[MUSIC]
Hey, so, Jenny, thank you so
much for being here with us today.
>> Thanks.
>> It's a real honor to have you here.
And as you know, there's a slight
interest in tech here at Standford.
So, in particular,
I'm honored to have one of the most
powerful executives in the industry.
But if I may, I'd like to pull you
back to the beginning of your career.
You started off in
the automobile industry.
What prompted the move to tech?
>> Well, I listened to this
journalist describing that
he said how many years, right?
You are all looking at me
thinking I look older or younger?
[LAUGH] And also we were just
outside talking about this.
You've had Mary Barra, too, right?
So, because I started
actually at General Motors.
And so why did I move?
I have to tell you something and
it's kind of an interesting story.
General Motors had at the time
back when I went to university,
and I went to Northwestern and
I was putting myself through school.
And back in those days GM offered me
a scholarship, no strings attached,
nobody does that anymore.
But no strings attached
helped me with school
if I would just work in the summers.
And I felt a great obligation then to try.
But what I always say to people,
what I learned at what I thought
was a really young age at the time,
is that I learned the importance
of passion about what you did.
And I said to Mary, you love cars.
I like helping you, but I wasn't in love.
In fact, I was working on trucks and
buses, okay?
And I'm like, I wasn't in love.
And it taught me something and I probably
didn't crystallize it till later in life
that it was the importance of being
passionate about what you do.
And I guess that's so
easy to say and especially for
everybody here who's you're doing
something now you like or you will do.
Boy, life is too short.
And so you've got to keep moving
til you find what that is.
And I'm not even sure I knew
what it was at the time.
I could only see what it wasn't.
And so that was what made me move.
And so because I said I love technology,
because I was an engineer.
I loved it, but
I wanted to apply it to do things.
And that's what lead me then back to it.
And actually it wasn't much.
I wish I could tell you it was
a really complex job search.
I had looked,
I had had a lot of job offers, but
at the time I was getting married and
my husband was from the midwest.
And so I know for all the job
offers I had on the West Coast,
they couldn't understand
why was I not leaving.
The cold the snow of Chicago until I
finally admitted I was getting married,
and I was moving over here.
And I ended up there for as I thought a
lot about it I said, where could I go that
I could use technology in any industry and
that's what led me to IBM.
So passion was my first lesson
at a really young age to learn.
>> Well, passion clearly worked.
You're now the CEO of one of the most
iconic companies in the world.
To those of us sitting in these seats,
it can occasionally be daunting to
think about the journey to being CEO.
Can you tell us whether you were ever
intentional about taking that job, and
what kind of the challenges
might have been along the way?
>> Well, let me do a poll, so
this is somewhat interactive, all right?
So how many people think they
want to be CEO of anything?
Okay so half, half.
How many are not sure?
The other half, or
the other third, so to speak.
because I was talking to Jordi about this,
I said you know what?.
There was never a goal.
It was never ever a goal for me.
And I think there's a lesson in that,
because I think there's been a lot of
people who've always said,
this has gotta be a mission.
You've gotta want to do this.
People who want this job stake it out and
go for it.
And I don't prescribe to that school.
I prescribe to the school that you just
keep doing what it is you love to do,
you do it great, it opens a door,
you do something else.
And that sort of led to this place, right?
So I can't say I ever started that way.
I know people want me to say that, but
I can't say that it was really that way.
But I think the other thing, if I can, not
that if you have it as a question or not.
>> [LAUGH]
>> But the other thing what you made me
think of though is, again,
if I can share something of value on this.
I do think people often say to me and,
John,
when you introduced me you said
I'd been at IBM now it's 37 years.
And that may seem like a long time, well,
it's obviously double most of your ages or
something.
>> [LAUGH]
>> But so why did I stay, right?
People will say why did you stay?
And in addition to being passionate,
I feel really strongly,
whatever you go do,
do something with purpose.
You can define what that means,
but do something with purpose.
And I always felt to this
day in different ways and
I'll come back to me even now as CEO.
