WEBVTT - Smart Talks with IBM: IBM CEO Arvind Krishna: Creating Smarter Business with AI and Quantum 0:00:00.160 --> 0:00:02.960 Hey everyone, it's Robert and Joe here. Today we've got 0:00:02.960 --> 0:00:05.240 something a little bit different to share with you. It's 0:00:05.280 --> 0:00:09.400 a new season of the Smart Talks with IBM podcast series. 0:00:09.720 --> 0:00:13.520 This season on Smart Talks with IBM, Malcolm Gladwell is back, 0:00:13.520 --> 0:00:15.760 and this time he's taking the show on the road. 0:00:15.880 --> 0:00:19.160 Malcolm is stepping outside the studio to explore how IBM 0:00:19.239 --> 0:00:22.880 clients are using artificial intelligence to solve real world challenges 0:00:23.079 --> 0:00:25.440 and transform the way they do business. 0:00:25.480 --> 0:00:29.560 From accelerating scientific breakthroughs to reimagining education. It's a fresh 0:00:29.600 --> 0:00:33.040 look at innovation in action, where big ideas meet cutting 0:00:33.120 --> 0:00:33.960 edge solutions. 0:00:34.320 --> 0:00:37.160 You'll hear from industry leaders, creative thinkers, and of course 0:00:37.280 --> 0:00:40.920 Malcolm Gladwell himself as he guides you through each story. 0:00:41.440 --> 0:00:44.640 New episodes of Smart Talks with IBM drop every month 0:00:44.680 --> 0:00:48.279 on the iHeartRadio app, Apple Podcasts, or wherever you get 0:00:48.320 --> 0:00:52.240 your podcasts. Learn more at IBM dot com slash smart Talks. 0:00:52.880 --> 0:01:02.440 This is a paid advertisement for IBM pushkin. 0:01:06.240 --> 0:01:06.479 Hello. 0:01:06.520 --> 0:01:09.280 Hello, I'm Malcolm Gladwell and you're listening to Smart Talks 0:01:09.280 --> 0:01:12.440 with IBM. This season, we've been bringing you stories of 0:01:12.440 --> 0:01:15.839 how IBM works with its clients to solve complex problems 0:01:16.560 --> 0:01:21.120 like helping Lreel reimagine how scientists approach cosmetic formulation, or 0:01:21.240 --> 0:01:25.240 enabling Scuderia FERRARIHP to connect with fans in new ways. 0:01:25.959 --> 0:01:28.240 But in this episode, we're going to zoom out and 0:01:28.280 --> 0:01:31.320 look at the bigger picture. Earlier this month, I had 0:01:31.360 --> 0:01:34.319 the chance to meet the person who's shaping IBM's future. 0:01:34.800 --> 0:01:39.080 It's CEO and Chairman Arvind Krishna. We sat down in 0:01:39.080 --> 0:01:41.360 front of an intimate live audience at IBM's New York 0:01:41.360 --> 0:01:45.240 City office and talked about his uncanny ability to anticipate 0:01:45.280 --> 0:01:49.080 where technology is heading, the future of AI, and his 0:01:49.200 --> 0:01:53.400 passion for quantum computing, which he says is as revolutionary 0:01:53.720 --> 0:01:54.800 as a semiconductor. 0:01:56.360 --> 0:01:58.400 Thank you everyone, Thank you Arvin. 0:01:58.440 --> 0:02:01.000 You're a difficult man to scare for what they said, 0:02:01.120 --> 0:02:03.000 so we're we're enormously pleased that you. 0:02:02.960 --> 0:02:03.600 Could join us. 0:02:04.120 --> 0:02:06.560 Let's start with a I have all these cousins, two 0:02:06.560 --> 0:02:08.560 cousins who work for IBM their entire career. 0:02:08.840 --> 0:02:11.120 I would ask them what does IBM do? 0:02:11.760 --> 0:02:16.000 And they would always give me different, confusing, complicated answers. 0:02:16.280 --> 0:02:18.600 What's your answer? What's your simple answer to that question? 0:02:19.480 --> 0:02:24.480 IBM's role is to help our clients improve their business 0:02:24.480 --> 0:02:29.320 by deploying technology. That means you're not ever gated to 0:02:29.400 --> 0:02:32.240 one product. It is what makes sense at that time, 0:02:32.720 --> 0:02:35.520 but it is about improving their business, not just giving 0:02:35.520 --> 0:02:38.520 them a commodity. Then to go to the next layer, 0:02:38.520 --> 0:02:41.359 I would say we help them through a mixture of 0:02:41.480 --> 0:02:46.000 hybrid cloud and artificial intelligence and a taste of quantum 0:02:46.040 --> 0:02:47.359 coming down the road is kind. 0:02:47.200 --> 0:02:48.600 Of where I would take it. 0:02:48.760 --> 0:02:50.040 That's that's what IBM is. 0:02:50.560 --> 0:02:54.880 So you are technology agnostic in some sense. 