IBM 2011 Annual Report Download - page 7
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5
As we look back on our strong
performance in 2011
—
the culmination
of an impressive decade
—
Ginni
and I thought it would be appropriate
for me to share a perspective on this
most recent phase of IBM’s 100-year
journey, and to offer some thoughts
on what it has taught us.
I recently took a look at my notes from my rst meeting
with IBM’s senior leadership after becoming chairman
in January 2003. I was surprised to see how little I had
written down. At the top were just four questions:
+ Why would someone invest in us?
+ Why would customers buy from us?
+ Why would society allow us to operate?
+ Why would someone work here?
Our history teaches us that IBM became one of the world’s
great companies by continually creating value for all
of these stakeholders. Certainly, that was the IBM I joined
38 years ago. And as IBM’s incoming chairman nine years
ago, I couldn’t imagine an agenda that wasn’t built on that
multidimensional goal.
Let’s consider how we have done against each of these
fundamental questions.
First, how have we done in answering: Why would
someone invest in us? Some technology companies,
particularly start-ups, are attractive to investors because
they grow meteorically
—
but often without prot or
positive cash ow. Others provide a broad portfolio
of products and services
—
but their very breadth makes
them mystifying to the investor.
A decade ago we committed to providing our owners
with clarity about our business model, strategies, nances
and governance principles. We would manage and grow
IBM through the basics
—
revenue, prot, earnings, cash
and margins. And we pledged to deliver consistent investor
returns through dividends and repurchased shares.
At the same time, we believed we could provide a unique
investment opportunity
—
participation in attractive
new growth areas in technology and in emerging markets,
with condence that IBM would safeguard shareholders’
investments.
It all came together in our 2010 Road Map, and we
are continuing to demonstrate progress against our
2015 Road Map. The results for investors speak for
themselves. Over the past ve years, we have increased
our market capitalization by $70 billion, and returned
$50 billion to shareholders in net share repurchases
and $14 billion in dividends
—
creating approximately
$135 billion in value for our owners.
A Letter from
the Chairman of the Board