But is that IBM had
a purpose in this world
in that this world would be
different if it wasn't for IBM.
And it doesn't mean everything
we do is that way, and
there will be clearly other great
companies and you'll go off and do.
But there are so
many things I can point back in time, and
forward to, and say wouldn't have existed
without, and that's this idea of purpose.
And so I started, John said as an
engineer, but I've done engineering, I've
done sales, I've done research, I've done
finance, I feel like I've had 100 careers.
I did a consulting company, I did
a technical company, all within one place.
So that ability to work from
anything you can dream of, and
then in those wildest moments,
it has purpose.
And I was thinking at the day,
a client I had met about seven years ago,
we had started some work together,
you mentioned Watson,
and we started in healthcare.
Healthcare is one of the most difficult.
Who's in healthcare?
Who wants to be in healthcare
in some way related?
It is obviously one of the most
important things to change,
it is one of the most
difficult things to change.
And it varies around the world
on what the systems are.
But anyways, I've always said for IBM,
it was going to be one of our moon shots.
Moon shots meaning I know
how hard it is to change.
It's so obvious the problems, so if it's
so obvious, why can't it get changed?
And so there are many, many reasons.
And anyways we started on this, and I only
tell you this story back to purpose was,
I'll always remember going down
the streets of New York one day.
I was with my husband and
someone, she called my name out.
And I turned around and it was a client.
We were working on the beginnings
of Watson in healthcare.
And I can always remember,
she grabbed my shoulder and
she said you know,
we will change the face of healthcare.
My little part, I'm under no illusions
that I will change my little part.
To me those are the moments you live for.
And so that is why I stayed.
Did you ask me that question though?
>> [LAUGH]
>> I felt like telling you that story,
I don't know why [LAUGH]
>> My question is somewhere in there.
>> I felt it was important based on
I don't know what, but go ahead.
All right.
>> [LAUGH]
>> I think one-
>> I don't always tell it, so that was,
>> Thank you.
>> You're welcome [LAUGH]
>> More interesting answer than
my question was.
>> Why do you stay here?
>> Sorry?
>> No [LAUGH]
>> [LAUGH]
>> This is not interactive, [LAUGH]
>> [LAUGH]
>> We'll cut that off.
>> But I looked, you've had lots
of different jobs, already.
>> Yeah, I've had three or
four different jobs.
>> Several experiences, right?
[LAUGH]
>> Yeah.
>> [LAUGH]
>> Several experiences.
None of them with
any purpose.
That's why I'm
here.
>> Yeah.
>> So that's a little easier.
>> No, do you believe about
purpose though?
Doing something
on purpose?
Or
just more-
>> [LAUGH]
>> I'm just curious.
>> [APPLAUSE]
>> I
do now.
I do now.
>> [APPLAUSE]
>> I'm not trying to put you on the spot.
I am serious,
does it seem important now or maybe later?
>> I think it always seems important.
I think main purpose is something that
I think a lot of people here think
about a lot.
And it's one of the reasons why a lot
of people come to business school-
>> It isn't the only reason, so
don't make it, I don't mean it
to be as an altruistic point.
because I think you can do multiple,
you have commercial value And
purpose at the same time, right?
You can learn and
have purpose at the same time.
And I think those are those companies
that offer wonderful combination.
And it isn't as if it's like, all you
have to every moment of every day, right?
So that's all, I think you'll find
many opportunities to do both.
>> So throughout your career
when you're faced with choices,
other companies trying to lure you away
for a greater personal commercial value.
Was it always that purpose you
found at IBM that kept you?
>> I think, this purpose,
actually if I can,
this purpose point I think is an important
point right now in this moment in time.
Jordi and I were talking
about before I got out here.
I just came back from,
it feels like it was a long time ago, but
I think it was last week,
the World Economic Forum.
And this year I co-chaired it, and
I co-chaired it with six other women.
So highly unusual, and if you think about
it, that decision was made a year ago,
actually, to have this
be women to co-chair it.
