Have you guys heard Steve Jobs talk about sales people running tech org ? That's worth watching. Jobs talking about John Scully and his sales background from Coke and why sales should not dictate how a tech company is run. IBM is dying, their only hope is RedHat now. Ginni is not to be blamed alone for the current state of IBM, it all started with Sam Palmisaono , he ventured into IT services and reduced investments in to R&D of tech and products, he vied for quick bucks in IT services and BPO in india. IBM fell way short of innovation targets because of the short sighted sales guy, he didn't see how not-innovating will make IBM irrelevant in the years to come. Ginni was unlucky she inherited a tardy, bureaucratic mess and she again tried fixing it by selling tech that consumed cash but could have been a cashcow in the long term. ex-IBMer here, Ginni never seemed to quit so I quit instead :D
IBM is so big. They should trim their product portfolio and reduce work force. Just like what Jobs did when he returned
Agree that is what they need. Interesting thing to consider. I heard a quote (think it was about IBM) that even though a $50 billion per year company is what they should be, they need to remain a $100 billion company to cover all the legacy costs - retiree healthcare and pensions. That is something Apple didn't have to worry about. IBM moved from defined benefit to defined contribution (401K type plans) sometime in the 90's if I recall correctly. That means at some point the legacy costs should start to free up - it's an actuarial reality - no matter how good the health care is - there will be very few 105 year old retirees.
Good points. I wasn’t aware
Good analysis. I believe Arvind Krishna will be a net positive, and will focus on making IBM about tech again rather than marketing hype.
Thanks, but Arvind is the old timer and from the mess and don't really have many hopes. IBM products once ran our Enterprise but now we are getting rid of them much faster than we imagined we would. It actually makes me feel sad at times.
The important thing is that Jim Whitehurst is being made President, so it will be his responsibility for improving IBM work culture. We need to learn from the culture of Red Hat. Arvind is a numbers guy with a strong technical background, so even if he is an old timer, the main strategy he is pushing is similar to that of GCP, AWS, and Azure. For corporate strategy, Arvind will be good for the company.
IBM is same like Oracle and Cisco
Oracle and Cisco will never be as screwed and convoluted as IBM . It's a mind boggling mess there and can't be fixed easily without considerable bloodbath and extremely unpopular decisions.
ex-IBM, came in from PwC Consulting Acquisition. You give GR too much credit. She shares a lot of the blame too. I never was impressed with her strategic leadership before she became CEO. She thrived in the "tardy, bureaucratic mess" so couldn't see why it was killing the company's future. IBM is run by accountants, and I think both Palimisano and Rometty didn't place future bets on the right technology investments. An accountant would never tell you those bets make sense, that's why the CEO needs to make the strategic bets, IBM failed here. I knew IBM lost the cloud in 2008 when we went against AWS in a proposal. The client wanted a list of cloud services with price per service. That totally short-circuited IBM's brain. They were all about big wins - sell a mainframe, sell an enterprise websphere license, sell IT outsourcing to a F500 company. They just could not understand selling a small thing one-million times. That experience sealed my decision to leave. Going into IT services was a great move when IBM made it, but it had only about a 20 year life as a big success. Once cloud really got going, the forward looking companies didn't need IBM's IT services because they didn't have all the on-site IT for IBM to manage for them. IBM's problem is it doesn't not appear they have any good "what's next?" ideas in the pipeline. The Red Hat acquisition looks more like desperation than a future growth strategy.
Wow thanks for the great insights. Writing was on the was much earlier in Ginni's career , you are right she could have done way better and steered the ship in the right direction but it now feels she sustained it to sustain herself at the top.
Additionally to what has been said above.. IBM needs to get rid of all those "thinking the IBM way" type old timers. They know shit about tech and have been filling the same Excel sheets for decades
Cloud move all ops to cloud next 100$ is coming only via cloud. Eye 2-3 applications like Twitter or snap move them to ibm cloud that’s your success story , cut dividends focus on growth
So now Ginni is gone, are you joining back ?