David Novak 0:04 

Welcome to How leaders lead where every week you get to listen in while I interview some of the best leaders in the world, I break down the key learning so that by the end of the episode, you'll have something simple you can apply as you develop into a better leader. That's what this podcast is all about. Today's guests is Ginni Rometty, the former chairman and CEO of IBM. Now I've got a question for you. Have you ever felt uncomfortable at work? I'm talking about that feeling when you're offered a new leadership opportunity, or when your boss wants you to give that big presentation in front of the team, or whatever moment where you're being asked to swim out past the breakers? Well, our guest today, Ginni Rometty, says you will only grow when you're uncomfortable. So that feeling that pit in your stomach in those situations, let me tell you, those are the moments when you have the opportunity to grow as a leader. Before Jenny was appointed CEO, she had risen through the ranks at IBM, a company she had worked at for 40 years. And so what you're about to hear from Jenny, and what you'll learn from her journey to become CEO of IBM, is that great leaders are comfortable being uncomfortable. There's a lot for us to learn here. So let's get right to it. Here's my conversation with my good friend, hence soon to be yours, Ginni Rometty, the former chairman and CEO of IBM.

Ginni, thanks so much for taking the time for being on the

Ginni Rometty 1:41 

show. My pleasure, Dave, pleasure to do this with you. First off,

David Novak 1:45 

Happy New Year, if you if you made any new year's resolutions, you're not gonna keep.

Ginni Rometty 1:49 

You know, it's funny. We had a little New Year's gathering and I had hats for everyone to write in their New Year's resolution. I think people are so tired. Nobody wanted to write anything. So we're done.

David Novak 2:00 

You know, Jenny, I want to start out with the obvious you were the first female CEO for IBM. That's a company that you worked for, for 40 years, where were you when you got the call? And how did it feel to get that invitation to head such a iconic company?

Ginni Rometty 2:14 

It was, let's see, October 2011. I remember that distinctly. But it's funny until you get the job. You never think you're going to get the job. And I was sitting in my office. And my boss called me. And it was really quite a very short conversation. He just said, Well, you're going to be the Knights CEO. And I really thought I remember his thanking him. I remember hanging up the phone. I remember sitting there quietly for a minute, I did call my husband because I've been sworn to secrecy. And honestly, I got up and did the rest of my meetings.

David Novak 2:47 

Yeah, yeah. To think holy cow, here we go.

Ginni Rometty 2:50 

That came later. That came later. In the moment, it was just sort of a bit of a stunned silence.

David Novak 2:56 

I remember when I was coming up a business. I worked for PepsiCo. And, you know, we modeled a lot of what IBM was all about. And IBM was known for being a culture of blue suits, white shirts, red ties. What do you wear on your first day, when you joined? You know, that first day of your 40 year tenure,

Ginni Rometty 3:15 

I can't exactly remember what I were, although what I wore was written about many times, I mean, that's another topic of being a woman in business and how many times people would comment on my clothing. But what I thought about more on that first day was where I went, not what I wore. And so I had really thought hard because I knew that this was going to be a tough journey ahead. And I chose to go to IBM Research 7am, because I knew that this was going to have to be a replatforming of a company. And that would require a lot of the technical skill. And I wanted it to be really clear. That's where I was going to be that moment at 7am. And so I did a broadcast from there for the all 400,000 employees, but it was from IBM Research. I don't remember what I wore, I remember where I went,

David Novak 3:56 

understand you're a bit reluctant to make a big deal out of being the first female CEO of IBM. Why was that?

Ginni Rometty 4:02 

You know, Dave, I think there are a lot of women that feel this way. And certainly of my generation, I always felt I wanted people to recognize what I did and be commended. For my work. I did write just my work not that I was a woman. So I never focused on this point, in fact, probably went to pretty much extremes about don't recognize me. And even when I was named CEO, people said to me, Hey, don't don't do media don't do anything. You don't want to be known as the first woman CEO. You wanted to be known as a good CEO of IBM. And so I was really, for the first several years very reticent about that. So I stayed away from women's conferences. I mean, I would do things internally, but I really didn't do anything. And I have to say it's one of the things I reflect on. And I turned around on this topic that I came to view as a big mistake. Because I said as time went on, it became clearer and clearer to me. I was in such a privileged position, that it was an obligation to help others and I really came to under stand this feeling of you cannot be what you cannot see. And that there were so many people who said, Look, I see you. I mean, I would remember this over the years when I would give a presentation I can remember, many years ago I was in Australia, gave a presentation a man came up to me, it was on financial services. And I thought he's gonna tell me what a great presentation it was. And he says to me, I wish my daughter had been here. And those events would continue to happen. And you realize how much it means to other people, not yourself to other people, to have someone to look at. And so, wow, I felt that way at the beginning, and was really coached that way by others who I know we're well intended. I think it was the wrong thing. And so I came full circle on that, to really see and tell people how important it is for you to be a role model to help other people.

