The Tom Watson, Jr. years

(1974 retrospective)


The Tom Watson, Jr. years

Thomas J. Watson, Jr.

In March 1974, Frank T. Cary, IBM's chairman of the board and CEO at the time, wrote to his employees about one of his distinguished predecessors. He said:

Although Tom Watson, Jr., retired as an active employee at the end of January [1974], he is still chairman of the executive committee of the board, he still has an office down the hall [in Armonk, N.Y.], and he still has IBM very much on his mind.

He remains on our minds, too. Few IBMers who experienced them will ever forget those lively and eventful Tom Watson, Jr., years which began in the mid-1950s, when he became chief executive officer, and lasted a decade and a half.

Tom insisted on a quiet leavetaking from the business. For most employees, it was limited to that two-minute telephone talk at Christmastime. But a number of people have told me they want to know more, what Tom's recollections are and, specifically, what he will be doing.

To mark those years as they ought to be marked, that IBMers who shared in them might once again recall with pride, I asked Think [the IBM employee publication] to put together [a] special section. It's more, perhaps, than Tom would wish. But it's considerably less than those years meant to so many of us.

The following is the text of that special section: "The Tom Watson, Jr., Years Of IBM," by Peter Hillyer, published on pages 23-27 of the March 1974 issue of Think. (The images below were not included in the original article.)

Thomas J. Watson, Jr.
In 1956, when Thomas J. Watson, Jr., became IBM's chief executive officer (he had been president since 1952), the company already was attracting an unusual amount of attention.

There were bigger organizations, to be sure. IBM ranked a relatively modest 48th on Fortune's list of the 500 biggest U.S. industrials. But it had the intriguing (and to its stockholders and management, delightful) habit of almost doubling in size every four years. What's more, IBM conveyed a can-do spirit that was infectious.

That same year, on his first visit to the company's Endicott plant since his father's death in June, Watson predicted that IBM would become a billion dollar corporation. And the revenue figures at the end of the next year proved him right.

But even the 42-year-old Watson, steeped in IBM traditions and the management and business philosophies of his father, hardly could have envisioned the spectacular achievements that lay ahead as the company continued its great surge from the age punched card machines to the world of the computer.

In the 17 years that followed until his retirement this January [1974], the company's gross revenue leaped from $734 million in the United States to almost $11 billion worldwide, and its international population from nearly 73,000 to more than three times that number. The number of countries in which IBM did business grew to 127; plants, laboratories, and offices proliferated at amazing rate; new professions appeared and prospered; employee benefits were greatly increased; education for IBMer and customer alike was intensified; and technological advances followed one upon the other.

The company developed and produced a succession of computers, the trickle that began with the IBM 701 in 1953 turning into a torrent of thousands of systems. They enabled firms to do business more efficiently, helped put men on the moon, and materially improved the lot of mankind on earth.

IBM became the bellwether of a new industry, often the standard by which others in it were measured. It provided hundreds of thousands of new and meaningful jobs, not only within the company, but also in many other industries throughout the world.

When asked recently what it was that allowed IBM to zoom to such prominence in less than two decades, Watson explained that the company had been blessed with a nucleus of people with a "very basic systems knowledge who knew how to take devices, once invented, and apply them to the problems of business." This, plus resources which allowed extensive research and development, meant that IBM was in the right place at the right time when it came to taking advantage of the computer's potential. "And, of course," he added, "we had some luck."

True enough. But, as a number of business publications have observed, the leadership was there, too. Other companies with solid pasts and bright futures have failed or floundered. Tom Watson, Jr., together with a cadre of seasoned, dedicated executives, drove, nudged, and inspired IBM into a place of preeminence in the computer age, and provided a restless, challenging, and rewarding environment that attracted outstanding men and women by the thousands.

"Tom was never a technical man, says a colleague. "But he had the imagination and the vision to see what needed to be done, and to find the people who could do it."


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