Customer Reviews

Who Says Elephants Can't Dance? Inside IBM's Historic Turnaround

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This is a fairly good book by an immensely talented CEO. It takes up more or less a few decades after the retirement of one of the greatest businessmen of the 20C (TWatson Jr.), when the business had lost its way and was under attack by extremely nimble rivals.

Gerstner took over the failing, almost bankrupt, company and both re-made its startegy and culture, re-focusing it on customer needs and re-engineering it (i.e. laying off an awful lot of people). In this book, he tells the outlines of how he did it, which is indeed extremely interesting. In particular, he stresses that while a strategy is needed, implementation of it is far more important.

Unfortunately, he does not go into enough detail for the reader to fully understand what he faced and how he did it. Neither the technology nor the brutal methods he had to employ were adequately addressed, at least for me. I read it carefully and did not feel I had had quite the full meal I expected. The reader also gets virtually no insight into what makes Gerstner tick, other than that he "wants to win" with passion. THe book was also entirely written by Gerstner; his style is competent, if somewhat like a business memo: good analyses are "actionable" and effective actions are "impactful."

Nonetheless, this is a very good primer on basic strategy and organizational behavior. He has lots of valuable advice to give and pinpoints many important issues. I will keep it and return to it.

THere were some things that I found questionable and surprising, if also unintentionally revealing. FOr example, he made IBM both an honest broker in offering comprehensive technology-based business solutions - for the first time, its employees could recommend the hardware of competitors if they better suited the customers' needs - while another part of the company continued to strive to produce the best hardware. This flatly contradicts both what Porter advises and Gerstner himself argues elsewhere in the book regarding the self-reinforcing compatibility of the elements of a business strategy and makes me question if Gerstner really thought it all thru. In addition, he astonishingly posits that Japanese business reporters are the best in the world, when in fact - and I worked in Japan for Nikkei, a leading business news wire service - they are merely part of the PR apparatus of firms, reporting verbatim what they were told to report by companies! If that is what Gerstner expected of Western reporters, then he was naive. But then, he was a benevolent dictator and is open about his dislike and lack of trust of the press.

REcommended. But if you really want a rivetting account of IBM, I would recommend Watson's autobio, Father Son & Co. There is also an excellent account of the turnaround of Xerox, using TQM, that is far more compelling a read than this book.

While at IBM Louis V. Gerstner, Jr. developed a reputation of aloof arrogance. One would not suspect this from reading his book, in which he gives generous credit to the tens of thousands of people who created the company and to many others, some by name, who helped to save and resurrect it.

As a former IBM executive who took early retirement twenty years ago, just as the company's bureaucracy was beginning to strangle the organization, I was fascinated to learn how that bureaucracy spread and the extremes to which it went, creating a culture thst led to decisions (if any) by committee, conspiratorial compromise, and self-protective behavior. This is not the IBM I had known. Even more interesting is the rapidity with which Louis Gerstner diagnosed the sickness of the company and the speed and persistence with which he administered tough medicine.

Despite IBM's near-terminal condition Gerstner saw it correctly not only as a business enterprise but as a "national treasure" that was well worth the collossal efforts needed to restore it.

Unlike Jack Welch's adolescent "Jack: Straight from the Gut", this book focuses on the processes of leadership and management, strategic choice, and the decision process. But it speaks also to the essential importance of corporate culture, at IBM a way of life that is based on values rather than just on being first.

As a recovering IBMer I salute Mr. Gerstner for his remarkable achievements and as a reader applaud him for this exceptional contribution to the business book genre.

Don't miss it.

If you are looking for a condensed version of IBM highlights under Gerstner's lead, this book will meet your needs. If you are interested in gaining an understanding of IBM's issues that led to the "elephant" stumbling, and Gerstner's solutions, you will be disappointed.

"Who says..." is a quick read with a superficial treatment of the various issues facing IBM and a simplified view into Gerstner's techniques to turn the company around. Many different scenarios are rushed through, leaving the reader wanting to know more about how and why. The solutions offered by Gerstner and his team seem pat--surely there was more going on.

Gerstner can not answer all his critics or the legion of angry ex-IBM'ers in a single book, particularly so close to his career transition. Unfortunately, this book misses the opportunity to provide the reader with anything more than a superficial insight into one man's view of IBM.

It is strangely ironic that, after doing his best to suppress all negative communication within IBM, it should be the reader feedback on amazon.com that alerts Gerstner to what the world at large really thinks of him. Ever since 1994 the newsreading public has been conned into a set of beliefs about IBM and Gerstner, simply through IBM's vice-like control of all media that wanted a share of IBM's ad spending. It is bizarre that he expects us to read through a critical employee e-mail on pages 81-82 of his book, when he admits that he couldn't even spare the time to reply to it himself.

