In “Who Says Elephants Can’t Dance,” Louis V. Gerstner Jr., former CEO of IBM, takes us on a captivating journey through the revitalization of one of America’s most iconic companies. Published in 2002, this book offers valuable insights into leadership, organizational transformation, and the power of innovation.
Louis V. Gerstner Jr. is an accomplished business executive and author with a remarkable track record of turning around struggling organizations. He served as the Chairman and CEO of IBM from 1993 to 2002, during which he led the company’s dramatic turnaround. Prior to his tenure at IBM, Gerstner held various leadership positions at American Express and McKinsey & Company. His expertise, strategic thinking, and ability to rally teams have made him a respected figure in the business world. Through “Who Says Elephants Can’t Dance,” Gerstner shares his experiences and valuable lessons learned while spearheading IBM’s transformation.
Part 1 The Courtship and The Announcement
Chapter 1 of the book “Who Says Elephants Can’t Dance” by Louis V. Gerstner Jr., titled “The Courtship,” provides an insightful account of Gerstner’s unexpected journey to becoming the CEO of IBM. Initially, he had no intention of taking the position, as he lacked experience in the technology industry. However, he was eventually persuaded by IBM’s board and decided to accept the challenge.
Gerstner describes his early days at IBM, uncovering the company’s underlying issues, such as its complex bureaucracy and lack of customer focus. He sees a need for change, but realizes that implementing it won’t be easy. Throughout this chapter, he emphasizes the importance of understanding the organization’s culture before attempting any transformational efforts.
In Chapter 2, “The Announcement,” Gerstner vividly recalls the pivotal moment when he formally introduced himself to the IBM employees as their new CEO. Aware of the skepticism surrounding his appointment, he acknowledges the uncertainty and addresses the rumors circulating within the company.
During this address, Gerstner outlines his strategic vision for IBM, emphasizing the need to prioritize customer satisfaction and adapt to the changing technology landscape. He emphasizes the importance of teamwork, innovation, and accountability as key drivers for IBM’s future success.
These two chapters lay the foundation for Gerstner’s candid exploration of the challenges he faced while leading a major corporate turnaround and provide a glimpse into the mindset he brings to his role as IBM’s CEO.
Part 2 Drinking from a Fire House to the Field
Chapter 3 of the book “Who Says Elephants Can’t Dance” is titled “Drinking from a Fire Hose.” In this chapter, Lou Gerstner, the author and former CEO of IBM, reflects on his early days at the company. He describes the overwhelming challenge he faced upon taking over as CEO, as IBM was on the brink of collapse. The metaphorical “fire hose” represents the immense flow of information and problems that came his way.
Gerstner discusses the need for him to quickly gather information and make critical decisions. He emphasizes the importance of prioritization and focusing on the most critical issues first. He also highlights the significance of teamwork and collaboration, as he relied on his team to collect and analyze data, enabling him to make informed choices.
Chapter 4, titled “Out to the Field,” delves into Gerstner’s realization that in order to truly understand IBM and make effective changes, he needed to get out of the corporate headquarters and go directly to the field. He visited numerous customers, attending meetings and listening to their concerns about IBM’s products and services.
Through these interactions, Gerstner gained valuable insights into the strengths and weaknesses of the company. He discovered that IBM’s reputation among its customers was still strong, despite internal challenges. This realization further motivated him to transform IBM and regain its market leadership position.
In summary, these two chapters highlight the initial hurdles Gerstner faced as IBM’s CEO and his hands-on approach to understanding the company’s problems by immersing himself in customer experiences.
Part 3 Operation Bear Hug
Chapter 5 of the book “Who Says Elephants Can’t Dance” is titled “Operation Bear Hug.” In this chapter, Lou Gerstner, former CEO of IBM, narrates his strategy to revamp and revive IBM’s culture.
Gerstner discusses the importance of changing the mindset of the company’s employees. He wanted to shift the focus from internal competition to collaboration. To accomplish this, he introduced “Operation Bear Hug,” a program aimed at fostering teamwork across different departments.
Gerstner realized that to achieve success, IBM needed to break down the silos that had hindered innovation and progress within the organization. He initiated an intensive cross-functional approach, encouraging employees to work together on projects and share their expertise.
Through Operation Bear Hug, Gerstner focused on eliminating bureaucracy within IBM. He instituted the concept of “client teams” to provide a seamless experience for customers and streamline decision-making processes. This approach removed layers of management and empowered employees to take ownership and responsibility for their work.
By implementing Operation Bear Hug, Gerstner successfully created a more collaborative and customer-centric environment at IBM. This cultural transformation played a crucial role in revitalizing the company and helping it regain its position as a market leader in the technology industry.
