HBA Chicago chapter - Transformational Leadership: Inspiring a New Perspective

The HBA Chicago chapter event, "Transformational Leadership: Inspiring a New Perspective" was presented by Lori Steele, general manager, IBM Global Process Services. The program took place at Audubon Hall at Independence Grove Forest Preserve in Libertyville, IL. The evening started with a networking reception on the patio overlooking Independence Grove Lake. After additional networking over dinner, Blasine Penkowski, Abbott DVP/general manager of the Oncology Franchise, introduced Lori.

Lori started her presentation by giving the HBA Chicago chapter audience specifics about IBM, such as the number of employees as well as the culture. She said employees have such a deep-seated association with the company that they think of themselves as IBMers. Due to IBM’s culture, about 50% of employees have less than five years of service and approximately 40% work remotely. It is a fast paced, changing work force. IBM celebrated its 100 year anniversary in 2011. It is a rare thing for a technology-based company to survive so long let alone thrive.

Lori described how Louis V. Gerstner, CEO of IBM from April 1993 until March 2002, foresaw that change was coming in world markets, information technology and client needs, and took decisive action to turn disruption into opportunity. She said Gerstner’s book, Who Says Elephants Can't Dance?, is well worth reading.  IBMers had to change in order to save the company from bankruptcy and make IBM great again. Lori said it took IBM 10 years to refine what it was really good at. IBM needed to change from a products company to a solution/service based company and determine how to excel as a service company.

Lori was a partner at Pricewaterhousecoopers when it was acquired by IBM in 2002. Once a part of IBM, she said she gave herself two years to create a service business. It was very much a grind for a few years to create a new consulting firm which required a whole new model. Every interaction was new. Ginny Rometty lead the integration. Sam Palmisano, CEO at the time, was adamant about rapid integration. Lori said Sam had to make tough decisions to refocus on service and software for large clients. It took 10 years to shift the mix of IBM’s business from products to services.

Success at over 100 acquisitions and integration over 10 years keeps IBM on its toes as far as innovation. Lori said “You need to keep hungry to be great.”

In 2006, IBM took a rather unusual step and went public with their plans to transform the company by announcing the 2010 roadmap which described how the company would deliver value. Lori said she experienced a transformative moment when she started thinking how she, personally, could move the company forward. How did her plan map to the 2010 roadmap?

Lori’s experience on the global emerging markets team gave her invaluable lessons in how to do business in Mexico. More and more IBMers are rotating through the global emerging markets team building global skills which continues to change IBM’s culture. Mergers and acquisitions have changed where IBM finds intellectual propriety. Today, 80% of IBM’s research dollars are spent on services and analytics instead of products. IBM developed Watson technology, an artificial intelligence computer system capable of answering questions posed in natural language. This had caused a dramatic shift in what people can do with technology; one can predict outcomes. IBM’s research and development staff now work at client locations instead of just in-house which facilitates IBM continually changing and staying ahead of the curve.

Lori mentioned the steep cost to the company when talented people leave. The R&D group was asked to use analytics to determine why people leave and what types of people stay, and identify people who were at risk for leaving. This approach allowed them to reduce the turn-over rate by 30%.

Lori wrapped with two take home messages, 1) IBM’s leadership model is tightly tied to strategy, 2) change is the norm.

Lori’s captivating talk offered attendees an opportunity to think about how they can make innovative changes in the healthcare sector such as transforming from a product centric to customer centric strategy, and what it takes to lead a company through a total transformation.

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