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  1. Technology
November 4, 1991


By CBR Staff Writer

It may be hard to imagine an institution as great and powerful as IBM as being trapped, but that is indeed the case. IBM is trapped in its own mystique. Customers and shareholders expect it to be, if not infallible, at the very least nearly so. In battle, IBM is believed to be indomitable. Its products are assumed to be superior, its managers wise, its every worker serious, loyal and dedicated to the needs of the customer. This mystique can be a wonderful thing, but it can also be dangerous. Because of it, IBM has been able to overcome circumstances that would have swamped a lesser firm. At the same time, customers, shareholders, suppliers and even competitors have held IBM to a higher standard than they would an organisation that was regarded as more flawed – more like themselves. Even when IBM has misstepped or deliberately misbehaved, it has been given more freedom to apologise and mend its ways than an ordinary industrial concern.


And, true to its mythology, IBM has almost always done the right thing… eventually. Lately, however, some people have begun to say that IBM is unnecessarily harsh and that it is not absolutely trustworthy. While IBM’s great power and influence remain largely intact, the company is a lot more like other huge corporations… not much different, not much better. Outsiders and insiders alike have said this and then, doubting their own judgement, recanted or at least minimised the importance of their observations. Something has changed. The change is not in those who watch IBM, but in IBM itself. For the first time in memory and, we believe, the first time in its history, IBM is hungry. No, that is not quite right. IBM acts like it is starving. In some circles, starvation is an acceptable reason for bad behaviour. In others, it is at least a mitigating circumstance. But there are times when starvation is no excuse at all. A starving man may steal a loaf of bread, but cannot kill the baker for it. And one who imagines he is starving, but is in fact not, can only be considered a madman and treated accordingly. Although IBM is having a very tough time, it is by no means on its way to the bankruptcy court. It is, to be sure, failing to meet many of its goals. And even if it is actually doing as well as it expects under unpropitious conditions – for that is what its leaders seem to say – it is faring poorly compared with past years. Moreover, we cannot take seriously the attempts by IBM’s leadership to calm the quaking nerves of investors and customers. The company appears to be running scared – and at times is running amok. This is not a sign of management in control. By Hesh Wiener

So even if management’s representations about the company’s sales being satisfactory compared to their expectations are nominally true, we sense an underlying fear. This fear is the result of one thing: IBM, from the very bottom up, knows it can and should be doing better. It should be building better machines that can be profitably sold for lower prices. It should be selling improved software because customers want it, not because they have no choice. It should be treating rivals with respect, even undue respect, because it and they know who will succeed in the end. When it encounters problems, as it would no matter how well it was run, IBM should try to settle them quietly, quickly and justly. IBM should be merciful, whether or not its tolerance is appreciated by those it forgives. IBM should consistently demonstrate all these fine qualities and more. Because of its mystique. If IBM continues to betray the expectations it created by year after year of superior conduct, it will suffer in ways that its people will find intolerable. Its talent will reluctantly go elsewhere. Decay will set in and eventually become apparent to outsiders. Customers, who have based not only their business decisions but in fact staked their careers on IBM and its mystique will not simply desert. That would be too kind. In their disillusionment, they will become spiteful. They will insist that IBM outperform competitors, where today

it merely has to equal them to win. As the reaction continues, IBM will not merely sag. It will crash. Even now, IBM’s signals are ominous. The company has confused its rivals with its real enemies. In attacking firms that are at worst parasites feasting on Big Blue’s economic inefficiencies undercutting new machines with old (and always less desirable) ones or finding an angle that lets them lease for less, it has ignored the threat posed by other companies with the money, the will and possibly the ingenuity to run IBM right into the ground. It spends the funds it should be pouring into semiconductor development on lawyers. It persists at skirmishes while shrinking from wars that, if faced in time, need never be fought. IBM had better learn to cherish its mystique and pay the price of maintaining it… while it still can. IBM can come back from the brink of collapse, at which it is now poised. IBM is obviously hungry. But it is not starving. And it shouldn’t bite the hands that feed it.


In Slough’s train station, 40 minutes by rail west of London, stands Station Jim, formerly the Canine Collector for the Great Western Railway Widows and Orphans Fund. Today, Station Jim is a stuffed dog in a glass case. Station Jim was born in 1893. He began work at the age of four months. Station Jim was given a tan leather harness, similar to that on a guide dog for the blind, to which was attached a matching leather pouch. Station Jim worked the crowd at Slough Station, performing tricks or barking in return for coins, which travellers put in his pouch. The money helped the needy families left behind by railway men. On his best day, in 1896, Station Jim collected 265 coins, five of which were silver, the rest copper pieces of smaller value. But later that year, on the 19th of November, Station Jim was called to the Great Station that is the last stop for all of us. He was not yet four years old. Today all that remains of Station Jim is a fine example of the taxidermist’s craft, which looks with mournful brown glass eyes across the village of Slough at Comdisco’s new European headquarters. Some people say that Station Jim is still at work, though, protecting the good people of Slough from the menacing Celtic demon Aysisi and its familiar, Cravathswain, which, like Station Jim, barks for coins. – Hesh WienerCopyright (C) 1991 Technology News of America Co All rights reserved.

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