David Novak 5:46 

I couldn't agree with you more. In fact, in this podcast, my daughter did a podcast with Indra Nooyi and myself on her new book on family work balance, and I realized just how much it meant to my daughter, Ashley, to be able to talk to Indra and just how successful Indra has been. And she was so excited. I was doing this podcast with you. Because I think you really do show people what's possible. And and so on behalf of my daughter, I want to thank you for showing women that you can really rise to the top, there's no doubt about that. I've heard you talk quite a few times. And you talk a bit about the difference between a job and a career. What's that difference from your perspective? And how has that principle played out in your life and career?

Ginni Rometty 6:28 

You know, to me, this is something that over time, it's been an art that has become more and more important. But I can kind of remember a dawning of like the first moment I really understood that. And I think it's really important to particularly people coming into the workforce now. And so the first time I really recognize that difference, I was probably 22 years old, I had gone to Northwestern, and General Motors had given me a scholarship to go to Northwestern, they had been very generous with me, I could never have afforded it otherwise. So when I left and graduated, I had a choice, I could work for GM or not. And I felt a great obligation given this huge investment. They'd made me in a very expensive school. It was no strings attached. But I went to work for GM. And I'm very appreciative. So I always say that to Mary Barra, I'm very appreciate that opportunity. But what I saw was, you know, I would come to work every day. And I wasn't as passionate about cars as Marius, and others. And I also looked at people around me, and it was more like a job to them. And I said, at a really young age, I could see this difference between a job and a career. And you know, I have people that they become at 73. And I was thinking, no, no, no, there's got to be more to this if you put all of this effort into something. And I felt like I couldn't crystallize what that meant then. But it's when I left for IBM, because I said, No, I want to apply technology to really make a difference in something. And I new technology. Now mind you, this is back in 1980. And that's when I moved. And so over time, I have always felt my say to people, you know, what you work on, you know, everything you do every day isn't like that. It's not like everything, every activity, you know, drive some greater purpose, but in the general, that it's got to be towards that. So it's either a company who you believe in its purpose, and therefore you're doing something that furthers it, I would go on and work on things like AI that would help healthcare and and now you mentioned what I do now. And it's got a lot to do with the work I've done an education and opportunity for people. And to me that is just so important that wherever you're at, you feel like there's either your job or the company is headed and sort of a North Star. And that to me, I felt like I said I learned early in life and that I feel you're really lucky when you can align those things.

David Novak 8:37 

I want to get into a lot of the exciting things you did at IBM. But I want to go back and take you back a little bit. Tell me a story about your upbringing that really shaped who you are as a leader.

Ginni Rometty 8:48 

Well, this is clearly my mother, actually, she's with me now. Right now I've got to help her with some health things. But my mom I was raised by a single mother. So not unlike there are many people out there like this today. And when I say single my mom I was born when my mom was very young. And I have three other brothers and sisters. And we did have a father, obviously, but about the time I was 1516 years old, just really out of the blue. My father told my mother he no longer cared about any of us, and frankly didn't care how she made a living or if she made a living if she had money or if she took care of us and he was gone. My mother found herself in this position of four children, no education beyond a high school degree and never worked a day in her life. And we really went through a period of time where my mom almost lost the house, went on food stamps, went on social aid, etc. But my mother was really determined that this would not be how this could end. And she went back to school. I helped really raised my brothers and sisters because she had to go back to a community college to get enough of an education to get a better job to get us off of financial aid. And I said I never saw my mother cry. She never complained. Ain't, I could see quiet sad moments. And at the end of the day, what that really taught me, and it's probably the biggest thing that's to this moment influenced me is that I watched my mom, she was not going to let my father define her as a, a dropout, a divorce a, a person on wealth, she was not. And she was determined that only she defined who she was. And that idea that only you define who you are is something to take control of your life, and that no one else determines that for you. And I also saw in that my mother, my mom was smart, she just didn't have access to a lot of things. So the conclusions you draw about people about their education level, or where they live, are wrong. And so when my mother had some access, then she was able to really get us to a different spot. So it's kind of funny how life comes full circle, what I do now with 110, but it also will come back to what it led, even in IBM, my strong feelings about how technology had its good and bad sides for a lot of the population. But the biggest thing she taught me was only you define who you are. So and I think that's important, because people feel they're a victim of other things. And they're not you can grab hold. And if you don't define who you are, by the way, someone else will define you. And there have been those moments, when I've let others start to do that. And, you know, or for a company, because it's true for a person, a company a country, you know, you have to pull it back and define yourself,

David Novak 11:25 

that makes so much sense. Do you remember a time or a story where you had an incident at IBM, where you literally thought of your mother and said, My mom would do this? And I'm gonna do it too?

Ginni Rometty 11:35 

Well, I think early on back when I mentioned to you that I didn't do any media, it's ironic now because I do it a lot. And but early on, when I wouldn't do these things, I started to watch and say, Well, if I don't speak up, they're going to define who we are. So whether they want to call us old tech, or do something like this, right? thought back to that story, right? Either I define who they are, they're gonna define us. And that would be one of those examples.

