“…As we get into this summer season, this June, July, August and September, you will see a rush for people to travel, especially air travel,” CEO Stephen Squeri said on a post-earnings conference call. [18] Gerstner wrote that in spite of OS/2's technical superiority to the dominant Microsoft Windows 3.0, his colleagues were "unwilling or unable to accept" that it was a "resounding defeat" as it "was draining tens of millions of dollars, absorbing huge chunks of senior management's time, and making a mockery of our image". AmEx also lowered some reserves it had set aside for credit losses and posted a gain of $111 million from consolidated provisions, compared with credit loss provisions of $1.02 billion last year. Net income fell to $1.44 billion, or $1.76 per share, for the quarter ended Dec. 31, compared with estimates for a profit of $1.31 per share, according to IBES data from Refinitiv. Kenneth Irvine Chenault (born June 2, 1951) is an American business executive. The way they were: Kim Kardashian and Kanye West share a combined $2.2bn fortune that the duo could be fighting over amid reports of an 'imminent divorce;' seen together December 14, 2019 at Sean 'Diddy' Combs' 50th birthday party in LAThe power couple are said to be heading toward divorce, with Kim hiring celeb favorite lawyer Laura Wasser. After he arrived, over 100,000 employees were laid off from a company that had maintained a lifetime employment practice from its inception. The company's own management was in the process of allowing its various divisions to rebrand and manage themselves — the so-called "Baby Blues." pg 172. Gerstner was hired as chairman and CEO of IBM in April 1993. Fisker stock is on track to double over the next year or so. Despite these successes, Gerstner hit a ceiling at American Express, as chief executive James D. Robinson III was not expected to retire for another 12 years. Louis Vincent Gerstner Jr. (born March 1, 1942) is an American businessman, best known for his tenure as chairman of the board and chief executive officer of IBM from April 1993 until 2002, when he retired as CEO in March and chairman in December. We would like to show you a description here but the site won’t allow us. Workers; In Dutchess County, a Disorienting Time for Employees Less Hardened to Job Loss", "Louis Gerstner III, Son of Celebrated IBM Chairman, Dies at 41", "Our Impact & Approach | Gerstner Family Foundation", "Golden Plate Awardees of the American Academy of Achievement". Barron's also provides information on historical stock ratings, target prices, company earnings, market valuation and more. U.S. Supreme Court rejects bid by Ghosn’s accused escape plotters to avoid extradition, Daimler recalls 1.29 million U.S. vehicles for software issue, Tesla to set up electric car manufacturing unit in southern India, Akbar: Fiji had no part in release of BDO report, Labasa businessman acquitted of charge brought by Council, Villagers surprised about the news of tsunami threat to Fiji, Mother identifies the body of her three-year-old child. Gerstner found new uses and users for the card. [22] Gerstner was also the first highly-paid IBM CEO relative to his home-grown predecessors, earning a personal fortune of hundreds of millions in his role. [10][11], In his memoir, Who Says Elephants Can't Dance?, he describes his arrival at the company in April 1993, when an active plan was in place to dis-aggregate the company. "[5], As chairman and chief executive officer of the Travel Related Services division, Gerstner spearheaded its successful "membership has its privileges" promotion. T&E spending on AmEx’s cards declined 65% in the final quarter of 2020. As sales and profits rebounded, Gerstner was promoted to chairman and chief executive officer of AmEx's Travel Related Services in 1982, and president of the parent company in 1985. AmEx forecast a 9% to 10% jump in overall 2021 revenue, with travel and expenditure (T&E) spending by consumers recovering to around 70% of fourth-quarter 2019 levels by the final quarter of 2021. Net income fell to $1.44 billion, or $1.76 per share, for the fourth quarter ended Dec. 31, from $1.69 billion, or $2.03 per share, a year earlier. Rupert Cornwell reports", "Why CEOs Fail It's rarely for lack of smarts or vision. IBM then turned to Gerstner, an outsider with a record that suggested success[7][8] whose older brother Richard had run the company's PC division until retiring due to health issues four years earlier. American Express Co. says its fourth-quarter net income fell 15% to $1.44 billion as the coronavirus pandemic continued to impact its bottom line. Gerstner, L. (2002). [3], Gerstner established the Gerstner Family Foundation in 1989[25] and serves as the chairman. Le portail boursorama.com compte plus de 30 millions de visites mensuelles et plus de 290 millions de pages vues par mois, en moyenne. He is the third African American CEO of … [26], In 1991, Gerstner received the Golden Plate Award of the American Academy of Achievement.