Tag Archive: IBM


Five years ago Hewlett-Packard (NYSE: HPE) was kicked off the Dow Jones Industrial Average, replaced by Visa.

Three years ago, AT&T (a.k.a., The Phone Company) was ingloriously removed from the index of 30 share prices, substituted by Apple.

And just last month, General Electric (NYSE: GE) was unceremoniously ushered off the exchange for Walgreen Boots.

Will Itty Bitty Machines (NYSE: IBM) be the next Dinosaur Tech heading for Dow Jones extinction?

Flintstones vs Jetsons

Under legendary CEO Jack Welch, GE was the most valuable (market capitalization) American company in 2000. The company was one of the founding companies of the Dow Jones Industrial Average in 1896. General Electric was a consistent standard on the exchange since 1907, 111 years.

What have you done for us lately, Fred and Wilma Flintstone? GE was replaced on the Dow Jones two weeks ago by a drug store company? How embarrassing.

Almost DailyBrett earlier wrote about companies that are absolutely rocking (i.e.,  Apple, Amazon, Facebook, Netflix, Google, Salesforce.com), metaphorically packing stadiums as opposed to those reduced to playing “greatest hits” at county fairs and desert casinos (i.e., Intel, Cisco, Dell).

These latter companies were/are directly tied to the mature PC market and thus became fairly valued with limited prospects for investor growth unless and until they credibly changed their story with compelling new information (e.g., Apple from Amelio to Jobs2 to Cook) & (e.g., Microsoft from Gates to Ballmer to Nadella).

Apple was on the precipice of bankruptcy in 1997; now the company is the world’s most valuable at $912 billion. The Wunder corporation may be first to ever to achieve a $1 trillion market cap (share price x the number of shares).

Microsoft has cleverly reinvented itself as the market leader in the cloud, even though the PC software company was late to the party. Macht nichts. MSFT has a $762 billion market cap.

Apple, Amazon, Facebook, Google, Netflix and Salesforce.com constitute the 21st Century version of the Jetsons.

Conversely, AT&T, GE, Hewlett-Packard and IBM are the Flintstones.

What Are Their Winning Narratives?

Having worked in corporate Silicon Valley public relations for more than a decade, Almost DailyBrett understands the virtue of championing a winning narrative.

What is your company’s raison d’etre?

How does it make the legal tender?

How is the company positioned in the marketplace against ferocious competitors?

What is its competitive advantage?

What is its legacy of results?

What are the prospects for reasonable and achievable expectations for shareholder joy?

For the record, Almost DailyBrett owns shares of Apple (NASDAQ: AAPL) and Salesforce.com (NYSE: CRM).

Both companies have delivered. Both are leaders in their respective fields. Most of all, your author understands their business strategies – lead in consumer innovation and services; provide selected software via the cloud to business customers).

Investing or Gambling?

When you understand how and why a company makes money then markets are investing, not gambling.

What is the winning narrative for GE? The company is restructuring yet again. Give it up J.C. Penney. Forget it, GE.

Tell me more about the business strategy for AT&T. How will it beat Verizon? Your author doesn’t know either.

Your author loves his Lenovo Ideapad. Who commercialized the PC? IBM in 1981. Reagan was president. “Watson,” can you help?

HPites love the 1937 story of HP founders William Hewlett and David Packard and the Palo Alto garage.

If the two gents could see their creation in the post-Carly Fiorina era, they would most likely would be turning over in their respective graves.

When contemplating these four Dinosaur Techs – AT&T, GE, HP, IBM — in a Jurassic Park era, the hardest questions are also the most basic: How do these companies make money? What product defines their respective businesses?

In stunning contrast, Apple is the #1 company in the world, defined by game changing innovation (e.g., iPhone X) and services (e.g., Apple Music).

Amazon is the #1 digital-retailer in the world with 100 million Prime memberships.

Facebook is the world champion social media company with 2.19 billion subscribers.

Google is the #1 search engine and developed the smart phone Android OS.