David Novak 11:58 

That's a great one. And I couldn't agree more with you about, you know, your your mom being smart. And she could have been the CEO with the right kind of background and environment. And I feel the same way about my parents high school education, but they're smarter than me. And, you know, they gave everything to me, you know, you know, I've heard you say that the number one thing a company should hire for is the propensity to learn, share a story of how this always learning mentality really helped you personally in your career.

Ginni Rometty 12:25 

So this is interesting, because I actually think this is almost one of the underlying issues of our time. Now, because of the rate that technology is changing. And even with COVID, now people are having to change jobs. So I go back to my mom. So the first point about her having to get a new set of skills, but were crystallized for me was, when I began my job as CEO, it was clear to me, I'd have three big transformations, it soon became clear, we'd need a new technology platform, we'd have to build completely new skills on the workforce. And we'd also have to change how we did work. So those are three big transformations. So skills. And that was a long journey in itself, we can come back to but one of the things I noticed one of the first things it was most of 2012 trying to hire cyber skills, couldn't get them anywhere. And even today, they're they're very scarce. So we've had this brainstorm about going to schools that had kids, high schools, that we could work with a community college and get them out, even before they had a college degree. And could they do these jobs, lo and behold, they could very interesting point. Another point, then, I had all the IBM errs to transform to bring new skills. I thought, Well, boy, do I have to bring in all new people. So we did lots of external hiring, and also offered lots of education. What did I learn, it had nothing to do with age, it had nothing to do with background, it was all about this, if people had a curiosity and wanted to learn were the ones that made the transition, none of the typical stereotypes that you otherwise thought. And it was also not the degree that they had, right. So it wasn't their age, it wasn't the degree it wasn't any of this. And so I put all those three together. And to me, it changed the way we hired. So when we hire now we do testing for curiosity, drive grit, that ability is best you can test for these things. Because nowadays, even the half life of technology skills is three to five years. So I don't want people who only want to do one thing forever. Because if you do, that's that's really what they want to do. And if you're in an industry that's rapidly changing, so to me became the most important thing to do. And one more thing and again, this is all for aspiring leaders and like, from a personal perspective, I have always been someone really curious. I never wanted to be taught what and how to memorize. I always wanted to know how how how so then I always felt like could go back to the roots to figure something out. But that whole idea is what makes you I think is a leader really good because whenever you listen to people, you listen with intent to learn something and it has a really interesting byproduct out of it. If you are always listening with intent to learn and to You will grow a huge network, because people genuinely believe you care, because you do genuinely care. And it isn't that you're just talking for what's in it for you, you're talking for what's in it for them as well. And so I think the byproduct of that curiosity is for anyone a gives you confidence in your job and be it is the way to create a whole long lasting network of relationships. I

David Novak 15:22 

couldn't agree more. And you know, and I look at your career and the number of different jobs that you had at IBM, I imagine that you were pushed out of your comfort zone several times with various promotions over the years. How did you learn to adapt so successfully taking on new and different roles?

Ginni Rometty 15:40 

I'm not sure I always defend the beginning. Okay, so for maybe you did, maybe you were like infinitely, you know, confident in every role? I don't know.

David Novak 15:49 

I don't think so. But I might have acted that way.

Ginni Rometty 15:52 

Well, okay. So this is a very big sort of, I'm going to stereotype I think it's a very big difference between men and women, by the way, in the general. So if I can, one of the first stories of mine was one of when I made one of my biggest career changes. So I'd had a very, I would call what IBM would have been a traditional career of you move in, I came in as an engineer move through that went into sales into marketing, I was on my way back, then the job would have been a branch manager, wonderful things. And someone came to me and said, You know what, we're going to start a consulting business. And we're gonna hire all these people from the outside. And we think that you would be really good at this. It was one of the very first times and I was like, Oh, my God, I'm going to divert off of this path. And I hemmed in hard. And you know, it was my husband. He'd say, well, Jenny, consulting, you know, it's all this engineering problem solving. These all sound like things you're good at, why are you so worried about this? And the more I thought about it, first lesson was, you know, what, consulting is a really valued external career valued by the external world. I was getting really good at IBM stuff, but like, what's that worth in the external world? So my first lesson on being willing to change was that the second was time would go on. And that turned out great, successful, etc, went on to other jobs. And I remember being offered a very large job. And the man who I worked for he came to me said, Jenny, I'm going to get a new job, I am going to go to Asia. And I think you should take my job. And I looked at him, I said, boy, now this is a very big global management job. I said, I'm not ready for this job. Maybe two more years, I could be ready for it. He said, Go to the interview. Because I had with his boss. So I went to the interview the next day, he's telling me why I should do it, this and that. And he offers me the job. And I said, let me go home and talk to my husband about it. Kind of looked at me. Okay. I went home, I talked my husband's name is Mark, you know, Mark did, yeah, I talked to Mark and Mark looked at me, you know, he kind of I went on and on, like usual. He's like sitting there and he goes, Jenny, do you think a man would have answered that offer that way? I said, No. He said, I know you, you're going to do it, you're going to, you know, six months, you're going to have said, I've learned everything, I'm bored. I gotta move on. This is it. And I know these other people, you're better than all of them. And it was that was when to me it crystallized that story. Some have heard that I say, growth and comfort. Never coexist. Never. And it really was in that moment that I really realized my mistake. And I went in the next I took the job, he looked at me. And he said, Don't do that. Again. I said I understand. And the point was, you know, you got to have confidence, even if you're not, by the way, because very natural, don't show it then, okay, because you will only grow when you're uncomfortable. And I've talked to so many people around the world that resonate with that. And I try to say to them, I actually got to the point where I love to feel uncomfortable, because then I'm like, Yes, I'm learning I'm learning. And so I would even look to put myself as a CEO, particularly in those positions, right? You know, I'd be seeing a client that ran a railroad, I gotta learn railroad business before I get there, you know, and it was like, if you start feeling like you're not I would say to people, if you're feeling so comfortable in a role, you do need to change it, because you are not learning. So growth and comfort never coexist. And by the way, I felt that way about a company and a country to on that one.

