Been retired 11 days now. Feels good even though I’m still adjusting to the verb and the adjective. The reaction of others is “lucky you”; my reaction is “am I as old as my father once seemed?! I am working on the straight-faced retort, “Yeah, I retired. How much money does a guy need?!”
The sobering reality is that at a meeting with the staff of a prospective client yesterday (it turns out that I need some more money), I asked about the profile of their typical customer. One replied, “Old. Like in their thirties.” I hoped that she referred to their geographic latitude or their winter weather. Nope. Age. I was calm and continued taking notes on my Underwood.
This is not a rant of a guy on the other side of the company gate. Truthfully, I already appreciate IBM’s employee shield as I purposefully explore the US’s systems of healthcare, retirement and university education. Or Not! Our family’s healthcare cost could triple for less coverage; how long will we live for how much?!; is even public university price-worthy for the requirements of the modern, Internet world? Such deliberations reaffirm the need for cocktail hour.
Yes, posterity will record that I retired from IBM. And it feels much better to separate with a handshake than a cardboard box. The subtext of my exit is that employees of a certain age were told that we’re expensive; employed in the lowest revenue and weakest growth marketplace, North America; and would not be laid-off if we agreed to retire after an eighteen month period of reduced hours. I imagined a composite wanted-poster of us being nailed to telephone poles and pasted above coffee machines: “Have you seen these around? Encourage them to leave.” So I did.
As I worked from my home office for 15 years and met many more clients than I did other IBMers (the nature of my job was international travel to discuss technology strategies with senior executives of our clients), not much has changed for me so far. I do read IBM tweets and press with the attitude of an outsider. It’s the same way that I perceive news about the US Navy. I believe that I understand the language and the culture; I have no pretense that I am up to date on the details of decision-making.
Like you, I read this week that IBM will invest $1 billion dollars in its Watson Division. After three years of much promising without much related selling, the proffered solution is more investment. The logic seems to be “if we invest more, they will buy more.” I don’t buy this thinking for several reasons. Customers with whom I’ve spoken about Watson or Cognitive Computing do not relate to the feat of winning at Jeopardy. It’s an American tv program. International executives know it’s a game show and most don’t understand the game. The brains behind Watson’s development, Dr. Dave Ferruci, left IBM quietly over one year ago (he joined a hedge fund). This is not a positive sign for a fledgling technology.
The secret sauce of Watson is the quality of its own data, the data that it uses to learn about a topic so that it can assess and understand what other target data sets might mean. It has to be taught all of the cities in the world to understand a question related to the location of Toronto. Few, very few clients have such high quality data sets. If they do, they guard this data carefully. Watson systems are expensive. Combining these two circumstances portrays why hospitals and banks are the first clients of Watson and why neither is making a related, profitable business for IBM. Hospitals may be willing to share some form of patient data and, in no way, can they afford the price of a Watson computing system. So they want to share a Watson system. IBM is trying this approach now with a Watson Cloud offering (details TBD). Banks can afford Watson computing systems and, in no way, have the correct data to teach Watson (what does your bank really know about you?!).
Now that the IBM’s Smarter Planet mantra is shopworn, there is a struggle to promote the next technology rallying point. Watson is the only wild card in their hand. This plus way too many unconnected acquisitions. Watson feels like another OS2 effort. By the time that it’s great, Siri, Dragon, Nuance and others will offer mid-range and personal equivalents.
What was the road not taken by IBM? The product climate of IBM reminds me of a too similar circumstance in the mid-1980s when I was an IBM client in Maine. Our young Boston-educated IT staff wanted to delve into mid-range computers and packaged software. The reliable and equally skilled IBM account team hardly knew what they were talking about. The company’s management sided with IBM and the boys returned to Boston to work for DEC. Then came the wave of personal computers, a storm that IBM weathered well. Unfortunately, the company considered PCs to be hardware products and allowed the Seattle startup, Microsoft, to develop and to own the operating system software. Hell hath no fury…and IBM began the OS2 march to Moscow. That did it and nearly did in the company. IBM has never again attempted packaged or end-user software development. I guess that the accuracy of my comment depends upon how one feels about Lotus Notes and recent acquisitions.