Part 4 Stop the Bleeding (and Hold the Vision)
Chapter 5 of the book “Who Says Elephants Can’t Dance” is titled “Stop the Bleeding (and Hold the Vision).” In this chapter, Lou Gerstner, the former CEO of IBM, recounts the critical steps he took to turn around the struggling company.
Gerstner emphasizes the importance of stopping the hemorrhaging in a company by bringing in discipline and controlling expenses. He implemented stringent cost-cutting measures, including layoffs and reducing unnecessary expenditures. While these decisions were difficult, they were necessary to stabilize IBM’s financial situation and regain the trust of investors.
Simultaneously, Gerstner focused on holding a clear vision for the future. He realized that IBM needed to evolve and adapt to the changing technology landscape. He recognized the significance of embracing the internet and shifting the company towards providing technology solutions rather than just selling hardware.
To foster innovation, Gerstner encouraged collaboration and teamwork within the organization, breaking down silos and promoting cross-functional partnerships. He also sought external alliances and partnerships with other companies to strengthen IBM’s position in the market.
Overall, this chapter highlights the crucial steps taken by Gerstner to stop the financial bleeding and reposition IBM as a forward-thinking technology company.
Part 5 Creating the Leadership Team a Global Enterprise
Chapter 7 of the book “Who Says Elephants Can’t Dance” is titled “Creating the Leadership Team.” In this chapter, author Louis V. Gerstner Jr., the former CEO of IBM, discusses the process of building a strong leadership team within the company.
Gerstner emphasizes the importance of assembling a diverse group of talented individuals who can bring different perspectives and skills to the table. He outlines his approach to selecting capable leaders based on their track records, problem-solving abilities, and their commitment to teamwork.
The chapter also highlights the need for effective communication and collaboration among team members. Gerstner describes how he encouraged open dialogue, established clear priorities, and fostered a culture of trust and accountability within the leadership team. By doing so, he was able to align the team’s efforts with the larger goals of transforming IBM into a successful company once again.
Moving on to Chapter 8, titled “Creating a Global Enterprise,” Gerstner delves into the challenges faced by IBM as it transitioned from being a predominantly US-focused company to a truly global one. He shares his experiences of expanding IBM’s presence in various international markets and adapting the company’s operations to suit local cultures and business practices.
Gerstner highlights the significance of maintaining a balance between standardization and localization to ensure consistent service delivery while catering to specific regional needs. He shares examples of strategic alliances and partnerships that helped IBM establish a strong global presence and expand its portfolio of offerings.
Overall, these chapters provide insights into the critical aspects of building a strong leadership team and transitioning to a global enterprise, showcasing Gerstner’s strategic decisions and management principles that were instrumental in IBM’s turnaround.
Part 6 Strategic Company Restructuring
Chapter 9 of the book “Who Says Elephants Can’t Dance” is titled “Reviving the Brand.” In this chapter, author Louis Gerstner discusses his efforts to revitalize IBM’s brand and restore its position as a market leader. Gerstner emphasizes the importance of understanding customers’ needs and aligning the organization’s offerings with those needs. He highlights the significance of changing the company’s culture and mindset to foster innovation and customer-centricity.
Gerstner also focuses on transforming IBM’s marketing strategy by introducing a new campaign called “Solutions for a Small Planet.” The campaign aimed to showcase IBM’s ability to provide solutions that address pressing global challenges while emphasizing its commitment to technological excellence. Furthermore, the chapter delves into the initiatives taken to reinforce IBM’s corporate image through thought leadership, participation in industry events, and engaging with key influencers.
Chapter 10, “Resetting the Corporate Compensation Philosophy,” explores Gerstner’s approach to remuneration within IBM. Recognizing the need to attract and retain top talent, Gerstner sought to structure a compensation package that motivated employees and aligned their interests with the company’s goals. He implemented a performance-based system that rewarded individuals and teams based on their contributions to business outcomes, rather than just tenure or seniority.
The chapter explains how Gerstner created a comprehensive evaluation process that identified and rewarded high-performing individuals across the organization. He emphasized the importance of transparency, fairness, and aligning incentives with business objectives. Gerstner believed that a well-designed compensation system played a significant role in shaping a high-performance culture and cultivating employee motivation.
Overall, these chapters highlight Gerstner’s strategic efforts to revive IBM’s brand and restructure the company’s compensation philosophy, setting the stage for its successful turnaround.
Part 7 Back on the Beach
Chapter 11, titled “Back on the Beach,” from the book “Who Says Elephants Can’t Dance” by Louis V. Gerstner Jr., details IBM’s transformation journey after a financial crisis. In this chapter, Gerstner reflects on his first year as CEO and addresses the challenges faced by the company.
