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  • A Second First Chance

    Real change is not becoming something different, but becoming something new. IBM has found its voice and is roaring again. There are lessons to be learned from leaving something you love behind to find something greater in the future.

    I wrote a post for Upstart: Business and Management for 20-40 Year Old Professionals, “Blowup The Company To Save It,” which examined Lou Gerstner, the former CEO of IBM, who implemented its historic turnaround. Gerstner not only saved the company – he positioned IBM for its second act.

    I wrote, “After reading, Who Say’s Elephants Can’t Dance? Inside IBM’s Historic Turnaround (Collins, 2002), by Lou Gerstner (former CEO of IBM), I was amazed by the clearly pointed and relational elements that go into turning around a struggling, near obsolete company… Mr. Gerstner did the impossible: he took an aging, but proud lion (IBM) and brought it into the future, much of it by using past fundamentals, which is a terrible irony for a technology company…What was really interesting was how with IBM’s bloated infrastructure, monolithic bureaucracy and myopic culture, Gerstner assumed the task of shaking IBM from its historical moorings, to make it a strictly information technology and consulting enterprise, as opposed to servers and personal computers, which had served the company well for generations. Gerstner had to blowup the company to save it……Gerstner had to undo much of IBM’s past glory, reinvent a future that IBM could capture and become the leader of, and do this while shedding most of IBM’s old practices, processes and culture. Gerstner was being somewhat forced to create a new IBM with the same employees most suited for old IBM. Hell….In the book, I was surprised at the rudimentary nature of some business objectives depicted as effective (principles, vision and customer satisfaction), which most businesses lose as they grow and go forward, characteristics some businesses avoid, due to the discipline and consistency required, while other businesses don’t know these things exists to strengthen and monitor their performance, so from the start they’re in real trouble, but they don’t know they’re in trouble until it’s too late.”

    And now IBM is back in the headlines, not for just remaking itself – but for again moving towards benchmark status: it’s so improbable for a great company that became less than great, to become great again, while doing so without many of the products and accoutrements that made it great in the first place – that’s remarkable.

    Real change is not when you become something different: real change is when you become something completely“new.”

    I cite this because, after reading Steve Lohr’s New York Times article, Lessons in Longevity, From I.B.M. I realized that now that IBM has found its voice and is roaring again – there are lessons to be learned from leaving something you love behind to find something greater in the future: it is both frightening and liberating – yet it’s always necessary.

    Lohr stated, “Yet, not so long ago, I.B.M.’s corporate survival was at stake. In the early 1990s, it nearly ran out of money. Its mainframe business was reeling under pressure from the lower-cost technology of personal computing….New leadership was brought in, and thousands of workers were laid off. It was part of the company’s painful journey to what might be called “post-monopoly prosperity” — that is, a new path to corporate success once a dominant product is no longer the turbocharged engine of growth and profit it once was…. “I.B.M. faced the challenge that all great companies do sooner or later — they dominate, they lose it, and then they re-create themselves or not,” observes George F. Colony, the chief executive of Forrester Research.”

    Technology is probably one of the worst if not worst industry to reinvent yourself, because you have the “young turks,” who grow-up in a wired world, who see the world differently – who see the integration of consumerism and technology different – who also do this with very little barriers: so their sense of being contemporary – their fluidity, as well as the ease with they can become very good businesses in no time, were all serious – immediate and long-term challenges to IBM: yet in spite of such daunting odds – IBM pulled it off and you have to respect that.

    The take away from Lohr’s article, “One central message, according to industry experts, is this: Don’t walk away from your past. Build on it. The crucial building blocks, they say, are skills, technology and marketing assets that can be transferred or modified to pursue new opportunities. Those are a company’s core assets, they say, far more so than any particular product or service.”

    It’s encouraging and exhilarating to see IBM put fear in the hearts of competitors again, because if they have found the path, process and “magic” to turnaround an American icon – one that was staggering and seemingly inoculated to its own failings: it might just be the those same types of both prodigious and subtle measures that save the American idea from eroding as well.

    We will all have to become different – some of us will become different and better: but only a select few of us will become completely new after being something valuable at one time — something now obsolete. Force yourself into your moment and become completely new – become the future, now.

    Good Luck.

    Calvin Wilson
    Founder and CEO
    Upstart: Business and Management for 20-40 Year Old Professionals

    Filed Under: Tech/E-Commerce


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