turn around strategy

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Turnaround Strategy of IBM

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Introduction

Successful Turnarounds Require Fearless Moves

We have often heard that small is beautiful. But when something big goes bad

then the turnaround story of such an institution becomes exciting and would beregarded as the historys most successful turnaround story. The corporate

turnaround story of International Business Machines (IBM), engineered by

Louis Gerstner fits the bill perfectly. The company known as Big Blue and

which was into hardware, software and services business was on the verge of

extinction by the end of 1993. But what followed that was something that

astonished the business world.

IBM, once the poster of American dominance had got it wrong in the early

90s. By 1993, the company had lost almost $8 billion due to the changing

dynamics in the IT Industry. Actually the company had enough cash to sustainfor another 100 days. The reason behind sudden slide in fortunes was

attributed to its elephantine size, a laidback corporate culture and inability to

integrate the business effectively to offer a bouquet of solutions to its

customers. The company had to do something quick and thats when entered

Louis Grestner who over the next decade at the helm of the company taught

the world that even elephants could dance.

Who was Louis Grestner?A brief bio data about this man reveals that he was

highly qualified man having completed his MBA from Harvard Business

School. He had held senior positions at American Express and Mckinsey &

Company. Prior to being appointed as the Chairman of IBM he was the CEO

of RJR Nabisco. A man with impeccable credentials was chosen to lead the

company in those tough times and did he deliver remarkably.

Then what did he do right which his predecessors had not done?The first

job he had to take up when he joined was to make the company solvent as the

company was fast running out of cash to run its day to day expenses. The

gameplan was to leverage all the 3 core parts of the business to deliver the

entire gamut of end to end services to the customer. This strategy helped them

then and is still working wonderfully well for the company.

Once the company becomes too big each unit acts as a separate company on itsown and the company as a whole begins to suffer. Same was the case with

IBM with separate units competing with each other and causing harm to the

company. He broke this thinking and tied the rewards of the employees to the

performance of the entire company rather than to the unit which they were

working for. This ensured better integration and ensured cohesively among the

various units. So he wanted to break the fiefdom culture which was slowly

engulfing the company. He sacrificed a few non performing products. Also he

bought in a culture where in the performance was the key to the success of the

employee in the organization.

With this Louis Grestner had successfully made the Elephant dance to histunes. In his 9 years at the helm, the company had grown by around 40% with


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the majority of the growth coming from the services and consulting division.

Also the stock price of the company during that period increased by 8 times.

He had laid a vision on what should be the focus areas for the company in the

future. So the services and consulting led growth had now catapulted the

company back to its glorious days. Louis Grestner will always be remembered

in the company and also across the world in the times to come as the architectof one of the worlds most successful corporate turnaround stories.


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IBM a short summary

I nternational Business Machines, abbreviated IBM and nicknamed "Big

Blue", is a multinational computer technology and IT consulting corporationheadquartered inArmonk, New York,United States. The company is one of

the few information technology companies with a continuous history dating

back to the 19th century. IBM manufactures and sells computer hardware and

software (with a focus on the latter), and offers infrastructure services, hosting

services, and consulting services in areas ranging frommainframe

computers tonanotechnology. Ginni Rometty is the president and CEO of

IBM.

IBM has been well known through most of its recent history as one of theworld's largest computer companies and systems integrators. With over

433,362 (2012) employees worldwide, IBM is one of the largest and most

profitable information technology employers in the world. IBM holds more

patents than any other U.S. based Technology Company and has eleven

research laboratories worldwide. The company has scientists, engineers,

consultants, and sales professionals in over 170 countries. IBM employees

have earned fiveNobel Prizes, fourTuring Awards, fiveNational Medals of

Technology,and fiveNational Medals of Science.

IBM was ranked as follows:

No. 2 largest U.S. firm in terms of number of employees (Fortune 2012). The No. 4 largest in terms ofmarket capitalization (Fortune 2012). The No. 9 most profitable (Fortune 2012). The No. 19 largest firm in terms of revenue. (Fortune 2012). Global No. 31 largest in terms of revenue (Forbes 2011). No. 1 Company for leaders (Fortune). No. 1 company worldwide (Newsweek). No. 2 best global brand (Interbrand). No. 2 most respected company (Barron's). No. 5 most admired company (Fortune). No. 18 most innovative company (Fast Company).

IBM has 12 research laboratories worldwide and, as of 2013, has held therecord for mostpatents generated by a company for 20 consecutive years.
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INTERNATIONAL BUSINESS MACHINES CORPORATION

Type Public

Industry Computer hardware, computersoftware, IT services, ITconsulting

Founded Endicott, New York, U.S

(June 16,1911)

Founder(s) Thomas.J.Watson

Charles.Ranlett.Flint

Headquarters Armonk, New York, U.S

Area served Worldwide

Divisions Financing, Hardware, Services,Software

Key people Ginni Rometty

(Chairman, President, CEO)

Revenue US$ 106.916 billion(2012)

Operating Income US$ 21.90 billion (2012)

Net Income US$ 16.60 billion (2012)

Total Assets US$ 119.21 billion (2012)

Total Equity US$ 18.86 billion (2012)

MOTTO - THINK
http://en.wikipedia.org/wiki/File:IBM_logo.svg


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How did IBM come into existence???

The roots of IBM date back the 1880s, decades before the development of

electronic computers. Since the 1960s or earlier, IBM has described its

formation as a merger of four companies: theTabulating Machine Company,

the International Time Recording Company, the Computing Scale Company

and theBundy Manufacturing Company.The merger was engineered by noted

financierCharles Flint, and the new company was called theComputing

Tabulating Recording (CTR) Company. CTR was incorporated on June 16,

1911 inEndicott, New York, U.S.A...CTR was aholding company; the

individual companies continued to operate using their established names until

the holding company was eliminated in 1933. Flint remained a member of the

board of CTR until his retirement in 1930.

The companies that merged to form CTR manufactured a wide range ofproducts, including employee time-keeping systems,weighing scales,

automatic meat slicers, coffee grinders, and most importantly for the

development of the computer, punched card equipment. The product lines

were very different; Flint stated that the consolidation instead of being

dependent for earnings upon a single industry, would own three separate and

distinct lines of business, so that in normal times the interest and sinking funds

on its bonds could be earned by any one of these independent lines, while in

abnormal times the consolidation would have three chances instead of one to

meet its obligations and pay dividends.

Based in New York City, the new company had 1,300 employees and officesand plants in Endicott and Binghamton, New York; Dayton, Ohio; Detroit,

Michigan; Washington, D.C.; and Toronto, Ontario.

Of the companies merged to form CTR, the most technologically significant

was the Tabulating Machine Company, founded byHerman Hollerith, and

specialized in the development of punched card data processing equipment.

Hollerith's series of patents on tabulating machine technology, first applied for

in 1884, drew on his work at theU.S. Census Bureau from 187982. Hollerith

was initially trying to reduce the time and complexity needed to tabulate the

1890 Census. His development of punched cards in 1886 set the industry

standard for the next 80 years of tabulating and computing data input.

In 1896 the Tabulating Machine Company leased some machines to a railway

company but quickly focused on the challenges of the largest statistical

endeavour of its day the1900 US Census. After winning the government

contract, and completing the project with amazing speed, Hollerith was faced

with the challenge of sustaining the company in non-Census years. He

returned to targeting private businesses both in the United States and abroad,

attempting to identify industry applications for his automatic punching,

tabulating and sorting machines. In 1911, Hollerith, now 51 and in failing

health sold the business toFlint for $2.3 million (of which Hollerith got $1.2

million), who then created CTR.
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When the diversified businesses of CTR proved difficult to manage, Flint

turned for help to the former No. 2 executive at the National Cash Register

Company, Thomas. Watson became General Manager of CTR in 1914 and

President in 1915. By drawing upon his managerial experience at NCR,

Watson quickly implemented a series of effective business tactics: generous

sales incentives, a focus on customer service, an insistence on well-groomed,

dark-suited salesmen, and an evangelical fervour for instilling company pride

and loyalty in every worker. As the sales force grew into a highly professional

and knowledgeable arm of the company, Watson focused their attention on

providing large-scale, custom-built tabulating solutions for businesses, leaving

the market for small office products to others. He also stressed the importance

of the customer, a lasting IBM tenet. The strategy proved successful, as during

Watson's first four years, revenues doubled to $2 million, and company

operations expanded to Europe, South America, Asia and Australia.

