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IBM executives concede that despite its wide-ranging successes, the company has its weaknesses and has made some major mistakes over the years. Despite increased efforts to recruit women and minorities, there are still few of either in management ranks. Only 3,089 of IBM's more than 29,000 managers are women. IBM policies, moreover, can seem high-handed, especially toward women. In December 1981, a California jury awarded $300,000 to an IBM marketing manager who quit after the company objected to her romantic relationship with a former employee who had joined a rival firm. She resigned when her boss, fearing a conflict of interest, tried to transfer her to another division. IBM is appealing the jury verdict.
Some employees find the firm slow to capitalize on opportunities in spite of steps to decentralize decision making. "IBM has more committees than the U.S. Government," complains one insider. To increase its flexibility, IBM has set up 15 small ventures within the company since 1981. These explore new business opportunities in such fields as robotics, specialized medical equipment and analytical instruments. The new units are independently run, but they can draw on IBM resources. This seems to provide IBM with the benefits of both a large company and a small one. Says Robert Burgelman, an assistant professor of management at Stanford University's Graduate School of Business: "If IBM can integrate these new ventures into its culture, the company is going to be an enormously dangerous competitor in most of the emerging areas of high technology."
IBM stumbled badly when it set out to produce an office copier in the 1970s. Executives first turned down a chance to buy a process that Xerox later used with great success, and then introduced a balky model. Admits Gary: "If you're asking was it a mistake to ship so many copiers before they were really reliable to sell, yes it was a mistake." The company was forced to suspend deliveries until the problems were solved.
IBM, in addition, has not broken into the market for so-called supercomputers, which are used mainly for scientific research. The company launched supercomputer projects in the 1950s and 1960s, but could not produce a design that executives believed would be profitable. IBM has since abandoned the specialized field to Control Data and Cray Research.
Opel is bullish about the future of IBM, and he is very optimistic about the outlook for the whole industry. He notes that while people have limited demands for commodities like shoes and automobiles, they seem to have an insatiable appetite for information. Says he: "I have yet to hear somebody say they could not use more information. Hence the demand for information processing, though perhaps not infinite, is enormous."
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