0:02:55.160 --> 0:02:58.920 I'm product agnostic. Product I'm not technology agnostic. 0:02:59.040 --> 0:03:01.800 Yes, But if I twenty five years from now, IBM 0:03:01.880 --> 0:03:07.040 could be doing things that would be unrecognizable to contemporary IBM, it. 0:03:07.040 --> 0:03:08.079 Is completely possible. 0:03:08.320 --> 0:03:11.040 Yeah, it could be that in twenty five years from now, 0:03:11.200 --> 0:03:14.520 the only software IBM does his open source. It could 0:03:14.520 --> 0:03:17.120 be the only computing you do is quantum computers. And 0:03:17.160 --> 0:03:19.799 if I add those two people today, WLD say that's 0:03:19.800 --> 0:03:20.760 not the IEM of today. 0:03:21.040 --> 0:03:23.600 Is it even simpler to say you just IBM solves 0:03:23.680 --> 0:03:26.639 problems at the highest technical level. 0:03:26.919 --> 0:03:29.600 If you say highest technical level, yes, yeah, Like the 0:03:29.600 --> 0:03:32.320 guy who invented the bar code, he was solving a 0:03:32.360 --> 0:03:36.640 problem retailers wanted to scale. Many of you may not 0:03:36.760 --> 0:03:39.240 know it was an IBM or who invented the bar code, 0:03:39.800 --> 0:03:42.600 by the way, not somebody who was a PhD. Not 0:03:42.720 --> 0:03:46.080 somebody who was a deep researcher. I think it was 0:03:46.080 --> 0:03:50.880 actually a field engineer. Oh really, Yeah, and lasers were 0:03:50.920 --> 0:03:54.240 out and you could use lasers to scan things, but 0:03:54.280 --> 0:03:56.760 they could be upside down, they could be muddy, they 0:03:56.760 --> 0:04:00.000 could be partly scraped off. And he came up with 0:04:00.080 --> 0:04:03.680 the idea of the bar code. Yeah, and that changed 0:04:03.720 --> 0:04:06.520 inventory management forever. But the world needs to know that 0:04:06.560 --> 0:04:08.920 IBM invented the barcode. You guys should do a better 0:04:09.000 --> 0:04:13.640 job ombicizing that. I am sure our CMO will listen 0:04:13.680 --> 0:04:17.040 to this podcast and we'll get that idea. 0:04:17.480 --> 0:04:21.719 Tell me you started at the Thomas Watson Research Center. 0:04:22.200 --> 0:04:24.360 What were you doing when you first started it, IBM. 0:04:24.960 --> 0:04:30.360 I started in nineteen ninety and that was the era 0:04:30.520 --> 0:04:34.400 in which computers and networking but beginning to converge. And 0:04:34.480 --> 0:04:38.159 for the first five years I was actually building networks. 0:04:38.560 --> 0:04:41.680 So let's remember this was pre laptops. Laptops came in 0:04:41.760 --> 0:04:44.600 ninety two or ninety three, but it was clear to 0:04:44.680 --> 0:04:47.960 us that they were going to come supportable computing, and 0:04:48.080 --> 0:04:51.040 I spent my first five years building what today you 0:04:51.080 --> 0:04:54.440 would call Wi Fi. We used to have these debates 0:04:54.480 --> 0:04:56.320 can be builded, it's got to be small enough. I 0:04:56.360 --> 0:04:58.880 mean like, it can't be more than one hundred grams 0:04:58.960 --> 0:05:01.520 was kind of our thought, because if it's more than that, 0:05:01.560 --> 0:05:04.799 you're on a three thousand grand laptop. Why would anybody 0:05:04.800 --> 0:05:07.480 put this on? And the debate used to be, why 0:05:07.520 --> 0:05:10.840 would anybody want to walk around untethered? Won't you want 0:05:10.880 --> 0:05:13.760 to attach a big thick cable into it and sit down? 0:05:13.800 --> 0:05:16.479 Because that was the thought, that's how terminals worked. And 0:05:16.560 --> 0:05:19.479 I spent five years having a lot of fun, building 0:05:19.560 --> 0:05:24.040 many iterations of those and making progress on that. 0:05:24.400 --> 0:05:27.760 If I had a conversation with your nineteen ninety self 0:05:28.920 --> 0:05:32.880 about what the next thirty years were going to look like, 0:05:33.560 --> 0:05:36.720 is it possible to reconstruct you? What were your predictions 0:05:36.760 --> 0:05:38.800 at that age about where the company, where the industry 0:05:38.839 --> 0:05:39.159 was going. 