Frozen on the wrong MIS road, IBM fell to one knee in the early 1990s. Burroughs nearly purchased IBM. Outsiders Lou Gerstner from American Express and Jerry York from Chrysler were deputized to rescue the company from itself. The marketplace cooperated thanks to the ERP period, the Y2K scare and the e-business boom (bomb). They righted the boat, were thanked and dismissed. A veteran of the money-bleeding PC division replaced Lou as CEO.
Then began the march to the past. As the Internet-based technologies replaced dozens of markets and millions of users with millions of markets and dozens of users, IBM management pined for the days of the branch office (Lou closed them all to incite employees to go see clients) and the predictable profits streams of mainframe-based computing. This strategy exploded, ignited by the Financial Crisis of 2008 (banks are by far IBM’s best customers). Apple and the iPhone took center stage. Senior executives of IBM clients traded their Blackberrys for the phones that their kids were using. Promising a steady increase in earnings per share and tacitly admitted that they could no longer compete via internal resources, IBM went on an acquisition binge. To pay for dozens and dozens of acquisitions, a companion program of maniacal cost-cutting was implemented.
The world of Mobile, Social, Cloud and Big Data is being taken on by a machine called Watson. Ironically, the voice recognition algorithms used by Watson are licensed from Nuance, the same company that licensed Siri to Apple. Nuance got this speech recognition software from IBM (Via Voice) at fire-sale pricing from IBM Research as these Labs were pressured to earn their keep. It would be hard to make this up.
What would I do if I were CEO for a day? I’d adopt the tools that I try to sell to others. The company has no widespread and reliable customer management system; sales are managed on Excel spreadsheets; employee productivity tools are nearly the same as they were 15 years ago: Lotus Notes, Lotus Instant Messaging and a company portal. Conference calls and emails predominate the distribution of information in a cascading model. There is nearly no way to talk back or up or over. Never in 15 years of speaking with the most senior executives of IBM’s biggest clients did I ever have access to a CRM system. No one ever knew what I learned.
Meanwhile, Apple earns as much in a quarter as IBM promises to earn in its much heralded 2015 Roadmap. I’d appoint executives who talk to their employees in a modern, meaningful way. Lou was good at this; Sam didn’t try; Ginni was handed the job because Moffet went to jail. The strength of the company is its incredibly talented, and sadly underutilized, employees.
There may always be an IBM as there may always be the local utility company. Success in the urgent near term requires widespread revitalization of the company’s morale and a determined focus on competing where it matters to clients. Watson knows this.
We live in an academic community in the small city of Durham, North Carolina; could be named Dukeham for the significance of Duke University to our local economy. Sometimes referred to with the “New Jersey of the South” moniker, but I’ve heard that as many students come from Florida. I don’t believe it.
As a consequence of the influx of these out of state, private tuition sources, Jersey or Miami, $58k per year per student including room and board, high achieving professors are recruited. Throw into the pot the doctors and scientists from the Medical Centers (only two cities have two such large and renown medical centers, ours with Duke and UNC, and the Bay Area with Stanford and Cal Berkeley) and pre-school for infants and toddlers costs plenty around town.
In the beginning, we carted our infant son to the other side of Chapel Hill, a 90 minute round trip twice per day, because that’s where the best-we-could-find pre-school was. Foolishly, we had waited until he was born to solicit invitations for our son’s attendance and our related funds. This is like trying-out for the middle school soccer team in order to get some exercise, have some fun and learn an internationally popular sport. One would be lucky to get an orange slice as a booby prize before a squadron of mini-vans with insulted parents escorted you from the field.