At the helm during this period, Watson played a central role in establishingwhat would become the IBM organization and culture. He launched a number

of initiatives that collectively demonstrated an unwavering faith in his

workers: he hired the company's first disabled worker in 1914, he formed the

company's first employee education department in 1916, and in 1915 he

introduced his favourite slogan, "THINK," which quickly became a corporate

mantra. Watson boosted company spirit by encouraging any employee with a

complaint to approach him or any other company executive his famed Open

Door policy. He also sponsored employee sports teams, family outings and a

company band, believing that employees were most productive when they

were supported by healthy and supportive families and communities. These

initiatives each deeply rooted in Watson's personal values system became

core aspects of IBM culture for the remainder of the century.

Given the company's geographic growth and his own expansive vision,

Watson found the CTR name too limiting,. A name of a publication from

CTR's Canadian operation caught his eye, and on February 14, 1924, the CTR

name was formally changed to International Business Machines Corporation,

later to be abbreviated IBM.


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A brief history of IBM

19301979

In 1937, IBM's tabulating equipment enabled organizations to processunprecedented amounts of data, its clients including theU.S. Government,during its first effort to maintain the employment records for 26 million people

pursuant to theSocial Security Act,and theThird Reich, largely through theGerman subsidiaryDehomag. During theSecond World War the company

produced small arms for the American war effort (M1 Carbine,andBrowningautomatic rifle). In 1947, IBM opened its first office in Bahrain.

In 1952, Thomas J. Watson, Jr., became president of the company, endingalmost 40 years of leadership by his father. In 1956, Arthur L. Samuel ofIBM's Poughkeepsie, New York, laboratory programmed anIBM 704 to play

checkers using a method in which the machine can "learn" from its ownexperience. It is believed to be the first "self-learning" program, ademonstration of the concept ofartificial intelligence.In 1957, IBM developedtheFORTRAN (Formula Translation) scientific programming language. In1961, Thomas J. Watson, Jr., was elected chairman of the board andAlbert became president of the company. IBM develops the SABRE (Semi-Automatic Business-Related Environment) reservation system for AmericanAirlines. The IBM Electric typewriter was a highly successful model line ofelectric typewriters introduced by IBM on July 31, 1961.

In 1963, IBM employees and computers helped NASA track the orbital flight

of the Mercury astronauts, and a year later, the company moved its corporateheadquarters from New York City to Armonk, New York. The latter half ofthat decade saw IBM continue its support of space exploration, with IBM

participating in the 1965 Gemini flights, the 1966 Saturn flights, and the 1969mission to land a man on the moon.

On April 7, 1964 IBM announced the first computer system family, theIBMSystem/360.Sold between 1964 and 1978, it was the first family of computersdesigned to cover the complete range of applications, from small to large, bothcommercial and scientific. For the first time, companies could upgrade theircomputing capabilities with a new model without rewriting their applications.

In 1974, IBM engineer George M. Laurer developed theUniversal ProductCode.On October 11, 1973, IBM introduced the IBM 3660, a laser-scanning

point-of-sale barcode reader which would become the workhorse of retailcheckouts. On June 26, 1974, at Marsh's supermarket in Troy, Ohio, a packofWrigley'sJuicy Fruit chewing gum was the first-ever product scanned. That

pack is now on display at theSmithsonian InstitutionsNational Museum ofAmerican History inWashington, D.C.

In the late 1970s, IBM underwent some internal convulsions between those inmanagement wanting to concentrate on their bread-and-butter mainframe

business, and those wanting the company to invest heavily in the emergingpersonal computer industry.
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19801993

Financial swaps were first introduced to the public in 1981 when IBM and

theWorld Bank entered into a swap agreement. TheIBM PC, originally

designated IBM 5150, was introduced in 1981, and it soon became the

industry standard. In 1991, IBM soldLexmark. In 1993, IBM posted what at

the time was the biggest loss in the history of corporate America: US$8

billion. This is the time when the downfall of IBM started.

1993-2002: IBM's near disaster and rebirth.

In April 1993, IBM hired Louis V. Gerstner, as its new CEO. For the first time

since 1914 IBM had recruited a leader from outside its ranks. Gerstner brought

with him a customer-oriented sensibility and the strategic-thinking expertise.

Recognizing that his first priority was to stabilize the company he took quick,

dramatic action. His early decisions included recommitting to the mainframe,

selling the Federal Systems Division to Loral in order to replenish the

company's cash coffers, continuing to shrink the workforce and driving

significant cost reductions within the company. This initial step worked. IBM

was in the black by 1994, turning profits of $3 billion. But stabilization was

not Gerstner's endgame the restoration of IBM's once great reputation was.

To do that, he needed to come up with a winning business strategy. Over the

next decade, Gerstner crafted a business model that shed commodity

businesses and focused on high-margin opportunities. IBM divested itself oflow margin industries (DRAM, IBM Network, personal printers, and hard

drives). The company regained the business initiative by building upon the

decision to keep the company whole it unleashed a global services business

that rapidly rose to become a leading technology integrator. Another high

margin opportunity IBM invested heavily in was software, a strategic move

that proved equally visionary. Content to leave the consumer applications

business to other firms, IBM's software strategy focused on middleware the

vital software that connects operating systems to applications. The middleware

business played to IBM's strengths, and its higher margins improved the

company's bottom line significantly as the century came to an end.

As Internet applications and deep computing overtook client servers as key

business technology priorities, mainframes returned to relevance. IBM

reinvigorated their mainframe line with CMOS technologies, which made

them among the most powerful and cost efficient in the marketplace.

Investments in microelectronics research and manufacturing made IBM a

world leader in specialized, high margin chip production it developed

200 mm wafer processes in 1992, and 300 mm wafers within the decade. IBM

designed chips are currently used in PlayStation 3, Xbox 360, and Wii game

consoles. IBM also regained the lead in supercomputing with high end

machines based upon scalable parallel processor technology.
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Instrumental too to this popular resurgence was the 1997 chess match between

IBM's chess-playing computer systemDeep Blue and reigning world chess

championGarry Kasparov. Deep Blue's victory was an historic first for a

computer over a reigning world champion. Also helping the company reclaim

its position as a technology leader was its annual domination of supercomputer

rankings and patent leadership statistics. Ironically, a serendipitous contributor

in reviving the company's reputation was theDot-com bubble collapse in

2000, where many of the edgy technology high flyers of the 1990s failed to

ride out the downturn. These collapses discredited some of the more

fashionable Internet-driven business models that stodgy IBM was previously

compared against.

Another part of the successful re-entry into the popular mindset was the

company's revival of the IBM brand. The company's marketing during the

economic downturn was chaotic, presenting many different, sometimes

discordant voices in the marketplace. This brand chaos was attributable in partto the company having 70 different advertising agencies in its employ. In

1994, IBM eliminated this chaos by consolidating its advertising in one

agency. The result was a coherent, consistent message to the marketplace.

As IBM recovered its financial footing and its industry leadership position, the

company remained aggressive in preaching to the industry that it was not the

Old IBM, that it had learned from its near death experiences, and that it had

been fundamentally changed by them. It sought to redefine the Internet age in

ways that played to traditional IBM strengths, couching the discussion in

business-centric manners with initiatives like ecommerce and On Demand.

And it supported open source initiatives, forming collaborative ventures withpartners and competitors alike.

Change was manifested in IBM in other ways as well. On the human resources

front, IBM's adoption and integration of diversity principles and practices was

cutting edge. It added sexual orientation to its non-discrimination practices in

1984, in 1995 created executive diversity task forces, and in 1996 offered

domestic partner benefits to its employees. The company is routinely listed as

among the best places for employees, employees of color, and women to work.

