Discuss the salient features of pre-Gerstner IBM culture.

Pre-Gerstner IBMs culture was based on norms and procedures and rarely permitted any
divergence from them. The company had also grown very large by the 1970s and 1980s and had
lost its ability to react quickly to the changes in the market. IBM became complacent with its
success and did not believe that anything could threaten it.
Before Gerstner, IBM was failed in making the most of its innovative talents because of stifling
bureaucracy and excessive rigidity that characterized the culture at the company.

IBM Research was organized more like a university laboratory than the R&D unit of one
of the largest technology companies in the world. Researchers worked in an academic
environment and were rewarded for the number of papers they published and awards they
won, rather than for commercial innovation. Academic excellence was valued and IBM
Research even had its own system of recognition. Researchers were given titles of Master
Inventor, Distinguished Engineer or an IBM Fellow, which was the highest level of
recognition. IBM Fellows had the freedom to conduct research in any topic of their
choice and most of these people came out with outstanding innovations.
The culture was also highly individualistic and people rarely met to exchange ideas. The
distance was even greater between the research labs and the business units. There was
very little contact between researchers and the product development and marketing
teams.
There was little benchmarking of IBMs practices vis--vis other companies. In a sense
IBM was the benchmark and decided on its own what it wanted to do. Basically it was a
family-oriented, protective environment where equality and sharing were valued over
performance-driven differentiation.
CIOs were managing their own local systems architectures and funding home-grown
applications. If IBM had a financial issue that required the cooperation of several
business units to resolve, it had no common way of talking about it because they were
maintaining a large number of different general ledger systems.