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| F E A T U R E The 10 Most Important People of the Decade Number 6: Louis V. Gerstner | ||
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October 2, 2000 By Eric A. Hall Amazingly, within five years Gerstner managed to right the stumbling giant, returning revenues and staffing to their previous levels. More important, though, Gerstner restored IBM to a position of significance and credibility, particularly within its corporate customer base. If we were discussing any other company, Gerstner's feat might not have been enough to secure him a spot on our list. Certainly there were plenty of other corporate rescues in the '90s, and many were just as spectacular, albeit on a smaller scale. However, given that IBM has products in every corner of the networking world--large-scale mainframe systems that host massive databases, high-performance servers of various types on the edges, along with infrastructure gear in the closet and application software everywhere in between--this story is a very big deal to a substantial percentage of the computing community. Because IBM's failure was felt by everybody in one way or another, so was its turnaround. In addition, the strategy Gerstner latched onto and announced in 1995--using "network-centric computing" to save IBM--is a testament to the power of networking in the '90s. The company, he declared, would focus on providing top-quality equipment, software and services for every inch of the "high-speed, high-bandwidth networking environment" to come. IBM has in fact come to dominate many of these areas. In terms of raw performance, for example, the RS/6000 and AIX are consistently ranked at the top. Meanwhile, many of the new companies that have launched their ships on the Internet wave have rediscovered the power and stability of the mainframe platform, especially when dealing with transactions on a massive scale. Add to this IBM's acquisition of companies such as Lotus Development and Tivoli, and you end up with a depth and dimension unmatched by any other player in the industry today. Reading through IBM's catalog is like studying a microcosm of the entire networking industry. One element in particular that defines Gerstner's role in the industry has been his tenacity in preserving IBM's position as a leader in basic research. While others might have dropped the budgetary ax on R&D cost centers, Gerstner recognized the importance of research to IBM's future and thus maintained its funding--and the results have paid off handsomely. The company's T.J. Watson Research Center has continued to make strides in areas such as storage, microprocessors and optical networking, all of which are keeping IBM in a strong technical-leadership position. The rest of the industry is forced to license IBM's technology (IBM is the leader in terms of annual patent assignments) or play an ongoing game of catch-up. Time will tell how long the "new" IBM can maintain the momentum that Gerstner has built up over the past five years. IBM is continually realigning many of its products and services--the sale of its new Internet connectivity business to AT&T last year and the company's constant tweaking of its infrastructure product line have confused many--but by all signs, IBM is in a position to dominate rather than to stagnate. The company may never again attain the position it enjoyed in the '60s and '70s, but neither is it likely to falter in the future.
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