David Novak 19:16 

That's really interesting, because I never said I was not ready for anything. I've never seen any man ever say I'm not ready for anything. What is it about women that makes them think they've got to have those two years that you thought you needed? Initially? What's in that there have

Ginni Rometty 19:30 

been many studies on this and you and you probably know and and and I don't know the the deep down roots of it. I know that and I would actually, you know, with my own teams catch this over time. And I will say to them, it seems like our discussions on our male colleagues are about their potential. And our discussions on the women colleagues, when it's time for promotion, are about what experience did they have to be able to do it? I said it's very interesting difference here. One is you're saying about what he could do. The others are saying well, let's prove it by what she did do. And so that feeling that I felt many my A female colleagues had was it? Well, if I hadn't done it yet, I couldn't do it. And you know, it's a little bit of a circle. So the best way I know how to deal with that is a to be really aware of it right? And call people, right, we would be very aware of this was happening. And also, I think it really helped, because we'd have these conversations with many of our women, by the way, we have the best women diversity and technology upfront about okay, we know they're going to react that way. Okay, off it. So help move them along. And we did. And I think that well, the results speak for themselves.

David Novak 20:28 

So when was it? You know, when you were coming up IBM, where were you actually looked yourself in the mirror and said, You know, I can be a CEO, this is something that I have the capability of doing it? And was there a moment in your career that really accelerated your trajectory and your belief in yourself?

Ginni Rometty 20:46 

Did you have a moment like that they've,

David Novak 20:48 

you know, I just kind of did every job as well as I could do it. And then kind of look at who had the next job and said, what do they have that I don't have and tried to do that? What did I don't know how it happened. But somehow I became a CEO.

Ginni Rometty 21:00 

Yeah, I really do feel the same way about that. Now, it doesn't mean it's the only formula because there are lots of people who go, that's what I want to be. And I, you know, chart a course. And I didn't, I always felt that if you did a really good job in this role, the next role would open up and unfold itself. And in fact, if anyway, if you chart it too specific, you just be disappointed in work. And so I believed in that now, in retrospect, if you asked me that, I would tell you that the job that probably made the biggest difference for me was when we acquired PricewaterhouseCoopers, consulting, IBM had a technical consulting group, I would call it if 30,000 people, and we brought PwC, in this was the year 2002. And they were another 30,000. And at that time, there had been previous big consulting acquisitions, all had failed, or had failed. And then here, we came with this one largest acquisition we'd ever done at that time. And I was asked to run it. Actually, I was actually asked to go run and I was extra go help the due diligence. And what we were doing, I believed in it, I was running another part of services at the time. And in going to help, it became clear, I should be the one to run it. And what I learned in that from that whole experience was what it takes, again, 30,000 60,000, people who had to merge, you couldn't run them separately. So it wasn't like buying parts, it wasn't like buying something else that could stand on its own, these two had to come together and really create one plus one equals three, it really had to be that way. It wasn't a product going through distribution channel, nothing like that. And so it taught me probably the biggest thing it taught me was this point about both being in service of clients, which is different than serving clients. And the second thing was how to help unmask people build conviction about something. And so it was probably after that, I can remember when I finally took the job, I said to myself, well, this is a you're going to be really good, or this is going to kill me. It was hard. But we successfully I mean, today, it's half of IBM. And so you know, in the end, it worked. But so many lessons of it. And it was another one of those long after my other story, one of those big challenges. And if you come through the other side, but I think what it taught me was I could do things on very big scale, then. And that was really to your point, when did you feel you can have some confidence?

David Novak 23:17 

Yeah, you started out as a systems engineer, you had to be an individual contributor for a while. When did were you able to make that transition into really being a people leader? I mean, you obviously have great taking people with you skills.