Gerstner retired at the end of 2002
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2002-2013

Crucial to this success was the decision to become brand agnostic IBM

integrated whatever technologies the client required, even if they were from an

IBM competitor. IBM augmented this services business with the 2002

acquisition of PwC consulting. In 2003, IBM initiated a project to rewrite itscompany values. Using its Jam technology, the company hosted Internet-based

online discussions on key business issues with 50,000 employees over 3 days.

The discussions were analyzed by sophisticated text analysis software

(classifier) to mine online comments for themes. As a result of the 2003 Jam,

the company values were updated to reflect three modern business,

marketplace and employee views: "Dedication to every client's success",

"Innovation that mattersfor our company and for the world", "Trust and

personal responsibility in all relationships". In 2004, another Jam was

conducted during which 52,000 employees exchangedbest practices for 72

hours. They focused on finding actionable ideas to support implementation ofthe values previously identified.

In 2005, the company sold its personal computer business toLenovo,and inthe same year, agreed to acquireMicromuse.A year later, IBMlaunchedSecure Blue,a low-cost hardware design for data encryption that can

be built into a microprocessor. In 2009, it acquired software companySPSSInc. Later in 2009, IBM'sBlue Gene supercomputing program was awardedthe National byU.S. PresidentBarack Obama. In 2011, IBM gainedworldwide attention for its intelligence programWatson,which was exhibitedonJeopardy where it won against game show championsKenJennings andBrad Rutter.As of 2011, IBM had been the top annual recipient

of U.S. patents for 19 consecutive years.

IBM's closing value of $214 billion on September 29, 2011surpassedMicrosoft which was valued at $213.2 billion. It was the first timesince 1996 that IBM exceeded its software rival based on closing price. OnAugust 16, 2012, IBM announced it entered an agreement to buyTexasMemory Systems.Later that month, IBM announced it has agreed to

buyKenexa. The acquisition is expected to close in the fourth quarter. Thedeal is worth $1.3 billion and was paid in cash by IBM.

In June 2013, IBM acquiredSoftLayer Technologies,a web hosting service, ina deal of around $2 billion.

In August 2013, US regulators began an investigation into how the firmreports revenue from its cloud computing business. Also in August, IBMacquiredTrusteer,an Israel-based, privately held, computer-security companyresponsible for the development of Rapport security software, in a deal closeto $1 billion.
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IBM was successfully growing since it came into existence, but there came a

time (1990s) when it hit the rocky patch and had a tough time surviving in the

business world. This was also the time when its journey- from survival to

success started. Mr Louis Gerstner played a major role in helping IBM bounce

back

Towards the downfall....

Despite having talented workforce, great technology and a sound strategy,

IBM was underperforming and was suffering from near collapse before

Gerstner took over. Unfortunately, the culture that was prevalent at IBM was

that of arrogance. It was not in tune with the times and with customers needs.

The behavioural pattern and worki ng that lead to the downfal l:

IBM was mired in the tradition and culture of its own success, it was unable torespond to the pace and behaviours of the new economy.

Customer service absolved itself from paying attention to customers needsand business. Employees served themselves better than their customers.

Meaningless meetings, far-flung business units operating independently, withlittle accountability, divisions competing against each other both internally and

in the field.

Large dysfunctional bureaucracy, committee decisions, tacit compromise andactions committed to serve group interests.

IBM had a dress code that again had outlived its times. Obsession with perfection, system of several layers of checks and approvals,

slowed down decision making and delayed product launches and response

times.

The company and its people had lost touch with external realities. It waswidely believed that what was happening in the marketplace was essentially

irrelevant to the success of the company. IBMs dominant position had

created a self-contained, self-sustaining world for the company.

Employees perceived employment at IBM as life-long with ensured benefits. Product portfolio still focused on products which were losing market share and

had no bright future in a networked model of technology.

New Kill initiatives which provide new direction were killed in works if didnot receive consent from other units.

Compensation system was focused on fixed rewards, commonality, internalbenchmarks and entitlement.

This culture insulated IBM and it employees from market realities and the

emerging competition from client-server technology, emergence of PCs and

high pricing of IBM products signalled the death spiral for IBM.


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However there were a few positive behaviours and they were:

Ability to provide integrated solutions for customers, handle internalcomplexity a great talent pool, experience, knowledge, maturity, and

character.

Employees who never give up on their company, their colleagues, andthemselves Are energized, motivated and stimulated, who demonstrate

commitment towards company goals.

IBMs existence as a whole.

Turnaround begins...

Gerstner was able to quickly diagnose the problems at IBM and sought to find

immediate remedies to fix the shortfall in revenues and stabilize the company,

make good strategic choices and turnaround IBM.

Background of Mr Louis Gerstner

Louis Vincent Gerstner, Jr. (born March 1, 1942 inMineola, New York)was

chairman of the board and chief executive officer ofIBM from April 1993

until 2002 when he retired as CEO in March and chairman in December. He is

largely credited with turning around IBM's fortunes.

He was formerly CEO ofRJR Nabisco, and also held senior positionsatAmerican Express andMcKinsey & Company. He is a graduate of

Chaminade High School (1959),Dartmouth College (1963) and holds

anMBA from theHarvard Business School.

In January 2003, he assumed the position of chairman ofThe Carlyle Group,a

global private equity firm located inWashington, DC. He retired from that

position in October 2008 and remains a senior advisor toThe Carlyle Group.

In January 2013,Broad Institute announced that Gerstner will serve as

Chairman of Broad Institute Board of Directors.
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Removing power and status as key elements of the rewards system created amore market and profit focused company.

Right sizelayoff 100k employees and shut down unprofitable departments. Customer segmentation and customer centric sales force.

Service marketinginnovate software, segment service and provide integratedsolutions.

Culture shaping Strategy

The greatest barrier to change in any large corporation is the culture. Any

major shift in strategy or structure requires culture shift to create alignment.

Mr. Gerstners strategy involved the following phases:

Diagnose & define (define current and future state) met customers,competitors, senior executives, financial analysts, and consultants to get a grip

on outstanding issues. Accepted feedback, paid attention to divergent ideas

and opinions

Unfreeze & educate (shift behaviours) Influencing skills, was resultsoriented, interested in short-term results without considering long-term, overall

results and outcomes, had limited perspective, in time and scope, encouraged

ideas off the beaten track and embraced new ideas and innovation, accepted

criticism of the organization,

Reinforce (treasure long term change) convinced people of the strategy andbrought their buy-in for implementation

Apply to Strategies (address business issue)Mr. Gerstner regrouped IBM byproviding one single leadership at the top. Reversed the core IBM mainframe

business by cutting prices and becoming customer focused. Synergized the

IBM messaging division by providing single message globally. Intelligently

put his bet on Services, Software and e-Business. Realigned the employee

incentive system to encourage the culture that promotes customer oriented

actions.

Measure progress (monitor progress) Compensation system base onDifferentiation, Variable rewards, External benchmarks and Performance. Tiedemployee compensation to the performance of the whole company rather than

to the employees particular division

The cultural change required at IBM (and at just about every large

organization that I can think of) Product based to customer based, do it my

way to do it the customers way, from manage to morale to manage to

success, from decisions based on anecdotes to decisions based on data, from

relationship driven to performance driven (and measured), from conformity to

diversity, from looking good to accountability, from US to global, from rule


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driven to principle driven, from silo to holistic, from analysis paralysis to

make decisions and move forward with urgency from not invented here to

learning organization, from fund everything to prioritize. IBM was facing the

PC dilemma, the emerging e-Business, shedding OS/2 due to stiff competition,

new focus on middleware technology, new software acquisitions, networked

model, and services as key to integration etc. These external factors played a

huge role in shaping IBM strategy and its eventual transformation from a

product-centric to service-centric organization.

Most of the changes introduced by Gerstner were successful. With proper

strategy and efficient leadership, he brought about significant changes in

organization culture and business direction and was able to restore IBM to

stability.

