Filling in the details as far as possible on what was a very incomplete announcement, IBM Corp’s biggest reorganisation since Louis Gerstner took the helm sees it consolidating its two marketing divisions – US and Worldwide, and while maintaining four product divisions, creates a software division and eliminates the networking division. Networking software will now become part of the new software division, while some networking hardware goes in with servers and some into a new division that combines IBM’s chip and storage systems businesses. The idea of combining US and international marketing is that the activity is already structured along vertical markets rather than geographically, and many customers have major operations both in the US and the rest of the world, which are increasingly run seamlessly – so IBM better serve them seamlessly too. Gerstner appointed Ned Lautenbach, senior vice-president for world marketing, to lead the combined marketing divisions while John Thompson, who led l arge systems and their operating systems, will take charge of the new software division – which excludes MVS, VM, VSE and OS/400. It will do development and marketing for all IBM software except for operating software for mainframes and other large-scale machines. Analysts estimate a little under $7,000m in software revenues are associated with mainframes, making them captive and tied to a declining sector. It will comprise three divisions – Software Solutions, Personal Software Products and Networking Software. Analysts told the New York Times that Thompson has no ties to products already in development and can thus make hard decisions about what projects to sell and what ones to cancel, adding that his background is also suited for steering IBM to acquire developers of leading-edge software. Thompson’s former post goes to Nick Donofrio, who had headed the mainframe development effort and now gets the expanded server group that takes in mainframes, AS/400s and RS/6000s. But it is clear that Gerstner’s cabinet-making is far from complete, IBM hasn’t announced who will succeed Bob LaBant as the top US marketing executive, a post that now will report to Lautenbach rather than to the chief executive; Lautenbach is expected to make that choice in the next few weeks; and the way the US and overseas sales forces will be combined has yet to be decided, IBM said.