Ginni Rometty 23:30 

Yeah, as do you, my friend. You know, I think you make that transition again, now that we are like old dogs to think back. A couple points. I'm a big believer of watching other leaders and learning from them. I think you can learn from everybody you've ever good and bad by the way that you've ever worked with. And for. And you make this transition from focusing on you being the best to focusing on bringing out the best in someone else. I don't think it happens like a light switch. It kind of moves over time, when you recognize that you get more joy in someone else's accomplishments than your own. I worked for someone who I thought did that. And he probably brought that out the most to me at some point in mid career that I really, he took such pride in what we did and never about what he did. And that to me is that moment when you make that transition, and there was a I can't remember, Oh, I wish I can refer to as Benjamin Franklin, Abraham Lincoln, or if it was, I shouldn't remember who said it. It was there's nothing one can't accomplish, if you don't care who gets credit for it. And it could have been even Ronald Reagan.

David Novak 24:37 

And I think they get I think it was me. I

Ginni Rometty 24:39 

don't think so. I think it's right, that there's no good. Yeah. And if you take that attitude, I think you'll be surprised at what you can actually get done.

David Novak 24:48 

Yeah, absolutely. And, and you know, speaking of getting something done. I mean, when you came into IBM, you had one heck of a tough job ahead of you. You had to basically reinvent the company and you You did it and you return billions of dollars back to the shareholder in terms of share buybacks and you know, really good dividend. But you had to go through a pretty tough stretch where the company stock didn't really grow. That's always tough for a CEO, we have a tendency to be looking at that stock price every day. How do you keep yourself motivated during that time? How did you keep yourself with the kind of energy I know that you have? I mean, you've got tremendous positive energy.

Ginni Rometty 25:25 

You know, a couple of points I would make that I think now are good advice. First off, you are asking me a minute ago about my first days and the job, right. And the first evening, after I'd been told, I'd gone home, and Mark had flown into town, he was there. And he had arranged for just a dinner for he and I, at the top of my building kind of an event space, no one else was in it. I can remember looking out over the sky, and you can see the twinkling lights of New York City. And I said to him, I was the first time I think I really understood the word stewardship. I said, you felt this gravity of GE, there, let's see a million employees. Pension years, we have the largest pension in the world, right? Yes, your shareholders, yes, these clients have how many people in you, you don't have to go far to find someone who worked for IBM, or had a relationship or something like that, that you're responsible for. But with that understanding of stewardship, I felt came this view that I was taught you do what's right for the long run, even if it's not right for the short run. And so there were many decisions I had to make that I knew were right. And I knew probably my successor would benefit from them, not me. But I also know if I didn't do them, I could likely kill the company. And so that all equals that word, conviction. And so I think how anybody gets through those times is conviction. And there were times that were rough. And by the way, yes, the share price and go up but we did return a lot in dividends. Okay, so they didn't get nothing. And someone wise told me you run the company for the owners, not the renters. All right. So the renters meaning in and out of the stock caring about it, if I own it, okay, doesn't go up in that period. That's fine. I'm getting my my dividends. But again, to your point, everyone looks, and my mom would say she'd watch television, she said, Oh, Jenny, sometimes are so mean to you on television. My answer here is I might say, Mom, turn it off. Okay. I'll tell you when to turn it back on. I said, I'm very clear what I have to do. And I know what I have to do. And so a conviction. B, it is that idea that you cannot if you do a Dave, I do compartmentalize things. And that does allow you to keep moving forward, right. I don't go backwards a lot. You do it, you handle it, or something bad happens here put in a box, I go on to the next topic. I don't drifted over into it. So this idea about conviction compartmentalizing. And just like this, always looking forward, it's always forward to me. Okay, something bad happens that goes back to my being brought up. And, you know, a really bad thing happened in my youth. But we all turned out okay, my brothers and sisters are more successful than I. And so this idea that a bad things do not determine your future. And so that to me, was the secret about how did you do it? I would tell people, if you start with conviction, you can handle anything. And then this maniacal focus on okay, it happened now move forward, take an action and move forward. Right?

David Novak 28:18 

You've got a very tough mindset, you know, you can handle it, you got a thick skin? Is that something you've always had? Or did you just learn it as you took on more and more responsibility? No,

Ginni Rometty 28:27 

no, it got thicker with time, there's no doubt. And I think that's a great piece of coaching to people to realize that it will get thicker with time. And actually, it's those tough things that make it thicker in the end, right?

David Novak 28:40 

Yeah. And for you, I mean, you know, IBM now is so much better off. And when you look back, Ginni, what transformation Did you lead at IBM that you're the most proud of,

Ginni Rometty 28:49 

you know, the thing people talk the most about was the portfolio. Right? I had to replatform the company for data and cloud. So when I left, our cloud business was maybe 24 billion or so let's say, and half of the portfolio had been transformed. And again, in the public eye, right. So to what you just said a moment ago, while the plane was running, and the train was moving, you know, all that had to happen while it was going on. But the part I'm probably most proud about, even though that was essential, and it gave them the foundation now going forward for growth is it's probably what I would call employee engagement. It's a topic near and dear to your heart, which really have a lot to do with the people skills, as well as how they did their work and how they felt about working there. And so that, to me, is probably the part I'm most proud of, because, you know, a more industrial company, sets a financial model, and then that drives what happens going forward. I think there's another way to run a company, which is what I was switching, which is that an engaged employee really drives what happens with the client and then that drives your return. That is the cycle of the engine I restarted and so when I left, we had best in class Net Promoter Score best in class and playing Ah man, and we had not started there. So that's the piece I feel the best about. And it was very hard to do, by the way. So it wasn't like along the way, it was easy and was difficult for a lot of people. Anyone I tell people now that have to really transform a company. I know you all think all the time about what you do. Sometimes the how in the who in the skills is the more important part.