Personal Leadership

Mr. Gerstner was an embodiment of most competencies characteristic of an

effective leader drive, motivation, integrity, self-confidence, intelligence,

business knowledge and emotional intelligence. Other noticeable key

competencies include tenacity, openness, assertiveness and trustworthiness.

He has an excellent past as a transformational leader at American Express and

RJR Nabiscoone who can bring about significant change in organizations byinspiring, motivating and leading people in new direction. He is noted for his

significant accomplishments as a change agent and when offered the job at

IBM by Mr. Jim Burke, he was little hesitant to take the job. His was in a

dilemma whether to accept the offer or not. He was emotionally strong and

knew his capabilities of self-awareness, self-management, social-awareness

and relationship management. The factors which led to his job acceptance

offer were:

Being optimistic, achievement and initiative oriented, and adaptable, Gerstnerdecided to take up the challenging offer.

He had a feel for the problems at IBM after meeting Paul Rizzo, an executiveat IBM.

He had the backing of his family in this endeavourFactors which worked against taking the job offer include:

Apprehensive how a non-technocrat can turnaround a technology company.He had no prior knowledge of working in technology industry.


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His initial analysis showed the severity of problems at IBM and doubted thesuccess of recovery efforts.

Unlike a consumer products company, technology products can be extremelysuccessful or disappear within a short period of time.

By reflecting back on his past achievements, Gerstner decided to take the job.

He looked at IBM not as an enterprise but as a national treasure that was

well worth the colossal efforts needed to restore it. Gerstner always saw his

values in action in personal work behaviours, decision making, contribution,

and interpersonal interaction.

After so many years at IBM, Gerstner learned three fundamental aspects of

leadership that define a successful enterprise and executive.

Focusmeet the challenges during tough times and undergo transformation Executegetting things done, not crafting strategy but implementing it. Leadcreate high performance culture, set goals, measure results and ensure

accountability.

Gerstner was quite frank and open about issues and his opinions which helped

revive IBM. Through a strategy of listening to customers needs, partnering

with customers, competitors and other industry leaders, right sizing,

eliminating compensation and recognition systems, Gerstner was able to bringIBM back into profitability.

Execution of strategy must be built on three attributesworld class processes,

strategic clarity and a high performance culture. Leadership is all about

making things happen. Achieving success requires energy, organizational

leadership, marketplace leadership and personal qualities. Organize resources

around customers, not products, or geographies. Measure the future, not the

past and walk the talk.


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Organizational leadership

Mr. Gerstners leadership style is marked by strong emotional intelligence and

ability to lead people with passion and commitment. We can see six different

styles of leadership in Mr. Gerstner- authoritative style, the affinitive,democratic, coaching, pacesetting and coercive styles, all demonstrated in

varying strengths.

Mr. Gerstner was able to resonate with employee emotions and have a shared

desire to be a part of something effective and meaningful. This emotional

resonance was established through leadership styles based on emotional

intelligent acts. By establishing this connection and creating resonant teams

and culture, Gerstner was able to improvise and sustain it till his retirement. As

an authentic leader he was able to influence work outcomes and organizational

performance.

He was a man with convictions and followed his instincts. He was not carried

away by what his critics said. He was more into fire fighting, a fix it

personality who felt the urgent need to rescue IBM. His focus was on short-

term strategies and did not set long-term strategic goals since he believed

irreversible actions will bring radical shifts which may disrupt his turnaround

efforts at IBM.

He was an avid observer and excellent problem solver. He could identify the

emerging technological trends to shape new strategies. He understood the

importance of customer and devised strategies to address their immediate

needs and concerns.

Mr. Gerstner followed a systematic approach to address business issues. In

order to diagnose problems, he met customers, competitors, senior executives,

financial analysts, and consultants to get a grip on outstanding issues. Afterlearning about IBMs strengths and weaknesses, he launched his turnaround

plan. Instead of focusing on grand vision, he motivated employees through

business success which translated into job security and higher pay. He

understood the immediate need to have open lines of communication with his

employees and having candid feedback. As part of the grand vision,

individuals executed tasks which made them an integral part of the

transformation effort.


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By being democratic, he sought alternatives and convinced others of the need

to discontinue support for unattractive products. Gerstner gives credit to many

people that were instrumental in the turnaround. He was coercive when he

disbanded the management committee and relayed this news across the

organization. His affinitive style of leadership resulted in building strong

relationships amongst teams. This is reflected in his new set of management

principles that reinforce teamwork and harmony. He made employees equity

holders of company to align them with company goals.

As a pace-setter, he showed strong faith and confidence in employee abilities

and set high performance standards. An authoritative style emerged when Mr.

Gerstner resorted to right sizing which may have created some negative impact

(emotional dissonance) from the affected employees who were laid off.

Mr. Gerstner could spot emerging talent and personally mentored them to lead

new divisions within IBM. This was reflective of his coaching style of

leadership. He shunned conservative approach and instead took huge risk in

transforming IBM from a product-focused organization to a service-oriented,

networking-led model organization. Mr. Gerstner played his style by gauging

the readiness of his employees to foster change. He leveraged employee

abilities and willingness to accomplish specific tasks.

As an effective leader, Mr. Gerstner seamlessly shifted from one style to the

other to garner best results possible. His repertory of leadership styles is

extensive and he used them as the situation warranted to deliver positive

outcomes.

Since Mr. Gerstner was in a fire fighting mode, he had to apply the right mix

of various leadership styles according to the context. I would be acting in the

same way that Gerstner did to get IBM out of distress.

Though I agree with most of the actions taken to restore IBM back to

profitability, I would like to wean away from some harsh decisions and mend

my leadership style to some extent. I would try not to be intensely

competitive, blunt, focused and tough. I will try to be more personable, willing

to learn and share business knowledge and have empathy towards others. I

may introduce IBM as a way of life that is based on values rather than just on

being first. Any cost cutting measure involving layoffs will need to be used as

a last resort only after exhausting all alternatives. In conformity with Gerstner,I would admit failures and try, fail, learn and move on, than never to try at all.


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Putting the customers first

On the more positive side, and pursuing his obsession with the customer,

which was at the very core of his new vision for IBM, Gerstner asked

everyone of the top fifty members of the senior management team to visit at

least five major clients in the next three months, and for each of their direct

reports to do the same. For every visit he asked for a short report (one or two

pages). He read these reports and took actions when necessary. Staff began to

see that he was serious about keeping the customers happy. One of Gerstners

most radical decisions was to slash the price of mainframe computers: IBMs

vital cash cow (i.e. major source of income) arguably-the revenue stream that

was keeping the company afloat (just).

Gerstner could have kept milking this cow, but he felt that to do this was to

ignore what IBM customers were asking for: a lower price. The fewcompetitors in mainframe supply were offering products that were 30-40%

cheaper. And, in fact, Gerstner had potential ace up his sleeve: IBM research

had been working on a new technology that would replace the mainframe

technical architecture. The new CMOS technology had the potential to deliver

even more powerful mainframes for less cost. Gerstner signed off the

continuing $1billion investment in CMOS development. It worked. IBMs

aggressive pricing policy infused new life into mainframe sales. As the cost of

a unit of mainframe processing decreased radically over the coming years,

IBM turned around potentially fatal slump in mainframe sales and began to

increase sales dramatically year on year from 1994 onwards, while the new

technology helped to maintain profitability.

Finally every aspect of Gerstners new vision for the company is represented

in Gerstners most remarkable decision: to pursue IBMs commitment to

customer needs by unleashing an Integrated Service Unit that would supply all

customers IT needs in a rapidly changing technological world, even if it

meant recommending non-IBM products if these represented best solution to a

customers needs and to maintain and service those products also as part of the

service contract. This deeply unpopular strategic move resulted in the creation

of a division that came to deliver 50% of IBM revenues. Also it was during

Gerstners watch that IBM embraced the internet as a serious business tool.


