BEST PRACTICE

WakingUpIBMHow a Gang of

Unlikely Rebels Transformed Big Blue

HARVARD BUSINESS REVIEW July-August 2000

Six years ogo, IBM was a has-been. Today, it's an e-businesspowerhouse. It didn't turnaround by imposing changefrom the top. It let ideas, initi-atives, and enthusiasm bubbleLip from below. Maybeyourcompany should do the same.

BYGARYHAMEL

D o YOU REMEMBER WHEN IBMwas a case study in complacency? In-sulated from the real work! by layerupon layer of dutiful manaj;ers andobsequious staff, IBM's executiveswere too busy fighting their endlessturf battles to notice that the compa-ny's once unassailable leadership po-sition was crumbling around them.The company that held the top spoton fortune's list of most admiredcorporations for four years runningin the mid-T98os was in dire need ofsaving by the early 1990s. Fujitsu,Digital Equipment, and Compaqwere hammering down hardwaremargins. EDS and Andersen Consult-ing were stealing the hearts of CIOs.Intel and Microsoft were running

137

BEST PRACTICE • Watting Up fBM

away with PC profits. Customerswere bemoaning the company's ar-rogance. By the end of 1994, LouGerstner's first full year as CEO, thecompany had racked up $15 billionin cumulative losses over the previ-ous three years, and its market caphad plummeted from a high of $105billion to $32 billion. Armchair con-sultants were nearly unanimous intheir view: Big Blue should he bro-ken up.

Despite Gerstner's early assertionthat IBM didn't need a strategy (thelast thing he wanted was to start an-other corporatewide talk fest), IBMwas rudderless in gale force winds.Yet over the next six years, the com-pany transformed itself from a be-

and Microsoft originally missed?Much of the credit goes to a smallband of activists who built a bonfireunder IBM's rather broad behind.This is their story.

Missing an OlympicOpportunityThe first match was struck in 1994in the backwoods of IBM's empire,on a hilltop in Ithaca, New York, bya typical self-absorbed programmer.David Grossman was a midlevelIBMer stationed at Cornell Univer-sity's Theory Center, a nondescriptbuilditig hidden away in the south-east corner of the engineering quad.Using a supercomputer connectedto an early version of the Internet,

How did a company that had lagged behind every computertrend since the mainframe catch the Internet wave-a wavethat even Bill Gates and Microsoft originally missed?

sieged box maker to a dominant ser-vice provider. Its Global Servicesunit, once a backwater, grew into a$30 billion business with more than135,000 employees, and corpora-tions flocked to IBM consultants forhelp in capitalizing on the Internet.By the end of 1998, IBM bad com-pleted 18,000 e-business consultingengagements, and about a quarter ofits $82 billion iti revenues was Netrelated.

How did a company that bad laggedbehind every computer trend sincethe mainframe catch the Internetwave-a wave that even Bill Gates

Gary Hamel is the Thomas S. Mui-phy Distinguished Research Fellowat Harvard Business School, a visit-ing professor of strategy and inter-nationa} management at the Lon-don Business School, and chairmanof Strategos. a consulting firm basedin Menlo Park, California. He is theauthor of the forthcoming book.Leading the Revolution (HarvardBusiness School Press), from whichthis article is adapted.

To discuss this article, join HBR'sauthors and readers in the HBR Fo-rum at www.hhr.org/forum.

Grossman was one of the first peoplein the world to download the Mosaicbrowser and experience the graphi-cal world of the Web. Grossman'sfecund imagination quickly con-jured up a wealth of interesting appli-cations for tbe nascent technology.But it was an event in February, assnow dusted the groxmd around tbeTheory Center, that hardened his de-termination to help get IBM out infront of wbat he knew would at thevery least be the Next Big Thing-and might very well be the UltimateBig Thing.

Tbe Winter Olympics had juststarted in Lillebammcr, Norway,and IBM was its official technologysponsor^ responsible for collectingand displaying all tbe results.Watching the games at home, Gross-man saw the IBM logo on tbe bottomof bis TV screen and sat througli thefeel-good ads touting IBM's contri-bution to the event. But when he satin front of bis UNIX workstationand surfed the Web, he got a totallydifferent picture. A rogue OlympicsWeb site, run by Sun Microsystems,was taking IBM's raw data feed andpresenting it under tbe Sun banner."If I didn't know any better," saysGrossman, "I would have thought

that the data was being provided bySun. And IBM didn't have a clue asto what was happening on the openInternet. It bothered me."

