International Business Machines CEO Sam Palmisano, who will turn 60 next year, said the practice of the company's leader retiring at that age isn't "cast in stone."
International Business Machines CEO Sam Palmisano, who will turn 60 next year, said the practice of the company’s leader retiring at that age isn’t “cast in stone.”
Three of IBM’s past four CEOs have stepped down at 60. In response to a question at The Wall Street Journal Viewpoints Executive Breakfast Series, Palmisano said “there’s no formal policy.” After a follow-up question, he said, “I’m not going anywhere.”
Palmisano, who has led the company since 2002, shuffled his top management in July, giving more responsibility to several executives and fueling speculation t he is preparing to step down.
In the interview, Palmisano criticized IBM rival Hewlett-Packard on several fronts. He said HP didn’t handled the exit of former CEO Mark Hurd in the best interests of shareholders.
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He also said HP has had to make acquisitions, including its $2.35 billion deal for storage-system maker 3Par this month, because it isn’t putting enough money in research and development.
“I’m never worried about a competitor that doesn’t invest in R&D,” he said. “They’ve had to buy. They have no choice.”
IBM’s larger threat in the long term will come from Oracle, Palmisano said, noting its CEO Larry Ellison has increased cash flow and invested in technology. “He’s done a good job,” Palmisano said.
Ellison snapped up Sun Microsystems this year for $7.4 billion, becoming a rival to IBM in the server market as well as the software market. Ellison also hired Hurd last week, less than a month after he left HP.
Palmisano’s remarks about retirement reassured investors that IBM isn’t rushing to find a new leader, said Pete Sorrentino, senior portfolio manager at Huntington Asset Management in Cincinnati.
In July, IBM gave Ginni Rometty, a senior vice president, responsibility for marketing and strategy in addition to her position as head of sales.
Mike Daniels, the senior vice president leading technology services, took on the consulting business as well.
Rometty and Daniels have been mentioned as candidates for the CEO post.