Upon joining IBM, Gerstner quickly realized the urgency of the situation. IBM was losing money and market share, and its outlook seemed bleak. He formed a management team to tackle the problems head-on and initiated various strategic changes. Gerstner emphasizes the importance of prioritizing customer needs and shifting the organization’s focus towards delivering value.
To revive IBM’s culture, Gerstner recognized the need for employee empowerment and involvement. He introduced a more inclusive decision-making process, encouraging employees to actively contribute their ideas and expertise. Additionally, he emphasizes the significance of open communication channels to foster transparency and trust within the organization.
Gerstner also discusses the significance of embracing change and the difficulty of breaking old habits ingrained in a large organization like IBM. He shares the challenges faced in implementing new initiatives, such as shifting from a product-centric approach to a customer-centric one.
Overall, Chapter 11 highlights Gerstner’s efforts to reposition IBM by placing customers at the center of its transformation and fostering a culture that embraces change and innovation.
Part 8 A Brief History of IBM
Chapter 12 of the book “Who Says Elephants Can’t Dance” provides a concise overview of IBM’s history, focusing on the company’s transformation during Lou Gerstner’s tenure as CEO. Gerstner took charge of IBM in 1993 when it was on the verge of bankruptcy and facing numerous challenges.
The chapter begins by highlighting the early years of IBM, founded in 1911, and its dominance in the mainframe era. However, by the late 1980s, the company had become complacent and failed to adapt to the changing technology landscape, resulting in financial distress.
Gerstner’s arrival marked a significant turning point for IBM. He recognized that the company’s focus needed to shift towards customer needs and building a culture of innovation. To accomplish this, he embarked on a series of transformational initiatives, such as breaking down silos, streamlining operations, and fostering collaboration across different business units.
Furthermore, Gerstner emphasized the importance of embracing the internet and e-business, leading IBM to become an industry leader in these areas. He also made strategic acquisitions and divestitures to reshape the company’s portfolio and tap into emerging markets.
In summary, Chapter 12 highlights Lou Gerstner’s pivotal role in reviving IBM by implementing a customer-centric approach, embracing new technologies, and transforming the organization into a more agile and adaptable entity.
Part 9 Strategic Decision-Making and Service Integration
Chapter 13 of “Who Says Elephants Can’t Dance” titled “Making the Big Bets” discusses the importance of taking bold and calculated risks to transform a struggling company. Lou Gerstner, the author and former CEO of IBM, emphasizes that incremental changes are not enough in times of crisis. He explains how he encouraged his management team to make significant bets on the future of technology, even if it meant challenging traditional beliefs and risking short-term profits.
Gerstner describes the necessity of investing heavily in research and development, nurturing innovation, and allocating resources strategically. He highlights key initiatives such as embracing the internet, focusing on e-business solutions, and building new partnerships to expand IBM’s offerings.
In Chapter 14, “Services—the Key to Integration,” Gerstner discusses the value of services in integrating a once-disparate company like IBM. He emphasizes that services provide an opportunity to deliver complete solutions to customers while generating reliable revenue streams. Gerstner outlines the challenges faced in transforming IBM into a service-oriented company and the steps taken to overcome them.
By leveraging IBM’s expertise and industry knowledge, Gerstner explains how the company was able to integrate its diverse product portfolio with comprehensive service offerings. This chapter underscores the significance of understanding customer needs and aligning business strategies accordingly, ultimately positioning IBM as a leading provider of technology services.
Overall, these chapters highlight the transformational journey of IBM under Gerstner’s leadership, emphasizing the importance of risk-taking, innovation, and strategic integration of products and services.
Part 10 Growth and Transformation of a Software Business
Chapter 15 of “Who Says Elephants Can’t Dance” titled “Building the World’s Already Biggest Software Business” describes IBM’s transformation into a software powerhouse. The chapter focuses on IBM’s shift in strategy towards software and services, aiming to become a leader in the industry. IBM recognized the potential of software as a lucrative business and began investing heavily in research and development, acquisitions, and partnerships to enhance their software offerings.
Chapter 16, “Opening the Company Store,” reveals IBM’s decision to establish its own internal marketplace known as e-business-on-demand. This platform allowed IBM employees to access and utilize the company’s vast range of software products. By implementing this store, IBM aimed to foster innovation, encourage cross-collaboration, and promote the use of their software within the organization. The company store played a crucial role in aligning IBM’s internal culture with its external focus on software solutions.
