plant in Guilford county: www.newsobserver.com/2013/06/05/2941517/lenovo-shows-off-new-guilford.html
  5. Ranii, D. (2011, May 21). Lenovo to add jobs in Triangle. Retrieved from www.newsobserver.com/2011/05/21/1213550/lenovo-to-add-jobs-in-triangle.html
  6. Ranii, D. (2014, January 23). Lenovo to double presence in NC with IBM server deal. Retrieved January 27, 2014 from www.charlotteobserver.com/2014/01/23/4635403/lenovo-to-double-presence-in-nc.html
  7. OneSource. (2014). Lenovo Group Limited Company Profile. Retrieved January 27, 2014 from OneSource database.

top

Cree, Inc.
Introduction

Cree is a North Carolina-based manufacturer of semiconductors, including LEDs and power devices, and related products. The company was established in 1987 in Durham, North Carolina and has since received acclaim (and captured significant market share) thanks to its cost-effective and energy-efficient lighting products. In 2014, the company was named one of the world’s “50 smartest companies” by MIT Technology Review (5).

Headquarters: Durham, NC
Total Employees (2012): 6,120
NC Employees (2012): 2,045
NC Locations: Durham, RTP, Morrisville
Total Revenue (2012/2013): $1.4 billion
Year Established: 1987
Primary NAICS: Semiconductor and Related Device Manufacturing (334413)
Sources: (3; 4)

Brands & Market Segments

Cree is active in three main product categories: 1) light emitting diode (LED) products, 2) LED-based lighting products, and 3) radio frequency (RF, or “wireless”) and power products. LED products, which are based on semiconductor technology, include LED chips and LED modules. These are components in LED lighting products. Lighting products, in turn, include light bulbs and lighting fixtures, though Cree is also active in the provision of consulting services in this area through the Durham-based Lighting Experience Center. Finally, RF devices and power devices are both semiconductor products which have applications outside of lighting. Power devices are small semiconductors which allow for the control and conversion of electrical energy into different types of energy; RF devices (such as transistors) are a specific application focusing on the conversion of electrical energy into radio waves (5).

Strategy & Competitiveness

Process innovation, vertical and horizontal integration and internationalization form important pillars in Cree’s competitive strategy. The company began by marketing LED applications of a highly innovative and efficient process for manufacturing silicon carbide. The company expanded into downstream activities, such as the production of lights and lighting units, and also identified applications of its semiconductor fabrication processes in other product spaces, such as RF and power devices. Today, the company advertises itself as “the industry’s only fully vertically integrated pure-play LED lighting [i.e. it is not active in other lighting technologies] company” (5). The company has expanded rapidly in recent years, with revenues roughly doubling since 2010 (3). This is a reflection of the company’s aggressive strategy for expansion, including the internationalization of both production (now spanning both Asia and the US) and marketing (the US, Europe and Asia) of semiconductors, as well as the acquisition of firms with strong downstream production and marketing capabilities such as Ruud Lighting in Racine, WI (5). Thanks to competitive pricing and very high energy efficiency relative to incandescent and fluorescent lighting (as well as the mandated phase-out of incandescent light bulbs in the US), Cree appears to occupy a competitive position with respect to the lighting market. Already in the market for home LED light bulbs, which Cree entered only last year, the company has already captured a 10% market share (6). In coming years, Cree will participate in the recently announced, federally supported research initiative focused on power electronics manufacturing, which will be based at North Carolina State University (7).

Global Footprint

Cree is headquartered in Durham, North Carolina, with facilities in nearby Research Triangle Park and Morrisville, NC. The company’s North Carolina-based activities include R&D; product design; production of chips, devices and lighting units; marketing; consulting and service provision; and administrative activities. Cree also manufactures lighting products in Wisconsin (home of Ruud lighting, which Cree purchased in 2011) and operates a technology center outside of Santa Barbara, CA. In the first decade of the 2000’s, Cree expanded its activities into Asia, first acquiring Hong Kong-based Cotco Luminant Device in 2007, which applies LED lighting to personal electronics, such as backlights for flat-screen technologies. Cree also established an engineering center in Shanghai in 2008, and then in 2009 acquired a large facility to be used for chip fabrication. In Europe, Cree’s activities are focused on marketing and sales (1; 2).

References
  1. Cree, Inc. (2012). Cree 10-K Report. Retrieved October 16, 2012.
  2. Gereffi, G., Ahmed, G. and M. Lowe. (2010). Case Study: Cree, Inc. Local Markets and Global Competitiveness: A Value Chain Analysis. Center on Globalization, Governance & Competitiveness (CGGC): Durham, NC.
  3. OneSource. (2014). Cree, Inc. Company Profile. Retrieved January 27, 2014 from OneSource database.
  4. Hoover’s. (2014). Cree. Retrieved January 27, 2014 from Hoover’s database.
  5. Cree, Inc. (2014). About Cree. Retrieved March 4, 2014 from www.cree.com/About-Cree
  6. LaMonica, M. (2014, Feb. 28). “50 Smartest Companies.” MIT Technology Review.
  7. Murawski, J. (2014, Jan. 15). Obama picks NCSU to lead $140 million research consortium. News & Observer.

top

Microsoft
Introduction

Microsoft is an international player in the IT industry. It is heavily involved in North Carolina as well in software publishing, electronic store and computer programming services for customer needs.

Headquarters: Redmond, Washington
Total Employees (2012/2013): 99,000
NC Employees (2012): 2,030
NC Locations: Charlotte, Durham, Asheville
Total Revenue (2012/2013): $77.8 billion
Year Established: 1975
Primary NAICS: Software Publishers (51121)
Sources: (1; 4)

Brands & Market Segments

Microsoft covers a wide variety of projects with its hold of its market segments. Its three most prominent shares are in software publishing, electronic stores, customer computer programming services, and servers. The branding is primarily restricted to cloud technology. There several mediums through which Microsoft is trying to push cloud technology. In operating systems, the company offers Windows Azure, which is the cloud equivalent of the Windows operating system. In servers, Microsoft has two cloud-based types: the Windows Server and the SQL Server (both of these are more business oriented), and SkyDrive (for personalized cloud data storage). Microsoft also provides cloud-based infrastructure for PC and mobile devices under the Windows InTune name (1).

Strategy & Competitiveness

Microsoft is a lynchpin in the IT industry across the world, through its dominance in key software platforms, such as the Windows operating system and the Office suite of “productivity” software. The company not only produces and publishes these software packages but also draws extensive revenue from after-market services such as consulting and support services.

Global Footprint

Microsoft’s North Carolina-based operations focus on the provision of sales, consulting and support services for key products such as Exchange, Windows, Office, and SQL Server. The company has engaged itself in the state’s education system through the initiation of an “IT Academy Program” in public high schools, which focuses on building IT skills among students (3). North Carolina will be the first state to implement this program and it shows a desire from the company to help make a more skilled workforce that it can tap into when the individuals are appropriately trained.

References
  1. Microsoft Corporation. (2013). Retrieved December 8, 2013 from www.microsoft.com/en-us/default.aspx
  2. Hoover's. (2013). Microsoft Corporation [company overview, company description, family tree]. Retrieved December 8, 2013 from Hoover's database.
  3. Hinchcliffe, K. (2010, November 15). N.C., Microsoft partner to provide it training to students. Retrieved from www.wral.com/news/education/story/8625962
  4. OneSource. (2014). Microsoft Corporation Company Profile. Retrieved January 27, 2014 from OneSource database.

top