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Technology Stocks : Intel Corporation (INTC)

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To: GVTucker who wrote (72768)	2/3/1999 10:00:00 AM
From: Burt Masnick	Read Replies (3) of 186894

What brought down IBM was a double whammy of: 1) A president (or CEO - can't recall now) named John Akers who WAS PROUD OF THE FACT THAT HE DIDN'T HAVE A PC IN HIS OFFICE AND WOULDN'T KNOW HOW TO USE ONE IF HE DID. This from the company that had to literally decouple the company from the development program in Boca Raton to invent their first PC so that corporate IBM wouldn't "contaminate" the project with paperwork and meetings. IBM never understood THEN what they had invented, how important it was, how useful CLONES were to establishing the "IBM PC" as the world standard. IBM gets a grade of D- or F+ on botching the opportunity to dominate the PC world the way they dominated the mainframe market. They never "got it" until it was way too late. 2) A related but different factor - they didn't understand or act on the fact that the PC was a serious threat to the growth of the mainframe and minicomputer business. Faced with that possibility, they took the ostrich defense - pretending that it didn't exist. With that posture they were guaranteed to get their clocks cleaned. IBM didn't hit the skids because someone else was selling more mainframe iron than them. It hit the skids because something REPLACED the mainframe and miniframe iron they would have sold. As Intel calls it, an inflection point. The bitter irony is that Apple (and IBM itself) didn't spring this (the onslaught of the desktop pc) on the world as a stealth attack, but with an open, advertised, publicised approach. IBM leadership was paralyzed by its culture to ignore a sea change in the landscape (to mix metaphors). I'm sure that there were some in IBM's upper middle management who saw it coming but couldn't get the message to the top with a pickaxe. If the technology is going to beat your brains in, lead the parade (and exercise some control) - don't ignore it. Dilbertesque management will defeat talent every time.

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