Abstract

This case examines the measures taken by IBM to nurture leadership at the company. It discusses in detail about Lou Gerstner, former CEO of IBM, and his efforts to develop a company-wide leadership development process by bringing about cultural change. It details how the leadership development initiatives and succession planning helped the company immensely in making a smooth transition when a CEO retired from his post. The case also presents how a set of 11 competencies went on to become the revolutionary leadership competencies of IBM. It examines how these competencies were revalidated due to the ever changing business models. In addition, the case explains the leadership development programs at IBM that fostered the leadership traits of up-and-coming leaders at the company. The case details the strategic measures taken by Gerstner to transform IBM from a hardware vendor to a complete IT solutions provider. After Gerstner, how Sam Palmisano brought in a second transformation in the company is also discussed. The case concludes with thoughts on what efforts IBM should take to combat the risk of insularity. How to continuously reinvent the leadership development model of a company amidst rising competition and changes in the business environment? Did IBM leaders become obsolete even before they got a senior leadership role? This case is aimed at MBA level students as part of the Leadership/ Strategic Human Resource Management curriculum. It can also be used in a General Management and Strategy curriculum.

Learning Objectives

The case is structured to achieve the following Learning Objectives:

• Understand the importance of leadership development in any organization.
• Study the key elements of leadership training and development at IBM.
• Examine the process of developing future leaders and identify the basic tenets of successful leadership development programs of IBM.
• Analyze the concept of Leadership competencies and leadership traits followed at IBM.
• Understand the importance of ‘building from within’ the company in fostering loyalty and leadership competencies.

Keywords

Leadership Development, Leadership roles, Leadership competencies, Leadership traits, Developing leadership capabilities, Building Organizational Capability, 'On-Demand' strategy, Product-centric to customer-centric, Training, Executive development, 'Operation Bear Hug', Worldwide Management Council, Senior Leadership Group, Coaching, Mentoring, 'NextGens', IBM's Advanced Leaders Series, Executive Assistant Program, Leadership Foundation, Emerging Leaders, Basic Blue, IBM