John Fellows Akers

John Fellows Akers (December 28, 1934 – August 22, 2014) was a U.S. businessman. At IBM, he was president between 1983 and 1989, the CEO from 1985 until 1993, and chairman between 1986 and 1993.

Akers attended Yale, and while there became a brother of Delta Kappa Epsilon (Phi chapter).

IBM

Akers ascended to CEO as a result of support from his predecessor Frank Cary.[1] In 1989, a young Sam Palmisano was appointed as Aker's assistant; decades later Palmisano would serve as Chairman and CEO.[2]

Akers was credited with simplifying the company's bureaucracy to focus more on profits.[3] On January 29, 1988, in a sweeping restructuring intended to reverse three years of disappointing performance, Akers created five new, highly autonomous organizations responsible for all of the company's innovation, design and manufacturing. The moves were intended to greatly decentralize the company, which had been seen as bloated and unable to keep up with competition, and give significantly more responsibility to a younger generation of managers, while significantly reducing the role of the company's Armonk, N.Y., headquarters in the day-to-day operations. Under the plan, thousands of employees had to switch jobs or find themselves working for new managers.[4] Akers' vision was to autonomize each division into "Baby Blues" with the aim of spinning them off from "Big Blue".[5]

Akers also presided over a major downsizing of IBM's workforce, cutting down from 407,000 to 360,000 by the end of 1991. The company had previously had a lifetime employment policy but the mass layoffs caused a morale crisis.[6] Akers also closed ten plants and trimmed manufacturing capacity by forty percent.

On Tuesday, January 26, 1993, Akers was forced to announce his resignation, after several months of IBM insisting that it had full confidence in his leadership.[3] The company had posted a $5 billion annual loss, the largest in corporate history. The dividend was also slashed from $1.21 to 54 cents, after the company had failed to make enough profit to cover its dividend payments for eight business quarters. IBM president Jack Kuehler was shifted to the post of vice chairman, while finance director Frank Metz was also ousted. Paul Rizzo, a rival with Akers for the CEO position back in 1985 who had retired in 1987 was restored to the post of vice-chairman and appointed finance director. Akers remained as chief executive for three months while a committee of directors chose a successor, long speculated to be an outsider.[7]

The management coup was mounted by longtime IBM director Jim Burke, who organized secret meetings between Rizzo and outsider Louis V. Gerstner, Jr. to examine the company's problems.[5] It was also speculated that several entities were dissatisfied with losing their power on the board of directors and the declining stock price, including the banks which were once IBM's largest shareholders, as well as Aker's predecessors as CEO, John Opel and Frank Cary.[3]

Akers retired as Chairman and CEO of IBM on April 1, 1993, which was ironically and coincidentally April Fools' Day. He was succeeded in both positions by Gerstner, the first CEO in IBM's history to be hired from outside the company.

Legacy

Akers was chief executive during IBM's decline in the mid-1980s and early 1990s. Apple Inc. founder Steve Jobs described Akers as "smart, eloquent, fantastic salesperson, but he didn’t know anything about product.”[8]

The company's difficulties, however, weren't caused by Akers alone, as some suggested that he was merely doing what he had been "programmed" to do by an outdated "IBM system",[3] while a complacent board of directors was also blamed.[9]

Post-IBM

He was also on the Board of Directors of Lehman Brothers when it filed for bankruptcy. Akers died of a stroke at age 79 in Boston, Massachusetts on August 22, 2014.[10]

References

  1. ↑ Bob Djurdjevic. "Akers: The Last Emperor (June 1991)". Djurdjevic.com. Retrieved 2014-07-28.
  2. ↑ Timothy Prickett Morgan (7 November 2011). "Ex-IBM CEO John Opel dies aged 86". The Register.
  3. 1 2 3 4 Bob Djurdjevic (1993-01-26). "Akers: A Nice Guy Who Lost His Compass (Jan 1993)". Djurdjevic.com. Retrieved 2014-07-28.
  4. ↑
  5. 1 2 Maria Pikalova. "How IBM Board Member Jim Burke Persuaded Gerstner to Put His Career At Stake". GOOD2WORK. Retrieved 2014-07-28.
  6. ↑
  7. ↑ From LARRY BLACK in New York (1993-01-27). "IBM fires Akers and slashes dividend - Business - News". The Independent. Retrieved 2014-07-28.
  8. ↑ Robert McMillan   (2011-10-05). "Steve Jobs: HP Implosion Was an iTragedy | Enterprise". WIRED. Retrieved 2014-07-28.
  9. ↑ Bob Djurdjevic. "''Akers: The Last Emperor? (June 1991)''". Djurdjevic.com. Retrieved 2014-07-28.
  10. ↑ New York Times' John F. Akers led IBM as PCs ascended'

External links

Business positions
Preceded by
John Opel		 CEOs of IBM
1985–1993 		Succeeded by
Louis V. Gerstner, Jr.
This article is issued from Wikipedia - version of the Tuesday, March 15, 2016. The text is available under the Creative Commons Attribution/Share Alike but additional terms may apply for the media files.