IBM's Palmisano on innovator's dilemma, avoiding tech's 'bone pile'

IBM's Palmisano on innovator's dilemma, avoiding tech's 'bone pile'

Summary: "It's so easy to stick to things that made you profitable," says IBM's chief.


IBM CEO Sam Palmisano said technology is filled with a "bone pile of enterprises" that couldn't find a second act. The problem: These companies couldn't break an emotional tie to whatever made it successful in the first place.

"It's so easy to stick to things that made you profitable," said Palmisano. "A core responsibility of leadership is understanding when it's time to change."

That leadership can equate to strategy shifts to setting up a company to operate when you're gone to creating an institutional culture.

The message is quite current as many technology companies are working through leadership transitions (Apple, Yahoo), trying to create new acts (Microsoft and Google) and managing their first big crises (Netflix). Netflix CEO Reed Hastings recently referenced the innovator's dilemma challenge in his mea culpa post to customers.

Palmisano, speaking at IBM's Think leadership conference at the Lincoln Center in New York, argued that the world is becoming a system of systems and that's why there's so much upheaval in the world. Part of that upheaval revolves around short-term management.

Related: IBM at 100: 15 inflection points in history

For IBM, the challenge to long-term management is a 90-day earnings cycle. But governments, universities and other institutions also face short-term issues whether it's a budget or electoral cycle. Palmisano added that leaders have to ignore the pull of short-term management.

Palmisano took an optimistic tone and noted that historians will look back to current issues as an innovative golden age. The challenge is that leaders have to be more collaborative than competitive. "You have to see self as not only a competitor, but a broad collaborator," said Palmisano. IBM's definition of collaboration differed from the standard---which revolves around Facebook, social networking and other tools---and focuses on addressing society issues and bringing multiple groups together and "assembling the right talent pools."

"The technology is not the issue these days," said Palmisano.

He added that boundaries across companies, governments and disciplines are crumbling and that creates a lot of discomfort---and opportunities---around the world.

Topics: CXO, IBM

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  • IBM's Palmisano on innovator's dilemma, avoiding tech's 'bone pile'

    hp's board seems to miss the boat on this one. first, they fired the very leader that wanted to do what palmisano knows. second, they hired the replacement ceo who was clueless of what was going on, and whose only talent was to take credit for the job well done by the predecessor and date love for hire. third, hired another ceo that understand what was going on (as far as software and services are concerned), and then fired that ceo because the short term gain they hope to get did not come to fruition. and the rest is history... hope hp will not listen to the son of the founder, who is clueless. remember, he is not his father!
  • RE: IBM's Palmisano on innovator's dilemma, avoiding tech's 'bone pile'

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  • A Transportation plan for the 21st century: Wind Spirit (a letter to IBM)

    Dr. Laura Wynter (IBM) 5-20-12
    Public transportation systems in the US are in a mess; we???re trying to use the same methods we were 100 years ago to move people around and it seems to be coming to a dismal death. The primary mode of transportation is the automobile with a small fraction of people using the less convenient mode of public transportation, reluctantly, I might add. 15% seems to be the average use of public transportation around the country. I think that includes bicycle riders. Obviously that average should be at least tripled. I think the only thing that motivates people to use public transportation is the immense difficulty of navigating our congested road systems plus the cost of gas and parking.
    The optimistic reports coming from the transportation industry are attempting to convince us that tinkering around the edges of the problem will increase efficiency by some measurable amount; that tinkering is flying in the face of reality; you probably know that. Trying to gain one percent here or two percent there is going to revitalize the industry? We???re all grown up now and realize that flogging a dead horse won???t work. Many paragraphs of your texts use the word, ???innovation???. Initiate some real innovation in rethinking how this could be better done; recognize that in order to make real change you have to throw out the old, non-efficient aspects of your work that are not working! You need to understand: IT NEVER WILL! No matter how many thousands of engineers twist it with many thousands of computers. IT???S A DEAD HORSE! It doesn???t work now and it won???t in 50 years. The basic reasons are that every car has to stop at every stop to maintain a schedule and no car can pass any other car.

    Consider: The population of the US will hit 400 million by 2050. Our population is increasing by 200 thousand people a month and will for the next 40 years (.etc); our kids will be grown up and will be left with the mess we didn???t fix. The best method of controlling this number of people is consolidation. According to some futurists it will be necessary to build up not out. In other words put these additional 100 million people into the same space as our existing 300 million; stop the suburban sprawl. No more putting thousands of people on farmland at a 1/4 acre per lot. The transportation industry can???t serve those people anyhow. Does that make sense? If there are another one or two thousand people per square mile in the city how is a transportation system that???s only capable of carrying 6 or 7 thousand passengers an hour going to service that market? It can???t do it now! You need some inspiration!

    So, here???s some innovation, something you???ve been looking at and trying to work around for sixty years or better; I want you to look at the video: ???Wind Spirit, and see if you can recognize what???s going on. If what you see excites you, (I???ll settle for ???interests you???), you might possibly try to figure out amongst your peers how this can work. That is: the ???nuts and bolts??? of the operation. Then, if you are really intrigued you could maybe buy the book and see if you???ve passed your test in innovation technology. Until you do that I would suggest that you lay off of that word ???innovation???.

    I???d better point out to you that this is not a monorail by any conventional definition of the word. What I???m presenting, I believe, is a workable concept based on my many years of industrial design experience.

    I do recognize that such innovation takes time, lots of it, and many resources. It will take many years to replace all of those light rails, most of your kid???s lifetimes, and maybe their kids. It takes time to get the property back to the city, to clear all of those intersections and recycle all of those millions of tons of material. The year 2050 sounds like a good target for completion.

    I would really hate to have this built in China rather than sold to China. What I???m sending you is also available to them and has been for several years.

    Randall Schwab
    P.O. box 1467 Langley, Wa

    See: Wind Spirit Commute .net
    randall schwab