Netflix is the #1 digital-streaming-video company (at least for now) with 125 million subscribers.

Salesforce.com pioneered SaaS (Software as a Service) and is a leading-business-software-via-the-cloud provider.

Quick: Can you name a signature product/service directly associated with AT&T, GE, HP or IBM?

Being a jack of all trades, master of none leaves investors will absolutely … nothing.

https://www.cnbc.com/2018/06/19/walgreens-replacing-ge-on-the-dow.html

https://almostdailybrett.wordpress.com/2011/07/21/what-happens-when-the-music-stops/

 

 

Or is it Outsourcing to Insourcing?

Did I just buy a computer that was made in (gasp) Communist China?

Is this unpatriotic? Or is it patriotic?

Did Chairman Mao just turn over in his grave?

mao

These questions seem to suggest not only how much yours truly has changed, but how the world has shifted its attitudes and business practices in the past four decades.

One suspects that Henry Kissinger knew that his secret trip to China in 1971 had the potential to change the geopolitical balance of affairs, but the question is how much? And it is clear that Deng Xiaoping altered China for the better by coming to the obvious conclusion that Capitalism even with its well-documented flaws is still light years better than Cultural Revolutions and collective farms.

Having said that, it is Big Leap Forward from Kissinger’s sub-rosa journey and Deng’s landmark reforms to the significance of my purchase of a Lenovo Ideapad laptop for $600 (Best Buy) powered by an Intel Core i5 microprocessor (Santa Clara, CA) and controlled by Microsoft’s Windows 8 operating system (Redmond, WA).

And now good ole boys and girls in Whitsett, North Carolina are hard at work producing more PCs, hybrid PCs/tablets (e.g, Lenovo Yoga) and servers for a company that was started in 1984 by a $25,000 state (Chinese Academy of Sciences) investment…the state that brought a chilling new meaning to the words, Tiananmen Square.

Yep, I bought a laptop from a company that was created by an investment made by Communist China and held its first meetings in a guard shack.

Back in days of the Evil Empire, I made my first trip overseas…and not to a place in which most post-college bachelors go for vacation: Russia. It was the 1981 Soviet Union of that fun-loving guy, Leonid Brezhnev.

Upon returning my maternal grandfather told me there were two places he never wanted to go to: One was hell; the other…you guessed it.

Just as if it was yesterday, I remember after a performance of the Bolshoi Ballet standing on the edge of Red Square with the onion-dome masterpiece, flood-lit St. Basil’s, on the opposite end…Ground Zero of the Cold War. Deep down inside I was hoping that this would be neither the time nor the place for a thermonuclear confrontation, particularly at that exact time.

Reflecting back on my visit to the country of 11 time zones, which is a must for any student of modern history and politics, I can see the average people packed like sardines into trolley cars, while the most equal-of-the-equals zipped on by in special lanes for their Zil limos. The USSR even took Diner’s Club, Carte Blanche along with Visa and American Express. When were the Reds coming back?

I didn’t like Communism before I made this trip. I liked it even less after my visit.

If you asked me at the time, if I would ever buy any product made by a communist country that treats its people as if they were sheep, the answer would be an emphatic, “nyet” or “het” in Cyrillic.

lenovoideapad

Serving as a director of corporate public relations for a Silicon Valley hardware innovator and later as a vice president for an international public relations agency, I wore out at least three IBM Think Pad laptops.

“What’s this blue screen?” I would ask one of our all-knowing IT managers. “Ah, did you back up your files?” I was asked. “What if I didn’t? I replied. Welcome to the “Blue Screen of Death.”

Little did I appreciate was that IBM (e.g., Itty Bitty Machines) was outsourcing a portion of its ThinkPad business to China’s Lenovo, and then Big Blue outright sold the its corporate PC business to Lenovo in 2005. I have been using a Chinese laptop for the better part of a decade, and last year I doubled downed on this bet.