The fact that IBM's muckety-mucks were clueless about the Webwasn't exactly news to Grossman.When he had landed at IBM a fewyears earlier, everyone was still us-ing mainframe terminals. "I wasshocked/' he remembers. "1 camefrom a progressive computing envi-ronment and was telling people atIBM that there was this thing calledUNIX-there was an Internet. Noone knew what I was talking about."

This time, though, he felt embar-rassed for IBM, and he was irked. Helogged on to the corporate directory

and looked up tbe name ofthe senior executive incharge of all IBM marketing,Abby Kohnstamm. Then hesent her a message inform-ing her that IBM's Olympicfeed was being ripped off. Afew days later, one of her

minions working in Lillehammercalled Grossman back. At the end ofa frustrating conversation, Gross-man had tbe feeling tbat one of themwas living on another planet. Everpersistent, Gtosstnan tried to sendsome screen shots from Sun's Website to IBM's marketing staff in Lille-hammer, but IBM's internal e-mailsystem coukln't cope with the Websoftware. Tbat didn't stop IBM's dili-gent legal department from sendingSun a cease-and-desist letter, whichsucceeded in shutting down the site.

Most frontline employees wouldhave left it at tbat. But Grossmanfelt IBM was missing a bigger point:Sun was about to eat Big Blue'slunch. After everyone had comeback from the Olympics, he drovedown to IBM's headquarters, fourhours away in Armonk, New York,to personally show Kohnstamm theInternet.

A Virtual Team Takes ShapeWhen he arrived, Grossman walkedin unattended, a UNIX workstation inhis arms. Wearing a programmer'suniform of khakis and an open-necked shirt, he wound his way upto the third floor-the sanctum sanc-torum of the largest computer com-

138 HARVARD BUSINESS REVIEW July-August 2000

BEST PRACTICE • Waking Up IBM

pany in the world. Borrowing a Tlline from someone who had beenworking on a video project, he strungit down the hall to a storage closetwhere he plugged it into the hack ofhis workstation. He was now readyfor his demo - a tour of some earlyWeh sites, including one for theRolling Stones. As sohcr-suited IBMexeeutives scurried through theirrounds, Miek Jagger could he heardwailing from the closet.

In addition to Kohnstamm, twoothers were present at that first demo.One was Irving Wladawsky-Berger,head of the supercomputer divisionwhere Grossman worked. The otherwas [ohn Patriek, who sat on a strat-egy task foree with Wladawsky-Berger. Patrick, a career IBMer andlifelong gadget freak, had heen headof marketing for the hugely success-ful ThinkPad laptop computer andwas working in corporate strategy,scouting for his next big project.Within minutes, Grossman had hisfull attention. "When i saw the Wehfor the first time," says Patriek, "allthe hells and whistles went off. Itsahility to include colorful, interest-ing graphics and to link to audio andvideo content hlew my mind."

Not everyone saw what Patrieksaw in that primitive first browser."Two people can see the same thingbut have a very different understand-ing of the implications," he recalls."A lot of people [would say], 'What'sthe hig deal ahout the Web?' But Iconld see that people would do theirhanking here and get access to allkinds of information. I had beenusing on-line systems like Compu-Serve for a long time. For people whoweren't already using on-line sys-tems, it was harder for them to see."

Their passions fueled hy the Web'slimitless possibilities, Patriek andGrossman hecame IBM's Internettag team, with Patrick doing thebusiness translation for Grossmanand Grossman doing the teehnologytranslation for Patrick. Patriek actedas a sponsor and a resource hrokcr.Grossman developed intimate linkswith the Net-heads in IBM's far-flung development community."The hardest part for people on thestreet like me," says Grossman,"was how to get senior-level atten-

tion within IBM." Patrick hecamehis mentor and his go-between.