Gerstner was the IBM CEO with a worse revenue record than John Akers, the man he replaced. The only way Gerstner could find to grow revenue was by buying firms like Lotus. He turned what was a fantastic company to work for into a an ordinary one. He writes in the book that he transformed the company into a firm where the most able got the most rewards. In fact he converted it into a firm where the most aggressive individuals, like Gerstner, win through. He destroyed IBM's employee benefits schemes across the world, claiming they were unaffordable at the time of IBM's darkest hour. Perhaps they were at that time, but Gerstner's greatest sin was that he never returned any of the benefits to the employees when business improved, except through a silly bonus scheme that in my experience never motivated anyone. The result is that IBM has become a company that people still want to have on their CV, but those who join in mid-career almost never stay more than two years.

Gerstner groped around and never really found the right idea for growing revenue. His shift to services meant that he took his eye off all the products in the IBM catalogue, and IBM architectures have become an irrelevance in a world now dominated by Windows, TCP/IP, Linux, Solaris and Oracle. He used the AS/400 as a cash cow when a very aggressive pricing scheme could have seen the system create the market that Windows NT instead built. Gerstner has said the Internet saved IBM, but frankly it did a lot more for rivals like Microsoft and Sun.

There's a part of me that makes me think this book is one huge, ironic joke -- the guy only pretends to be unaware of the impact of his decisions on others. He boasts about a turnaround that never was and advocates management behaviour that no-one should accept.

That would be fine if it were confined to the pages of this book. But unfortunately the impact of Gerstner is written large across the lives of many, many individuals who crossed his path, both inside and outside IBM. The blight cast over their lives means that, when they get the chance, they usually don't recommend IBM products. Gerstner just doesn't understand that.

These pages on amazon ought to be required reading for anyone foolish enough to think they want a career in IBM.

As a departed employee of many years, the book provided little to capture my attention except to learn that Lou did at least have some grasp of the gridlock and culture problems resulting from chronic political infighting in the management ranks. There was no sudden clarity for why his apparent reign of terror was good for IBM, its customers, employees or the communities. Developing a good understanding of the situation inside of the company, but without a clue of how to compete in the industry, he develops a plan to keep IBM solvent. Indeed, IBM was a place where the brown spots in the lawns were painted green prior to a visit from the CEO. How much can a CEO actually know in a place like that? Lou neglects to discuss that his plan was to sell the seed corn, slash, burn and reap whatever was left of intrinsic value for personal gain. Basically, his plan to save the company was to 1) Surround himself with loyal friends. 2) Fire anyone that could get in his way. 3) Buy everyone else out with stock options and the resulting fear of loss 4) Sell every asset possible to generate cash. (including trees from un-used land) 5) Shut down every business that lost money. 6) Lay off everyone possible that contributed to pension liabilities. 7) Raid the remaining pension fund and use that cash to prop the stock price. 8) Make stock price the primary objective for everyone. 10) Ride the dot-com bubble to the top and bail out. 11) Write a book to justify his actions so he could sleep at night. Nowhere in the book does he mention anything about the rank and file, the thousands of families that lost their homes, ability to send kids to college, and lifetimes to prepare for retirement. Little is mentioned of any effort to develop new businesses, or describe technological initiatives, or the creation of anything. Nowhere does he describe the untold wealth he accumulated through his vast stock options. There are almost no stories about encounters with anyone interesting except a couple of backhanded swipes to the likes of Bill Gates. There are virtually no facts or numbers to back him up other than some very selective charts in an appendix. If you are looking for a book to tell you how to save a company, this is not it. If you are looking for book to learn how to be a great leader, this is not it. If you are looking for a book to learn how fouled up a big company can get, and how to leverage that for personal gain well, you will get that, but you have to read between the lines to put those pieces together.

I wasn't surprised by the admission that IBM consisted of multiple fiefdoms with little communication between segments. I respect the man for what he accomplished, but there was so much more insight that could've been added. He should've used a ghost writer.

While this is a good book of an historic turnaround, there is little one can take away and apply. Between Gerstner's excessive modesty and the way he focuses more on his actions than the reasoning behind them, there is not much to learn here. Nonetheless, it is an enjoyable story.

As an IBMer who joined in the mid-1990s, I enjoyed the book as a light read and an accurate account of the cultural transformation which has touched all of us insiders in some fashion or other. I found particularly entertaining a short "IBM lingo" section, with many sayings that I had assumed were part of the everyday business vocabulary.

However, I would have liked more depth and detail throughout Mr. Gerstner's account. Overall the book feels a bit light in many areas, with few references to anecdotes, actual examples, and names of actual people (other than the few who are praised). As a result, the narrative does feel a bit detached and fails to grab the reader emotionally... You can't really feel the "passion" and the "struggle" that must have permeated Mr. Gerstner's day-to-day life as he was moving to transform the company.

I would recommend the book, particularly since it can be easily digested over a couple of weekends and makes for an interesting and entertaining read.

Who Says Elephants Can't Dance?

