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IBM's Grassroots Revival

By: Eric Ransdell
The real story of how Big Blue found the future, got the Net, and learned to love the People in Black.

Who could have predicted it? In an era when the Internet is everything, Silicon Valley is the center of the universe, and young software programmers push rock stars off the covers of magazines, IBM matters again. Big Blue's turnaround is one of the most unexpected comebacks in corporate history.

In April 1993, when CEO Lou Gerstner arrived, IBM looked like one more giant company bent on self-destruction: out of touch, out of steam. Younger, hungrier rivals were stealing its best markets and attracting the best talent. There was lots of talk, in lots of places, of an AT&T-style breakup.

Less than five years later, IBM is back. The company is growing. It is a genuine presence on the Net. It even wants to be cool -- relevant to the programmers flocking to Netscape, Starwave, and other fast-moving software companies.

"We used to call them the ponytail brigade, the black turtleneck brigade," says David Gee, 30, IBM's point man in Silicon Valley. "Now they're PIBs -- People in Black. We have to be relevant to PIBs."

Gerstner played a decisive role in IBM's comeback. He understood that the company's future lies not in tearing itself apart but in pulling itself together under the cry of "network-centric computing." He became a force for discipline and accountability in an organization coasting on its reputation.

But no turnaround this far-reaching can be the work of a CEO alone. IBM's comeback has been a grassroots revival, driven by a network of leaders who made it their business to change the company. What follow are profiles of these in-the-trenches leaders. They have different titles and work in different parts of the company -- and of the world. But they share a passion for their jobs, for the Net, and for making a difference inside IBM. They have created principles and practices -- "rules for radicals" -- relevant to change agents in any company.

These IBMers are working on the edge. But they relish the challenge. "You want to know why none of us is insecure about what we're doing?" asks David Gee. "Because we're doing the right thing. We're at the forefront of what's coming."

Where do you find the future?

It was late 1993, months after Lou Gerstner had arrived to "save" IBM. As the world around them was collapsing, IBMers around the world were asking the questions employees in all big companies ask during times of crisis: What went wrong? Who was to blame? People were looking inward and pointing fingers.

Well, most people. John Patrick, one of IBM's senior strategy executives, wasn't casting blame. He was messing with his computer. "I was experimenting with Gopher," he says, referring to the Internet software utility. "I became captivated by the idea of sitting at home and cruising around someone else's computer. Being remotely connected was hardly a new idea at IBM. But being inside someone else's computer and having a standard that meant it didn't matter what kind of computer either of us had -- a light went off. I thought, this is going to change everything."

In a way, it did. It would be an overstatement to argue that all of what's exciting about IBM's presence on the Net goes back to Patrick's "Gopher epiphany." Lou Gerstner created intense pressure from above. But it was Patrick who let loose pressure from below. Ask in-the-trenches IBMers who has really pushed the company onto the Net, and the name you hear again and again -- second only to Gerstner -- is John Patrick.

From Issue 11 | October 1997

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