Chapter 17, “Unstacking the Stack and Focusing the Portfolio,” delves into IBM’s efforts in simplifying its product portfolio. The chapter highlights how IBM recognized the importance of streamlining its offerings to better meet customer needs. By unstacking the traditional technology stack, which featured multiple layers of hardware and software, IBM aimed to provide more integrated and simplified solutions. This involved divesting certain businesses that were no longer aligned with the company’s core strategy and focusing on key growth areas, such as middleware and enterprise software.
Overall, these chapters illustrate IBM’s commitment to becoming a leading software provider through investments in research, the establishment of an internal marketplace, and a renewed focus on delivering integrated solutions.
Part 11 The Evolution of Business Strategy in the Digital Age
Chapter 18 of “Who Says Elephants Can’t Dance” titled “The Emergence of e-business” explores the dawn of the internet era and its impact on IBM. In this chapter, Louis Gerstner recounts how IBM initially struggled to embrace the potential of e-business. He emphasizes the importance of adapting to changing technology and customer demands. Gerstner describes how IBM transitioned from being a hardware-centric company to focusing on software and services, acknowledging that survival required a fundamental shift in the business model.
Chapter 19, “Reflections on Strategy,” reflects on the lessons learned during Gerstner’s tenure as CEO of IBM. He discusses the significance of a clear strategy, emphasizing the need for companies to focus on their core competencies. Gerstner highlights the importance of understanding the market, competition, and customers’ needs. He also stresses the significance of building strong relationships with customers and partnerships with other organizations to drive success.
Throughout these chapters, Gerstner underscores the critical role of leadership, adaptability, and embracing change. He showcases how IBM transformed itself into a leading player in the technology industry by embracing e-business and strategically positioning the company for future growth.
Part 12 The Dynamics of Leadership and Organizational Values
Chapter 20 of “Who Says Elephants Can’t Dance” explores the significance of corporate culture within an organization. Lou Gerstner, the author and former CEO of IBM, emphasizes that a strong corporate culture is essential for a company’s success. He describes how he worked to change IBM’s culture by encouraging collaboration, innovation, and customer-centric thinking. Gerstner also highlights the importance of aligning the company’s culture with its strategic goals and values.
In Chapter 21, titled “An Inside-Out World,” Gerstner discusses the rapid changes brought about by technology and globalization. He explains how these forces have transformed the business landscape, making it imperative for companies to focus on their core competencies while outsourcing non-core activities. Gerstner shares his experiences at IBM, emphasizing the need for agility and adaptability in order to keep up with the ever-evolving market dynamics.
Chapter 22, “Leading by Principles,” delves into Gerstner’s leadership philosophy. He stresses the importance of setting clear principles and values as a leader and making decisions based on them. Gerstner believes that leaders must be authentic, honest, and transparent while inspiring and motivating their teams. He also encourages leaders to prioritize people and their development, fostering a culture of continuous learning and growth.
Overall, these chapters highlight the critical role of corporate culture, navigating the rapidly changing business environment, and leading with principles in the journey of transforming organizations.
Part 13 Foundations of Business Success
Chapter 23 of the book “Who Says Elephants Can’t Dance” titled “Focus—You Have to Know (and Love) Your Business,” emphasizes the importance of understanding and being passionate about your business. The chapter highlights how successful leaders have an in-depth knowledge of their industry, customers, products, and competition. By having this deep understanding, leaders can make informed decisions and effectively navigate through challenges.
In Chapter 24, “Execution—Strategy Goes Only So Far,” the author underscores the significance of execution in achieving business success. While strategy is crucial, it is only effective when executed properly. The chapter discusses the importance of setting clear goals, establishing accountability, and fostering a culture of discipline. It explores the concept of “knowing how to do” rather than just “knowing what to do,” emphasizing the need for rigorous execution to realize strategic objectives.
Chapter 25, “Leadership Is Personal,” focuses on the personal aspects of leadership. The chapter delves into the idea that leadership is not just a position but a personal commitment to making a difference. It emphasizes the importance of building trust, inspiring others, and being authentic as a leader. The chapter highlights the significance of strong interpersonal skills, empathy, and emotional intelligence in leading teams and driving organizational success.
Overall, these three chapters stress the significance of knowing your business inside out, executing strategies effectively, and embodying personal qualities as a leader to achieve long-term success.
Part 14 Elephants Can Dance
Chapter 26 of the book “Who Says Elephants Can’t Dance” delves into IBM’s transformation and its journey towards becoming a successful technology company once again. The chapter focuses on the critical period between 1999 and 2002.