Reading about Lenovo, I discovered that English is the $30 billion company’s official business language. It maintains two headquarters, one predictably in Beijing, and the other at IBM’s former PC hub in Morristown, NC. And just this year, Lenovo started manufacturing in the aforementioned Whitsett in the Tar heel State.

Let’s see…IBM outsourced a portion of its PC business to China, taking advantage of lower Chinese manufacturing costs and giving the company greater access to the world’s largest market. Eventually IBM (which invented the PC in 1981) sold the business to Lenovo. And now global market share leader Lenovo is outsourcing a portion of its PC business to the United States or insourcing the business in North Carolina, if you prefer that point of view.

Topping it off, China is becoming a more expensive place to manufacture with each passing day and the US is getting cheaper as demand for skilled Chinese labor is going up. The Pacific Ocean is just as big as ever and shipping costs are a major factor. Cost parity is expected in two years.  Lenovo is outsourcing PC production to the United States, bringing it closer to US customers and key suppliers including Intel and Microsoft.

Does this mean that buying a Chinese computer is patriotic? That seems like a stretch, particularly for a guy who saw the Evil Empire up close and personal.

If you agree that buying a Chinese computer is actually patriotic, then financing the nation’s $17.4 billion debt through China occasions playing of the Star Spangled Banner.

So why are we upset about outsourcing?

And what is the true meaning of outsourcing anyway?

Or is it actually insourcing?

Who the heck knows?

http://www.economist.com/news/special-report/21569572-after-decades-sending-work-across-world-companies-are-rethinking-their-offshoring

http://www.economist.com/news/business/21569398-how-did-lenovo-become-worlds-biggest-computer-company-guard-shack-global-giant

http://www.economist.com/blogs/graphicdetail/2013/05/focus

http://en.wikipedia.org/wiki/Lenovo

http://www.cnbc.com/id/100651692

http://en.wikipedia.org/wiki/Deng_Xiaoping

https://en.wikipedia.org/wiki/Tiananmen_Square

http://en.wikipedia.org/wiki/Leonid_Brezhnev

http://news.lenovo.com/article_display.cfm?article_id=1635

Sixty-eight years ago Adolf Hitler and his propaganda chief Joseph Goebbels boasted about “Fortress Europa” and the “Atlantic Wall,” a series of supposedly impregnable defenses against the coming Allied invasion of France.

The guy actually in charge of these defenses, legendary Field Marshal Erwin Rommel, privately described his Führer’s vision this way: “He’s in cloud-cuckoo land.” (Wolkenkuckucksheim)

Nordafrika, Generaloberst Erwin Rommel

Considering everyone in the technology space seems to be getting their collective knickers-in-a-twist (or bowels-in-an-uproar, if you wish) about cloud computing, one is tempted to label this period of time as Cloud Cuckoo Land 2.0.

Almost DailyBrett in February commented on how PR/marketing/social media practitioners have this irritating habit of falling in love with certain terms and phrases, such as “organic,” “sustainable,” “solutions” etc., and then pounding them to death, reducing them to cliché status. “Cloud computing” was listed as one of those overworked buzz phrases. Almost DailyBrett even attempted to take all of these buzz words and phrases and work them into one massive run-on sentence. https://almostdailybrett.wordpress.com/2011/02/20/pounding-pr-buzz-words-to-death/

Since that time the quest for the cloud has actually accelerated, raising the obvious question as whether 15-yard penalties should be given for piling on. Google “cloud computing” and 120 million results come rushing at you, the ultimate contest in Search Engine Optimization (SEO). There are so many “clouds” out there that you would have to conclude that the weather is just downright overcast.

Just last week, Apple became the latest to be late in embracing the cloud. Steve Jobs led the charge, with the company’s “iCloud” announcement in San Francisco. The “technology” even comes with a nifty little tag line, “It just works,” which sent the 5,000 gear-heads in the audience into spontaneous simultaneous orgasm.

After working in technology for 15 years (10 with LSI Logic, two with the Semiconductor Industry Association and three with Edelman), let me assure you that no marketeer wants to be seen as falling behind the competition. It is far better to copy, borrow, pilfer, steal someone else’s idea and add your own particular bits, bytes, bells, whistles and spin than to explain why you were beaten.