After seeing Grossman's demo,Patriek hired him, and they soonhooked up with another Internetactivist within IBM, David Singer.Singer was a researcher in Alameda,California, who had written one ofthe first Gopher programs, whichfetched information off the Net.Grossman and Singer started build-ing a primitive corporate intranet,and Patrick published a nine-pagemanifesto extolling the Weh. Enti-tled "Get Connected," the mani-festo outlined six ways IBM couldleverage the Weh:1. Replace paper communications

with e-mail.2. Give every employee an e-mail

address.5. Make top exeeutives available to

customers and investors on-line.4. Build a home page to better

communieate with customers.5. Print a Weh address on every-

thing, and put all marketingon-line.

6. Use the home page for e-com-merce.Tbe Get Connected paper, distrib-

uted informally hy e-mail, found aready audienee among IBM's unher-alded Internet aficionados, The nextstep was to set up an on-line newsgroup of the sortthat allowed IBM'sunderground hack-ers to trade techni-cal tidbits. "Veryfew people higherup even knew thisstuff existed," saysGrossman. Withinmonths, more than300 enthusiastswould join the vir-tual Get Cotinectedteam. Like dissi-dents using a purloined duplicator inthe old Soviet Union, Patrick andGrossman would use the Weh tobuild a community of Web fans thatwould ultimately transform IBM.

As Patrick's group began to blos-som, some argued that he should "gocorporate" and turn the nascent Webinitiative into an officially sanc-tioned project. Patrick's hoss, seniorVP for strategy and development

As sober-suited IBMexecutives scurried

through their rounds^Mick Jagger couldbe heard wailingfrom the closet

Jim Canavino, disagreed. "Youknow, we could set up some sort ofdepartment and give you a title,"Canavino remarked to Patrick, "hutI think that would be a bad idea. Tryto keep this grassroots thing going aslong as possible." Patrick needed toinfiltrate IBM rather than managesome splendidly isolated projectteam. It would he easy for others atIBM to ignore a dinky department,hut they couldn't stand in the wayof a grounds well,

Still, Canavino wasn't above usinghis role as head of strategy to givethe fledgling initiative a push. Toavoid the danger of going quicklyfrom having no IBM Weh site to hav-ing dozens of uncoordinated ones,Canavino decreed that nohody couldhuild a site without Patrick's ap-proval. Though few in IBM had anyinkling of what the Internet wouldhecome, Patrick had become IBM'ssemi-official Internet czar.

"Where's the Buy Button?"Patrick's volunteer army was awidely dispersed group of Net ad-dicts, many of whom had no ideathat others shared their passion."What John ended up providing,"says Grossman, "was the ahility toarticulate and summarize whateveryone was doing and to open a lot

of doors." In turn,the Net-heads in-troduced Patrick tothe culture of theInternet, with itsegalitarian idealsand trial-hy-fire ap-proach to develop-ing new technolo-gies. When tbe GetConnected conspir-ators gathered fortheir first physicalmeeting, remem-

bers Grossman, "the question oneverybody's lips was. How do wewake this company up?"

Patrick gathered a small group ofhis Get Connected renegades, in-cluding Grossman, at his vacationhouse, set deep in the woods of west-ern Pennsylvania. There they cob-bled together a mock-up of an IBMhome page. The next step was toget through to Gerstner's personal

140 HARVARD BUSINESS REVIEW July-August 2000

BEST PRACTICE • Waking Up IBM

How to

start""Insurrection

Is it clear to you that your company needsto be shaken up? Then it's time you becamea revolutionary. Here are seven steps fororganizing a coniorate insurrection.

1Establish a point of view. In a world of peoplewho stand for nothing more than more of the same,a sharply articulated POV is your greatest asset. It's

a sword that lets you slay the dragons of precedent. It's arudder that lets you steer a steady course when othersare blown about by fad and whim. And it's a beacon thatattracts those who are looking for something worthy oftheir allegiance. A powerful POV is credible, coherent,compelling, and commercial. To be credible, it must befounded on unimpeachable data. To be coherent, it mustbe logical, laying out a bulletproof argument. To be com-pelling, it must speak to people's emotions, telling tbemwhy your cause will make a difference in the world. To becommercial, it must have a clear link to the bottom line.

2Wri te a manifesto. Ifs not enough to have anideology; you have to be able to pass it on, to infisctothers with your ideas. Like Thomas Paine, whose

Common Serise became the inspiration for the AmericanRevolution, you have to write a manifesto. It doesn't haveto be long, but it must capture people's imaginations. Itmust paint a picture of what is and what is coming thatcauses discomfort, And it must provide a vision of whatcould be that inspires hope.