For awhile, we enjoyed the variety from routine and the car-time with the Howard Stern radio program. Then the call came that Our Child (OC) fell from his high chair, cut his head and ‘needed us to pick him up.” “Can’t we meet you at the doctors office?”, Mother implored. “Uh, no. We don’t have a car seat for a baby.” Quite the memorable occasion was the next hour as we motored over to the school then to the Emergency Room. Turns out, OC was ok – a few stitches now hidden by an eyebrow. Mother recovered also.
We dug out the phone book (remember? still had those in 1997) as well as the related tip sheets so that we could renew the begging of day-care directors. We found a sincere program at a Catholic school that was well managed and very diverse, although nobody was like us. Couldn’t enroll OC until he was 2, three months from now / then, and as spots in the “program” were going fast, our chances of securing one later were kind of like walking-on to that aforementioned middle school soccer team.
Luckily, I attended Holy Name of Jesus, a Catholic school in New Orleans, and felt that I should employ this ADMG connection. Knowing the lingo of the Vatican, I asked, “can we start paying now and send our child later, after his second birthday?” Our request was processed up the chain of command or being. By the time we got home, we had a positive reply, i.e. acceptance, with address for the check, recorded on our answering machine (still had those in 1997).
Alas, not enough natural light, the diversity was too diverse – gratefully, no high chair flights- so, with much guilt (Once a Catholic, Always a Catholic), we met with Miss Rosa, the school’s Director, to confess and to accept the blame (O a C, A a C). She understood, suggesting that we contact The Lakewood Avenue Children’s School as that program seemed to be more like us. Our kind of market regulated diversity as we were about to learn.
We followed this advice, met that Director who became a dear friend, and enrolled. $900 per month in 1998 dollars moving to $1,200 over three years. We later learned that we were given a Disney-like Golden Entrance Pass bypassing the application queue as the wait list exceeded 100. Maybe she was moved by the sight of a begging mother and her clueless to the ways of the world husband.
LACS was quite the set-up: in a renovated home, large back yard, vegetable garden, rabbit hut, fox predators 6 teachers, 32 children in 3 grade levels and parents ranging from big time science prize winners; plenty of doctors; former and current lovers; trust fund hippies; the mayor. Once for a party game, we counted how many different last names identified the kids. I recall circa 18 and there were twins and siblings in the program. It was the kind of pre-school that you wish your college had been like.
Now for the good part. The teachers were smart, kind and capable. Turn-over was slight as they paid above the average with health benefits. LACS won a national recognition award and a citation in the Wall St Journal, pre-Murdoch the Fox.
Of our six teachers, Steve was the sole male. Fit in well with the rest of the teaching team and was especially popular on the days that he brought Mr. Happy, his pet snake, to school. I was content because mom was happy and OC was buckled in.
One spring day, Steve announced his resignation from LACS. Selected parents in the know, yours truly excluded, were atwitter- meant something different then. OC’s mother had seen Steve perform in Raleigh, the state capital on the other side of the Research Triangle Park. His celebrity impersonations were so good that Las Vegas made him an offer that he could not refuse. With minimum fanfare and less explanation, he cordially and, in high regard, headed West to what I’ve come to classify as that hell-hole in the desert.
About the same time that Steve arrived in LV, I did, too, as IBM negotiated a multi-year contract for thousands of off-season room-nights. Consequently, seemingly every sales conference and many client events were hosted in The Venetian, at Treasure Island or The MGM Grand. A couple of times it made sense for me to stay the weekend there because I was due back the following week. After 6 or 8 seemingly surreal, week-long trips there, I shaped my own Rat Pack world of dinners at Brennan’s, exercise at the Canyon Ranch Spa and roaming the Frontier Mall. I never managed to feel like James Bond at the baccarat table. “I bet $15.00, Goldfinger” doesn’t have the requisite aplomb.
Somewhere in the middle of this period of professional purgatory, I stood in the long, incredibly long taxi line at the Vegas airport for the short ride to The Strip. Arrival at that airport is like being sent down a chute into a perverse wonderland of big luggage, odd people, glittering advertisements, exits without identity.
