Word: palmisano
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Dates: during 2000-2009
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Listen to Palmisano for a while, though, and you might begin to share some of his contrarian views. With CEOs, CFOs and CIOs desperate to cut costs and focus on their core businesses, IBM believes it can, in the words of a money manager who owns the stock, "wrap its arms around customers even more" by supplying IT seamlessly, on demand, on a variable, pay-as-you-go basis. J.P Morgan Chase bought Palmisano's pitch, as did American Express. But it's not yet clear how many others will be willing to hand over more control...
...Palmisano has the easy, boyish grin and hearty laugh of the consummate salesman he has been for much of his 30-year career at IBM. He can seem quite a contrast to his predecessor as CEO, Lou Gerstner, a notoriously gruff, prickly outsider responsible for one of the greatest turnarounds in corporate history. But nearly a year after taking over the reins amid a lingering slump in corporate spending on technology, Palmisano, 51, has shown that he has sharp teeth behind that smile...
...accelerated Big Blue's transformation from a hardware dinosaur to a technology-services dynamo--a firm that, rather than just selling computers and software, can persuade FORTUNE 500 clients to let it provide all their technology needs, from support staff to data storage. Over just the past half-year, Palmisano has spent $3.5 billion for the consulting arm of PricewaterhouseCoopers, which gave IBM the people and contacts to turbocharge its services business, and has paid $2 billion for Rational Software, which provided new software-development tools. He agreed to sell IBM's money-losing hard-drive business to Hitachi...
...Even as Palmisano sat down to talk with TIME at IBM's woodsy, secluded headquarters in Armonk, N.Y., he was busy last week announcing a pact to outsource more of IBM's PC and low-end server manufacturing. "This is the opportunity of a lifetime for IBM," he says, "to go from a company that was almost out, to a comeback, to being the undisputed leader...
...Palmisano's optimism might seem forced amid the wreckage left behind by the tech bust, with cash-strapped companies wary of spending on technology that often doesn't live up to expectations. Such skepticism is one of the principal reasons that IBM's 2002 earnings, which will be announced this week, are expected to drop more than 10%, a reversal from the solid, double-digit annual earnings growth that Gerstner consistently achieved--and that Palmisano is promising for 2003. That pledge will be all the harder to keep at a time when Wall Street is taking a much closer look...