Out of the Blue

Several former IBM employees are featured in an attempt to see why past Big Blue employees often become entrepreneurs.

Thomas J. Watson grew the world's most successful company by teaching a corps of businesspeople how to 'think.' Now, as Big Blue shrinks, a cadre of entrepreneurs with IBM experience are learning to think again

When Bill Holt finally got to tackle the project he had always dreamed of, he knew exactly how to go about it. Twenty-seven years at IBM -- 17 of them as a line manager -- had taught him a thing or two about how to plan, how to budget, and how to anticipate problems. He gathered reams of market data from industry experts and potential customers. He designed a prototype of the product. He created a detailed business plan and, using the large-format presentation graph paper familiar to anyone who has worked at IBM, drew up a step-by-step storyboard. But Holt wasn't launching some new peripheral or software application or mainframe server. In fact, he was no longer at IBM. The venture he was embarking on, with his brother (and former IBM employee), James, was Holt Brothers Barbecue.

"One of the things you learn at IBM is how to run a business. The rules and principles apply to any business you go into," Holt says. Since opening his restaurant, in 1992, he has grown it into an $800,000 joint. It recently garnered a local award for best barbecue in Atlanta. Holt's success makes him a member of an elite club of IBM expatriates turned entrepreneurs who attribute their accomplishments to the set of skills they learned at the computer company.

Once upon a time IBM was famous for its promise of lifetime employment. But times have changed. Initially through attrition and then through plain old layoffs, IBM has shed 180,000 employees since reaching its 406,000-person peak, in 1986. According to group vice-president William C. Hollett of Drake Beam Morin (DBM), the New York City-based outplacement firm handling IBM's refugees, that crowd is more entrepreneurial than any other cross section of downsized corporate lifers. "Historically, the culture of IBM has encouraged employees to try new things and suggest alternative means to solving problems," says Hollett. Drawing from numbers compiled from the DBM entrepreneurial workshops offered to people who have left IBM, he has discovered that roughly 15% to 18% of former IBM employees tackle entrepreneurial enterprises -- twice the percentage of all corporate refugees starting businesses.

Many Big Blue alumni traffic in the same high-tech knowledge they traded on at IBM. Yet businesses launched by former IBM employees are all over the map. They include TopsyTail Co., a Texas company that peddles hair gadgets; Finally Finished, a furniture-restoring company in upstate New York; Everyday Learning, a $7-million educational-publishing company in Evanston, Ill.; Preferred Staffing, a $14-million temporary-staffing agency based in Chicago; and Bob Soto's Diving Ltd., in Grand Cayman Island.

And they include legions of solo practitioners in either technical consulting or other -- sometimes far-flung -- pursuits. Private detective Bob Tomlin and comedian A.J. Jamal have more in common than an IBM pedigree and a successful solo career. Both praise their IBM experience as the secret to their success. "IBM taught us the logical way to think about a problem, how to break down a big problem into smaller components and solve each one," says Tomlin, who worked for IBM from 1968 until he took a generous retirement package, in 1992. Jamal, who hosts the Comedy Channel show Comic Justice, attributes his successful career to the basic skills he learned in his six and a half years with Big Blue in downtown Cleveland. "Everybody wonders why I am so businesslike with comedy -- and it dawned on me that doing comedy is like troubleshooting a technical problem. No matter what is happening with the machine, you can fix it. Is the green light on? The green light is on. Check the left panel. Is the red light on? The red light is on. Check the back panel. And so on. It's the logic IBM taught us."

IBM's entrepreneurial ex-employees are a large and vibrant enough group to support such endeavors as the Big Blue Alumni International, a nascent board on Prodigy where they can network. According to the board's cofounder Linda Anderson, more than 1,300 members have signed on since its launch, last year, making it the second-fastest-growing board on Prodigy. She and cofounder David Camm (another "Blue-blood") have also set up a "virtual corporation" of members who offer their home-based services to companies throughout the world -- a high-tech temp agency of former IBM employees. And Out of the Blue, a snappy monthly newsletter for IBM alumni, has, in only a year, attracted several thousand subscribers, according to publisher Alex Auerbach. "The newsletter," he says, "celebrates the real value to being an ex-IBMer -- that the training you received can be of value in your next job."

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