But I thought hard about,
did I want to do it, and why.
And it's going to be related to
the question you just asked me.
So you said purpose.
I actually think this is a really
interesting moment in time for technology,
actually for business in total.
I feel like this is this wonderful,
wonderful,
we have this opportunity to solve so
many problems many of you work on.
But with them come a set of challenges
that are greater than have ever been in
time before.
And so the reason that I
had agreed to do WEF was,
this idea about responsible stewardship.
Maybe there's a better word,
but I feel tech, ourselves,
as well as even most companies, this
idea of what is responsible stewardship?
Because there is no doubt
these technologies, and
maybe we'll talk a little bit about it,
they're going to impact everybody.
They're going to impact everybody's job,
and they're going to happen faster than
other series have happened before.
And we have this, I think, a real
issue of creating a world of have and
have-nots out there.
Whether it's businesses,
whether it's people, individuals.
And that there is this idea that
you've got to responsibly bring
these technologies into the world.
So when you say to me what also
keeps me there, it is that belief.
And I think this is really this moment,
maybe we will talk more about it, but
this ability to usher them in
with transparency, with purpose,
that word again.
To also live by a set of data principles,
so the whole world doesn't end up will
all value and a few hands,
I think that's wrong.
And a third is then,
a real obligation of business and
government and society to prepare
people to live in this world.
I always think it's like transforming
a company, you can see where you are and
where you want to go.
You get killed in the transition, and
it's always this transition
that makes the difference.
And so why do I say, I believe really
strongly that we understand that
stewardship, that it is
not enough to make things.
You have to bring them safely into
the world, or your job is not done.
>> There's a lot to-
>> You can take your notes back out, sorry
>> [LAUGH]
>> No, there's a lot to unpack there.
And I think that one of
the interesting points is,
in a practical sense, how do you balance
your responsibility to your shareholders?
Your need as a company to drive sort
of real technological leadership
with that stewardship society.
I mean,
how do you do that on a day-to-day level?
>> What do you think, and seriously,
you must think of this in classes right?
What do you think about for that?
>> I honestly have no idea.
[LAUGH]
>> [LAUGH]
>> I'm not putting you on the spot.
>> [APPLAUSE]
>> I'm not putting you,
because I think you actually probably know
the answer to that, to be honest with you.
So to me, the answer has always been, and
maybe it's because of,
you talked about our past and all.
First off, if you don't define yourself
as a product, if you don't protect
your past, and
then if you try to do the right thing for
the long term,
I think you end up in the right place.
If you do those three things.
And so to me that balance,
I always feel like many of us, and
again, some of you in the places you go.
We are allowed to operate, because our
clients and society allow us to operate.
And that build on trust, and
so in the end, society or
business will decide if will trust you.
And so always that in my mind,
I mean, I go back in time.
Things like, and not a credit any
of my decisions, by any stretch.
This goes back decades, when governments
have asked us in many countries,
we were talking about today
IBM's in 170 countries.
35% of our business is
from the United States, so
we've got quite a lot of
experience everywhere else.
How many times governments had
asked us for access to technology,
back doors into technology.
And we're the only tech that can say
we said no, from the beginning of time.
Because our license to
operate was based on trust.
And so I think this idea,
if that's the role you feel you play, and
you make that decision for
the long term, and
that trust will matter, you will
actually make those right decision.
And I think it's true for
consumer companies.
i don't think it's true for just, we're B
to B, but I think it's true for everybody.
>> There's a lot of rising mistrust in
technology companies these days I think.
And you've seen a lot of tech leaders
go to Washington publicly apologizing.
How do you think the tech industry
as whole needs to rebrand itself or
re-evaluate its image?
Is it all part of this communication?
Is it being demonstrative?
How does that work?
>> I was going to ask you what you think,
but I won't do that, okay?
>> [LAUGH]
>> Next week it'll just be me up here.
>> [LAUGH]
>> I'll take questions from everybody and
we'll see if that will work better.
