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IBM CEO Sam Palmisano is in Baltimore today delivering a speech at his alma mater, Johns Hopkins University–marking the launch of the company’s year-long centennial celebration. It was 100 years ago this year that three small manufacturing firms combined to create the company that was later renamed International Business Machines. In the run-up to the centennial, IBM took the opportunity to look back on what it considers to be a century of progress–not just for the company but for the United States and the world. I was one of the writers who did much of the research for the centennial, and, in the process, I learned a lot about what it takes to make a company (or any organization) survive and thrive for a century.

Assembly worker, 1923

Assembly worker, 1923

IBM’s history teaches lessons that hold as true today as they did 50 or 100 years ago. To succeed over the long haul, a business needs to adopt values that guide it in good times and bad. It must continually transform in anticipation of changes that are coming. And it must engage with society in ways that strengthen itself and the civil institutions around it. For humankind to progress, our study of the last 100 years teaches us, leaders from all corners of society must come together to imagine a better world and then cooperate to make the world work better.

Yet, today, it’s clear to me that progress is imperiled. The financial calamity of 2008 and its aftershocks have left individuals angry and fearful, businesses overcautious and slow to react and government leaders uncertain about what to do next, or, worse, tearing at each other in recrimination. It’s a climate of reaction and negation, not hope and initiative, which, I’ve learned in my first year as an IBM employee, is Big Blue’s approach to problem solving.

How can we, collectively, imagine a better world in the midst of so much tension and uncertainty? Those lessons from IBM’s history serve as a guide. It’s clear that knowledge leads to prosperity and that advances in science improve health and productivity. So we must value education and science by investing in them. We know that tremendous changes are coming: shifts in economic and political power, climate change and new technologies that promise to improve our lives but also threaten our privacy and security. So we need to anticipate these changes and get out ahead of them. And we know that only by cooperating can the constituents of the global community take on the world’s massive and complex problems. So we must work together to solve them.

Concerns about government budget deficits are legitimate, but that should not result in slashing spending indiscriminately. The US federal government has an important role not only in national defense but in regulating the financial system, safeguarding the environment and improving the education and health of citizens. It is uniquely positioned to chart a new course and set policies that guide all of society to better outcomes. So, rather than hobbling government, let’s help it become more efficient and effective.

IBM imagines a better world–which it calls the Smarter Planet–and it’s willing to invest in it. Sure, IBM watches its expenses. But, at the same time, the company has rededicated itself to the values and ideas it has long held dear. IBM is committed to innovation. In two weeks, the “Watson” question-and-answer technology will be shown on the Jeopardy TV show taking on two past champions, demonstrating  that the capabilities of science are practically limitless. IBM is expanding its footprint in Africa this year. It sees the potential for the continent to become a significant market someday, but it knows  that won’t happen unless it helps develop the economic and knowledge infrastructures to support such growth. At the same time, the company is engaging with society more deeply than ever before all over the world. Through the Smarter Cities Challenge, the company will send teams of experts to 100 cities scattered around the globe over the next three years to provide free advice aimed at helping them take on complex problems.

One of the first of the Smarter Cities Challenge locations is Baltimore. IBM is working with Mayor Stephanie Rawlings-Blake to improve the education system. Baltimore has many problems, economic and social, but city leaders have the will to overcome them–and IBM is there to help. IBM is helping at the national level as well. We’re participating in a new initiative announced yesterday by the White House called Startup America Partnership. Chaired by AOL co-founder Steve Case,  this alliance of businesses and non-profits with government is aimed at fostering startups and job creation.

Making progress is hard, but, by working together, governments and businesses can provide citizens with the services they deserve and build a foundation for a better economic future. That’s perhaps the most important lesson to be drawn from 100 years of doing business.

Here’s a link to our Centennial stories:

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February 4, 2011
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February 2, 2011
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[...] Sam Palmisano delivered a speech yesterday at his alma mater, Johns Hopkins University, marking the launch of our year-long centennial celebration.  You can read the highlights of his speech here. [...]

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February 1, 2011
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