David Novak 30:21 

It sounds like your formula for success as you get to people capability, right, then you're gonna satisfy more clients. And that's how you make money. So many times people start out thinking, I want to make the money, this is what we have to do. But they don't realize the people capability, you have to have to really make that happen. When I think about IBM, it's such an iconic brand. I mean, it's just it's huge. It's so huge. You almost don't know what it does. It's like if you're just the layman out there, how would you describe what IBM really does today?

Ginni Rometty 30:48 

Yeah, by the way, that is a bit of a challenge. Because for IBM being the granddaddy of all the tech companies, the oldest right at over 110 years old, it means that it has had to change many times, you know, it started out is meat slicers and cheese slicers. Okay, that was tabulating machines, right. And then it was eventually timecards punching in and out of work. And then it was eventually obviously the birth of the computer, right. But then people remembered it for PCs or point of sale in a grocery store. Printers, we moved out of all of those things over time, because they would commoditize. And so today, I think the best way to describe what IBM does is it does the mission critical work that runs the world. So there isn't a banking transaction that doesn't go through those systems. There's hardly a credit card and airplane reservation Hotel. So it is what's below the surface, though, in many cases, right? It's like, you know, they're running in places. And so my best way to describe it is it does a lot of the mission critical work of the world. And it's probably the easiest way for people to think of it

David Novak 31:53 

your public face of the company. Was this Watson? Okay, you know, which is really great. You know, tell me about the origin of Watson ended up winning Jeopardy with his AI capability. You know, I always love those commercials tell me the story behind Watson and how you developed his personality

Ginni Rometty 32:12 

well set yet such an interesting, I think learning around this because, you know, aI had been artificial intelligence had been around, in and out. It's been decades, we did some of the very early work on it, Carnegie Mellon, MIT, you name it. And the idea if you think about the eras of computers, for as a kind of layman, my layman's view of this, originally, like I was talking about IBM, originally, there were systems that could count things, tabulate, you know, little beads moving across or little machines tabulate adding things up, then you got a set of computers that could do logic, if this do that. Alright, so we went from counting to this logic. And then what Watson began it in human eyes for people was a system that could learn. So that was the difference kind of this third era of computing. So it was in research. And that was 2011, when I believe Jeopardy aired. And when I think Watson did, in my view, it humanized and made AI understandable to the general public. And honestly, it got away, we couldn't tamp it down because people a they understood it, it could no one natural language, so you could communicate it like you and I are talking. And then it had the ability to learn put things together and learn from it. And so that brought it to the mass it democratized this idea, right? And that, in some ways, was good. In some ways. It was bad, because people had huge expectations. And some of our first forays, you know, right or wrong back to this mission critical in our DNA, we took on some really tough problems to solve, like health care. And I would always say, Oh, we're gonna do our little piece. But it was hard, while others were looking at pictures of cats, and you know, photos, and that would have been a way easier route to go with AI. And so we made a lot of progress today, what Watson is, it's a platform of artificial intelligence, lots of different routines. But what I would say is, it's a trusted AI platform. And that's a very big difference, because it means the data you don't learn from someone else's data. So if I'm a competitor, I don't have to worry that your AI systems learning from me that my data does not become IBM's data, algorithms that check for bias, all these things that were the downside, we can talk about good tech. So today, it's a platform more able to be used in any application. But certainly when it was visible like that to the public, it really did, I think show the world at least the possibilities of AI, which day those are really still in front of us, right? And the biggest learning is you don't get the benefit of it. In a business world. Unless you really change how work is done. If you tried to sprinkle it, like salt on things. Very marginal benefit.

David Novak 34:52 

Yeah, good point, you know, and it's obvious you're passionate about AI and urine a communicator. And by the way, have you always been a community cater? I mean, it's just something you picked up.

Ginni Rometty 35:02 

No, I have not actually. So that's another good lesson for everybody listening, find the stuff you're bad at and go work on it. Because we found in a box recently, my very first evaluations of communications from a class and IBM, oh, my God, I was horrible. And it's so now I feel I'm on the other end of that spectrum. I work so hard because I think, first, it's hard with clients, someone taught me that times the most valuable thing a client gives you, you must give them something clear in return. And so it started this preparation thing I do with clients, and then it moved to man, when you got to talk to masses of people. Two things, they don't exactly remember what you said. They do remember how you made them feel. And then the second was, if they're ever to remember what you say, you must make it easy for them. That is your job, not theirs. And that old either written you a shorter letter, if I had more time, it's so clear. So anyways, I'm a big advocate that people underestimate that that is a science, not an art.

David Novak 35:59 

Yeah, absolutely. And obviously today now you're moving on to different things and you're making a big difference in the world. And I know you're motivated by a lot of other products, but I want you to talk about the 110 initiative and and why you're so passionate about it.

