IBM CEO Ginni Rometty Steps Down, Arvind Krishna To Take Over

IBM has announced that CEO, President and chairman Ginni Rometty is to step down after nearly 8 years in running Big Blue.

Rometty is a IBM veteran with nearly 40 years at the firm. She has overseen a period of great change at IBM, ever since she took over the CEO role back in 2012, becoming the first woman to be in charge of the founding firm of the IT industry.

For most of her tenure, Rometty followed a policy that saw IBM shrinking “by design”, as part of its refocusing on the cloud and analytics, and move away from its hardware heritage.

Ginni Rometty

This change earned her fierce criticism, as under her leadership IBM posted over 24 consecutive quarters of revenue decline.

Rometty has also been criticised for executive compensation bonuses, layoffs, and outsourcing.

IBM is also facing an age discrimination lawsuit in the US, and last year Rometty was ordered by a US Federal judge to hand over memos and communications.

That legal action came after in-depth report by ProPublica and Mother Jones in March 2018 alleged that IBM had a systematic strategy of pushing out Big Blue staffers aged 40 and upwards, and replacing them with younger, and cheaper employees.

But IBM will now have a new man in charge as of April.

IBM announced the change at the top and confirmed that Arvind Krishna, 57, who is currently Big Blue’s senior VP for cloud and cognitive software, has been appointed Chief Executive Officer of the company and a member of the Board of Directors, effective 6 April 2020.

Jim Whitehurst, the Red Hat CEO who many thought would take over for Rometty, will become IBM’s president.

Rometty aged 62 will remain executive chairman of IBM until her retirement at the end of the year. Most IBM bosses tend to step down when they reach 60 years old, so her retirement was not unexpected.

Shares of IBM rose 5 percent after hours on the news of Rometty stepping down. Ouch.

New CEO

“Arvind is the right CEO for the next era at IBM,” said Rometty. “He is a brilliant technologist who has played a significant role in developing our key technologies such as artificial intelligence, cloud, quantum computing and blockchain.”

“He is also a superb operational leader, able to win today while building the business of tomorrow,” said Rometty. “Arvind has grown IBM’s Cloud and Cognitive Software business and led the largest acquisition in the company’s history.”

IBM spent $34bn in 2018 to acquire open source cloud giant Red Hat to reinvigorate its cloud growth.

“Through his multiple experiences running businesses in IBM, Arvind has built an outstanding track record of bold transformations and proven business results, and is an authentic, values-driven leader,” Rometty said. “He is well-positioned to lead IBM and its clients into the cloud and cognitive era.”

Indeed, Krishna has worked for Big Blue for nearly 30 years in a variety of roles.

Rometty also took the opportunity to praise former Red Hat CEO Jim Whitehurst.

“Jim is also a seasoned leader who has positioned Red Hat as the world’s leading provider of open source enterprise IT software solutions and services, and has been quickly expanding the reach and benefit of that technology to an even wider audience as part of IBM,” Rometty said. “In Arvind and Jim, the Board has elected a proven technical and business-savvy leadership team.”

“I am thrilled and humbled to be elected as the next Chief Executive Officer of IBM, and appreciate the confidence that Ginni and the Board have placed in me,” said Krishna. “IBM has such talented people and technology that we can bring together to help our clients solve their toughest problems.”

“I am looking forward to working with IBMers, Red Hatters and clients around the world at this unique time of fast-paced change in the IT industry,” he added. “We have great opportunities ahead to help our clients advance the transformation of their business while also remaining the global leader in the trusted stewardship of technology. Jim will be a great partner in the next step of this journey.”

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