3 Create a coalition. You can't change the directionofyour company all by yourself. You need to build acoalition, a group of colleagues who share yourvision

and passion. It'seasytodismiss corporate rebels when theyare fragmented and isolated. But when they present them-selves as a coordinated group, speaking in a single voice, theycannot be ignored. And remember, as you struggle to attractrecruits to your cause,you will have an advantage over topmanagement. Your army will be made up of volunteers;theirs will be composed of conscripts. Conscripts fight tostay alive; volunteers fight to win.

4Pick your targets. Sooner or later, a manifesto hasto become a mandate if i f s going to make a difference.Tbe movement has to get the blessing of the suits.

That's why activists always identify and target a potentialchampion-someone or a group of someones tbat can yankthe real levers of power. Ultimately, tbe support of seniormanagement is the object of your crusade. Make an effortto understand tbem-the pressuresthey face, the objectives

they have to fulfill. Find some who are searching for help

and ideas, and go after them. If necessary, bend your ideals

a bit to fit their goals. And don't forget that leaders are

often more receptive to new thinking than are the minions

who serve them.

5 Co-opt and neutralize. Some activists furthertheir causes by confronting and embarrassingtheir adversaries. Such tactics may work in the public

sphere, but in a business setting they'll probably get youfired. You need to disarm and co-opt, not demean andhumiliate. To win over IBM's feudal lords, John Patrickconstructed a set of win-win propositions for them: Lendme some talent, and I'll build a showcase for your products.Let me borrow a few ofyour top people, and I'll send themback with prototypes of cool new products. Reciprocitywins converts; ranting leaves you isolated and powerless.

6 Find a transki tor. imagine bow a buttoned downdad looks at a daughter who comes home withgreen hair and an eyebrow ring. Thaf s the way top

management is likely to view you and your coconspirators.And thaf s why you need a translator, someone who canbuild a bridge between you and the people with the power.At IBM, Patrick was a translator for Dave Grossman. Hehelped the top brass understand the connection betweenthe apparent chaos of the Web and the disciplined world oflarge-scale corporate computing. Senior staffers and newlyappointed executives are often good translator candidates-they're usually hungry for an agenda to call their own.

7 t Win small, win early, win often. None ofyourorganizing efforts is worth anything if you can't

demonstrate that your ideas actually work. You needresults. Start small. Unless you harbor kamikaze instincts,search for demonstration projects tbat won't sink you oryour cause if they should fai l- for some of them will fail.You may have to put together a string of successful proj-ects before top management starts throwing money yourway. You have to help your company feel its way towardrevolutionary opportunities, step by step. And as yourrecord of wins gets longer, you'll find it much easier tomake the transition from an isolated initiative to an inte-gral part of the business. Not only will you have won thebattles, you will have won the war.

142 HARVARD BUSINESS REVIEW July-August 2000

Waking Up IBM • BEST PRACTICE

techtioJogy adviser, who agreed totnake him available for a demo ofthe prospective IBM corporate Website. When Gerstner saw the mock-up, his first question was, "Where'sthe buy button?" Gersttier wasn'ta quick study-he was an instantstudy. But Grossman and Patrickknew that an intrigued CEO wasn'tenough. There were thousands ofothers who still needed to get the In-ternet rehgion.

Their first chance for a mass con-version came at a meeting of IBM'stop 300 officers on May 11, 1994.Having schemed to get himself onthe agenda, Patrick drove his pointhome hard. He started by showingIBM's top brass some other sitesthat were already up and running,including ones done by Hewlett-Packard; Sun Microsystems; theRed Sage restaurant in Washitigton,D.C.; and Grossman's six-year-oldson Andrew. The point was clear: onthe Web, everyone could have a vir-tual presence.

Patrick ended the demo by saying,"Oh, by the way, IBM is going tohave a home page too, and this iswhat it will look like." He showedthe startled executives a mock-up ofwww.ibm.com, complete with a36.2-second video clip of Gerstnersaying, "My name is Lou Gerstner.Welcome to IBM."

Still, many IBM old-timers re-mained skeptical. Recalls Patrick:"A lot of people were saying, 'Howdo you make money at this?' I said, 'Ihave no idea. All I know is that thisis the most powerful, importantform of communication both insideand outside the company that hasever existed.'"

