Monday, Dec. 09, 1991
Business Notes Computers
At IBM, breaking up is hard to do. The world's largest computer maker has restructured itself several times in the past five years in an attempt to operate more efficiently. Last week the company went much further, announcing the most radical changes in its 78-year history. Virtually all divisions in IBM, ranging from those that manufacture mainframe computers to those that produce small PCs, will be spun off into decentralized units and given an unprecedented amount of autonomy. Each of these subsidiarylike divisions will be free to develop its own marketing strategies, determine salaries and report profits and losses to the public. Some may even be sold to investors and become public companies, with IBM maintaining a minority interest. The goal, says chairman John Akers, is to unshackle IBM from its stifling bureaucracy and enable its separate divisions to compete more nimbly against an increasingly diverse group of rivals. To help reduce operating costs, IBM announced it will spend some $3 billion to eliminate 20,000 of its 353,000 jobs worldwide in 1992, following a similar cut this year.