0:05:40.200 --> 0:05:42.760 It was more about where technology was going to go, 0:05:42.800 --> 0:05:45.480 I would say, than where industry would go. I would 0:05:45.520 --> 0:05:50.839 have told you that networking and computers would fuse in 0:05:50.920 --> 0:05:53.600 nineteen ninety. That was a weird thought that some researchers 0:05:53.640 --> 0:05:56.919 held by the late nineties, that was obvious that it 0:05:57.000 --> 0:06:01.920 became the Internet. I would have told you that I 0:06:02.040 --> 0:06:05.000 believe that video streaming will be the primary way people 0:06:05.040 --> 0:06:09.120 will consume video. You would have said that in nineteen ninety. Absolutely, Now, 0:06:09.160 --> 0:06:12.719 that didn't take five years. That took twenty. But it 0:06:12.800 --> 0:06:15.800 happened because you could do it technically, except it just 0:06:15.800 --> 0:06:19.400 too expensive and too cumbersome. And if you've been in technology, 0:06:19.560 --> 0:06:22.479 like in nineteen eighty five, I would have told you 0:06:22.720 --> 0:06:26.920 the Internet is old because when I went to grad school, 0:06:27.520 --> 0:06:30.680 every one of us had a those days, an Apple, 0:06:30.960 --> 0:06:34.920 Mac or Lisa on our desks. They're all connected by 0:06:34.920 --> 0:06:37.960 a network. You're happily sending email to people all around 0:06:38.000 --> 0:06:41.000 the country. We were doing file transfers. So okay, you 0:06:41.000 --> 0:06:42.719 had to be a little bit more aware of the 0:06:42.760 --> 0:06:46.640 technology and didn't have a browser that took ten years 0:06:46.680 --> 0:06:48.320 to get the browser that took five years to be 0:06:48.360 --> 0:06:51.360 a business. But when you see the speed and the 0:06:51.400 --> 0:06:55.240 pace of technology in usually ten or fifteen years, the 0:06:55.360 --> 0:06:59.960 cost point and the consumerization is at a scale that 0:07:00.480 --> 0:07:02.560 you couldn't imagine ten years ago. 0:07:02.920 --> 0:07:04.479 Until you've seen a few of those cycles. 0:07:05.160 --> 0:07:08.240 Wait, did you make the lead to sorry, this is fascinating. 0:07:08.440 --> 0:07:10.080 I'm curious about how far did you take that. That's 0:07:10.080 --> 0:07:13.160 a really fundamental thing to have gotten right in nineteen 0:07:13.200 --> 0:07:15.160 ninety I think you're that idea. 0:07:15.640 --> 0:07:19.840 We were pretty convinced that what we used to think 0:07:19.880 --> 0:07:24.360 of as linear television or broadcast would become digitized. That 0:07:24.520 --> 0:07:29.200 was a given two with cable already the preponderance of 0:07:29.240 --> 0:07:33.640 how people got it that if you put packet television 0:07:33.760 --> 0:07:36.840 over cable, then that becomes the way it will go. 0:07:38.080 --> 0:07:41.800 I fundamentally believed, actually way back eighty seven, that on 0:07:41.920 --> 0:07:45.800 demand movies would become the way people would consume movies. 0:07:46.520 --> 0:07:50.320 So those were all things that I could have predicted. 0:07:50.360 --> 0:07:53.520 Nine didn't personally work on all those. I mean, after networking, 0:07:53.560 --> 0:07:56.360 I moved on to doing other things. But those were 0:07:56.680 --> 0:07:57.800 easy to predict. 