Ginni Rometty 36:13 

Okay, so co founded with tensional, Ken Frazier, pinching off from Amex American Express, Ken Frazier, from Merck, Kevin shear who ran Amgen, Charles Phillips who ran in four. But Ken Frazier and I are the co chairs, it is to place 1 million black Americans who do not have a college degree. But go back to my stories I've told you who do not have a college degree into upwardly mobile, middle class jobs. So our point was, I mean, we're very clearly picking what we're working on. And strong view, Economic Opportunity is the greatest equalizer that's out there. And that if you want racial justice, one of the best things companies can do is jobs. That is what we do. It's not talking, talking talking is giving people jobs and opportunity. And we don't mean dead end jobs. We mean, take a skills first mentality, if I hire you, because you have propensity to learn and some skill, do not demand you have a college degree yet, because of all our companies 88% require college degrees for these good jobs. And 80% of black Americans do not have a college degree, this, this equation will never be solved. If you do not change something in what you believe. I offer this 10 years I was kind of talking about this earlier, I came to be such a strong believer in this skills first mentality meaning higher because of my skill first, not a degree only world. And it and we can go on and on into that and how the education system has failed. And trust me, I'm not saying don't get a degree ever, because my own experience with this is. So many of the people I've hired have then gone back and gotten degrees IBM, we have our first PhD out of this crowd. So again, not an issue of aptitude, the issue is access. And so we said this is what we can do, we can go get all our peer companies to sign up, do it 10 years is not an easy thing. And the first thing they have to do is go back, check how they do all their hiring, you go test every job to get started, do you really have to or have you just become lazy that the college degree is the kind of bar to get in. And that is the case in 95% of the cases. And so then go through the hard work of changing your job racks, then you gotta go do the hard work of interviewing differently. Because, again, this is a different group of people that start in a different spot. And then you got to do the hard work of how to promote them and move them along. And then we are working with all the places that we say okay, at Bastion is leading up Atlanta for us from Delta, and his colleague companies there, they say okay, collectively, we got 1000 people, we can hire and cyber, we're going to the community colleges and other nonprofits and saying, Okay, this is what we need this kind of skill set credential, can you do it, we will hire them. And so that's that matching and putting it together. And in our first few months, as we ended last year, we did 20,000 hires, but we'll get much closer to 100,000. Now again, and it'll just should take off. But already the impact is happening from people opening how they look at candidates. And as I say, it changes the role of HR who went from, you know, I would buy skills ready made to I have to build them more, right? And, but these are, again, I've been at it a decade. So we're kind of the longest on this topic. They're more loyal, higher retention. And guess what we did the work after a year there as innovative. And trust me, I had a company of all PhDs and I had to convince him I wasn't dumbing down my workforce and what I was doing, and that this was the ultimate definition of inclusion. And it is and so anyways, that's in a two minutes. That's 110

David Novak 39:46 

I love it. And thank you for for leading the way on that for our country. It's absolutely the right thing to do. And you know, I understand you would tell your IBM team that this is our time. And Jenny, it sounds to me like this is your time you're really passionate about what you Do it right now. How important is it to have that mindset of this is our time and seizing the day? Well,

Ginni Rometty 40:06 

whenever you do something hard, I think that is critical. Dave, you've always been that way, right? As, as I watched, you know, your strong view about how to treat employees, right. And really, as they were the penultimate of what would eventually then turn out to be your success. And it's not rah, rah, by the way. So this is, I think, an important point, people I don't want them to miss. Again, another great saying I first learned from tensional, but it's actually from Napoleon. He said, A leaders job is to paint reality, and then give hope. And the point being, hopes gotta be based on facts, okay? Otherwise, it's just sort of an illusion. And I do think for any of us, when you say this is our time, and what I would say with the IBM errs, it was because I had to sell the things I believed in, that were factual happening. And, you know, again, we were the oldest, not the newest tech. And as you know, the world falls in love with the most new shiny object, you would see it in your industry, too. And it's easy to forget, you know, what is in your heart of what you are. And IBM, at its heart, it was a trusted company, right, with the most important assets in the world. And as this area is now evolving, trust is probably one of the ultimate currencies that companies want to deal with. And so as we moved into now, hey, chapter two, they're going to change their back end systems. It's about data. It's about a cloud for, you know, really serious work. That is their time. That's what I meant by that is your time, but I, but I think it's so important to base it on facts. Right, not on, like what you wish to be true.

David Novak 41:36 

Well, is this your time? You know, I

Ginni Rometty 41:38 

hope they've all been my time, right? I don't know sometimes. Yes, I think so. I mean, look, I think the best thing for anybody is, if you're authentic, it's your time. And and to me, that's the greatest piece of advice. I'd give someone you know, when people say, well, what's the best advice you'd give somebody? And I'd say, be authentic? Yeah, great point. All of this doesn't matter. Unless you are authentic about it. Diversity and Inclusion. I mean, you name it, my belief in that transformation of IBM, because Authenticity will then lead to your conviction, and it will lead to your resilience.

