How to fix IBM

IBMGiven IBM’s earnings miss last week and the impact it had on company shares I thought rather than just criticizing the company it might make better sense to consolidate my ideas for how to fix IBM. Here they are.

Early in his tenure as CEO, Sam Palmisano made changes that created IBM’s problems today. IBM customers are buying fewer products and services. Revenue has dropped each quarter for the past ten. Sam’s changes alienated IBM customers, many of whom are ending what has been in many cases a multi-decade relationship. No amount of earnings promises, no amount of financial engineering, will fix this problem.

IBM forgot the most important part of running a business. While shareholder value […]

Ginni comes to her senses, but too late for IBM?

Ginni_RomettyThis week, of all weeks, with IBM seemingly melting-down, you’d think I’d be writing about it and I have been, just not here. You can read two columns on IBM I published over at, here and here. They are first day and second day analyses of IBM’s earnings announcement and sale of its chip division to GlobalFoundries. I could publish them here three days from now but by then nobody will care so instead I’ll just give you the links.

One thing I can do here is consider the way IBM CEO Ginni Rometty is spinning this story. She was all over the news […]

The Fed suckered IBM into a failing cloud strategy?

Ginni_RomettyEconomist David Stockman, who is probably best known for being President Reagan’s budget director back in the era of voodoo economics, has been particularly outspoken about IBM as a poster child for bad policy on the part of the U.S. Federal Reserve. How this would be isn’t immediately obvious but I think is worth exploring because IBM is far from the only company so afflicted. There’s an important effect here to be understood about corporate motivations and their consequences.

So I’ll begin with a story. Almost 40 years ago there was a study I worked on at Stanford’s Institute for Communication Research having to do with helping farmers in Kentucky be […]

IBM to customers: Your hand is staining my window

Ginni_RomettyA month ago I began hearing about impending layoffs at IBM, but what could I say beyond “layoffs are coming?” This time my first clues came not from American IBMers but from those working for Big Blue abroad. Big layoffs were coming, they feared, following an earnings shortfall that caused panic in Armonk with the prospect that IBM might after all miss its long-stated earnings target for 2015. Well the layoffs began hitting a couple weeks ago just before I went into an involuntary technical shutdown trying to move this rag from one host to another. So I, who like to be the first to break these stories, have to in this case write the […]