Big Moves at Big Blue

SAN FRANCISCO (07/24/2000) - IBM Corp. Monday announced Sam Palmisano has been named company president and chief operating officer, while John M. Thompson will become IBM vice chairman. The appointments will go into effect Sept. 1 with the two long-time company executives continuing to report to IBM Chairman and Chief Executive Officer Lou Gerstner.

The appointments could well be due to IBM's fears that the company may lose one or two of its vital members, according to Rob Enderle, senior industry analyst at Giga Information Group Inc.

"In these types of situations, you want to promote somebody so they will not leave," Enderle said. Gerstner, who appeared likely to step down three years ago, may also want to divest himself of some of IBM's day-to-day responsibilities, the Giga analyst added.

Using his experience as head of IBM's server and enterprise storage business, Palmisano will now take on the responsibility for the vendor's operating units, involving all of the products and services divisions, in addition to the firm's sales, distribution and global financing businesses.

Thompson will leave his post as group executive of IBM's software group in order to increase Big Blue's influence in emerging areas, including next-generation Internet and wireless technologies, Linux, and life sciences.

Gerstner supports these moves as organizational adjustments made to strengthen both day-to-day and future growth results, according to an IBM statement.

With regard to Palmisano's work as head of IBM's server and enterprise storage business, Enderle commented, "Having somebody at the executive level with that kind of experience should increase the corporate resources which go to that area."

The election of both Palmisano and Thompson to the IBM board of directors is anticipated at a Tuesday board meeting.

IBM, in Armonk, New York, can be reached at +1-914-499-1900 or

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