During this time, IBM faced numerous challenges, including a declining stock price, an outdated business model, and increased competition from rivals. To address these issues, the company embarked on a comprehensive restructuring plan. This involved redefining its strategy, restructuring its organization, and embracing new technologies.
Under the leadership of CEO Lou Gerstner, IBM made several strategic moves that helped revive the company. They shifted their focus from hardware to software and services, recognizing the growing importance of the internet and e-business. The acquisition of PwC Consulting also played a vital role in expanding IBM’s consulting capabilities.
Furthermore, Gerstner emphasized cultural change within the organization. He encouraged collaboration and teamwork, breaking down silos and fostering a more entrepreneurial spirit. This shift in culture allowed IBM to become more adaptable and responsive to market demands.
By the end of the chapter, IBM had successfully transformed itself into a leading technology solutions provider. The company experienced a remarkable turnaround, with its financial performance improving significantly. It serves as an inspiring example of how an established company can reinvent itself and thrive in the ever-changing landscape of technology.
Part 15 IBM—a Farewell
Chapter 27 of “Who Says Elephants Can’t Dance” focuses on the farewell of IBM’s CEO, Lou Gerstner. In this chapter, Gerstner reflects on his journey with the company and the significant changes that were implemented during his tenure.
Gerstner begins by acknowledging the challenges he faced when he joined IBM in 1993. At that time, the company was struggling and required a major transformation to regain its position as a technology leader. He emphasizes the importance of teamwork and the collective effort of IBM employees in achieving this turnaround.
The chapter highlights some key accomplishments under Gerstner’s leadership, such as refocusing IBM’s strategy, embracing the internet, divesting non-core businesses, and fostering a customer-centric culture. Gerstner expresses his gratitude towards the dedicated workforce for their commitment and adaptability throughout the transformation process.
As he bids farewell, Gerstner emphasizes the significance of change and the need for continuous improvement in today’s fast-paced business environment. He reflects on the successful revival of IBM and shares his optimism for the company’s future growth and innovation.
In conclusion, Chapter 27 encapsulates Lou Gerstner’s parting thoughts on IBM’s transformation, acknowledging the challenges faced and the collaborative efforts made to turn the company around, while emphasizing the importance of embracing change and maintaining a forward-thinking approach.
In conclusion, “Who Says Elephants Can’t Dance” is a compelling memoir by Louis V. Gerstner Jr., former CEO of IBM. The book provides an inside look at the challenges faced by one of the world’s largest technology companies and how Gerstner successfully transformed it from the brink of failure to renewed success. Through his leadership principles and strategic decisions, he emphasizes the importance of customer focus, innovation, collaboration, and cultural change in driving organizational turnaround. Gerstner’s personal anecdotes and candid storytelling make this book not only informative but also inspiring for anyone interested in leadership, business strategy, and adaptability in the face of adversity.
After reading “Who Says Elephants Can’t Dance” by Louis V. Gerstner Jr., a captivating account of IBM’s transformation, you might be craving more inspiring stories from the world of business. Here are five remarkable biographies that delve into the lives of business legends, offering invaluable insights and lessons for aspiring entrepreneurs and leaders.
“Shoe Dog” by Phil Knight:
In this memoir, Phil Knight, the co-founder of Nike, takes us on an extraordinary journey through the trials and triumphs of building a global brand. “Shoe Dog” reveals the challenges Knight faced as he battled financial crises, competitors, and self-doubt. This candid account demonstrates the importance of resilience, determination, and unwavering belief in one’s vision.
“The Snowball: Warren Buffett and the Business of Life” by Alice Schroeder:
Alice Schroeder provides an insightful account of Warren Buffett’s exceptional journey from an ambitious young investor to one of the world’s most renowned business magnates. “The Snowball” delves into Buffett’s investment strategies, his emphasis on long-term value creation, and the personal challenges he encountered along the way. This comprehensive biography offers timeless wisdom for investors.
“Pour Your Heart Into It: How Starbucks Built a Company One Cup at a Time” by Howard Schultz:
Howard Schultz, the architect behind Starbucks’ global success, shares his remarkable story in this engaging autobiography. Through “Pour Your Heart Into It,” readers gain an understanding of Schultz’s unwavering passion for creating a unique coffee experience. The book showcases Schultz’s pursuit of social responsibility, employee satisfaction, and his unrelenting commitment to providing genuine customer experiences.
These three inspiring biographies offer captivating accounts of business legends who left an indelible mark on the corporate world. By exploring the lives of Phil Knight, Warren Buffett, and Howard Schultz, you’ll gain invaluable insights into their leadership styles, perseverance, innovation, and dedication. These books are not only entertaining but also provide valuable lessons for anyone looking to make their own mark in the business world.