0:07:59.080 --> 0:08:02.280 If you had a converse in those years with someone 0:08:02.280 --> 0:08:05.640 in the television industry and you gave them those predictions, 0:08:06.000 --> 0:08:06.720 did they see it? 0:08:06.800 --> 0:08:07.880 Were they convinced of this? 0:08:08.320 --> 0:08:10.440 I'm actually going to take it back to wireless networking. 0:08:11.600 --> 0:08:14.480 I think one of the reasons I do what I 0:08:14.520 --> 0:08:17.560 do today, which is at the intersection of business and technology, 0:08:18.200 --> 0:08:20.640 is because of what I saw happened with Wi Fi. 0:08:21.520 --> 0:08:25.040 So you built these wireless networks and then you say, hey, 0:08:25.080 --> 0:08:27.920 the market's going to be millions, tens of millions, billions 0:08:27.920 --> 0:08:30.679 of users. And the business looks at it and says, 0:08:31.040 --> 0:08:36.040 we think the market is confined to warehouse workers doing inventory. 0:08:36.120 --> 0:08:38.439 You can look at them and say, why not people 0:08:38.440 --> 0:08:42.960 in their homes because they could imagine outside how people 0:08:43.000 --> 0:08:48.160 bought things at that time. And so I became convinced 0:08:48.200 --> 0:08:52.000 that I can't just help invent it. I got to 0:08:52.040 --> 0:08:55.360 think about, now, how do you market it? To whom 0:08:55.360 --> 0:08:57.440 do you market it? What are their routs? How do 0:08:57.480 --> 0:09:00.720 you make it easy enough? And that was I mean 0:09:00.800 --> 0:09:03.400 not making it simple? Now, that was probably a five 0:09:03.480 --> 0:09:08.400 to ten year evolution of myself in those days. 0:09:08.480 --> 0:09:11.000 You know, this reminds me of when the telephone is 0:09:11.520 --> 0:09:14.400 invented in the eighteen seventies. It doesn't take off for 0:09:14.400 --> 0:09:17.599 forty years because the people running a telephone business and 0:09:17.600 --> 0:09:19.520 they didn't want women using it because they were worried 0:09:19.520 --> 0:09:22.680 that women would gossip with their friends. They didn't understand 0:09:22.720 --> 0:09:24.199 that that's actually what telephone is. 0:09:24.360 --> 0:09:25.520 Right, It's an. 0:09:25.360 --> 0:09:29.199 Exact parallel, Yes, it is. You see it again and again. 0:09:29.240 --> 0:09:31.119 What is the source of that blindness. 0:09:31.120 --> 0:09:33.760 So there's a gap, in other words, between the invention, 0:09:33.960 --> 0:09:37.520 the technological achievement, and the social understanding of the technology. 0:09:37.840 --> 0:09:39.000 Why is there such a gap. 0:09:40.240 --> 0:09:44.600 I think that the gap is fundamental and rooted in 0:09:44.840 --> 0:09:50.320 a lot of academic disciplines. So even channeling some of 0:09:50.360 --> 0:09:52.320 your work, though you don't intend it to be used 0:09:52.320 --> 0:09:54.280 that way, you can say a lot of things are 0:09:54.320 --> 0:09:59.320 data driven. If it is data driven, then by definition, 0:09:59.400 --> 0:10:03.079 you're looking at history. If you're looking at history, that 0:10:03.160 --> 0:10:06.320 means you're looking at existing buying patterns. If you look 0:10:06.360 --> 0:10:10.600 at existing buying patterns, you forget. All of those who 0:10:10.679 --> 0:10:14.800 have created massive value in time have all created markets, 0:10:14.960 --> 0:10:17.920 meaning they've all created new markets. And I think that 0:10:18.000 --> 0:10:20.880 is why the world is fascinated with people like Steve 0:10:20.960 --> 0:10:24.400 Jobs for example, he imagined a market that didn't exist. 0:10:24.760 --> 0:10:27.600 So I think that is the gap. And then if 0:10:27.640 --> 0:10:32.720 you can get the technology the business acumen scaler company 0:10:32.920 --> 0:10:36.080 and that imagination of making the market is how you 0:10:36.200 --> 0:10:38.240 create I think massive value. 0:10:38.320 --> 0:10:40.440 You got to get all three pieces going. It's not enough. 