[27]. (Reuters) – American Express Co said on Tuesday it expects an uptick in holiday travel this summer, but not business travel, as it seeks to recover from a year which dented airline traffic and hotel bookings, knocking 15% off its bottom line. He is largely credited with turning IBM's fortunes around.[1][2]. View today's stock price, news and analysis for American Express Co. (AXP). Net income fell to $1.44 billion, or $1.76 per share, for the quarter ended Dec. 31, compared with estimates for a profit of $1.31 per share, according to IBES data from Refinitiv. The bullish outlook for travel, however, failed to lift shares, which fell 3% in late morning trade after AmEx’s total revenue, net of interest expense, dropped 17.1% to $36.09 billion. The bullish outlook for travel, however, failed to lift shares, which fell 3% in late morning trade after AmEx’s total revenue, net of interest expense, dropped 17.1% to $36.09 billion. The company does not expect a full-blown recovery before 2022, but is focused on achieving the EPS expectations it had for 2020 in 2022, Squeri said. [11] In the goal to create one common brand message for all IBM products and services around the world,[1] under Gerstner's leadership the company consolidated its many advertising agencies down to just Ogilvy & Mather. A workaholic can't take vacations and I take four weeks a year. He is largely credited with turning IBM's fortunes around. [1][2], From 1993 to Gerstner's retirement in 2002, IBM's market capitalization rose from $29 billion to $168 billion. Gerstner was formerly CEO of RJR Nabisco, and also held senior positions at American Express and McKinsey & Company. He served as chairman from January 2003 until October 2008 and upon retiring from that position, he continued as a senior advisor to Carlyle through September 2016. A rebound in corporate travel will take longer, AmEx warned, with companies, particularly large ones, limiting their T&E spending for some time. [15] Soon after, Gerstner announced e-business as IBM's growth strategy and formed the IBM Internet Division, led by Irving Wladawsky-Berger. The Carlyle Group's biography of Gerstner, Website for the Gerstner Family Foundation, Criminal Reduction Utilising Statistical History, https://en.wikipedia.org/w/index.php?title=Louis_V._Gerstner_Jr.&oldid=1006478172, Members of the Steering Committee of the Bilderberg Group, Members of the United States National Academy of Engineering, Honorary Knights Commander of the Order of the British Empire, American chief executives of Fortune 500 companies, Wikipedia articles with BIBSYS identifiers, Wikipedia articles with PLWABN identifiers, Wikipedia articles with SUDOC identifiers, Wikipedia articles with WORLDCATID identifiers, Creative Commons Attribution-ShareAlike License, Leading IBM's historic corporate turnaround in the 1990s, This page was last edited on 13 February 2021, at 02:43. [7][17] As an outsider, Gerstner had no emotional attachment to long-suffering products IBM had developed to try to regain control of the PC market. Corporations were persuaded to adopt the card as a more effective way of tracking business expenses. Layoffs and other tough management measures continued in the first two years of his tenure, but the company was saved, and business success has continued to grow steadily since then. [14] IBM's initial vision for how e-business could transform the world included electronic debit services that would allow customers to place orders online and eventually shop at virtual stores, creating virtual databases of movies, books, and music that would be available from anywhere in the world, and more. FILE PHOTO: Credit cards of American Express are photographed in this illustration picture in this March 17, 2016, file photo. Bienvenue sur la chaîne YouTube de Boursorama ! In January 2003, Gerstner assumed the position of chairman of The Carlyle Group, a Washington, D.C. global private equity firm. College students, physicians, and women were singled out in various marketing pushes. The company's board had forced his predecessor John Akers to resign, looking first within the computer industry for his successor. He is a graduate of Chaminade High School (1959), Dartmouth College (1963) and holds an MBA from the Harvard Business School. Net earnings rose to US$1.79-billion, or US$6.38 per share, in the