Shortly after the May meeting,Patrick and a few colleagues showedup at one of the first Internet Worldtrade conventions. The star of theshow, with the higgest booth, wasrival Digital Equipment. Like Gross-man's before him, Patrick's competi-tive fires were stoked. The next day,the convention's organizers auc-tioned off space for the next show,scheduled for December, and Patricksigned IBM up for the biggest dis-play, at a cost of tens of thousands ofdollars. "It was money I did nothave," admits Patrick, " but I knew

I could find it somehow. If you don'toccasionally exceed your formalauthority, you are not pushing theenvelope."

Now that IBM's name was on theline, Patrick had a rallying point forall of the company's various Inter-net-related projects. Here was hischance to seed his message acrossthe entire company. He sent lettersto the general managers of all the

asked him about his organization, hereplied, "You're looking at it, andthere are hundreds more."

Throwing Hand GrenadesPatrick was a relentless campaigner,spreading the good word about theInternet in countless speeches in-side and outside IBM. "Somebodywould invite me to talk about theThinkPad," he recalls, "and I would

Like dissidents using a purloined duplicator inthe old Soviet Union, Patrick and Grossman usedthe Web to build a community of Web fans that

would ultimately transform IBM.

business units asking for anythingthey had that smelled like the Inter-net. They would have to put in onlya little money, he promised, and hewould coordinate everything. Itturned out that IBM had a lot moreWeb technology brewing than evenhe had expected. But none of it wasreally ready to go to market. Still, hyDecember, Patrick was able toshowcase IBM's Global Network, asthe world's largest Internet serviceprovider, as well as a Web browserthat preceded both Netscape's Navi-gator and Microsoft's Internet Ex-plorer. IBM stole the show and be-came a fixture at every InternetWorld thereafter.

Constantly fighting IBM's paro-chialism, Patrick took every oppor-tunity to drive home the point thatthe Web was a companywide issueand not the preserve of a single divi-sion. At the next Internet World, inJune 199s, he challenged his compa-triots to leave their local biases atthe door: "The night before theshow, I got everybody together in anauditorium and said, 'We are herebecause we are the IBM Internetteam for the next three days. You arenot IBM Austin or IBM Germany.'That is part of the culture of the In-ternet-boundaryless, flat."

The huge IBM booth generated alot of curiosity among the show'sother participants. When peopleasked Patrick to whom he reported,he said, "The Internet." When they

come talk about the Internet in-stead, rd use the ThinkPad to bringup Web page presentations ratherthan PowerPoint slides." He alsomade himself accessible to the me-dia. But even when talking to re-porters, his prime constituency wasstill the vast swath of unconvertedIBMers. He just couldn't shut upabout the Internet. Says Patrick: "Ifyou believe it, you've got to be outthere constantly talking about it,not sometimes, but all the time. Ifyou know you're right, you just keepgoing."

While Patrick and his crew werethrowing Internet hand grenadesinto every meeting they could whee-dle their way into, Gerstner was fan-ning the flames from above. Gerst-ner's early belief in the importanceof network computing dovetailednicely with the logic of the Internet.Having bought into Patrick's pitch,Gerstner was ever ready to give IBM'sWeb-heads a boost. He insisted thatthe company put its annual andquarterly reports on the Web, and hesigned up to give a keynote addressat Internet World. This was whileBill Gates and others were still diss-ing the Web as an insecure mediumfor consumer e-commerce. WithinIBM, Patrick became a trusted emis-sary between the company's but-toned-down corporate types and theT-shirted buccaneers who wereplugged into Net culture and livingon Internet time. Patrick had the ear

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of IBM's aristocracy, and his messagewas simple and utiequivocal: "Missthis and you miss the future of com-puting." At the same time, Patrickconvinced Grossman and his ilk thatnot everyone in the head office wasa Neanderthal. "I used to think thatIBM at senior levels was clueless,that these guys had no idea how torun a company," says Grossman."But one of the many things that hasimpressed me is that the people whoarc running this company are reallybrilliant businesspeople. Somehowwe connected them to the street.Knowing how to shorten paths tothose decision makers was key."

