IBM: Will it Survive?
This strategic review of IBM’s business and management style is intended to provide a basis for answering the question: Can IBM Survive?
In the 1990’s IBM was in crisis: its sales and profits were plummeting, its customers’ needs were being ignored, and its morale was in shambles.
IBM reached outside for a new CEO and Lou Gerstner accepted. Gerstner rapidly sized up the company’s problems and implemented significant, disruptive changes to turn the company around. While he did not change the company’s vision of what it should be he made major changes to its strategies and its execution. He was successful and IBM went on over the next 20 years to new heights as the IT leader.
Now, in the 2010’s, IBM is in trouble again. Its sale and profits have been falling for several years, and its stock price has suffered.
This strategic review outlines IBM’s vision, strategy, and ability to execute over three periods:
- The Thomas Watsons era from the beginning to the 1980s, when IBM was the dominant Technology leader
- The Lou Gerstner era from 1993 to the 2000s, when the PC, Internet and Smartphone had significantly changed the Technology landscape; and
- the current era in the 2010’s, when Technology changed again and continues to change rapidly.
(Published in 2017)
Peter Farwell is a chartered professional accountant and certified financial analyst. He was an early purchaser of an Apple II and an avid user of VisiCalc. He is a retired partner of public accounting firm Ernst & Young. He was the leader of the Canadian firm’s services to the high technology industry for 14 years. He is the author and co-author of numerous studies, articles, and speeches focusing on the technology industry and the author of “IBM: Can It Survive,” and “Artificial Intelligence and the Job Market.”