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Thomas J. Watson Sr. 1914-1941

IBM CEOs: Leadership ⇔ Challenges ⇔ Transformations in the IT Century

Thomas J. Watson Sr. 1914-1941
(Highlights – Milestones – Excerpts)

The age of 40 years was about the life expectancy of the average American man in 1874, the year Watson was born (Richard S. Tedlow).
Implementing a Corporate Culture in CTR – “THINK” (1914)

Watson: “I will not tolerate any manipulation of CTR stock”

Famous Watson speeches - full of wisdom for today and the future: “The MAN proposition” in New York, Jan. 25-30, 1915

CTR 1915: Revenue 4 M$; Net Earnings 1 M$; Employees; 1.672.

First Hundred Percent Club - “HPC” - 1916

Commitment to Employee Education

Future Demands Committee established (1917)

Watson speech  “The Art of Selling” in New York on Nov. 23, 1917 - “Men-Minutes-Money” by Thomas J. Watson published in 1934

Watson consolidated 3 Canadian subsidiaries into a single subsidiary – the new name instead of C-T-R:
International Business Machines.

Watson was practicing the “marketing concept” decades before it was enunciated by marketing professors. (1919)

CTR Product Line 1920

Managing recession and crisis 1921

12 new tabulators saved the company

Watson’s philosophies

Watson on February 5, 1924: application to list International Business Machines (IBM) on the New York Stock Exchange
– CTR disappeared

Professional Salesforce 1925: HPC Convention in Atlantic City – First Members of the IBM Quarter Century Club

To Make a Business Grow – Begin Growing Men! (August 1926)

IBM introduced the Lake-developed 80 column card-system – rectangular instead of round holes (1928)

Competitive Rankings 1928 – 1968

October 24th Black Thursday – October 29th Stock Market Crash

“We are not going to wait for something to happen - we are going to make something happen.”

Watson’s famous speeches: Have Faith in the Future – Men of strive are the builders – Growing men - … (1930)

Watson bet the company in the early 1930s – he made two dangerous decisions

IBM acquired Electromatic Typewriters, Inc. – Rochester NY (1933)

IBM Product Line 1933

Thomas Watson, 1934: published his unique book “Men-Minutes-Money” – his speeches between January 1915 and December 1933 – 886 pages!   

The IBM 405 Alphabetical Accounting Machine saved the company during the thirties (1934)

The Man Proposition applied to Women too (1935)

“The Watson Way”: Watson was the longest of long-term thinkers – new research facility in July 1932, the lowest point in IBM’s fortune (Tedlow 2003).

August 14, 1935 Roosevelt signed the Social Security Act – IBM, in competitive bidding, was selected to do the bookkeeping: Sept. 16, 1936

IBM Type 77 Collator introduced in 1937 – Social Security Implementation  

Thomas J. Watson, Jr., 23, enters IBM Sales School in Endicott

IBM World Headquarters Building 590 Madison Avenue, NY, is dedicated in January 1938

James W. Bryce – IBM Chief Engineer – writes a two-page letter to Watson Jan. 26th, 1939  

IBM exhibition at the 1939’s World Fair

Thomas J. Watson Jr., qualifying as a pilot – called into Army Service in May 1940

IBM involvement in data communication

IBM – NCR comparison 1930-1940: In 1930, the first full year of the Great Depression, NCR profits were cut in half. Profits at IBM increased 10% and exceeded the performance of NCR for the first time, 7.4 M$ to 3.6 M$. (“Giants of Enterprise” by Richard Tedlow published in 2001).

IBM established the Munitions Manufacturing Corporation early in 1941  

1941; Revenue 60 M$; Net Earnings 10 M$. Employees: 14.207.