When IBM finally set up a small,formal Internet group, with Patrickas chief technical officer, he insistedthat the team stay separate fromIBM's traditional software develop-ment organization. His logic: "I dobelieve there's a benefit in being sep-arate. Otherwise, we'd have to startgoing to meetings. Pretty soon we'dbe part of someone else's organiza-tion, and a budget cut would comealong, and we'd be gone."

Even with the formal unit inplace, Patrick and Grossman didn'tdisband their grassroots coalition.As the 1996 Summer Olympics ap-proached, the group went throughseveral watershed events. Patricklent Grossman out for t8 months tocorporate marketing, which was incharge of the Olympics project. Forthe first time, the Olympics wouldhave an official Web site, and IBMwould build it. Grossman launchedhimself into building the site andwas soon begging Patrick for extrabodies. "Patrick did the magic to getthem hired," says Grossman, "andI morphed from doing the grunttechnical work to being Tom Sawyerand getting other people to helpwhitewash the fence."

To prepare for the Olympics,Grossman and his team had alsostarted developing Web sites forother sporting events such as the1995 U.S. Open and Wimbledon. Forthe U.S. Open site, he gave a coupleof college interns from MIT the taskof writing a program to connect ascoring database to the Web site. "Bytbe end of the summer," remembersGrossman, "we were sitting in a

Waking Up IBM • BEST PRACTICE

trailer, barely keeping together aWeb site with a million people a daypounditig away at it for scores. It washeld together by Scotch tape, hut wewere learning about scalability." Itwas amazing, thought Grossman,that all those people would come toa site merely for sports scores.

IBM's second surprise came in1996 when a chess match hetweenworld champion Garry Kasparov andan IBM supercomputer named DeepBlue generated a flood of global in-terest. Corporate marketing hadasked Grossman earlier to huild theWeb site for the match, but he wasbooked with too many other assign-ments, so the site was outsourced toan advertising agency that did littlemore than put up a cheesy chess-board. The day of the first match, thesite was overloaded with traffic andcrashed.

"Nobody had any idea this wasgoing to he such a big deal," saysPatrick. IBM went into panic mode.Grossman and a handful of IBM'sbest Web engineers jumped in to

take over the site. With only 56hours to revamp it before the nextmatch, they got Wladawsky-Bergerto pull a $500,000 supercomputer offthe assemhly line. The site didn'tcrash again, but the incident raisedthe anxiety level about the upcom-ing Olympics. If IBM was having dif-ficulty running a Web site for a chessmatch, what were the Olympicsgoing to he like? The incident suc-ceeded in convincing a few moreskeptics that the Internet was goingto he beyond Big.

The Olympics site had to be ableto withstand anything. Patrick wenttin-cupping again, asking all the gen-eral managers to lend him their bestpeople and best equipment. He gotnot one supercomputer, but three,and his team grew to about 100 peo-ple. By the time it was over, IBM hadbuilt what was then the world'slargest Weh site, which withstoodup to 17 million hits a day with fewshutdowns. The content on the sitewas replicated on servers across fourcontinents. IBM even learned how to

do a little e-commerce when a demosite for on-line ticket sales attracteda flood of credit card numbers and$S million in orders.

The Power of ResultsFor Patrick and Grossman, theOlympics was just one more high-profile way to show IBM the possi-bilities of the Internet. It was also aneasy way to get funding for develop-ment. "I used the Olympics as afront," admits Grossman. "WhatI was doing, without telling anyone,was getting computing resources.I also thought the fastest way to getIBM to change was to work from theoutside in. If IBM saw itself writtenabout in the papers, then it wouldchange faster than if we got mired inan internal process."

Grossman's on-the-fly develop-ment, in public no less, was thecomplete antithesis of IBM's tradi-tional way of doing things, whichwas to push developers to perfectproducts before letting them out thedoor. It was the difference between

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BEST PRACTICE • Waking Up IBM

improv comedy and a carefully re-hearsed Broadway play. The oldmodel didn't make much sense onthe Web, where if something breaks,you can fix it without sending outmillions of CD-ROMs with newsoftware. You just change the soft-ware on the server, and everyonewho logs on automatically gets thenew version.

