Based on the scenario outlined in this article, no way Krishna will succeed.
https://www.forbes.com/sites/georgebradt/2020/02/04/the–most-important-choice-facing-ibms-new-ceo-arvind-krishna/#15578c406c26
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IBM should no longer be an independent company. It is only a matter of time before it gets acquired and broken up.
@3tor That was a really good article. Finally someone addressed the elephant in the room - the dividend and the expectation that it will be increased every year forever. In reality, it needs to be slashed, and that cash flow needs to be invested in both organic R&D and strategic acquisitions.
Yet one more opinion of IBM. Everyone is saying Krishna needs to act and act fast. It addition they are saying “everything non-cloud must go so a big dog can buy us”. We’ll see ehh
https://seekingalpha.com/article/4322576-status-quo-for-ibm-is-unsustainable-acquirer-treat-assets-better
Keep your eyes right here. If IBM rightsized itself and cleans itself up, the third place cloud provider will come a calling
https://qz.com/1798530/can-google-or-microsoft-beat-aws-in-the-cloud-wars/
https://seekingalpha.com/article/4322064-ibm-post-earnings-mainframe-cycle-buy-redhat-time
This article outlines IBM’s recent earnings report and how the mainframe influenced it. NOTE it implies the mainframe may have bought The Redhat strategy a little time.
I would say you will know if Krishna is executing the “Redhat” strategy via a couple of directional changes
- Cut a deal for HW. (look for a globalfoundries deal) The Redhat strategy only involves the Fortune 1100. IBM will sacrifice the remaining customers to whoever bids the most for the scaleout customers and the HW division. Who might be interested in this. HPW and Cisco are the likely candidates as it opens upscale out, and gives them a market for the big iron as IBM will be their only customer. HPE needs a place for their high end HW to land. Cisco needs something more then network to carry them.
- Cut a deal for low end services. The Redhat strategy doesn’t involve perform operations, but rather consulting/migrating/modernizing/managing the cloud operations for the fortune 1100. The Indian outsourcers are the likely bidders here with market share being the objective.
- Use the revenue generated from the above 2 to pay down debt, and to enhance/expand the Redhat strategy. This is quite important to expand the “hybrid” play as Amazon and Microsoft have already run away with the low hanging fruit. Google is expanding, but has no base to build upon (Amazon has first mover and innovator, Microsoft has legacy intel SW, IBM has legacy enterprise HW). Google is trying to fill the void of each player, but it’s going to be a hard slog
"The Most Important Choice Facing IBM’s New CEO Arvind Krishna" ... Deciding how much of a "yes boy" he'll be with Chairman Ginni .
The author deserves an award for writing all that text and managing to not say a single meaningful thing throughout. I doubt he even knows what "cloud" is. There have been some articles posted here that presented insightful critiques of where IBM has gone wrong and what it needs to do going forward, this wasn't one of them.