January 26, 2004

NY Times: Big Blue's Big Bet: Less Tech, More Touch

My spin: An indepth article on how IBM is doing more technology by doing less of it.

Samuel J. Palmisano, the chairman and chief executive of I.B.M.

NY Times: "The aim is to create a very deep connection between I.B.M. and its customers, and at that level it is a very powerful strategy," said David B. Yoffie, a professor at the Harvard Business School. "But it's making I.B.M. more like a service business with technology thrown in than a technology business."

TO pursue his strategy, Mr. Palmisano needed to add expertise in business consulting and software. The largest purchases came in 2002, when he acquired PricewaterhouseCoopers Consulting for $3.5 billion and Rational Software for $2.1 billion.

More fundamental changes have come in the last year, and some are just now falling into place. In particular, I.B.M. has shaken up its software, services and research divisions. With the addition of PwC Consulting, the big I.B.M. services unit is more focused on executive-level business consulting instead of traditional technology services, like managing data centers for corporate customers. (full story)

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