Reading in between the lines of JW is saying in this 2 minute video from 18 Feb. 2021: prepare for more divestitures, spin-offs, RAs, and anything else to "right-size" Big Bleu very quickly.
https://www.linkedin.com/posts/jiwhitehurst_anopenconversationwithjim-activity-6768152287920570368-h7-E
Jimbo is just waiting for AK to get the boot... Should be in 2022... if not Jimbo will leave IBM... If I were him I would not wait... leave now Jimbo and save yourself!
Until ibm replaces all the current executives everyone from vp to svp nothing changes.
They paid 34b for RH because they want to sell a new story to Wallstreet (and added revenues for 'cloud') who had figured out ibm lies and they'll figure out same with RH in 2 yrs when ibms revenue doesn't grow as much as competition.
1wtd You keep saying Redhat which is a 4-5 billion dollar revenue stream as time moves on. Now add Legacy IBM (that compliments Redhat) to that revenue stream (HW, Middleware, TPP, consulting, and cloud (how ever you want to count it as green dollars count). You easily get to 40 billion. The equation = does Redhats growth outpace and help catalyze Redhats growth vs legacy’s shrinkage. The Catalyze is the BIG question/bet IBM is counting on. They bought a new strategy as the old one had stalled (it didn’t stop) and are incorporating it into OLD IBM. You keep thinking Redhat is going to be 40 billion tomorrow NOPE Redhat + Legacy IBM = 40 billion tomorrow. YEP IBM has way way way too much install base for it to fade away overnight. That’s IBM’s leverage Don’t rip and replace Your legacy, but rather Ease into changing your legacy Redhat allows and catalyzes that ease Of course IBM will have shrunk from 100 billion down to 70 billion (new Hybrid IBM + Newco), but that is water under the bride as we have all watched it happen and we are only dealing with going forward, and not looking backwards
@1ysy Why did IBM have to spend $34B for a new strategy? All they needed was a few smart executives. Or maybe to listen to their employees. But IBM forgot how to innovate a long time ago, now they can just buy other people's accomplishments.
@1ysy
Grow RH 10-15X? No, sorry. RH will never be a $40-60B business. Certainly not by focusing on the "mainframe monopoly" at the top 500 accounts.
Folks you are watching the next CEO of IBM. Why do I say that. The math works AK is 59 (remember IBM has a tradition of CEO’s leaving at 60 unless the board grants a special dispensation) JW is 54. JW just has to keep his nose clean (something he did not do at Delta), and he gets the nod. IBM spent 34 billion for something besides a company that generates only 3-4 billion in revenue. They bought a new strategy THUS reinventing themselves as everything they tried before that failed and failed rather spectacularly. (NOTE market share, revenue, abandoned acquitions, abandoned strategic initiatives, etc etc) So what is the game plan to transform IBM? It’s to build something that feeds the Redhat go to market narrative/strategy. When you buy a 12k headcount organization, how do you scale it 10-15X overnight? Now let’s apply that narrative to legacy IBM. What does IBM do well Mainframe is one thing (they own it, and better yet they control it, thus they determine who gets what deals or better yet terms from IBM). They control relationships (especially in captured Mainframe businesses (finance, banking, insurance, Govt, and Telco.)). Do other businesses fit into this, YES, but not like these traditional legacy guys. So how does GBS fit in? They recommend via consulting, thus feeding the Redhat narrative. How does Cognitive fit in? They implement via modernization, rewrite, and AI again thus feeding the Redhat narrative. It’s Redhats sweet spot. How does GTS fit in. They don’t, as all they do is execute what has been recommended. You can lease the parts they use to them thus keep them close, but don’t marry them. How does Systems fit in? You have to run this stuff on something and with Redhat being HW agnostic, why not pick the monopoly? That means mainframes right now are the best bet as they are the monopoly vs Intel, or Unix on Power. OS/400 is another monopoly, but IBM has adopted a Fortune 500 strategy due to relationship, and expense which for the most part excludes OS/400 as they cater to smaller businesses. Now you have the lay of the land, and all you have to do is ruthlessly pursue it. Dump GTS, emphasize/invest in Cognitive, restructure systems to more of the monopoly stand, and enhance GBS to continue singing the praises of Redhat. Does that appear to be AK’s go forward strategy? Sure looks that way me. You don’t have to like it, but the decision has been made (remember the 34 billion dollar check), and now it’s just ruthless execution to feed the remaining Redhat strategy that you bought. The real question now boils down to can AK execute in a timely manner? That is yet to be determined, BUT you can bank on the Redhat/Cloud/AI/Enterprise Fortune 500 strategy. It’s baked
What was open about that “conversation”? Wow just wow!
Wow - JW has mastered the fine corporate art of talking out of both sides of his mouth. What a pile of hot air. With this half-assed double talk, IBM can only s—ceed this year. Hit the exits, folks.
it sounds like the Suggestion Box for longtime-IBMers is kinda closed - "we have a strategy thanks.. and it needs to stay simple"
Can confirm.
No doubt, what would you expect from IBM.
IBM has set aside 3 billion for restructuring in 2021, and another 1 billion for Q1 in 2022.
The layoffs will only increase. Nobody is safe.