>> You're doing good, you're well
prepared, and so that's in fairness.
So let's just talks a little
bit about that, right?
Let me just pack in a small,
I really believe this is
a moment in time for all of us.
And I say this to all of my clients,
right?
This is our moment for
this kind of stewardship,
really principled stewardship, stewardship
about how to bring all this technology in.
And so I think when you do that,
you recognized what you are and
what you're not, or what you've become.
And so as an example,
we'll probably talk a little bit about AI.
And in AI, as an example, is one of
the many technologies, but I feel this way
about others too when I say,
what do you have to do to build trust?
Well, you have to bring
it to the world and
be clear about its purpose,
its transparency, and its explainability.
So purpose meaning, tell people,
this is to augment what man does.
Honestly, I was an AI
specialist like 30 years ago.
I wish it had been called
augmented intelligence,
I've been saying this for a decade.
Because I do really see
that we'll solve so
many great problems, but
this will be a world of man and machine.
And so they're going to
have to work together, and
that's going to mean a lot of change.
And so if you are clear that your purpose,
though, is to work with,
not to replace, I'm not Pollyanna,
there are things that will be replaced.
But then you'ill help people
do their job even better.
And I see this, and
I can give you tons of examples of it.
So purpose, then transparency,
you need to, I think I need to tell
you when I'm using these technologies.
And then I need to tell
you how they were trained.
I need to tell you what data got used,
I need to tell you where it came from.
It's one thing if you're asking
simple questions about weather, and
we own the weather company,
so that's okay, no problem.
You assume how weather got there or
the favorite song.
But when you're asking about healthcare,
you're asking about a regulation,
you're asking about the right treatment
for cancer, you care who trained it.
And so then, the other thing I tell
you we've learned over the years,
I mean, mistakes we have made, is you then
have to be able to explain your answers.
Because if I'm a professional using AI,
do I want a black box?
How many of you would like to work
with a black box, gives you an answer?
You don't, you want something to say
this is why, this is the background,
this is how it came up.
And it took us down different paths of
how to build this kind of technology,
because you have to be able to explain it.
So, to me, when you said how do you
build that trust in this moment,
I don't think it's about just words,
I think it is about real actions.
You clear on your purpose,
you'd be clear on transparency,
you'd be clear on explainability, and
then you have to live by things like,
you own your data, I don't own your data.
Data can freely flow, governments can't
have access, here's how I secure it.
And then you help with skills.
So I know that's a lot, but
honestly I think that's what we
gotta do at this moment in time.
This is such a special moment to
get this off on the right foot.
Does that make sense to you?
>> It does make sense to me.
>> I could ask everyone, but
you're right next to me.
>> [LAUGH]
>> It does make some sense to me and
I guess one of the fears I might have is
someone learning a very traditional set of
skills at business school is how am
I going to augment what I do with AI?
Is this something that you think is
really going to be treated practical
in every industry?
That we're old as it is or we're
going to be replaced by the machines.
>> How many people believe you're
replaced by a machine, seriously?
I mean the way I asked it doesn't make
you want to answer my question, but.
>> [LAUGH]
>> Two brave souls are at the back.
>> Yeah, I know, and
they are counting on that I cannot
see that far at this point, so.
>> [LAUGH]
>> We just finished another study.
There have been many studies,
I read three more on my way out.
Thursday, I'm going to be at a big
group of my colleagues on this topic,
about the future of work.
They're all over the board, right?
But I believe a couple things, and then
I'll answer your question about that, so,
first off, if you, and you guys study
technology better than most in the world.
What's so different about I think
the moment we're in right now,
is that it has the chance to have
an exponential impact, not linear.
Most of the time we think
the change is linear, improvement,
improvement, it goes like this,
line through it.
If you go back in time Morris Law with
processors, double their 18 months,
that would be more exponential.
If you would go back then in time, the
social media networking later became known
as metcalf's law that the value would be
the square of the nodes in a network so
you have the network effect.
So everybody talks endlessly
about the amount of data.