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TheManagement Style of Louis Gerstner

Success in general may be built on failure:As Gerstner started his new job at IBM, he met with the Corporate

Management Board (Top 50 executives of IBM) and told them that he had not

looked for the job and took it reluctantly as he thought that the responsibility

was important to the countrys competitiveness and health. He then went on to

outline his expectations:

Eliminate bureaucracy by decentralising wherever possible while ensuring theright balance with central strategy and common customer focus.

Benchmarking costs against those of competitors and then achieving best inclass status.

Layoffs maybe necessary IBM management wanted to breakup IBM into smaller autonomous

businesses. Gerstner said, Maybe that is the right thing to do, but maybe not.

We certainly want decentralised, market-driven decision making. But is there

not so offer comprehensive solutions, a continuum of support? Cant we do

that and also sell individual products?

About morale, he said, I want can-do people looking for short term victoriesand long term excitement. He also told the audience that it would be his

priority to utilise internal talent rather than bringing in outsiders.

How did he want to run IBM?Louis Gerstner-

I manage by principle, not procedure. The marketplace dictates everything we should do. Im a big believer in quality, strong competitive strategies and plans,

teamwork, payoff for performance and ethical responsibility.

I look for people who look to solve problems and help colleagues.

I sack politicians. I am heavily involved in strategy; the rest is yours to implement. Just keep me

informed in an informal way. Dont hide bad information I hate surprises.

Dont try to blow things by me. Solve problems laterally; dont keep bringing

them up the line.

Move fast. If we make mistakes, let them be because we are too fast ratherthan too slow.
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Hierarchy means very little to me. Lets put together in meetings the peoplewho can help solve the problem, regardless of position. Reduce committees

and meetings to a minimum. No committee decision making. Letshave lots of

candid, straightforward communications.

I dont completely understand the technology. Ill need to learn it, but dontexpect me to master it. The unit leaders must be the translators into business

terms for me. I would say a few things. First, dont be afraid to make

mistakes. Thats how you learn, so I believe a lot in trio al and error and

course corrections. Often companies are unwilling to admit when theyve

made a mistake. We tend to question things more in our business.

SWOT analysis:LG pointed out five ninety day priorities on joining IBM and they were:

Stop the bleeding of cash as IBM is running out of money. Ensure that IBM is profitable by 1994 (LG joined IBM in April 1993). Develop and implement a customer strategy for the next two years (93,94) that

indicated to the customers that IBM had returned and was there to serve them.

Complete the right sizing of IBM. Create an intermediate-term business strategy. Constant analysis:

With regards to mainframe pricing, Gerstner was convinced that the reasonIBM was losing out to competitors was that IBM had the pricing strategy all

wrong, so he reversed it with an aggressive price reduction. In addition at a

conference attended by approx 175 CIOs and after listening to them during the

conference, LG laid out his expectations:

IBM priorities would be redefined, starting with the customer. IBM laboratories would be allowed to do what they wanted to do and would

deliver open, distributed, user based solutions.

IBM would be easier to work with, would recommit to quality and re-establishits leadership position.

IBM would work for the customer and deliver the performance the customerwanted.
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Improve productivity:As Gerstner moved forward with re-inventing IBM, he took the following

measures to improve productivity:

All of IBM would stay together as one company and not converted intoautonomous units.

IBM economic model would be altered, such as expenses as IBM werespending 42 cents to produce $1 of revenue while its competitors were

spending only 32 cents..

Business re-engineering would be undertaken. For example processes andsystems would be reviewed as internally.

Underproductive assets would be sold to generate much needed cash. Business reputation and brand:

IBM had never had a true Head of marketing and just like the processes and

the 128 CIO scenario, marketing was controlled by countries and business

units etc. That resulted in a totally disjointed marketing campaign. The new

Head of marketing decided to consolidate all of IBMs advertising

relationships into a single ad agency. This spawned the Solutions for a Small

planet and was followed by the coining of the term, e-business.

Rating of employees performance:This was all about pay for performance, not loyalty or tenure. It was all about

differentiation: Differentiate our overall pay based on the marketplace;

differentiate our increases based on individual performance and pay in the

marketplace; differentiate our bonuses based on business performance and

individual contributions; and differentiate our stock-option awards based on

the critical skills of the individual and our risk of loss to competition.

Spotting opportunities:While looking for opportunities, LG met the Head of ISSC (IBM Subsidiary),

Dennie Welsh. The opportunity that Dennie had spotted would change IBM

forever. Gerstner said He told me that his vision of a services company was

not one that did just IBM product maintenance and strung together computer

codes for customers, he envisioned a company that would literally take over

and act on behalf of the customers in all aspects of information technology-

from building systems to defining architectures to actually managing the

computers and running them for the customers. My mind was afire. To be truly

successful, we would have to do things that would shake the place to its roots.


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Create and nurture the correct culture:Watson, Sr had created the original culture of IBM but over the years, IBM

personnel had moved away from the original ethos of that culture and had

started to interpret it quite differently to how it was originally intended. LGmade it an imperative to change the IBM culture that was a better reflection

and fit for the changing times. The original culture hinged around:

Excellence in everything we do. This became an obsession with perfection.The culture that developed threatened to halt IBM due to checks, approvals

and validation meant that decision making just ground to a halt.

Superior customer service.- This translated into servicing IBM machines oncustomers premises, and as a result the customers real needs were usually

not entertained.

Respect for the individual. This meant that employees expected theirentitlements regardless of performance. This meant that in many instances the

best people were not getting what they deserved.

Develop a Clear Visionand Stick to It:Gerstner I was always amazed at how many executives thought that vision

was the same as strategy. Vision statements are for the most part

aspirational, and they play a role in creating commitment and excitement

among an institutions employees. Good strategiesstart with massive amounts

of quantitative analysis hard, difficult analysis that is blended with wisdom,insight, and risk taking.

Business/IT Strategy/principles:Gerstner outlined eight principles that were to envelop the business strategy

and underpinned the new IBM culture.

The marketplace is the driving force behind everything that we do. At our core, we are a technology company with an overriding commitment to

quality.

Our primary measures of success are customer satisfaction and shareholdervalue.

We operate as an entrepreneurial organisation with a minimum of bureaucracyand a never-ending focus on productivity.

We never lose sight of our strategic vision. We think and act with a sense of urgency. Outstanding, dedicated people make it all happen, particularly when they work

together as a team.

We are sensitive to the needs of all employees and to the communities inwhich we operate.


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Be shrewd and keep the team on its toesLGWere getting our butts kicked in the marketplace. People are taking our

business away. So I want us to start kicking some butts-namely, of ourcompetitors. This is not a game were playing. We have got to start getting out

in the marketplace and hitting back hard. I can assure you, our competitors are

focused maniacally on these charts, and they talk us down constantly. For

example, this from Larry Ellison (CEO Oracle): IBM? We dont even think

about those guys anymore. Theyre not dead, but theyre irrelevant.

Hire Action oriented employees:LG was once asked, What do you really want people to do? He answered,

Win, execute and team.

WIN: It was vital that all the IBMers understand that business is acompetitive activity. In the new IBM there would be no place for anyone who

lacked zeal for the contest.

EXECUTE: No more studying things to death. In the new IBM, successfulpeople would commit to getting things donefast and effectively.

TEAM:This was a commitment to acting as one IBM, plain and simple. Focus:

Gerstner History shows that truly great and successful companies go

through constant and sometimes difficult self-renewal of the base business.

They dont jump into new pools where they have no sense of the depth or

temperature of the water.

Quality management:Gerstner-But alas, too often the executive does not understand that people do

what you inspect, not what you expect.


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Dawn of a new era

If you go back about a quarter of a century, IBM was at the pinnacle of

success. Over the previous two decades IBM had practically invented general-

purpose computing for business. They had helped put a man on the moon. Our

researchers won Nobel Prizes. Their revenue and market share skyrocketed as

customers clamoured for their latest products. By 1984 IBM was the toast of

Wall Street.

Less than a decade later, in 1993 IBM posted what at the time was the biggest

loss in the history of corporate America, $8 billion. It had missed a number of

key technology shifts. Customers who had previously said no one ever got

fired for buying IBM were abandoning itfor faster, more nimble competitors.One major business publication labelled IBM a dinosaur. Another said its era

had passed.