Anonymity amidst the chaos begins upon airport exit with thousands of riders queuing for hundreds of taxis. Oddly or maybe perversely, for Vegas, the dispatcher solicited passengers headed to the same locations. Bellagio? Mandarin? IBM conference? were examples of his sorting pattern. Things happened fast at this point. Two of us were paired and pointed to taxi down the queue. “Which one did he say,” asked my newly assigned companion. I replied, “the one with Cher on top, that’s was my son’s pre-school teacher.” I think he replied “nice ass” as this was him/Steve/Cher in her Bob Mackie outfit. Arm in arm with Steve in the mobile billboard atop the taxi were Judy Garland, Joan Rivers and Mariah Carey. How’s Mr. Happy, I wondered.
I caught Steve’s act three or four times during my Vegas incarcerations, usually joined by an adventurous or equally desperate IBM colleague. He always provided me with front row seats, once next to the bejeweled and bewigged Joan Collins. Astounding and fun were the impersonations and at every visit I was invited after the show to have a drink with Steve-Cher-Celine (he did her too) and “Michael Jackson” from Greensboro, NC. Just guys making a buck.
Steve and his partner lived away from The Strip, a necessary survival technique it seems. By day, Steve had resumed his work in pre-school education. Vegas, Baby!
It worked out for us, too, back in Durham, especially when OC entered kindergarten in the public school system. We added the former Lakewood tuition to the mortgage payment for our small home in Forest Hills- the mortgage payment was the smaller of the two- enabling the purchase of a much bigger place in Duke Forest adjacent to – irony alert – Duke University’s West Campus. Actually, next to their golf course and their Inn which is next to their West Campus.
Steve is still out there with the same gig at a different venue. I hope that Cherilyn Sarkisian,The Other Cher, finds a program for eternal life, or lifts, so long as it’s good for Steve. Owen will be off to college soon; I’m retiring from IBM at the end of the month. The beat goes on.
Since you ask:
IBM, nee a merger of the Computer Scale Company of America and the International Time Recording Company with the Tabulating Machine Company, started with weighing devices and propelled into the realm of computer science by Herman Hollerith’s (not a man of blue suits and white shirts, for sure) tabulating machine and the US Census Bureau (behind every successful company stands a good government project).
As Casey Stengel once said of pitcher and Durham native, Roger Craig, who completed 27 games amidst a record of 15 wins and 46 loses in two seasons with the beloved and famously inept New York Mets of the early 1960s, “ya gotta be pretty good to lose that many games.”
Maybe the same could be said of this company that can be such a large and benign target – I think of Arthur C. Clarke’s HAL 9000- add a letter to HAL, i.e. H + 1 letter = I. Although, I observe that Microsoft years ago became the outfit that everyone loved to hate.
We have to admire CTCR/IBM’s sturdy capacity to survive amidst the torrent of technology changes and sometimes immobile management. As well, we should be thankful for what IBM achieved for our country and the world. You can look it up – above.
My long time and good friend, Gary Rancourt, is the lead dude in this commercial. If you live long enough, you see it all.
Vimeo took down the file. Here is the same clip in the publc domain. http://www.archive.org/details.php?identifier=communications_primer
Incredible video before there were videos even. IBM sponsored the Eames couple, famous for all things instructional design. Music by Elmer Bernstein who also scored Magnificent 7 and The Great Escape . If this is not enough talent, John von Neuman, father of too many brilliant technical concepts, and Claude Shannon, Mr. Information Theory, among several other notables, were acknowledged as production contributors.
On a a day when the US stock market is likely to find an historic and panic-induced low, buoying to be reminded of the caliber of people who inspired many of the marvelous achievements of our modern lifestyles. We’re really not all about greed and selfishness and foolishness.
BTW, the clip uses many references to art, love, music to inform and information.
Thanks to Adam Christensen for site referral.