It's not the amount.
It's if you could really get learning to
happen exponentially off of that data,
you would have another exponential
curve caused by learning.
That's what I think is in front of us.
So if that's true, this third kind
of big exponential curve in life,
then you'd say,
does it replace everything?
I don't think it replaces everything.
It does change everything.
So we've done all these studies.
Could be 5% of jobs, 10%,
I don't think it matters.
I think it's 100% change.
So you prepare for that world.
So two ends of a spectrum.
One of the very earliest things we did
was health care, and started in oncology.
Extremely difficult.
And it's been an interesting road and
an interesting learning.
So first off, time does matter with some
of these technologies to get started.
So you may think of Watson from Jeopardy,
but much, much,
much has transpired since that time.
In fact, November-December,
the Oncologist which is the most trusted
sort of peer-reviewed journal in
oncology put out a study on Watson.
A thousand patients tumor board, and
we were able to find 30% more and 30% of
the cases new things that should have been
followed than what the doctor could find.
That's not an insult to doctors,
but there's a learning here, right?
Because how many professionals ever want
to be told they missed something, or
they got something wrong.
It's very difficult.
And so
there's a whole change management side
to what's going to really happen here.
But, I then take that same situation and
we're now up to 100,000 patients in
oncology treatment in India and China.
So because there, there's only one
oncologist for 1,600 patients.
Here, there's one for a hundred.
It's a very different world.
And so that sort of idea that motherhood,
how does that saying go?
Necessity is the motherhood of invention,
it's going to leap frog, I think, and
driven by perhaps other personal world for
different reasons, less specialization.
So there, the doctors are learning and
saying, my God,
I can't do this job by myself.
And I mean it isn't, it's impossible for
almost any professional, right,
to do this.
So I learn this lesson with that.
And the technologies continued
to learn faster and faster.
I remember the very first cancers
took nine to 12 months to teach,
now 30 days a new cancer,
30 days a new cancer.
So this idea where your job change,
I think everybody's will in professionals
at one end of a spectrum and then I
said there's another end of a spectrum.
Just to give you a feel for
why I say this, my own HR,
I actually think, you know most people,
anybody want to be an HR professional?
One, okay, see, there we go.
Now it is, most people would, is it A,
a difficult job, B, there's a lot of
administration that people think continue,
typically associated with it.
I've got fantastic leader who has spent
four years I think making it the most AI
cognitive profession in the world.
Now it's changed everybody's job, but
it has got everything to do with how
recruitment is done, proactive retention,
compensation so
there's no bias in it as an example.
Everything to do with not only answering
your questions, helping your career,
what should you learn, and
that is applied everywhere along the way.
And that to me is like a really normal
good example, of how life changes for
all of those jobs.
And they all changed.
It does make a difference in that you
have people with less training and
skill able to do jobs, and
it puts a premium on being an expert
on the other side, because things go
very quick from beginning to expert.
You almost skip right over those.
Does that make, that's the kind
of world I think we'll be in.
>> Definitely, and to go kind of away
from AI but still the future of work,
something that really struck
me as I was researching for
this interview was IBM's Pathways
to Technology schools.
I was wondering if you could tell us a
little bit more about that and the mission
and how you think future high school
as well will go through that education.
>> How many of you, how many people
think that kids coming out of school had
the right skills to be successful,
broadly speaking, not your neighbors.
Okay, was it the neighbor
part that stopped you or the-
>> [LAUGH]
>> You're like, my neighbor's kids,
forget it.
>> [LAUGH]
>> No.
>> This is something I would like to
either get some opinion when we have some
lunch afterwards and input from folks.
This started with I believe back to this
point, with this moment of technology
changing everything, that the skills issue
is a really big issue around the world.
And I don't look at it
just in a ZIP code and
in a state in one place in this country.
I believe it's what's given rise to all
of the political people we've seen.
There are people that don't view they
have a better future in front of them,
there's a world of have and have not.
And that to me is a very dangerous
place to go for any economy.
