IBM’s Sam Palmisano: A super second act

Sam PalmisanoBy Jessi Hempel – Here’s what you might not know: Nine years after Gerstner stepped down as CEO, IBM (IBM) is financially and strategically stronger and, yes, sexier than ever — all thanks to Sam Palmisano, Gerstner’s successor.

Under Palmisano, earnings have quadrupled and the stock is up 57%. He’s not merely cutting costs (though he’s done plenty of that, including shifting work from the U.S. to India). He’s remaking the company by pushing into new countries and expanding hot businesses such as supercomputing and analytics that require heavy-duty lab innovations. Last year’s R&D spending? Some $6 billion, or 6% of IBM’s nearly $100 billion in annual sales.

Its 5,896 patents in 2010 — more than any company in the world — help explain why it lands at No. 12 on Fortune’s annual list of the World’s Most Admired Companies. That Jeopardy-playing computer isn’t just a gimmick; it is at the heart of IBM’s long-term growth strategy. more>


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