Finding way back was difficult but things turned and IBM is back and has

been ranked among the top successful companies worldwide.

Recognition and Brand

For 2012, IBM's brand was valued byInterbrand at $75.5 billion.

For 2012, Vault ranked IBM Global Technology Services No. 1 in tech

consulting forcyber security, operations and implementation, and public

sector; and No. 2 inoutsourcing

Corporate affairs

IBM's headquarters complex is located inArmonk,Town of North

Castle,New York,United States.The 283,000-square-foot (26,300 m2) IBM

building has three levels of customcurtain wall.The building is located on a25-acre (10 ha) site. IBM has been headquartered in Armonk since 1964.

The company has twelve research labs worldwideAlmaden, Austin,

Australia, Brazil,China,Dublin,Israel,India,Tokyo,Watson (New

York),Zurich and Nairobiwith Watson (dedicated in 1961) serving as

headquarters for the research division and the site of its annual meeting. Other

campus installations include towers inMontreal,Paris, andAtlanta; software

labs inRaleigh-Durham,Rome andToronto; buildings

inChicago,Johannesburg,andSeattle;and facilities inHakozaki andYamato.
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On June 16, 2011, as part of its centenary celebrations the company announced

IBM100, a year-long grants program to fund employee participation in

volunteer projects.

Environmental record

IBM was recognized as one of the "Top 20 Best Workplaces for Commuters"

by the United States Environmental Protection Agency (EPA) in 2005. The

award was to recognizeFortune 500 companies which provided employees

with excellent commuter benefits to help reduce traffic and air pollution.

The birthplace of IBM,Endicott,suffered pollution for decades, however.

IBM used liquid cleaning agents incircuit board assembly operation for more

than two decades, and six spills and leaks were recorded, including one leak in

1979 of 4,100 gallons from an underground tank. These left behindvolatile

organic compounds in the town's soil and aquifer. Trace elements of volatileorganic compounds have been identified in Endicotts drinking water, but the

levels are within regulatory limits. Also, from 1980, IBM has pumped out

78,000 gallons of chemicals, including

trichloroethane,freon,benzene andperchloroethene to the air and allegedly

caused several cancer cases among the townspeople. IBM Endicott has been

identified by the Department of Environmental Conservation as the major

source of pollution, though traces of contaminants from a local dry cleaner and

other polluters were also found. Despite the amount of pollutant, state health

officials could not verify whether air orwater pollution in Endicott has

actually caused any health problems. According to city officials, tests show

that the water is safe to drink.

Tokyo Ohka Kogyo Co., Ltd. (TOK) and IBM are collaborating to establish

new, low-cost methods for bringing the next generation ofsolar

energyproducts, calledCIGS (Copper-Indium-Gallium-Selenide)solar

cell modules, to market. Use ofthin film technology, such as CIGS, has great

promise in reducing the overall cost of solar cells and further enabling their

widespread adoption.

IBM is exploring four main areas of photovoltaic research: using current

technologies to develop cheaper and more efficientsilicon solar cells,developing new solution-processed thin film photovoltaic

devices,concentrator photovoltaic, and future generation photovoltaic

architectures based uponnanostructures such as semiconductorquantum

dots andnanowires.
http://en.wikipedia.org/wiki/United_States_Environmental_Protection_Agencyhttp://en.wikipedia.org/wiki/Fortune_500http://en.wikipedia.org/wiki/Endicott,_New_Yorkhttp://en.wikipedia.org/wiki/Endicott,_New_York#Pollutionhttp://en.wikipedia.org/wiki/Printed_circuit_boardhttp://en.wikipedia.org/wiki/Volatile_organic_compoundhttp://en.wikipedia.org/wiki/Volatile_organic_compoundhttp://en.wikipedia.org/wiki/1,1,1-Trichloroethanehttp://en.wikipedia.org/wiki/Freonhttp://en.wikipedia.org/wiki/Benzenehttp://en.wikipedia.org/wiki/Tetrachloroethylenehttp://en.wikipedia.org/wiki/Water_pollutionhttp://en.wikipedia.org/wiki/Solar_powerhttp://en.wikipedia.org/wiki/Solar_powerhttp://en.wikipedia.org/wiki/Copper_indium_gallium_selenidehttp://en.wikipedia.org/wiki/Solar_cellhttp://en.wikipedia.org/wiki/Solar_cellhttp://en.wikipedia.org/wiki/Thin_filmhttp://en.wikipedia.org/wiki/Siliconhttp://en.wikipedia.org/wiki/Concentrating_solar_powerhttp://en.wikipedia.org/wiki/Nanostructurehttp://en.wikipedia.org/wiki/Quantum_dothttp://en.wikipedia.org/wiki/Quantum_dothttp://en.wikipedia.org/wiki/Nanowirehttp://en.wikipedia.org/wiki/Nanowirehttp://en.wikipedia.org/wiki/Quantum_dothttp://en.wikipedia.org/wiki/Quantum_dothttp://en.wikipedia.org/wiki/Nanostructurehttp://en.wikipedia.org/wiki/Concentrating_solar_powerhttp://en.wikipedia.org/wiki/Siliconhttp://en.wikipedia.org/wiki/Thin_filmhttp://en.wikipedia.org/wiki/Solar_cellhttp://en.wikipedia.org/wiki/Solar_cellhttp://en.wikipedia.org/wiki/Copper_indium_gallium_selenidehttp://en.wikipedia.org/wiki/Solar_powerhttp://en.wikipedia.org/wiki/Solar_powerhttp://en.wikipedia.org/wiki/Water_pollutionhttp://en.wikipedia.org/wiki/Tetrachloroethylenehttp://en.wikipedia.org/wiki/Benzenehttp://en.wikipedia.org/wiki/Freonhttp://en.wikipedia.org/wiki/1,1,1-Trichloroethanehttp://en.wikipedia.org/wiki/Volatile_organic_compoundhttp://en.wikipedia.org/wiki/Volatile_organic_compoundhttp://en.wikipedia.org/wiki/Printed_circuit_boardhttp://en.wikipedia.org/wiki/Endicott,_New_York#Pollutionhttp://en.wikipedia.org/wiki/Endicott,_New_Yorkhttp://en.wikipedia.org/wiki/Fortune_500http://en.wikipedia.org/wiki/United_States_Environmental_Protection_Agency


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Research and Inventions

In 1945, The Watson Scientific Computing Laboratory was founded

atColumbia University inNew York, New York. The renovated fraternity

house on Manhattan's West Side was used as IBM's first laboratory devoted to

pure science. The lab was the forerunner of IBM's Research Division, whichtoday operates research facilities around the world.

In 1966, IBM researcher Robert H. Dennard inventedDynamic Random

Access Memory (DRAM) cells, one-transistor memory cells that store each

single bit of information as an electrical charge in an electronic circuit. The

technology permits major increases in memory density and is widely adopted

throughout the industry where it remains in widespread use today.

IBM has been a leading proponent of theOpen Source Initiative, and began

supportingLinux in 1998. The company invests billions of dollars in services

and software based on Linux through the IBM Linux Technology Center,

which includes over 300Linux kernel developers. IBM has also released code

under differentopen source licenses, such as theplatform-

independentsoftware frameworkEclipse (worth approximately US$40 million

at the time of the donation), the three-sentence International Components for

Unicode (ICU) license, and theJava-basedrelational database management

system (RDBMS)Apache Derby. IBM'sopen source involvement was

troublesome.