And so I think the root when you
track back on all of this, is skills.
And so Jordy asked me about this
thing called Pathway to Technology
that we started.
So this is a wonderful university, but
I don't believe in the whole
globe you can say to people,
you only have a future if you have a STEM
degree or you have a university degree.
I believe strongly in those.
I mean, that doesn't mean
I don't believe in those.
But for the billions of people on this
Earth, that is not going to be the future.
And so how do you therefore back to man
a machine, and can people have a really
productive future, make a good income,
and have skills relevant.
And so, I think there'll be
three things you have to do.
One of them is, for
the youth coming through,
we came up with this idea
called Pathway to Technologies.
There's 100,000 kids in these schools now.
So you may say,
100,000 is a drop in the bucket for
billions of people on the Earth, but.
It's such a reasonable start,
100,000, and is was the idea,
could you take a high school?
We're now in six countries,
take a high school, and
some countries would call
it different things, but
a community college nearby,
think of it as a six year high school.
And could you come out with skills that
would be employable in a tech world?
And we've proven that it's pretty true.
Doubled the median income, and we picked
the worst kids in the worst schools
everywhere in the world that
we could find to start with.
We did not cherry pick anything.
And it is heartwarming, every parent
wants for their child a better future.
I don't care where you are from or
what country you are from.
And every kid if given the opportunity,
so A, we help them with curriculum, B,
we give them mentors, and C,
if we have jobs, we give them a chance.
And hundred other companies
like ours to go in on this,
everybody's happy to mentor a kid, I've
never met someone who wouldn't do it yet.
And this idea, I think is becoming
a bit viral, I'm going to do
all the Governor's of this country, well
I guess it's February this month already.
Get every state going,
there's about ten states that's
already going kind of viral in, and
I think this is going to be something that
every back to like social responsibility.
Every company can do something here, every
company, it's going to have to be a public
private partnership to address
the skills issue in this planet.
And many of my colleagues
have different ways or
something like it, but it will take that.
And then there'll be the section
of retraining which is also one of
the hardest,
again back to this dislocation here.
So whether we do a lot of retraining and
others do, and
then I think it leads to something
else which is going to be society and
government coming up with ways that say,
you know what,
this idea that you like go to
school till the university and
you're done,
this is not going to work out so well.
We're going to have to do something
with lifelong learning and
those of you that look
at social systems that
do some encouragement that people
continually go back and do that.
So what do you think of that idea?
>> Pretty cool.
>> Pretty cool?
>> [LAUGH]
>> Okay, it's heartwarming.
The only thing I did not count
on is that some of these kids,
this has really been an interesting thing
for me, the kids, they are kids, so
it's okay to call them kids.
You've given them this chance.
So six years, which by the way,
you guys would never know this.
The typical community
college in this country,
it takes seven years to graduate
from a two-year school.
And even at that, 7% of kids do it,
it's ridiculous, and partly,
it's because of the curriculum.
They don't teach anything employable,
and that's how they're funded.
So we've been working with the government
to get them to change that to say,
you can't just give schools funding,
they gotta teach an employable skill and
that's not just a vocation.
But the funny story I'm going to
tell you is, what we had learned.
They get going, we've got kids graduating
in four years with an Associate Degree.
Three years,
also with an Associate Degree.
So when we offered them jobs,
back to my HR, they came back, like, hey,
you realize these kids are not 18 yet?
I'm like, well,
that's a problem, isn't it?
[LAUGH] So, they're like, we've got to pay
for their mother to come with them, too.
And so they gotta live somewhere,
for their internships, but anyways,
we've managed through all that, and
it's to me it's very heartwarming.
And many of them by the way go onto
four year universities that never,
ever, ever would have anyways,
so it's both ways, right?
because I don't want you to say I'm down,
I'm not, it's to me about
giving people a chance, right?
>> That really is heartwarming, and
these institutions are fascinating.
But I would like to change tacks
slightly to talk a bit more about IBM.
