The key thing to understand in any organization is INCENTIVES. Is any mid-level manager incented to save the company money? Or improve its profitability? No. They are incented to increase their headcount and capital spending, ideally at the expense of the manager next door, because that's how they increase their own importance and therefore rewards.
As for the individual contributors, what's in for them for improving the company's results? Almost nothing. Even in those rare years that there is a bonus, it's such a trivial amount that nobody is motivated by it - certainly not compared to the rewards for favoring self-interest.
No, the only people who truly get rewarded when the company does better is a handful of execs (and a few outsiders with large stock holdings). And in some companies, the disparity gets so bad that people want the company to fail in order to punish the execs (see: HP under Fiorina).
The best way to think of any large organization, not least IBM, is as a set of feudal fiefdoms. The king gives resources to earls in return for a commitment of taxes (read: revenues), who in turn do the same to lesser lords and so on all the down to lords of the manor, who have actual peasants digging the fields (etc.). And everybody in that structure is going to do what's best for their own wealth and power - not what's best for the king.