0:10:40.480 --> 0:10:42.080 In other words, you were thinking it's not enough to 0:10:42.080 --> 0:10:44.880 invent something new. I need to make a business case 0:10:44.880 --> 0:10:48.240 for it. Simultaneously, and that's what gets you thinking along 0:10:48.240 --> 0:10:49.640 the path that leads you to this job. 0:10:49.720 --> 0:10:53.400 Oh yeah, I'll tell you if you had met or 0:10:53.440 --> 0:10:56.440 when the nineteen ninety four and you had talked about 0:10:56.600 --> 0:11:00.720 the stock market or about a balance sheet, or looked 0:11:00.760 --> 0:11:02.880 at you like, Okay, I got those words are I 0:11:02.880 --> 0:11:05.080 can parse them. I have no idea what they are. 0:11:05.320 --> 0:11:07.840 I have no intuition on what they are. I couldn't 0:11:07.880 --> 0:11:11.080 tell you why it's relevant or why it's not. But 0:11:11.120 --> 0:11:14.200 then you began to think, Okay, why do companies get 0:11:14.280 --> 0:11:17.440 higher values? Okay, that's the stock what does that capture 0:11:18.440 --> 0:11:21.000 if I have to spend working capital and that's the 0:11:21.000 --> 0:11:24.120 balance sheet? Well, so you learn. I mean, I figure 0:11:24.160 --> 0:11:27.560 I'm willing to learn. I'm willing to read. Howether the 0:11:27.559 --> 0:11:30.559 best way I read is to go to balance sheets? 0:11:30.920 --> 0:11:32.680 Here you can read the book. It's pretty damn dry. 0:11:33.400 --> 0:11:35.800 Much easier to go talk to a financial expert who's 0:11:35.840 --> 0:11:38.920 around the corner, and people are if you're curious about 0:11:38.920 --> 0:11:41.800 what they do, they're really happy to share their expertise, 0:11:42.200 --> 0:11:45.360 and over time you learn more and more and they 0:11:45.400 --> 0:11:48.520 actually become part of your network within the company. And 0:11:48.679 --> 0:11:51.760 that's how you can both learn and evolve yourself and 0:11:51.920 --> 0:11:53.719 actually gain the extra. 0:11:53.520 --> 0:11:57.840 Skills you are to be a successful business leader. Do 0:11:57.880 --> 0:12:01.720 you have to unlearn or or deviate from some of 0:12:01.720 --> 0:12:04.560 the things that made you a successful scientist. 0:12:05.200 --> 0:12:07.240 I actually believe the exactly opposite. 0:12:06.840 --> 0:12:08.920 Yeah, but use what. 0:12:08.800 --> 0:12:12.480 You're really good at as a foundation, but don't make 0:12:12.520 --> 0:12:14.880 it the only thing you use. So then how do 0:12:14.920 --> 0:12:18.560 you add the other skills? And there's many ways. You 0:12:18.600 --> 0:12:21.000 can have people that you trust who help you out 0:12:21.040 --> 0:12:24.920 those skills. You can gain some intuition, maybe not the 0:12:24.920 --> 0:12:28.040 depth of expertise. I want to be deeper on certain 0:12:28.200 --> 0:12:31.000 areas of electrical engineering than I'm ever going to be, 0:12:31.160 --> 0:12:34.079 let's say, in finance or marketing. But I want to 0:12:34.120 --> 0:12:36.600 be curious about those. I don't want to dismiss them. 0:12:37.080 --> 0:12:40.640 So you build on your skills, and then you have 0:12:40.720 --> 0:12:43.560 to say, but I need a complete and holistic view. 0:12:44.160 --> 0:12:46.960 So I'm going to be a little deep, not very deep, 0:12:47.000 --> 0:12:49.400 in all of those. And you've also got to learn 0:12:49.440 --> 0:12:51.079 to trust your intuition a little bit. 0:12:51.440 --> 0:12:54.120 Yeah, but I forgot a question that I wanted to ask, 0:12:54.920 --> 0:12:58.880 but about the predictions of nineteen ninety arvand what did 0:12:58.880 --> 0:12:59.520 you get wrong? 0:13:00.960 --> 0:13:03.840 All lots of things. I think that people were thinking 0:13:04.000 --> 0:13:08.640 that in those days, and it started my phrase, but 0:13:08.679 --> 0:13:11.240 I'll come back to it. I think most people thought 0:13:11.360 --> 0:13:14.840 that the communication companies would turn out to be the 0:13:14.880 --> 0:13:18.360 winners of how networking got carried. If you all think 0:13:18.360 --> 0:13:20.880 through the nineties of the investments that were being done 0:13:21.360 --> 0:13:23.720 by let's not take the names of all of the 0:13:24.000 --> 0:13:25.199 telecom carriers. 