IBM succession: What the papers say

Big Blue "lifer" replaces man with no "vision". Sort of...
Written by Jon Bernstein, Contributor

Big Blue "lifer" replaces man with no "vision". Sort of...

News that Sam Palmisano is to replace Lou Gerstner as CEO of IBM - reported last night on silicon.com - is given prominence in this morning's papers on both sides of the Atlantic. Most believe Gerstner will be a hard act to follow having turned IBM around. When he took over in 1993 IBM was suffering the worst period in its history with traditional mainframe and mid-range business struggling to compete with emerging PC networks. During his reign Gerstner grew the IBM share price by 800 per cent, breathed new life into the server business and identified consulting and services as the big area of growth. The New York Times says Gerstner had "guided a remarkable turnaround at IBM and transformed its once-hidebound culture". It adds: "Mr Gerstner overhauled the company. He cut costs and eliminated the jobs of thousands of workers and then set about making a lumbering giant of a corporation fast on its feet." The San Jose Mercury is equally glowing about Gerstner although it does recall how the outgoing CEO caused a storm on his appointment in 1993 by declaring he had no "vision" for IBM. The paper concentrates on the succession, describing the 50 year old Palmisano as "an IBM lifer". It adds: "[Palmisano] has been expected to follow in Gerstner's footsteps since being named president and chief operating officer in July 2000." However, the Financial Times says the succession is not as clean cut as it might have been. "In a break with what is regarded as best practice in US corporate boardrooms, Mr Gerstner is to stay on as chairman until the end of this year." Palmisano has the pedigree, says the Wall Street Journal Europe having been responsible for building IBM Global Services, the consulting and integration arm of IBM that until a decline in revenues last quarter had enjoyed uninterrupted success. And the WSJ sees a change in the air when the new man takes over. "Competitors and analysts foresee an IBM that will be more open and possibly more willing to make acquisitions."
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