IBM: Brand strategy wanted

wantedThink of IBM for a second and what comes to mind?  Once synonymous with computers, software and servers IBM’s CEO is demonstrating why some CEO’s are not cut out to lead, but rather to take shortcuts to make sure the stock price remains high.  However a closer look, via Business Week, is a clear indication that IBM is getting their clock cleaned.

IBM’s earnings per share are up, but that is not the story.  On closer scrutinization IBM is a company in serious trouble.  Their stock price has been driven by three things.  First, asset sales totaling $2.3 billion, an effective tax rate of 0% and an increase in debt to $40 billion.  But that’s not all. The most transparent companies present their performance according to generally accepted accounting principles, or GAAP. IBM’s 2009 annual report didn’t use the phrase “non-GAAP” at all; the 2013 report used it 125 times.


What has happened here?  The CEO who is leading IBM is leading it to ruin yet her reward for failure will be another CEO with a golden parachute that ensures she will never have to work another day in her life.  In the meantime the next CEO will probably have to lay off tens of thousands employees, which in turn will ruin families and make our economy weaker because it means less people able to drive the consumer economy.

IBM has had no brand strategy in this economy where nimble companies are rewarded while big and slow ones are punished.  Another brand that was once a brand superstar that has crashed and burned via financial engineering.




About richmeyer

Rich is a passionate marketer who is able to quickly understand what turns a prospect into a customer. He challenges the status quo and always asks "what can we do better"? He knows how to take analytics and turn them into opportunities and he is a great communicator.

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