Grossman and Patrick quicklyconcluded that creating Weh-en-abled software called for a new set ofsoftware development principles,which they summarized and sharedwithin the burgeoning IBM Webcommunity:• Start simple; grow fast,• Trial by fire.• Just don't inhale |the stale air

of orthodoxy).• Just enough is good enough.• Skip the krill (go to the top

of the food chain when you'retrying to sell your idea).

" Wherever you go, there you are(the Net has no bounds).

• No blinders.• Take risks; make mistakes

quickly; fix them fast.• Don't get pinned down

[to any one way of thinking).Much of the technology that

Grossman and his crew first proto-typed would later make its way intoindustrial-strength products. For in-stance, the Web server software de-veloped for the Olympics evolvedinto a product called Websphere, andmuch of what Grossman's grouplearned formed the basis for a Web-

'We have never been a threat toany other part of the company.From the beginningy our goal wasto help IBM become the InternetBusiness Machines company"

hosting business that today supportstens of thousands of Weh sites.

Following the Olympics, the In-ternet group stepped up its prosely-tizing within IBM. Grossman, whohad become the senior technicalstaff member on Patrick's team, set

up an Internet lab to hring in execu-tives from all over the company toexperience the Web's possibilities.Patrick's group also started a projectcalled "Web Ahead," which workedto revolutionize the company's ownIT systems through Internet tech-nology, For instance, the team tookthe old terminal-based corporate di-rectory and wrote a Java applicationthat gave it a great graphical inter-face and cool features. With a fewclicks, employees could look up acolleague, see what computer skillshe or she had, and then ask the direc-tory to list every other employee atIBM with those same skills. These"Blue Pages" were an instant hit.

Only a few dozen people officiallyworked for the Internet group, soPatrick was constantly pleading toborrow people (who were usuallyalready part of his virtual team) fromother departments. In this effort, hismost important ally was the team'sever-lengthening list of success sto-ries. People could argue with posi-tion papers, but they couldn't arguewith results. "1 have never beenturned down on anything I haveasked for, and I have asked for a lot,"he says. "I would go to a generalmanager and say, 'I need you to pullsome disk drives from the assemblyline, and I need your top engineer.What you will get out of it is unique.Your guy is going to come back toyour group, and you are going to havea hell of a reference story to talkabout. It will be great PR. We willmake your stuff work on the Inter-

net . ' " Patrick hadgained credibilitywithout a big job titleor a mcgabudget.

Patrick was hard torefuse, partly becauseit was clear that hewas operating inIBM's interests as awhole and not justfighting for his ownli t t le group. As he

puts it, "I didn't have any allegianceto any one product group. Although Ihad a budget that came out of thesoftware group, I didn't think of us aspart of the software group. Whensomebody called us and asked forhelp, we didn't ask them for a budget

code. We'd say, 'Sure.' We have neverbeen a threat to any other part ofthe company. From the beginning,our goal was to help IBM becomethe Internet Business Machinescompany."

Patrick was quick to assure would-be donors that the relationships hewas forging worked botb ways. Hewould borrow people from variousbusiness units, but at any giventime, about a quarter of his own peo-ple would be out on loan to otherunits, and Web Ahead alumni wereregularly posted to permanent posi-tions across IBM. When that hap-pened, he would tell his remainingstaff, "We did not lose Bill. We colo-nized the network hardware divi-sion. Now there is one of us livingthere."

Again and again, throughout theirInternet campaign, Patrick andGrossman broke long-standing IBMrules and overstepped the bound-aries of their own authority. But be-cause their cause was so importantand their commitment to IBM's suc-cess so visibly selfless, they got awaywith things that bad often sunk ca-reers at Big Blue. Then and now,Patrick is unapologetic: "If youthink of yourself as being in a boxwith boimdaries, you're not going tohave any breakthroughs. If (peopleon my team] come to me and say,'We failed because we didn't havethe authority to do something/ I'llsay that's crazy."

Inside IBM and out, Patrick andGrossman are today recognized fortheir pivotal contribution to theircompany's e-business metamorpho-sis. With the support of a prochangeGEO, these two unlikely heroes-a software nerd and a corporatestaffer-helped IBM do something ithadn't done for a couple of decades:lead from the front.

The author acknowledges the assistance otEhck Schonfeld in the preparaaon of this article.

Rep r in t R00406Tu order reprints, sec the kst page of this issue.

146 HARVARD BUSINESS REVIEW July-August 2000

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