What is particularly fascinating about cloud euphoria is that even the targets of this approach, namely Microsoft and Oracle, are appearing to embrace this cloudy concept (kicking and screaming?)…whether they want to or not.

New York Times columnist and author Thomas L. Friedman in his The World is Flat (2005) provided an excellent explanation of cloud computing or the downloading of software from the Internet (the cloud) via a web browser: “Software becomes something you rent, instead of something you own. Somebody else takes care of the upgrading and maintenance.”

This concept was a direct attack on the proprietary software of Microsoft, Oracle and SAP by Salesforce.com and some others. As Saleforce.com chief Marc Benioff said: “Microsoft wants you to buy more software. We want to see the end of software.” And if you visit Salesforce.com’s website there is the word “software,” sitting on its own little cloud with the diagonal line striking it out.

cloudcomputing

Microsoft certainly knows a trend when it sees one, and instead of countering Salesforce’s creativity, it extols the virtues of “cloud power” even including a tagline of completely overused buzz words and phrases imploring perspective customers to: “Find out more about our cloud-based platform solutions.” Let’s see: “Cloud,” “Platform” and (my favorite) “Solutions” in just four words.

Salesforce.com deserves credit for creativity. Whether Benioff et al are the actual creators of cloud computing or Software as a Service (SaaS) or not, they have assumed a first-mover position. As we used to say in my Sacramento days, “When in doubt; declare victory.” Benioff certainly has claimed victory.

Everyone else is taking turns spraying the fire hydrant. Consider IBM which has taken SaaS and devised its own acronyms, Platform as a Service (PaaS) and Infrastructure as a Service (IaaS). Wonder where they came up with those ideas? Will someone follow with PiiS?

Supposedly, Silicon Valley is the cradle of innovation. Alas, when it comes to public relations, marketing and social media, the usual practice is not creativity and cleverness. Instead it’s follow the leader (and pretend that is not what you are doing), trying to make it appear that you have something different when in reality you are copying someone else’s idea and you are late as well. Many PR offensives — targeting editors, bloggers, analysts, reporters — have been based on these shaky premises.

Communications innovation, creativity, choreography and cleverness are certainly easier said than done, it helps to have a real killer app. In the case of the cloud, it does not appear that anyone has really tried. All they did is let a few create while the rest surrendered en masse. Not even Erwin Rommel can save them.

http://news.bbc.co.uk/dna/h2g2/plain/F8984900?thread=4935057

http://en.wikipedia.org/wiki/Erwin_Rommel

http://en.wikipedia.org/wiki/Cloud_computing

http://www.salesforce.com/cloudcomputing/

http://www.ibm.com/cloud-computing/us/en/

http://content.dell.com/us/en/enterprise/cloud-computing.aspx

http://www.microsoft.com/en-us/cloud/default.aspx?fbid=XN-13jrEZdF

http://www.oracle.com/us/products/applications/fusion/hcm/index.html

http://www.apple.com/icloud/

Pounding PR Buzz Words to Death

To be successful in communications choreography you must be skillful in planning and implementing a multi-faceted communications campaign . . . A little ADD doesn’t hurt.

Included in this campaign is message development, formulation of timelines, preparation of deliverables, composing Q&As and briefing papers, crafting contributed articles, training spokespersons, pitching media and analysts, monitoring interviews, writing blogs, recording podcasts, twittering tweets, reviewing media reports and eventually accessing what went right and what went wrong.

As any communications professional knows there are always going to be challenges associated in choreographing a winning PR campaign from start to finish, namely because you are dealing at every turn with people…and people have issues and “concerns.” Keep in mind that Newton never would have found gravity, Edison would never have invented the light bulb, the Wright Brothers never would have learned to fly and Al Gore would have never invented the Internet, if they were overly concerned with “concerns.”

Having said all that, I do have a concern that must be addressed. Why do we insist upon hammering the same buzz words over and over again to the point that they have become cliché?