0:13:26.440 --> 0:13:27.480 Didn't turn out to. 0:13:27.400 --> 0:13:30.120 Be the case. Actually, I think that's the business model case. 0:13:30.840 --> 0:13:33.560 The reason is they all had in their heads that 0:13:33.640 --> 0:13:34.920 you can charge people by the. 0:13:34.880 --> 0:13:38.880 Minute, because they had been doing that already, because they 0:13:38.880 --> 0:13:40.120 had been doing that for one hundred years. 0:13:40.200 --> 0:13:44.560 Yeah, And in the end, the winners the networking were 0:13:44.559 --> 0:13:47.360 those who said flat price thirty bucks a month or 0:13:47.360 --> 0:13:50.440 fifty bucks a month or whatever, and that was just 0:13:50.600 --> 0:13:52.360 too much of a. 0:13:51.880 --> 0:13:52.600 Leap for them. 0:13:52.880 --> 0:13:56.400 You think it's as simple. That is the most parsimonious 0:13:56.400 --> 0:13:58.640 explanation for why you think they failed. 0:13:58.920 --> 0:14:01.120 No, there were a couple of hours the more technical things. 0:14:01.120 --> 0:14:03.840 The one was written by somebody who was actually inside 0:14:03.880 --> 0:14:07.280 one of these telecom companies, and he labeled his article 0:14:07.320 --> 0:14:11.199 the rise of the Stupid Network. So telephone people believe 0:14:11.200 --> 0:14:13.959 that the network should be really smart, the end device 0:14:14.040 --> 0:14:17.319 is dumb. If you think about the telephone, telephone is dumb. 0:14:17.320 --> 0:14:19.200 It doesn't actually do anything. It's just about the relays. 0:14:19.760 --> 0:14:22.240 And the network is smart. It routes you, it figures 0:14:22.240 --> 0:14:26.560 out where to send it, it does echocacul backwards. And 0:14:27.600 --> 0:14:30.000 the current Internet is completely dumb with the inside. It 0:14:30.120 --> 0:14:32.200 just takes the bits and shoves them out the other end. 0:14:32.600 --> 0:14:35.280 All the intelligence is the computer at the end. That's 0:14:35.600 --> 0:14:38.520 probably a bit more of a found explanation. But business 0:14:38.560 --> 0:14:40.000 model didn't help them either. 0:14:40.240 --> 0:14:40.480 Yeah. 0:14:40.800 --> 0:14:44.160 Wait, did nineteen ninety r of end think that the 0:14:44.200 --> 0:14:46.680 network should be dumb or smart? 0:14:48.080 --> 0:14:48.600 I'm not sure. 0:14:48.600 --> 0:14:51.240 I thought about it deeply, but everything I worked on 0:14:51.320 --> 0:14:52.240 the network was dumb. 0:14:52.960 --> 0:14:54.640 The netwuck movements. That's all I did. 0:14:55.240 --> 0:14:59.120 Yeah, because even I in those days understood I can't 0:14:59.160 --> 0:15:01.720 imagine all the opp loss. So if all you do 0:15:01.840 --> 0:15:04.440 is voice, maybe the network can be smart. But if 0:15:04.480 --> 0:15:06.200 you're doing all those other things, how could the network 0:15:06.200 --> 0:15:08.880 possibly know all those things that be smart for it? 0:15:09.080 --> 0:15:13.800 Yeah, so you've been COO for five years. Five years. 0:15:14.040 --> 0:15:16.760 Wait, so in your five year increment, what was your 0:15:16.840 --> 0:15:20.640 most misunderstood decision? Well, you ended up being right, but 0:15:20.680 --> 0:15:21.800 everyone thought you were crazy. 0:15:22.440 --> 0:15:26.360 Twenty and eighteen, I proposed to our boat that we 0:15:26.400 --> 0:15:30.840 should buy a company called rad Hat. IBM does proprietary 0:15:30.840 --> 0:15:34.440 but that was open source. The stock twelve fifteen percent 0:15:34.520 --> 0:15:37.920 of the day we announced it, and today most people 0:15:37.920 --> 0:15:39.880 will turn around and say, this is the most successful 0:15:39.880 --> 0:15:43.600 acquisition that IBM has done in all time, and probably 0:15:43.640 --> 0:15:48.360 the most successful software acquisition in history. So it was 0:15:48.400 --> 0:15:51.880 completely misunderstood because people didn't see that you actually did 0:15:52.040 --> 0:15:56.240 need a platform that could make you agnostic across multiple 0:15:56.640 --> 0:15:59.800 cloud platforms, across on premise environments. 