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With the naming of Lou Gerstner as its new CEO (and the retirement of John Akers on May 7), IBM now has a chance to change both its own organizational structure and goals and, at the same time, the future shape of the computer industry.
Nearly every computer publication has polled its readers asking such questions as “Do you think IBM can succeed at changing, Do you think Lou Gerstner is the right man to lead a turnaround at IBM,” and “Do you care?”
Reactions to such early pulse taking are mixed. Clearly customers are concerned about IBMs seeming inability to understand their future needs and help them move to new computing platforms. On the other hand, customers are divided between a “we have to give him some time to assess the problem and formulate a solution” point of view (we concur), and the feeling that an outsider like Gerstner cant possibly fix a computer company (see below). Some are convinced that it just doesnt matter, since the day of the mainframe is over and that means IBMs days as the industry leader are over, too. IBM, of course, does not agree.
Gerstner has not revealed the specifics of his plans at all, except for a few remarks at the Annual IBM Shareholders Meeting, where he brushed off the widely held notion that IBM would spin off profitable businesses. To him, it appears, reorganization means fewer people, different skills, more distribution of power, but not necessarily the wholesale deconstruction of IBM that some predicted.
On the other hand, some of the things he has already done send clear signals of the big changes to come:
* He is spending a lot of time in the field and with the customers. That guarantees he will hear the story first-hand, rather than filtered through tiers of IBM staffers and middle managers. It is just this kind of filtering that has led to the dangerous continuation of the status quo when IBM was teetering on the brink of disaster. Only a senior management badly out of touch with the field and the customers could have been so unaware of what was really going on. Gerstner doesnt intend to make that mistake.
* He is making big changes in IBM senior management and many more changes are likely to come. Tellingly, these appointments are from outside of IBM (nearly unheard of in days gone by) and each appointment appears in the business press with tales of just how tough the manager has been before and how good he is in tricky situations. Gerstner must assume that to change IBM he needs a team with no loyalty to the concepts that drove IBM in the past and every possibility of hearing ideas with fresh ears.
On the other hand, there are IBM values that were worthwhile.