It has almost reached the point that if we do not use certain words in the presence of those who pay the bills (e.g. our clients) that we are not providing them with our best thinking . . .  But are we really providing them with our best thinking if we just merely recite the same PR-speak over and over again? It’s reminds one of  Bill Murray in Ground Hog Day or Yogi Berra when he said, “It’s like déjà vu all over again.”

groundhogday

So what are these offending buzz words that we as a public relations community are literally loving to death? Here is a sampling in alphabetical order. Please feel free to mentally add your favorites:

Brand: Probably the most tired word in the PR professional’s dictionary, particular those hailing from the integrated marketing side of the industry. They talk about “building brand,” “safeguarding brand,” “brand management,” “enhancing brand,” “establishing brand awareness” and on and on and on. It’s reached the point that corporate sales VPs are checking off how many times a marketer can repeat the same word. Maybe we should brand that?

Cloud: When Salesforce.com (NYSE: CRM) invented “cloud computing” allowing customers to download software capability off the web it was a novel idea and an alternative to the purchase-the-entire-package from Microsoft, Oracle, SAP, IBM…Now everyone in the overly hyped software space is embracing the cloud, even Microsoft is running ads for the “Most Comprehensive Solutions for the Cloud on Earth” or “Cloud Power.” But wait…SpotCloud, “The Cloud Capacity Clearinghouse & Marketplace” is offering to trade clouds, just like Enron endeavored to trade bandwidth and eventually, the weather.

CSR or Corporate Social Responsibility, which could very well be an oxymoron. PR agency executive types are fond of lecturing the captains of industry on how they need to build trust by doing good deeds. Here’s a hint as long as there is this thing called fiduciary responsibility, corporate chieftains are going to be more interested in delivering shareholder value in the form of rising top and bottom lines and expanding gross margin. Oh by the way, a large percentage of employees are shareholders as well.

organic

Organic. This is a counterculture word that has been successfully marketed to derive higher prices from essentially the same product. There are regular apples and “organic” apples. There are regular oranges and “organic” oranges. There are regular spears of broccoli and “organic” spears of broccoli. Guess which are more expensive?

Solutions. Probably the buzz word that raises my blood pressure the fastest. Please note the word has already been used in this blog in the Microsoft cloud ad…That’s right, Microsoft managed to incorporate “solutions” and “cloud” in the same tag line. Where is the creativity? At LSI Logic, one of our marketers breathlessly came into my domain with a proposed corporate tag line: “LSI Logic, The Solutions Company.” Ah…No!

Sustainable. Lately, I have been contemplating labeling myself as a “sustainable capitalist.” Yes, I am vitally interested in sustaining capitalism. This is one word that has already morphed into a cliché. It is probably the one and only word that has made more Eugene (and other “progressive” enclave) elitists more proud of themselves. They adore stating that they are dedicated to sustainable living including maintaining a sustainable garden with sustainable vegetables originating from sustainable seeds that came from…

Thinking Out of the Box. As General George S. Patton said, “If we are all thinking the same, then no one is thinking.” Different kinds of thinking is to be encouraged and celebrated, but using the same almost mundane phrase over and over and over again completely erodes its effectiveness. Come on Silicon Valley, let’s come up with a new “Thinking Out of the Box.”

Thought Leadership. Wonder how many PR agency execs have used the words, “brand,” “CSR,” “cloud” and “thought leadership” in the same meeting with company executives? Let’s see if we can put all of them into the same sentence. When it comes to run-on sentences, no one does them better than the PR industry.

(Turning on the projector to run the 64-graphic PowerPoint presentation): “Today we are thinking out of the box in leveraging a portfolio of organic, sustainable cloud computing solutions that enhance your company brand, while demonstrating thought leadership and exemplifying your dedication to corporate social responsibility.” Pass the popcorn please.

http://www.spotcloud.com/

http://www.microsoft.com/en-us/cloud/default.aspx#tab2-small

http://www.salesforce.com/

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