Tag: IBM

Disruption – It’s the Punch You Don’t See that Hurts

Disruption – It’s the Punch You Don’t See that Hurts

Disruption Rarely Announces Its Arrival

Ask Curtis Stevens – the gentleman who was knocked on his posterior by Gennady Golovkin in our header image – if he saw the punches coming.  Ask former Microsoft CEO Steve Ballmer if back in the early 2000’s he knew SaaS/cloud-based service delivery models would dominate the software landscape.  Ask any of the Auto industry CEOs if they thought Tesla and EVs were here to stay 15 years ago. Ask the former CEOs of Motorola, Nokia and Blackberry (then Research In Motion “RIM”) if they anticipated the touchscreen iPhone. They will all tell you the same thing: it’s the punch you don’t see coming that does the most damage.  We can’t defend against that which we don’t see.

Last week we wrote about the new holographic phone from RED – the RED Hydrogen One – which is essentially a high-end camera that’s capable of making phone calls. The camera seems to be the feature that people care about most in our video and image-obsessed world. So, while Apple is busy enabling mobile payments, deploying facial recognition technology and curating the app store, RED is focused on the feature/functionality we care about most. What does that mean for Apple and the iPhone?

Past as Prologue?

Let’s pop into the TEK2day time machine and see what history suggests:


Microsoft’s former CEO Steve Ballmer is an easy target. What didn’t Microsoft miss? Mobile, the cloud and social media to name several. Perhaps the fact that Microsoft disrupted IBM gave the former a false sense of bravado – that it was the perpetual disruptor, the conqueror, not the disruptee. Perhaps the dominance of Microsoft’s Windows OS in the 90’s led to an air of invincibility. After all, the desktop would always be the dominant form factor – wouldn’t it? I mean, this new iPhone thing just wiped out Nokia, Motorola and Blackberry/RIM overnight, but it’s 2008 and we think the next big thing will be our $15,000 touch screen coffee table:

A hail mary attempt to get into mobile late in the game didn’t work out when Microsoft acquired Nokia under Steve Ballmer.  Satya Nadella, who has worked wonders for MSFT stock, later unwound that deal. Microsoft clearly underestimated the traction that mobile phones and the iPhone in particular would have on its legacy OS business as the mobile OS – particularly iOS and Android – became the dominant mobile platforms.

Microsoft was also famously slow-moving to the cloud after Salesforce.com took itself public in 2004 on the waves of its SaaS/cloud-based service delivery model in the CRM space. Salesforce was quite effective in taking share from legacy on-premise CRM providers including Siebel/Oracle, SAP and yes, Microsoft. Ray Ozzie did his best to push Microsoft into the cloud in the 2005-2010 timeframe but lacked Ballmer’s full support. Here too, Microsoft hadn’t a clue that SaaS/cloud-based platforms would become the dominant service delivery model for most every use case that traditionally had been satisfied by on-premise, behind the firewall applications.

To complete the trifecta, Microsoft famously missed on acquiring Facebook, but took home the bronze medal years later when it acquired enterprise social media platform LinkedIn for $26 billion in June 2016.  We could mention Microsoft’s failed attempt to build/acquire a search business after the company realized that Google was “a thing” (Microsoft offered to pay $46 billion for Yahoo!. Sometimes the best deals are those that you don’t do). To re-hash MSFT’s search trials and tribulations would be cruel however.

One could debate whether Microsoft was 100% blind to the fact or late to the game (or in some cases both) with regards to the above examples. It’s safe to say that early in the cycle Microsoft didn’t fully appreciate the disruptive power of mobile, the cloud, social media and search.


Tesla. Need we say more? GM actually got there first with its EV1 which was produced from 1996-1999:

Now, automakers can’t build electric vehicles quickly enough:

Circling back to Apple, while the company may have disrupted the mobile phone industry on that grand day in January 2007…

…its horribly lagging AI (Apple has a Siri problem) and over-engineered (some would say over-priced) iPhone put Apple at risk of being disrupted.

As Al Pacino said in “The Devil’s Advocate” (one of the worst movies ever made), “Don’t ever let ’em see you coming.”

How to Fix IBM: M&A and More M&A

YORKTOWN HEIGHTS, NEW YORK––IBM has created a computer, called Watson, that will play against the b

Recently we posited that IBM could easily fix its habitually declining revenue woes with a systematic acquisition strategy focused on Information Services companies. The benefit to IBM in targeting the Information Services sector goes beyond the obvious immediate-term revenue relief and operating margin accretion.

The key strategic benefit is that the Info Services companies are rich with data and information that could serve as grist for the mill with respect to IBM’s advanced analytics initiative – Watson.

Here is the Information Services M&A shopping list which we previously published some weeks ago: Info Services M&A Shopping List

Further, here is our recent podcast covering the subject: Ep.6: How to Fix IBM: M&A and More M&A

Finally – our podcast show notes presentation may be found here: Show Notes Preso

The Three “I”s for Selecting Board Members

The Three “I”s for Selecting Board Members:
1.) Intellectual Curiosity
2.) Industry Experience
3.) Inquisitive


IBM lacks Board members that have Software industry experience other than CEO Ginni Rometty. We recommend that IBM turn over its Board and replace BoD members with new members who have significant Software industry experience given that Software – particularly a strategic M&A plan focused on Software/SaaS/AI/ML/Info Services acquisitions – is likely what will lead IBM out of its malaise. If IBM does not address its BoD and Executive shortcomings proactively it is probable that an Activist investor will make changes for IBM – with or without the latter’s consent. Click HERE for our CEORater Podcast episode concerning the 3 “I”s.