Famous inventions

Automated Teller Machine (ATM) Floppy disk Hard disk drive Electronic keypunch Magnetic stripe card Virtual machine Scanning tunnelling microscope Reduced instruction set computing Relational database Financial swap SABRE airline reservation system Dynamic Random Access Memory (DRAM)
http://en.wikipedia.org/wiki/Columbia_Universityhttp://en.wikipedia.org/wiki/New_Yorkhttp://en.wikipedia.org/wiki/Dynamic_Random_Access_Memoryhttp://en.wikipedia.org/wiki/Dynamic_Random_Access_Memoryhttp://en.wikipedia.org/wiki/Open_Source_Initiativehttp://en.wikipedia.org/wiki/Linuxhttp://en.wikipedia.org/wiki/Linux_Technology_Centerhttp://en.wikipedia.org/wiki/Linux_kernelhttp://en.wikipedia.org/wiki/Open_source_licensehttp://en.wikipedia.org/wiki/Cross-platformhttp://en.wikipedia.org/wiki/Cross-platformhttp://en.wikipedia.org/wiki/Software_frameworkhttp://en.wikipedia.org/wiki/Eclipse_(software)http://source.icu-project.org/repos/icu/icu/trunk/license.htmlhttp://source.icu-project.org/repos/icu/icu/trunk/license.htmlhttp://en.wikipedia.org/wiki/International_Components_for_Unicodehttp://en.wikipedia.org/wiki/Java_(programming_language)http://en.wikipedia.org/wiki/Relational_database_management_systemhttp://en.wikipedia.org/wiki/Relational_database_management_systemhttp://en.wikipedia.org/wiki/Apache_Derbyhttp://en.wikipedia.org/wiki/Open_sourcehttp://en.wikipedia.org/wiki/Open_sourcehttp://en.wikipedia.org/wiki/Apache_Derbyhttp://en.wikipedia.org/wiki/Relational_database_management_systemhttp://en.wikipedia.org/wiki/Relational_database_management_systemhttp://en.wikipedia.org/wiki/Java_(programming_language)http://en.wikipedia.org/wiki/International_Components_for_Unicodehttp://source.icu-project.org/repos/icu/icu/trunk/license.htmlhttp://source.icu-project.org/repos/icu/icu/trunk/license.htmlhttp://en.wikipedia.org/wiki/Eclipse_(software)http://en.wikipedia.org/wiki/Software_frameworkhttp://en.wikipedia.org/wiki/Cross-platformhttp://en.wikipedia.org/wiki/Cross-platformhttp://en.wikipedia.org/wiki/Open_source_licensehttp://en.wikipedia.org/wiki/Linux_kernelhttp://en.wikipedia.org/wiki/Linux_Technology_Centerhttp://en.wikipedia.org/wiki/Linuxhttp://en.wikipedia.org/wiki/Open_Source_Initiativehttp://en.wikipedia.org/wiki/Dynamic_Random_Access_Memoryhttp://en.wikipedia.org/wiki/Dynamic_Random_Access_Memoryhttp://en.wikipedia.org/wiki/New_Yorkhttp://en.wikipedia.org/wiki/Columbia_University


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Product list

The following is a list of products, some notable, some less so, from

the International Business Machines (IBM) Corporation and its predecessor

corporations, beginning in the 1890s, and spanningpunchedcard equipment,time clocks, andtypewriters, viamainframe

computers andminicomputers,tomicroprocessors,software,and more..

IBM uses two different naming structures for products. Each hardware product

is normally given a 4 digit machine type (normally a decimal number that can

range from 0001 to 9999) and a 3 digit model number (can be a mix of letters

and numbers). However a product is also normally given a marketing name.

The list of products is as follows-

Unit record equipmento Keypunches and verifierso Sorters, Statistical, and derived machineso Collatorso Reproducing Punch, Summary Punch, Gang Punch, and derived machineso Interpreterso Tabulators, Accounting machineso Calculating deviceso Other Unit Record Equipment Time Equipment Division Typewriters and dictating equipment Copier/Duplicators Telephone switching systems World War II ordnance and related products Other non-computer products Computers based on vacuum tubes, the ASCC and the SSEC (1940s, 1950s) Computers based on discrete transistors (1960s)o IBM 7070 series: 7070, 7072, 7074o IBM 7090 series: 7040, 7044, 7090, 7094, 7094 IIo IBM 1400 series: 1240, 1401, 1410, 1420, 1440, 1450, 1460, 7010 Later Solid state computerso Computers based on SLT or discrete IC CPUs (1964 to 1989)o Computers based on discrete IC CPUs (1990 to present)o Computers based on microprocessor CPUs (1981 to present)
http://en.wikipedia.org/wiki/International_Business_Machineshttp://en.wikipedia.org/wiki/Punched_cardhttp://en.wikipedia.org/wiki/Punched_cardhttp://en.wikipedia.org/wiki/Time_clockhttp://en.wikipedia.org/wiki/Typewriterhttp://en.wikipedia.org/wiki/Mainframe_computerhttp://en.wikipedia.org/wiki/Mainframe_computerhttp://en.wikipedia.org/wiki/Minicomputerhttp://en.wikipedia.org/wiki/Microprocessorhttp://en.wikipedia.org/wiki/Softwarehttp://en.wikipedia.org/wiki/List_of_IBM_products#Unit_record_equipmenthttp://en.wikipedia.org/wiki/List_of_IBM_products#Keypunches_and_verifiershttp://en.wikipedia.org/wiki/List_of_IBM_products#Sorters.2C_Statistical.2C_and_derived_machineshttp://en.wikipedia.org/wiki/List_of_IBM_products#Collatorshttp://en.wikipedia.org/wiki/List_of_IBM_products#Reproducing_Punch.2C_Summary_Punch.2C_Gang_Punch.2C_and_derived_machineshttp://en.wikipedia.org/wiki/List_of_IBM_products#Interpretershttp://en.wikipedia.org/wiki/List_of_IBM_products#Tabulators.2C_Accounting_machineshttp://en.wikipedia.org/wiki/List_of_IBM_products#Calculating_deviceshttp://en.wikipedia.org/wiki/List_of_IBM_products#Other_Unit_Record_Equipmenthttp://en.wikipedia.org/wiki/List_of_IBM_products#Time_Equipment_Divisionhttp://en.wikipedia.org/wiki/List_of_IBM_products#Typewriters_and_dictating_equipmenthttp://en.wikipedia.org/wiki/List_of_IBM_products#Copier.2FDuplicatorshttp://en.wikipedia.org/wiki/List_of_IBM_products#Telephone_switching_systemshttp://en.wikipedia.org/wiki/List_of_IBM_products#World_War_II_ordnance_and_related_productshttp://en.wikipedia.org/wiki/List_of_IBM_products#Other_non-computer_productshttp://en.wikipedia.org/wiki/List_of_IBM_products#Computers_based_on_vacuum_tubes.2C_the_ASCC_and_the_SSEC_.281940s.2C_1950s.29http://en.wikipedia.org/wiki/List_of_IBM_products#Computers_based_on_discrete_transistors_.281960s.29http://en.wikipedia.org/wiki/List_of_IBM_products#IBM_7070_series:_7070.2C_7072.2C_7074http://en.wikipedia.org/wiki/List_of_IBM_products#IBM_7090_series:_7040.2C_7044.2C_7090.2C_7094.2C_7094_IIhttp://en.wikipedia.org/wiki/List_of_IBM_products#IBM_1400_series:_1240.2C_1401.2C_1410.2C_1420.2C_1440.2C_1450.2C_1460.2C_7010http://en.wikipedia.org/wiki/List_of_IBM_products#Later_Solid_state_computershttp://en.wikipedia.org/wiki/List_of_IBM_products#Computers_based_on_SLT_or_discrete_IC_CPUs_.281964_to_1989.29http://en.wikipedia.org/wiki/List_of_IBM_products#Computers_based_on_discrete_IC_CPUs_.281990_to_present.29http://en.wikipedia.org/wiki/List_of_IBM_products#Computers_based_on_microprocessor_CPUs_.281981_to_present.29http://en.wikipedia.org/wiki/List_of_IBM_products#Computers_based_on_microprocessor_CPUs_.281981_to_present.29http://en.wikipedia.org/wiki/List_of_IBM_products#Computers_based_on_discrete_IC_CPUs_.281990_to_present.29http://en.wikipedia.org/wiki/List_of_IBM_products#Computers_based_on_SLT_or_discrete_IC_CPUs_.281964_to_1989.29http://en.wikipedia.org/wiki/List_of_IBM_products#Later_Solid_state_computershttp://en.wikipedia.org/wiki/List_of_IBM_products#IBM_1400_series:_1240.2C_1401.2C_1410.2C_1420.2C_1440.2C_1450.2C_1460.2C_7010http://en.wikipedia.org/wiki/List_of_IBM_products#IBM_7090_series:_7040.2C_7044.2C_7090.2C_7094.2C_7094_IIhttp://en.wikipedia.org/wiki/List_of_IBM_products#IBM_7070_series:_7070.2C_7072.2C_7074http://en.wikipedia.org/wiki/List_of_IBM_products#Computers_based_on_discrete_transistors_.281960s.29http://en.wikipedia.org/wiki/List_of_IBM_products#Computers_based_on_vacuum_tubes.2C_the_ASCC_and_the_SSEC_.281940s.2C_1950s.29http://en.wikipedia.org/wiki/List_of_IBM_products#Other_non-computer_productshttp://en.wikipedia.org/wiki/List_of_IBM_products#World_War_II_ordnance_and_related_productshttp://en.wikipedia.org/wiki/List_of_IBM_products#Telephone_switching_systemshttp://en.wikipedia.org/wiki/List_of_IBM_products#Copier.2FDuplicatorshttp://en.wikipedia.org/wiki/List_of_IBM_products#Typewriters_and_dictating_equipmenthttp://en.wikipedia.org/wiki/List_of_IBM_products#Time_Equipment_Divisionhttp://en.wikipedia.org/wiki/List_of_IBM_products#Other_Unit_Record_Equipmenthttp://en.wikipedia.org/wiki/List_of_IBM_products#Calculating_deviceshttp://en.wikipedia.org/wiki/List_of_IBM_products#Tabulators.2C_Accounting_machineshttp://en.wikipedia.org/wiki/List_of_IBM_products#Interpretershttp://en.wikipedia.org/wiki/List_of_IBM_products#Reproducing_Punch.2C_Summary_Punch.2C_Gang_Punch.2C_and_derived_machineshttp://en.wikipedia.org/wiki/List_of_IBM_products#Collatorshttp://en.wikipedia.org/wiki/List_of_IBM_products#Sorters.2C_Statistical.2C_and_derived_machineshttp://en.wikipedia.org/wiki/List_of_IBM_products#Keypunches_and_verifiershttp://en.wikipedia.org/wiki/List_of_IBM_products#Unit_record_equipmenthttp://en.wikipedia.org/wiki/Softwarehttp://en.wikipedia.org/wiki/Microprocessorhttp://en.wikipedia.org/wiki/Minicomputerhttp://en.wikipedia.org/wiki/Mainframe_computerhttp://en.wikipedia.org/wiki/Mainframe_computerhttp://en.wikipedia.org/wiki/Typewriterhttp://en.wikipedia.org/wiki/Time_clockhttp://en.wikipedia.org/wiki/Punched_cardhttp://en.wikipedia.org/wiki/Punched_cardhttp://en.wikipedia.org/wiki/International_Business_Machines


