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Icons of Progress

System 360

From Computers to Computer Systems

In 1964, IBM made what Thomas Watson Jr. called “the most important product announcement in company history.” It was the IBM ® System/360, and it represented a revolution in computers, affording unprecedented power, speed and compatibility to thousands of businesses around the globe. Fortune magazine dubbed the System/360 “IBM’s $5 billion gamble.”

Commitment to change

Three years before its announcement, in December of 1961, IBM’s then vice president of sales and marketing, T. Vincent Learson commissioned a task force of 12 people to “establish an overall IBM plan for data processor products.” The team, code-named SPREAD Task Group (Systems Programming, Research, Engineering and Development) were told by Learson to stay at the New Englander Motor Hotel near Stanford, Connecticut, until they had a solution. The team spent eight weeks of dedicated time to the problem at hand.

The result was a 26-page report that outlined recommendations and specifications that later became the basis for the System/360 series and its operating system, IBM OS/360. The SPREAD report, published in December of 1961, included one key controversial statement that would change IBM forever: “Since such processors must have capabilities not now present in any IBM processor product, the new family of products will not be compatible with our existing processors.”

High stakes

Indeed, production and sales of the System/360 meant a complete re-engineering of the company’s development resources, processes and strategy. In addition to posing a daunting marketing challenge, it would also kill off IBM’s golden goose—a disorganized but very profitable line of existing computer products. As with any bold risk worth taking, there were passionate experts on either side of the System/360 debate.


The future arrives

As Chuck Boyer recalls in his book The 360 Revolution: “On April 7, 1964, before a large crowd of customers, reporters and dignitaries at the company’s auditorium in Poughkeepsie, IBM presented the System/360 to the world. The announcement was paralleled with press conferences in 165 other U.S. cities and in 14 other countries, for an estimated audience of 100,000 customers and prospects.”

The struggle to stay ahead

Within eight weeks of the announcement, clients had ordered well over two thousand machines. For Watson, the client enthusiasm for the System/360 is a tremendous relief. But it will take all the resources of the company, working 60 hour weeks—and in some cases round-the-clock shifts—for nearly two years before the System/360 can be called a success.

The payoff

In the end, the payoff to IBM, the computer industry and the world were nothing short of extraordinary. The System/360 transformed they way IBM functioned as a business, and it changed the way people thought about computers forever.