fourth quarter ended Dec. 31, from US$1.5-billion, or US$5.29 per share, a year earlier. However Apple's John Sculley, Motorola chairman George Fisher, and Bill Gates of Microsoft were not interested (other rumored candidates included Eckhard Pfeiffer of Compaq and Scott McNealy of Sun Microsystems). Not only was the division continually the most profitable in the company, but it also led the entire financial services industry. He was the CEO and Chairman of American Express from 2001 until 2018. "Gerstner Sloan Kettering School of Biomedical Sciences Leadership", "RJR Nabisco Hires Gerstner as CEO : American Express President Termed an Expert Marketer", "Profile: The iconoclast at IBM: Lou Gerstner enacted unprecedented cuts at the giant computer firm last week, but he will need to do more than wield the axe to revive it", "Profile: The iconoclast at IBM: Lou Gerstner enacted unprecedented cuts at the giant computer firm last week, but he will need to do more than wield the axe to revive it. He believed in the potential of B2B e-commerce and wanted to expand the application of the internet to more than just web-page browsing and consumer marketing. He has received numerous awards for his work in education, among them the Cleveland E. Dodge Medal for Distinguished Service to Education - Teachers College, Columbia University, and the Distinguished Service to Science and Education award from the American Museum of Natural History. By the end of 1994, IBM ceased new development of OS/2 software. He argued that a network-centric approach would shift the workload from personal computers to larger enterprise-systems and allow the internet to be embedded into all aspects of business operations. Then-CEO John Akers decided that the logical and rational solution was to split IBM into autonomous business units (such as processors, storage, software, services, printers,) that could compete more effectively with competitors that were more focused and agile and had lower cost structures. Outgoing IBM chairman and CEO Akers, a company lifer, was excessively immersed in its corporate culture, remaining loyal to traditional ways that masked the real threats. The prevailing wisdom of the time held that IBM's core mainframe business was headed for obsolescence. In 1980, most department stores did not accept American Express cards — by 1985 retail sales were second only to airline tickets in card purchases. Gerstner also created exclusive versions appealing to higher-end clients, such as the Gold Card, which carried an annual fee of $65 and came with a $2,000 line of credit, and the Platinum Card, which had a $250 annual fee, a $10,000 check-cashing benefit, and private club memberships for traveling executives. [14], While IBM had been credited with turning the personal computer (PC) into a mainstream product, the company could no longer monopolize its market. In recognition of his work on behalf of public education, as well as his business accomplishments, Mr. Gerstner was awarded the designation of honorary Knight of the British Empire by Queen Elizabeth II in June 2001. [12] Gerstner reversed this plan, realizing from his previous experiences at RJR and American Express that there remained a vital need for a broad-based information technology integrator. Most unsuccessful CEOs stumble because of one simple, fatal shortcoming", IBM100 - e-business - Transforming the World, "The Pain of Layoffs for Ex-Senior I.B.M. FSR stock is worth between $30.38 and $32.75, or over twice its price today.More From InvestorPlace Why Everyone Is … Microsoft grew beyond just PC software in the 1990s, hardware companies Apple and Dell expanded their market share, and entirely new entities such as the Google search engine emerged and created new computer-based business empires. [20] Long allowed by their managers to believe that employment security had little reference to performance, thousands of IBM employees had grown lax, while the top-performing employees complained bitterly in attitude surveys. Copyright © 2021 Fiji Times Limited. All Rights Reserved. Who says Elephants Can't Dance? [11] He discovered that the biggest problem that all major companies faced in 1993 was integrating all the separate computing technologies that were emerging at the time, and saw that IBM's unique competitive advantage was its ability to provide integrated solutions for customers – a company that could represent more than piece parts or components—something he only learned by going beyond just listening to the proponents of different technologies within IBM. In 1996, IBM's marketing department established the term e-business for any kind of business or commercial transaction