Text of Chairman's Message To the Employees at I.B.M.

The New York Times

June 19, 1991

Following is the text of the message that John F. Akers, I.B.M.'s chairman, circulated to employees on the company's electronic communications system:

In recent days, we have had a great deal of experience with communications, unfiltered and otherwise, especially concerning what I said to a small group at the Advanced Management School in Armonk. Here is the gist of what I want to communicate to everyone in the company.

I.B.M. exists to provide a return to its shareholders. We do that by creating satisfied and delighted customers -- more of them than our competitors. Those facts of business life are as plain now as they were more than 45 years ago when Thomas J. Watson Sr. reminded people of them, saying: "It becomes increasingly apparent in my small sphere of observation, and I conclude the company as a whole, that the average I.B.M.'er has lost sight of the reasons for his company's existence. I.B.M. exists to provide a return on invested capital to the stockholders."

'Not a Fraternity or Club'

He added: "It is the success of I.B.M. as a business that enables the company to provide good salaries and benefits. When everyone realizes that I.B.M. is a business, run by businessmen and affected by the business environment and not a fraternity or club they've joined with lifetime benefits, then we can parade into the future to reap earned rewards."

The more things change, the more they stay the same.

My own comments had to do specifically with the quality of work in our business. As I have been saying for some time, I believe it must be improved.

While I know many I.B.M.'ers have never worked as hard as they are working today, I am convinced that some of our people do not understand that they have a deeply personal stake in declining market share, revenue and profits. A healthy level of concern and urgency, which I call tension, is essential for everybody in I.B.M.

If our development and manufacturing teams deliver competitive quality, function, usability, and costs and are timely and reliable suppliers, our business will prosper. If our marketing and service teams are skilled, beat the competition, and delight our customers, our business will prosper. Our stockholders have every right to expect us to have a prosperous business. We must deliver -- not some of the time, but all of the time -- to this level of expectation.

Simple Propositions

That expectation begins with a few simple propositions:

*We will measure our success in two primary ways: customer satisfaction and balanced growth in market share and profitability.

*We expect to grow with the industry in every market and every segment in which we compete.

*I.B.M. is a worldwide, integrated computer systems company, but we expect every part of I.B.M. to be competitive in its own right: every product, every service, every unit, every country, every individual.

*We will invest in and reward success and contribution; this accountability means we will not expect successful contributors to subsidize those who are not.

The best and only assurance of personal reward and job security is to be part of a successful, prospering business.

It is in our hands -- individually and collectively -- to have delighted customers, delighted stockholders, and proud I.B.M.'ers. Would we have it any other way?


Copyright 1991 The New York Times Company