David Novak 42:12 

Absolutely. And I'm going to bounce wrap this up quickly. But I want to do a lightning round. And I always do with our guests. Oh, here we go. Are you ready for this? I'm ready. All right, three words that best describe you?

Ginni Rometty 42:23 

Hmm, resilient. Empathy. Logical.

David Novak 42:30 

If you could be one person for a day besides yourself, who would it be? And why?

Ginni Rometty 42:37 

You know, maybe president and I tried to get something done.

David Novak 42:41 

Come on, let's go. Okay, what's your biggest pet peeve?

Ginni Rometty 42:48 

I think my biggest pet peeve is when people have arguments with no facts.

David Novak 42:54 

What's something about you that few people would know?

Ginni Rometty 42:58 

Probably how much time I spend with my family and my friends in that I view that that is a really important thing for people to have in, not for them just to support you, but for you to support them. Right, right element of your life.

David Novak 43:12 

And do you have any hidden talents?

Ginni Rometty 43:15 

Oh, zero? I wish I have. I have lots of no talents.

David Novak 43:19 

Oh, come on. You got to have something there.

Ginni Rometty 43:21 

You know what? My grandmother taught me to bake Christmas cookies.

David Novak 43:24 

There you go. See that? No

Ginni Rometty 43:27 

one's ever expect I could do that. You know,

David Novak 43:30 

that's it. That's a handout. And I got to ask you this question. What would be the one bit of advice you'd give every leader who wants to make a significant impact at whatever they're doing?

Ginni Rometty 43:40 

You know, again, I love sometimes remembering these things in quotes. And it was Ann Richards, governor of Texas. She said, when someone asked the secret to her success, it was passion and perseverance when everyone else would have given up. I think that that is a lot of it. So if you really believe in it, passion and perseverance.

David Novak 43:59 

Great, you know, and I'm going to ask you one question, because I'd be crazy not to you lead this tremendous reinvention. Any advice to people on how to go about reinventing a company or brand or whatever business you might have?

Ginni Rometty 44:12 

I would put it if I could only say one thing. And I would come to learn this clearly in the middle is that people often ask, the first thing they do transformer companies change everything. And I actually think the most important first question is, understand what must endure. And so understand what must endure, then be willing to change everything else. Because for companies to transform, they do need a ballasts or a center or something. And as I was transforming IBM, there will be times I got us into things too far from our core as an example. And I'll always remember my very good friend, you know him well to Arne Sorenson. One day I was with Arne and I said that it was like a marketing system or something he's gonna buy from someone else. I'm like, how are you gonna do with IBM? Oh, all right, like Jenny, JJ. Hey, he's like, I rely on you for all that mission critical work. You got to do what IBM is good at. It was an epiphany of a moment that I said, Yes, he's right. I mean, back to that mission critical. At my heart, I am about trust and mission critical work. And these other things are diversions. And this idea about, then move adjacently to what you are so good at right use your strength to power your transformation is the other way to say it. I love that. And so that would be my advice is that and that's that point about know what must endure and then change everything else, not the other way around?

David Novak 45:37 

Well, Jimmy, I have to tell you, you know, I love doing these podcasts because I learned so much. And I learned a lot just by getting to know you even better. You're a good friend for coming on this podcast. I know you don't do it all the time. And I really appreciate it. I'm just thankful that our listeners are going to have the opportunity to get your wisdom and you've really provided a lot of it. So thank you. My pleasure,

Ginni Rometty 45:57 

Dave, you made it easy. Thank you.

David Novak 46:10 

You know, when I was coming up in marketing, I always wanted to become a general manager. But I was really being stereotyped as just a marketing guy. So I knew that I had to demonstrate that I could be a general manager by taking on another function. And when I was running marketing at Pepsi, that meant that I had to run operations for Pepsi. And I remember when that job came open, I didn't have any operating experience at all. And I remembered how uncomfortable I was when I walked into my boss's office. And I said, Craig, I really want to become the chief operating officer of the Pepsi Cola Company. He looked at me, and he thought I was almost crazy. But then I said it again, I know that if I'm going to stay in this company, I've got to demonstrate that I can be an operator that I can run a p&l that I can work with people on the front line, and you've got to give me a chance. And I think he saw that I was really serious about this. And I was so uncomfortable asking him for this opportunity, because I knew I was going to be making him uncomfortable. But because I did it. He said yes. And I got the chance to run operations. And that's what led me to become president of KFC. Now, you might think that was a very bold request on my part. But I'm going to ask you to do something bold this week. Go look for something that makes you uncomfortable. I mean it, seek it out actively look for an opportunity to be uncomfortable. But here's the most important part of this. When you find the opportunity I want you to really lean in, give it everything you got. Because I know these uncomfortable moments are where you're going to grow the most. So do you want to know how leaders lead? What we learned today is that great leaders get comfortable being uncomfortable. Thanks again for tuning in to another episode of how leaders lead where every Thursday you get to listen and while I interview some of the best leaders in the world, I make it a point to give you something simple in each episode that you can apply to your business so that you will become the best leader you can be. See you next Thursday.