What lessons do IBM’s failure in the 1980s and early 1990s and its apparent successful comeback have for other large corporations? In an extensive study of the company’s history (only part of which is covered here), the author finds two factors that contributed to IBM’s difficulties: it ignored its commitments to customers to provide effective, high-quality technology and service support, and it broke its implied promise to employees to provide job security. Large corporations will survive only if they can avoid some of the hazards that IBM has faced.
1. More about IBM can be found in:
D.Q. Mills and G.B. Friesen, Broken Promises (Boston: Harvard Business School Press, 1996).
This article is based on extensive interviews with IBM executives and personnel and access to some of the firm’s files. In particular, the historical perspective is derived from months of on-site research at IBM’s headquarters in Armonk, New York. I wish to give special thanks to John Akers, Walton E. Burdick, Ned C. Lautenbach, George Conrades, Jack Riley, and dozens of other IBM employees who generously shared their knowledge.