Company: International Business Machine.

Author: Louis Genstner, Jr.

Tenure: April 1993 to March 2002.

Graduation: Dartmouth College & HBS.

RJR Nabisco Inc: Chairman & CEO (4 years).

American Express: Chairman & CEO ( 11 years).

Also worked for Mckinsey & Company.

Change brought by Louis Gerstner.

Verge of extinction.

Rapid changing Computer Industry.

Management Team and not breaking down.

Power and Influence.

One of the most impressive turnaround stories in

business history.

Section 1: Four Critical Decisions.

Section 2: Two Big Bets on the Future.

Section 3: Setting the Strategy of the Business.

Section 4: Changing corporate culture at IBM.

Section 5: Key Lessons Learned.

Largest corporate loss of $16 billion.

Outsider for the industry.

Thoughtful and not quick decisions.

3,00,000 people on payroll worldwide.

‘State of Art’ research labs.

Establishing semi conductor industry, hardware, software, sales and

support.

With UNIX operating system arriving in 1990’s, it suddenly became

possible for companies to start making parts of an overall solution.

Their aspirations were couched in terms of a “Client/Server”

relationship – where the client was the desktop PC and the server was

another computer.

At around the same time, the PC makers also started suggesting that

since they were now being used on the desktops, it was logical to use

PCs in the back-office systems as well.

Section 2: Two Big Bets on the Future

Highest software selling company.

1993: Development on O/S 2 which failed.

Consolidation of software development business under one single manager.

Focus on developing “Middleware Software System” rather than developing

OS.

Section 3: Setting the Strategy for Business

Open Company’s own technology store(1994):

More research than commercialization.

Ability to set new standards and protocol.

Open up new revenue system.

More device, more demand for IBM products.

Unstack the stack and focus IBM initiatives:

Harness the emergence of e-business:

E-Business “Integrating Glue”.

Rewriting to internet enable software's.

New services of “Website Hosting”

Three Basic Belief’s By Thompson Watson Sr.:

Excellence in what we do.

Superior customer service.

Respect your individual.

Section 4: Changing the corporate culture

Eight Basic Principles Introduced by Garnster:

Market place as driving force.

Commitment to quality.

Customer satisfaction and shareholder value.

Minimum bureaucracy maximum productivity.

Never loose sight of our strategic vision.

We always work as a team.

Sensitive to needs of employees and communities.

WIN EXECUTE TEAM

Successful leaders and organizations have lots of good leadership

available to them.

Passionate Knowledgeable Highly Visible Driven Hands-on

Change agents Even Handed Good Communicators Tough minded but fair

Section 4: Key Lessons Learned

Successful leaders and great business execute well:

World class process are required.

Strategic clarity is needed.

High performance culture allows thing done faster.

People respect what you inspect and not what you expect.

Successful leaders and business are focused:

1993 1995 1997 1999 20010

102030405060708090

100

62.771.9

78.587.5 85.9

Revenue ($ bil-lion)

Year

Year Revenue1993 62.71995 71.91997 78.51999 87.52001 85.9

1993 1995 1997 1999 2001

-10-8-6-4-202468

10

-8.1

4.26.1

7.7 7.7

Income ($ billion)

Year

Year Income1993 -3.551995 1.761997 6.11999 7.72001 7.7

1993 1995 1997 1999 2001

-4-3-2-1012345

-3.55

1.76

3

4.12 4.35

EPS ($)

Year

Year EPS1993 -3.551995 1.761997 31999 4.122001 4.35

1993 1995 1997 1999 20010

20

40

60

80

100

120

140

12.7222.84

52.31

107.87120.96

Stock Price ($)

Year

Year Stock Price1993 12.721995 22.841997 52.311999 107.872001 120.96

IBM Webpage. (n.d.). Retrieved January Monday, 2012, from

http://www.ibm.com:

http://www.ibm.com/developerworks/rational/library/2071.html

Louis.V.Gerstner. (2008). Who Says Elephants Cant Dance? HarperCollins

Publishers.

Wikipedia. (n.d.). Retrieved january Monday, 2012, from

http://en.wikipedia.org:

http://en.wikipedia.org/wiki/Louis_V._Gerstner,_Jr.

www.imnu.ac.in (logo)

THANK YOU…