It's a company as the dean said that's
transformed itself several times,
you're taking it to another
transition right now.
I think we'd all be interested
to know a little bit more about
what transformational leadership
means to you and how it's become so
deeply embedded within IBM's DNA?
>> Yeah, so IBM, 107 years old, right?
Only tech still here, through
generation after generation, only one.
And maybe it's because we've had a few
near-death experiences that teaches you
forever to be humble and forever to
realize you have to reinvent yourself.
And so, as I've said when I stared,
my learnings
from my predecessors, don't protect your
past, don't define yourself as a product.
And then do the right thing for the long
term, no matter how strong short term wins
are in your face which
is what we have done.
John, you mentioned we're 46% new products
and services in the last several years.
So in a word what we
reinvented IBM around,
maybe I can convince some
of you to come work for us.
I'll hold that as my grade of whether
I did a good job today or not, maybe.
In a word it was the word data, you're
probably not surprised at that, right?
It was an honest,
I had sort of come up with this and
I thought it was corny at
the time a decade ago,
a saying that said data would be
the world's next natural resource.
Because I thought
the analogy was really good,
that like oil,
there are very poor countries with oil.
So you could have a lot of data doesn't
mean you get any wealth from it or
any value from it.
But those who did, and the technologies
were happening, could make a difference.
You marry that with we had done all of
this work on, just forget the background.
A two trillion dollar market
to make better decisions.
Unlike what we all probably think,
we all don't make great
decisions all of the time.
So better make in any profession
that would be out there.
And so that's what we started and
set out to do.
And that is what has been
really at the root of this.
So it meant having to transition to
the Cloud, transition to big data,
transition to AI, but
I would be the first to tell you guys,
we do it in a business context,
and there is a difference.
And so just like when I think
about Artificial Intelligence for
consumers versus for professionals,
I see a very strong difference.
As an example, what we've had to build for
is things like,
it has to learn, domain data.
So you have to learn
regulatory environments.
I've talked about medicine,
you have to learn HR, and
that means you have to learn off
of very small amounts of data.
That's a different kind of AI, you don't
have billions of records to look at,
you might feel like there's billions
of regulations but they're not.
So you have to learn of a very
small amounts, that's point one.
Second part, we felt like you know what?
80% of the data is not
searchable in the world,
it belongs to our clients,
I better protect it for them.
And I better not just protect the data,
I gotta build this in a way that
the insights because that's actually
what's more valuable, stays with them and
doesn't train something for
the competitor.
That is a very different kind of AI that's
not an AI that came from a search engine.
So because I've got to protect
those insights for the, and
I'll come back to why that is meaningful.
It also means in this kind of world,
you would have to be able to explain
like I was talking about earlier.
You have to be able explain where
the answers came from, and consumer not so
much required.
But definitely required when it's
a professional that you're dealing with.
So those are some of the differences.
And so we've been remaking both our AI,
all of our Cloud systems,
all of our expertise.
And then you gotta put it in workflow,
because this, again,
was my biggest learning.
I'm telling you, the technology alone in
the business environment does not matter.
You've got to be able to change and
reimagine the process or work, so
we had to build all those
capabilities in there.
And always underpin by security,
and then this won't be the end.
Blockchain, Quantum are all things
we've heavily invested in and
if I can humbly say, I believe in Quantum,
I know where I'm at.
I do know where I am but
I believe we're number one.
And Blockchain even too,
for business reasons.
Blockchain, I didn't say BitCoin.
I know you had Jamie out here.
I've had endless discussions
with him on that.
So So today that's what IBM is.
I mean, we've always lived uniquely
at this innovative technology,
industry expertise, trust and
security intersection.
Always reinvented for this next moment.
And so again, I want to be with
my colleagues in another day.
I am very optimistic, and
I know many of you want to do startups and
do great things.
I am equally optimistic about current
companies that are out there.
Because as I say to all of them,
I feel like this is the moment for
the incumbent disruptor,
and why do I feel this?
This is the moment for
the incumbent disruptive.
