Rebooting IBM Harvard Case Solution & Analysis

IMD-4-0318 © 2010
Weeks, John; Barsoux, Jean-Louis

The case commences in 2003, abruptly succeeding Sam Palmisano’s successive Louis V. Gerstner as Chairman and CEO of IBM. Palmisano was looking back on the happenings of his predecessor in bringing IBM back from the dead and these influenced the challenge going forward. IBM had long been among the most profitable firms in the world, but, by 1993, when Gerstner was recruited to lead the firm, the prevailing wisdom was that the company was heading for extinction. It was broadly agreed that IBM was “worth less than the total of its parts”. The assumption was that to save itself, IBM needed to be broken up, it needed to abandon its traditional strategy of being an one-stop supplier of options” that is “, and it needed to discard habit and its insular culture of promoting from within. In the span of ten years, though, Gerstner turned that conventional wisdom on its head and turned IBM around. He diagnosed, lay in its culture too, although there were tremendous strengths in the business’s culture. Long admired as a beacon of US business, IBM’s culture stopped evolving in step with its surroundings and froze.

Most of the instance describes Gerstner IBM achieved this transformation and the role of culture in keeping and driving those changes. By the time Palmisano took over, the business was reporting earnings greater than Microsoft, Intel, and Accenture combined and was being awarded more patents each year than any other firm in any sector. An IBM lifer, the challenge for Palmisano, was to convince fellow IBMers to keep changing now that the business was back on a healthy basis. After ten years of sacrifice and effort, there was a real danger of falling back into complacency. Palmisano took a wager on an on-line “jam” – a huge, 72-hour chat room where workers worldwide could voice thoughts about the values of the business. It aided in breathing new life into IBM’s principles as well as restructuring IBM with its tradition. Most importantly, it supplied Palmisano with a collective mandate for ongoing change that, to new record highs, pushed IBM’s results in 2010. Learning objectives: This case investigates what culture is and how it can be altered, focusing on: 1) The benefits and drawbacks of a strong organizational society. 2) The procedure of organizational conversion and cultural modifications. There are different amounts of culture and leaders have to reach the deepest of these to implement lasting change: people’s basic assumptions. But assumptions can only be changed indirectly. In a nutshell, we change the way people think by transforming how they discuss and altering what they do, then holding those steady long enough so that they stick.

Rebooting IBM Case Study Solution

Subjects: Organizational culture; Leading change; Computing; Strategy; Values; Vision; Alignment; Learning; Customer orientation; Systems; Processes; Turnaround; Transformation
Settings: Global; Computing; 320,000 employees; 1993-2010

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