0:16:00.080 --> 0:16:01.160 So you've got to have a view of what. 0:16:01.200 --> 0:16:04.000 It could be, and we drove it to a place 0:16:04.040 --> 0:16:07.120 where I think today it stands as the leader in 0:16:07.160 --> 0:16:07.600 its space. 0:16:08.360 --> 0:16:11.360 So how did you come to believe this heretical notion? 0:16:13.560 --> 0:16:17.960 So Cloud was happening, you could ask yourself the question, 0:16:18.480 --> 0:16:23.000 should we spend a lot of capital and chase Cloud? Okay, 0:16:23.200 --> 0:16:27.400 you're five years to be generous, maybe longer behind at 0:16:27.400 --> 0:16:30.800 that point the two leaders, So you could spend maybe 0:16:30.840 --> 0:16:34.800 ten billion a year, and a lot of businesses tend 0:16:34.840 --> 0:16:37.080 to do that. Okay, it's so important, it's going to 0:16:37.080 --> 0:16:40.600 be half the market. I can't not My view was 0:16:41.040 --> 0:16:43.080 we'll always be five years behind. They're not dumb and 0:16:43.080 --> 0:16:45.720 they're not slow. So if you're going to be there, 0:16:45.800 --> 0:16:49.240 you're going to be best case, a distant third, worst 0:16:49.240 --> 0:16:51.280 case maybe a fourth or a fifth. Because there's Chinese 0:16:51.280 --> 0:16:54.920 also in the mix, why would you do that instead? 0:16:55.280 --> 0:16:55.680 Is there a. 0:16:55.640 --> 0:16:58.760 Different space you can occupy instead of competing with them? 0:16:58.960 --> 0:17:02.040 Can you become their best partner, in which case you 0:17:02.200 --> 0:17:05.960 write their success. If I want to be the best partner, 0:17:06.440 --> 0:17:08.600 then what are the set of technologies that would be 0:17:08.680 --> 0:17:13.760 useful so you can flip The problem is how I 0:17:13.800 --> 0:17:14.440 thought about it. 0:17:15.280 --> 0:17:18.960 How hard was it to convince people needed convincing before 0:17:19.000 --> 0:17:20.760 that acquisition. 0:17:21.200 --> 0:17:26.199 Probably six to nine months of breaking my head with 0:17:26.280 --> 0:17:32.480 no success, and then six months of building the momentum 0:17:32.720 --> 0:17:36.440 once a couple of people began to see it. 0:17:36.920 --> 0:17:39.240 Yeah, you're very persistent. 0:17:39.280 --> 0:17:44.680 Oh yes, very Would you describe that as you defining trade? 0:17:46.040 --> 0:17:49.600 I am very persistent and I am very patient. I'm 0:17:49.600 --> 0:17:53.560 also probably very impatient, but I'm not a yeller and screamer. 0:17:53.640 --> 0:17:57.280 I don't rant and rave. But as I say, if 0:17:57.320 --> 0:18:00.679 I think we're going to do something, I can be 0:18:00.760 --> 0:18:03.240 remarkably stubborn about it. 0:18:03.280 --> 0:18:03.919 We will do it. 0:18:04.119 --> 0:18:06.399 If I got your family, put them up on stage 0:18:06.440 --> 0:18:09.080 and ask them this exact question, is this how they 0:18:09.080 --> 0:18:09.600 would answer? 0:18:09.640 --> 0:18:15.639 As well, they will tell you I'm very stubborn. They 0:18:15.720 --> 0:18:17.800 might not agree that I don't rant and drave. 0:18:20.119 --> 0:18:23.719 Well, you know, one of the principal observations of psychology 0:18:23.800 --> 0:18:27.240 is that our home self and our work self are uncorrelated. 0:18:27.880 --> 0:18:29.119 Once you know that, you know everything. 