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Computers Supercomputers Microprocessorso Solid State Computer peripherals Punched card and paper tape equipment Printer/plotter equipment and terminals Data storage units Core storage Magnetic drum storage Direct Access Storage Devices Magnetic tape storage Optical storage Storage networking and virtualization Coprocessor units Input/output control units Power supply/distribution units Modems Other IBM PC components and peripherals Embedded systemso Airline Reservation Systemso Avionics and space systemso Bank and financeo Document processingo Educationalo Industry and manufacturingo Medical/science/lab equipmento

Retail/point-of-sale (POS)o Telecommunications terminalso Unclassified Computer softwareo Operating systemso Utilities and languageso Middleware and applications
http://en.wikipedia.org/wiki/List_of_IBM_products#Computershttp://en.wikipedia.org/wiki/List_of_IBM_products#Supercomputershttp://en.wikipedia.org/wiki/List_of_IBM_products#Microprocessorshttp://en.wikipedia.org/wiki/List_of_IBM_products#Solid_State_Computer_peripheralshttp://en.wikipedia.org/wiki/List_of_IBM_products#Punched_card_and_paper_tape_equipmenthttp://en.wikipedia.org/wiki/List_of_IBM_products#Printer.2Fplotter_equipment_and_terminalshttp://en.wikipedia.org/wiki/List_of_IBM_products#Data_storage_unitshttp://en.wikipedia.org/wiki/List_of_IBM_products#Core_storagehttp://en.wikipedia.org/wiki/List_of_IBM_products#Magnetic_drum_storagehttp://en.wikipedia.org/wiki/List_of_IBM_products#Direct_Access_Storage_Deviceshttp://en.wikipedia.org/wiki/List_of_IBM_products#Magnetic_tape_storagehttp://en.wikipedia.org/wiki/List_of_IBM_products#Optical_storagehttp://en.wikipedia.org/wiki/List_of_IBM_products#Storage_networking_and_virtualizationhttp://en.wikipedia.org/wiki/List_of_IBM_products#Coprocessor_unitshttp://en.wikipedia.org/wiki/List_of_IBM_products#Input.2FOutput_control_unitshttp://en.wikipedia.org/wiki/List_of_IBM_products#Power_supply.2Fdistribution_unitshttp://en.wikipedia.org/wiki/List_of_IBM_products#Modemshttp://en.wikipedia.org/wiki/List_of_IBM_products#Otherhttp://en.wikipedia.org/wiki/List_of_IBM_products#IBM_PC_components_and_peripheralshttp://en.wikipedia.org/wiki/List_of_IBM_products#Embedded_systemshttp://en.wikipedia.org/wiki/List_of_IBM_products#Airline_Reservation_Systemshttp://en.wikipedia.org/wiki/List_of_IBM_products#Avionics_and_space_systemshttp://en.wikipedia.org/wiki/List_of_IBM_products#Bank_and_financehttp://en.wikipedia.org/wiki/List_of_IBM_products#Document_processinghttp://en.wikipedia.org/wiki/List_of_IBM_products#Educationalhttp://en.wikipedia.org/wiki/List_of_IBM_products#Industry_and_manufacturinghttp://en.wikipedia.org/wiki/List_of_IBM_products#Medical.2Fscience.2Flab_equipmenthttp://en.wikipedia.org/wiki/List_of_IBM_products#Retail.2Fpoint-of-sale_.28POS.29http://en.wikipedia.org/wiki/List_of_IBM_products#Telecommunications_terminalshttp://en.wikipedia.org/wiki/List_of_IBM_products#Unclassifiedhttp://en.wikipedia.org/wiki/List_of_IBM_products#Computer_softwarehttp://en.wikipedia.org/wiki/List_of_IBM_products#Operating_systemshttp://en.wikipedia.org/wiki/List_of_IBM_products#Utilities_and_languageshttp://en.wikipedia.org/wiki/List_of_IBM_products#Middleware_and_applicationshttp://en.wikipedia.org/wiki/List_of_IBM_products#Middleware_and_applicationshttp://en.wikipedia.org/wiki/List_of_IBM_products#Utilities_and_languageshttp://en.wikipedia.org/wiki/List_of_IBM_products#Operating_systemshttp://en.wikipedia.org/wiki/List_of_IBM_products#Computer_softwarehttp://en.wikipedia.org/wiki/List_of_IBM_products#Unclassifiedhttp://en.wikipedia.org/wiki/List_of_IBM_products#Telecommunications_terminalshttp://en.wikipedia.org/wiki/List_of_IBM_products#Retail.2Fpoint-of-sale_.28POS.29http://en.wikipedia.org/wiki/List_of_IBM_products#Medical.2Fscience.2Flab_equipmenthttp://en.wikipedia.org/wiki/List_of_IBM_products#Industry_and_manufacturinghttp://en.wikipedia.org/wiki/List_of_IBM_products#Educationalhttp://en.wikipedia.org/wiki/List_of_IBM_products#Document_processinghttp://en.wikipedia.org/wiki/L

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