The IBM System/360 Business Case

[Recorded August 14, 2008]Professor Richard S. Tedlow of Harvard Business School and a Trustee of the Computer History Museum discusses the story of IBM, the leading technology company in the 1960s, taking a huge risk in developing a new family of computers -- a financial investment approximately three times its 1960 annual sales. In 1966, Fortune magazine called this "perhaps the riskiest business judgment" of the era.In 1964, IBM held press conferences around the world, where Thomas Watson, Jr., the Chairman and CEO announced that the new System/360 was "a sharp departure from the concepts of the past." The System/360 was six separate, compatible machines, with interchangeable memories, providing 19 differentcombinations, and a total of 40 peripherals. No other company had ever introduced six computer models of totally new design, at one time, in a technology never tested in the marketplace, and with programming abilities of the greatest complexity.

Watch Professor Richard S. Tedlow facilitate a lively, interactive discussion, which analyzes this very high risk, very high reward business decision. With history as the teacher, Tedlow asks probing questions as he leads a live audience discussion through topics including:
- Why would a company that's leading the market attempt a project of such immense financial and technological risk?
- What were the key success factors for the IBM 360? What was the "secret sauce" in the company culture that allowed its people to succeed with this startling innovation?
- Why was it possible for a non-technical CEO, like Watson to manage such a technologically complex project? Would this be possible in today's technological climate?
- What can modern technology leader like Google and Microsoft learn from this lesson?
- What can other great companies learn about change and innovation from this business decision?