0:18:29.520 --> 0:18:32.600 Wait, I'm curious one last question about that. How long 0:18:32.640 --> 0:18:36.000 does it take for you to be vindicated with red Hat? 0:18:37.040 --> 0:18:41.960 Probably took five maybe four years, I think by twenty 0:18:42.119 --> 0:18:44.680 twenty three, So twenty eighteen we announced it, We took 0:18:44.720 --> 0:18:46.600 the big shot crop. It took a year to close 0:18:46.640 --> 0:18:51.040 twenty nineteen, so if O count not that I'm counting 0:18:51.080 --> 0:19:00.440 that much, but July ninth, twenty nineteen as the day 0:19:00.480 --> 0:19:03.000 that we got all the approvals. Took another few weeks 0:19:03.000 --> 0:19:07.119 to actually transfer the money. But from there, probably twenty 0:19:07.160 --> 0:19:09.399 twenty three, the world woke up and said, hey, you 0:19:09.440 --> 0:19:11.240 guys deserve credit for this was actually. 0:19:11.000 --> 0:19:12.920 A great move, not a bad move. 0:19:13.080 --> 0:19:17.280 Yeah, but this is it's interesting because this is a 0:19:17.280 --> 0:19:21.359 real gamble. If it doesn't work, you're not sitting in 0:19:21.359 --> 0:19:22.240 the chair right now. 0:19:22.160 --> 0:19:24.280 Right, Oh, for sure. There were two steps. 0:19:24.280 --> 0:19:26.960 One if it was obviously not going to work, I 0:19:27.000 --> 0:19:29.560 wouldn't have been selected, and two if it hadn't worked 0:19:29.560 --> 0:19:32.359 after that, That's why CEOs can be short lived. 0:19:32.840 --> 0:19:34.960 Can I ask you, sif a personal question, how much 0:19:35.000 --> 0:19:36.320 sleep did you lose over this. 0:19:39.760 --> 0:19:42.240 Once we had made the decision? 0:19:42.880 --> 0:19:43.200 None? 0:19:45.840 --> 0:19:47.560 Can you give me pointers on how you do this? 0:19:47.600 --> 0:19:50.840 Because I wake up at two am every morning and 0:19:50.880 --> 0:19:53.000 I over much more trivial things than this. 0:19:53.480 --> 0:19:55.440 Once a week, I'll probably wake up at two or 0:19:55.440 --> 0:19:58.800 three in the morning. I acknowledge it because I wake 0:19:58.880 --> 0:20:01.119 up and my brain is runrunning, and once it's running, 0:20:01.119 --> 0:20:01.720 I don't even. 0:20:01.600 --> 0:20:02.400 Try to go back to sleep. 0:20:02.400 --> 0:20:05.280 I mean, okay, go get up and do work and 0:20:05.280 --> 0:20:07.159 make yourself productive. You're going to be tired before in 0:20:07.160 --> 0:20:10.320 the afternoon, that's fine, you'll sleep well that night. I 0:20:10.400 --> 0:20:12.840 have actually learned a long time back. You can't do 0:20:12.960 --> 0:20:16.480 it across. You can't do it early morning, through the 0:20:16.560 --> 0:20:20.600 day and late at night. So an hour before I 0:20:20.640 --> 0:20:23.040 think I want to go to bed, I will actually 0:20:23.160 --> 0:20:27.480 change what I'm doing, meaning I will start reading something 0:20:27.520 --> 0:20:31.480 interesting to me but completely outside the scope of work. 0:20:31.520 --> 0:20:35.919 I may read a biography, I might read somebody who's 0:20:36.040 --> 0:20:40.399 spontefecating on demographics and population. But I won't read it 0:20:40.400 --> 0:20:43.240 on leadership because that's too close. Now, twenty years ago 0:20:43.280 --> 0:20:46.160 I might have that would have been different. I won't 0:20:46.200 --> 0:20:49.200 read it on deep signs because that's too close to. 0:20:49.160 --> 0:20:50.119 What we do for a living. 0:20:50.400 --> 0:20:53.400 So it's got to be outside the things that will 0:20:53.440 --> 0:20:57.080 make my brain churn about work. But it's got to 0:20:57.119 --> 0:21:00.720 be something that is dense enough to occupy your brain. 0:21:01.359 --> 0:21:04.480 So shifted gears. Sorry, I want to dwell on this 0:21:04.640 --> 0:21:05.880 just for a moment. The red hat thing. 0:21:06.640 --> 0:21:09.160 Was there someone or is there someone who you went 0:21:09.240 --> 0:21:13.400 to and explained the logic of this and they saw 0:21:13.440 --> 0:21:15.640 the logic of this, and that made a big difference 0:21:15.640 --> 0:21:15.840