UI president to participate in business course dissecting IBM turnaround

Harreld said he loves teaching, interacting with students

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In the upcoming semester, new University of Iowa President Bruce Harreld will be a “guest participant” in a business course that will look at the IBM turnaround Harreld helped lead in the 1990s and early 2000s.

The course, “Strategic Leadership of Change,” presents several models of change that students can use in both organizational and personal situations, and instructor Sara Rynes-Weller, a UI professor in the Tipple B. College of Business, said she invited Harreld to address her executive MBA class.

“This is a particularly appropriate audience because these students have significant work experience and have been identified by their companies as high-potential, next-generation leaders who will be responsible for framing their companies’ future missions, visions, and strategies,” Rynes-Weller said in an email to The Gazette.

Rynes-Weller plans to dissect the teaching case of IBM’s turnaround during her Feb. 6 session of the course and involve Harreld, who served as senior vice president for IBM between 1995 and 2008. While at IBM, Harreld said he worked with the CEO and senior managers to “chart the organization’s transformation from near bankruptcy.”

On his resume, Harreld reports leading the IBM unit responsible for formulating and executing the company’s overall strategy and creating the firm’s “emerging business organization” that produced “more than $15 billion in new, profitable revenue across 20 new businesses.”

After leaving IBM, Harreld served dual faculty appointments at Harvard Business School, where he taught — among other things — on the IBM turnaround. When the Board of Regents hired Harreld in September, many cited his turnaround experience and called it especially relevant and valuable in today’s changing higher education landscape.

Still, many UI faculty, staff, and students criticized Harreld’s lack of academic administrative experience and even passed votes of no confidence in the Board of Regents for hiring him.

Harreld, in response to questions from The Gazette, said he won’t be teaching the business class focused on IBM’s turnaround but listening to Rynes-Wellner’s instruction and participating. Rynes-Weller said Harreld’s involvement is a “great opportunity” for students, as he was involved in “one of the greatest business turnarounds in history.”

Given the current pace of innovation in an increasingly globalized marketplace, Rynes-Weller said, one could argue lessons learned from IBM’s turnaround are even more relevant today.

“President Harreld will not only answer questions about the turnaround, but will also tell students how IBM moved forward to transform itself from a primarily hardware and software-based company to a services-based consulting company,” Rynes-Weller said.

Harreld, in response to questions from The Gazette, said he loves teaching and interacting with students and will do so “as much as time permits and as much as deans and faculty will allow.”

He plans to continue teaching the UI President’s Leadership Class, created in 2008 to facilitate leadership development among UI students. The three-hour for-credit course is offered each fall to nominated first-year students, who then get the opportunity to explore leadership issues with the university president; participate in programs with UI, community, and state leaders; partake in civic activities; and network with other student leaders.

Harreld said he will put his own “twist” on the leadership course, and he’s also been asked by the UI honors program to teach a couple of classes.

“We are exploring that option,” he said.

As for his guest participation in the upcoming business course, Harreld said there are three primary lessons to be learned from IBM’s turnaround.

First, he said, leading organizations quickly can become losers, and IBM’s fall from having the second-highest profits in the world to borderline bankruptcy exemplifies how that can occur.

“It happens when companies or organizations become arrogant, close in, and do only what they’ve done in the past — failing to adapt,” he said.

Second, Harreld said, IBM shows the importance of acting sequentially in affecting transformation. Companies first have to address the crisis and then focus on changing their vision and strategy.

Third, according to Harreld, IBM is a case study on building new businesses inside a 100-year-old company.

“But this requires huge cultural change,” he said.

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