Page 12 - Forbes - Asia (October 2019)

TECH CONNECTOR RICH KARLGAARD

A Rare Breed

he late Steve Jobs had an
explanation for the de-
cline of once-great tech Intel has incredible engineering
BOB SWAN “
Tcompanies. He told bi-
talent. I could never be an en-
ographer Walter Isaacson: “The gineer, but I am really curious.
company does a great job, inno- I’m not afraid to ask dumb ques-
vates and becomes a monopo- tions. Should we build it our-
ly or close to it in some field, and selves? Acquire? Invest in start-
then the quality of the product ups through Intel Capital, where
becomes less important. The com- we’ve made $12 billion in in-
pany starts valuing the great sales- vestments in 1,800 companies?
men, because they’re the ones who can move the needle on These questions have a large fi-
blinded him to the shift from mainframe computers to serv- “
revenues, not the product engineers and designers. So, the nancial component.
salespeople end up running the company.”
That was Microsoft under former CEO Steve Ballmer,
who helmed the company from 2000 to 2014. Though Micro-
soft grew under Ballmer, its power weakened as Ballmer dis-
missed breakthrough innovations. In 2014, Satya Nadella re-
IBM has always defined itself by
placed Ballmer, who has steered Microsoft to the cloud and
what we do for our clients. Five
AI. Microsoft is again the world’s most valuable company.
years ago, as we were transform-
Nadella is an amazing and rare CEO.
MARTIN SCHROETER ing IBM’s business, we didn’t
IBM was not so lucky. The end of IBM’s dominance can
have the security skills that we
be traced to CEO John Akers in the late 1980s. Akers, too,
have today. We didn’t have the
was a jumped-up salesman. His focus on short-term sales mass of digital skills and design
skills. We had to reach outside
ers and networks. A similar belief in the tech industry holds ourselves. I see IBM as a portfo-
that chief financial officers (CFOs) and lawyers make poor lio of assets to help our clients.
CEOs. While good at engineering balance sheets, they are It’s not just about growing IBM.
poor at engineering products and innovations. Is this true? It’s about growing an ecology of
The world is about to find out. products and services that do
Intel is now led by its former CFO Bob Swan. At IBM, the best job for IBM clients. And,
former CFO Martin Schroeter and Jim Whitehouse, the CEO yes, we sell to CFOs.
of software company Red Hat acquired by IBM in July, are
said likely to succeed CEO Ginni Rometty next year.
I recently asked Swan and Schroeter whether CFOs and
lawyers could effectively run tech companies in an age of ac- Swan and Schroeter make valid points. I would not bet
celerating digital evolution. They each made a similar case. against them. Their companies are global giants learning to
Technological innovation has become so cheap, and is so dis- navigate through accelerating industry changes. Put it this
persed, that no company can rely on its own innovative abil- way: If your tech company is led by a brilliant founder—Jeff
ities to succeed—an outside view to innovation is necessary. Bezos, Jack Ma or Pony Ma—you’re lucky. You’re fortunate,
Acquisitions, alliances and deals are not mere decorations too, if you have a brilliant successor like Nadella. But for most
to dress up a balance sheet. They are essential to avoid being large companies, a former tech CFO or lawyer could be a
blindsided by disrupters. smart choice for CEO. F SAMYUKTA LAKSHMI/BLOOMBERG

Rich Karlgaard is editor at large at Forbes. As an author and global futurist, he has published several books, the latest of which
is Late Bloomers, a groundbreaking exploration of what it means to be a late bloomer in a culture obsessed with SAT scores and
early success. For his past columns and blogs visit our website at www.forbes.com/sites/richkarlgaard.

10 | FORBES ASIA OCTOBER 2019