Gerstner slams clueless CEOs

Lou Gerstner believes the new economy is forcing companies to "act in some very unbusiness-like ways" and that many CEOs have an "air of desperation about them".

The IBM chief says companies are being blinded by "dot-com alchemy" and that some could be on "dangerous ground" if they fail to grasp the fundamentals involved.

This startling -- and somewhat derisory -- assessment of those forging the new economy was contained in an internal memo written by Gerstner and obtained by The Register.

In it he confides how he has spoken to some of the top people in business and how they seemingly have no idea about how to deal with the dotcom revolution.

"I was recently with the highly regarded chief executive of a major US multinational who admitted to me that he has told his executive committee: 'Do something with the Internet -- anything,'" waxed Gerstner.

" The CEO of a well-known Asian company -- call it Acme Inc -- just confided to one of my colleagues that he was thinking of creating an Internet spin-off, Acme.com. When asked what he would put into it and what would remain in the parent company, he had no idea.

"Another CEO -- this one at a large Japanese company -- said recently that he had agreed to sign up with an online exchange because he thought his company would look dumb if it did nothing. But he confessed that he wasn't really sure what he had joined."

With the growing number of dotcom failures piling up, investor volatility and seemingly endless strategies to devise new e-strategies, few can challenge Gerstner's assessment. The fact that he said within earshot, so to speak, might raise a few eyebrows, though.

No one from IBM was prepared to comment. ®

Related link

That Gerstner memo