conducted over the internet. A year later he was named president of the Travel Related Services group, which was responsible for American Express cards, traveler's cheques, and travel-service offices. Gerstner told Leslie Wayne, "I hear that and I can't accept that. The New York-based company still beat Wall Street estimates for profit as it lowered credit loss reserves and benefited from higher online spending by consumers stuck at home. Official biography of Louis V. Gerstner, Jr. Full Biographical Profile of Louis V. Gerstner, Jr. At this time, MasterCard and Visa had begun to compete for the company's market share. Many expected heads to roll, yet Gerstner initially changed only the CFO, the HR chief, and three key line executives. IBM withdrew from the retail desktop PC market entirely, which had become unprofitable due to price pressures in the early 2000s. Although he claimed the position at the age of 43, Gerstner dismissed the speculation that his success was the product of being a workaholic. He left AmEx in 1989 to succeed Ross Johnson as chairman and chief executive officer of RJR Nabisco following its $25 billion leveraged buyout by Kohlberg Kravis Roberts.[6]. Inside IBM's Historic Turnaround. His philosophy, quoted as "The importance of managers being aligned with shareholders—not through risk-free instruments like stock options, but through the process of putting their own money on the line through direct ownership of the company—became a critical part of the management philosophy I brought to IBM" has been criticized for IBM's management in the late 2000s becoming "fully isolated and immune from the long-term consequences of their decisions".[23][24]. A proliferation of cheaper IBM-compatible PC clones that used the same Intel chips and Microsoft operating system software simply undercut it and eroded market share. Most recently, in 2019, over $15 million was granted across the three program areas. [19], In his memoir, Gerstner described the turnaround as difficult and often wrenching for an IBM culture that had become insular and balkanized. [16] Under Gerstner, e-business transformed IBM and within six years, they became the market leader in providing the products and services needed to transform any of their customers businesses into a network-centric e-business. Since inception, Gerstner Philanthropies has made over $100 million in grants. During Gerstner's 11-year tenure at American Express, membership had increased from 8.6 million to 30.7 million. Despite impressing net inflows worth $579m, including $$252m of institutional money in December, Magellan’s FUM fell 1.6pc to $103.37bn, driven … The Foundation makes grants in Biomedical Research, Education, and Helping Hands. Mr. Gerstner is the author of Who Says Elephants Can't Dance, the best-selling account of IBM's transformation; and he is the co-author of the book Reinventing Education: Entrepreneurship in America's Public Schools. Upon becoming chief executive of IBM, Gerstner declared: "the last thing IBM needs right now is a vision", as he instead focused on execution, decisiveness, simplifying the organization for speed, and breaking the gridlock. Three years after Gerstner's 2002 retirement, IBM sold the PC division to Lenovo. Louis Vincent Gerstner Jr. (born March 1, 1942) is an American businessman, best known for his tenure as chairman of the board and chief executive officer of IBM from April 1993 until 2002, when he retired as CEO in March and chairman in December. That indicates full-year revenue of $39.7 billion on the upper end of the range, marginally below consensus estimates of $39.92 billion. REUTERS/Kai Pfaffenbach/Illustration. In 2008, Gerstner received the Legend in Leadership Award from the Yale School of Management. Currently, Mr. Gerstner is the chairman of the board of directors of the Broad Institute of MIT and Harvard [3] and chairman of the board of the Gerstner Sloan Kettering Graduate School of Biomedical Sciences.[4]. [21] Despite his success[13] Gerstner also presided over the company's decline, relative to newer rivals, as it lost its once-dominant position in the IT industry. [12] His choice to keep the company together was the defining decision of his tenure, as these gave IBM the capabilities to deliver complete IT solutions to customers. [13], One of the strategic visions that Gerstner set for IBM in 1993 was to make e-business its heart and soul. Gerstner has held the position of chairman of the Broad Institute of MIT and Harvard since January 2013. It is now worth a reported $60 million. [9] Gerstner was the first IBM CEO who was hired from outside the company. 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