Who says an arrogant guy can't write a helpful book?

There are a lot of people who don't like this book. Some don't like it, because they perceive Lewis V. Gerstner as arrogant. Some don't like it, because his tenure at IBM saw thousands of people lose their jobs. Some don't like it, because they don't think there is anything new here. I like this book.

I like the book, because it is one of the most cogently and personally presented stories I've seen of a major corporate turnaround by the person who was in the CEO's job at the time. Here's a quick outline of the story.

Gerstner became Chairman and CEO of IBM in April, 1993. At that time, IBM, once the icon of American management, was in big trouble. The deathwatch was on. The conventional wisdom among the pundits was that IBM needed to be broken up and sold off piece by piece to create lots of small businesses that would create income for shareholders.

This was the heyday of the dot com boom. Smaller, networked computers were expected to rule the future. Big mainframe computers, the stuff that IBM sold, were supposed to be the troglodytes of American business, and heading for extinction.

Gerstner came to IBM after being a McKinsey consultant and after a successful eleven-year career at American Express, and four years as Chairman and CEO of RJR Nabisco. He describes what he calls "the courtship" that brought him to IBM in the beginning of this book.

The company he took over was once seen as the very model of the best in management. When I was starting out in business some thirty-five years ago, we looked to IBM as an exemplar of all that was good, effective and profitable. In 1982, Peters and Waterman featured IBM in "In Search of Excellence," with a long list of references in the index.

But by the time Gerstner took over many of the things that had made IBM great had fossilized. Many of the practices that had been touchstones had turned into radioactive rocks.

Gerstner started off with three critical challenges. He needed to stop the hemorrhaging of cash and stabilized the company. He needed to learn enough about the business and the people he had walked into to make good strategic choices. And he needed to put together a strategy to turn IBM around.

This book tells us about how he did all of those things. It does so candidly and that's one of the reasons I like the book.

While lots of people see Gerstner as arrogant, I found him, at least in this book, to be humble. That doesn't mean that he didn't think he had a lot to offer and had made lots of good decisions. It does mean that he understood that many of his decisions didn't work out the way he thought, and some of his ideas weren't the best. Those get play, too, and that's rare in a book like this.

I also appreciated the refreshing style of the book. It was not written with a ghostwriter or co-author. Gerstner did it himself. The language may not be the language that a professional writer would have chosen. But it is the language that's common to businesspeople everywhere, and that makes this a good read.

The big advantage of this is that we get a real view inside the head of someone who led a successful corporate turnaround. We don't get a view that's filtered through a collaborator.

Because Gerstner wrote the book, it's short on some of the details that might be here if a business historian or journalist did the writing. For my money, that's OK, because this is a real inside view.

This book is for you if you want a lucid discussion of a difficult turnaround process by the CEO who did the CEO's job. It is all of that and a good read besides.

The title of this book says it all: elephants don't naturally dance, it takes years of cruel training to make them do it, and in the end, there aren't many customers for the show.

IBM's revenue record in Appendix C of this book also says it all: Gerstner has the worse revenue growth record of any IBM CEO, and that is despite the the Internet boom, despite the ERP boom, and despite the acquisition of such big players as Sequent, Lotus and Tivoli. Some turnaround, mate!

More than once in this book Gerstner cites the pleas of others: "You owe it to America to take this job." It's hard to see what he has done for America during his nine-year tenure... Where once there were many readers who wanted to learn about SNA, CICS, RPG/400 and other IBM inventions, today there seem to be no IBM technologies that a sufficient number of people are interested in to propel a manual even in to the bottom of the amazon bestseller list.

For the story of Gerstner's tenure at IBM is really the story of IBM's hollowing out, of an extraordinary sell-off of IBM's assets to the short-term benefit of shareholders, of whom Gerstner was one of the biggest. As one of the IBM UK CEOs during Gerstner's reign, Barrie Morgans, said of Gerstner's skill at cutting costs and inability to boost sales: "Well, anybody can slash and burn." Gerstner says on page 87 that the dismissal of the EMEA head, Hans-Olaf Henkel, was for subverting his memos to employees. It wasn't: Gerstner got rid of Henkel because Henkel dared to tell Gerstner that one of his strategies wouldn't work.. There is no reference here to the classic case, Churchhouse v IBM, which was heard in a US court.

Gerstner also dismisses, in a page or two, the needs of employees in terms of benefits and pensioners. He simply says they were unaffordable; and yet he has no difficulty in negotiating an extraordinary compensation package for himself. And of course, as one of IBM's biggest shareholders, the more he could screw down the employees' packages, the more he himself benefitted. Never in IBM history had their been such a huge disparity between the compensation of the CEO and that of the lowest worker.

The truth is that Gerstner sees himself as an elite -- ever the McKinsey consultant (and by the way, there were McKinsey consultants crawling over IBM throughout the 1990s, yet he fails to give them much credit in the book)...