If you believe it's a future
differentiated by data and knowledge, and
you own 80% of it, if you can do something
with it, this is your moment now,
to take it and as I've said,
it just may be better to have had
a past than not to have had a past.
And so, I see this in their actions
in many companies right now,
you see it in Walmart coming back,
you see it.
And this is now their moment.
They've actually got something that
if they're able to harness it and
do something with it,
can differentiate them.
And they build a platform
on their expertise.
And so I think it really,
those of you that work on business models,
it is a time of soul-searching for lots of
companies on what's their business model.
They're saying to themself,
am I a car rental company?
Or, actually,
what I know how to do is fleet management,
I'm moving cars around all the time,
and in the world of autonomous cars,
fleet management might be a pretty
good thing to know how to do.
So, I mean I think everybody's
going through that about
what it is they can do with all that data,
and what their knowledge is.
And so that's what IBM has become.
It's the platform for that.
>> And you brought it up, so I'll ask.
There are lots of students here
considering offers from Google, and
Facebook, and the like, so
why they should go to IBM instead?
>> Have I convinced you yet?
>> I'm hestiating.
>> Okay.
>> [LAUGH]
>> We'll see, we'll see.
>> Okay, let me ask you
more questions, okay?
Test.
So look, I think it goes back
to where you and I started, and
then we'll do some Q and A here.
I would come to IBM for three reasons.
A, you gotta be passionate about the
impact technology can have in the world.
B, you gotta want to change
the way the world works.
I mean we do work on serious stuff
that changes the way the world works.
It doesn't mean we work on everything,
so other people will do other pieces.
But there isn't a bank that we
don't run and help reinvent.
There is not a credit card transaction,
there's not a railroad car that runs.
And these are serious obligations
about how that happens safely, and
how it then at the same reinvents itself.
So this idea that to help change,
not everything, but
to change part of how the world
works is more, let's just say,
it is certainly what we
aspire to every day, okay?
Only the world can determine
whether we do or don't.
And so I'd come for
that purpose, I'd come for
that strong, strong passion about
the technology in the third.
It's something that I actually took for
granted till the last couple of years,
it is a strong environment of inclusion.
I have never, never in my world,
I was interviewed not very long ago,
after many of the incidents of this
past here about inclusion, and
I said you know I gotta be honest
with you I've never felt that way,
and you might find that hard to
believe are there isolated incidences?
I've 380,000 employees,
of course of my scale in the in the world.
But I said I have never, I have never felt
anything any limit on myself I put there.
It was never put on me by IBM.
And I said, that,
I think that is such a deep root.
It goes back to having hired
the first disabled person in 1914,
the first woman executive is 1943.
I look now and
I think you've gotta be kidding me.
I've taken all this for granted, and
I no longer take it for granted.
And I'm proud of the culture,
I didn't build it,
I have only had to carry it on, right?
And be sure it got even more, and
I use the word inclusion not diversity and
purpose, to me inclusion is about sexual
orientation, gender, religion, country,
ethnicity, I don't care that it is,
right, that you feel comfortable.
This is why we have fought, and I can't
fight every battle, we have fought so
hard for the dreamer, we have fought so
hard around these bathroom bills,
these crazy things.
But they were so
symbolic about people feeling welcomed
in their workplace in their state.
I happen to be a big employer in Texas and
North Carolina too.
And we got those stopped,
is it because of that one thing?
because you got fight everything.
No, it was because that was very
symbolic to me about inclusion, and
so I feel that environment then, and it's
what we do even now, whether it's women.
I am very proud guys, we will won
this thing called the cattle stored,
where the only tech company, and
the only company on earth to have won
it four times about inclusion and
women in the workforce, so
that would be my third reason.
It would be passion,
purpose, and inclusion.
Yeah, [LAUGH].
>> [APPLAUSE]
>> Well,
I finally said something that made sense.
>> [LAUGH] Perhaps he's always tried that.
Perhaps fourth reason could be, that
we've a lot of crypto investors out here.
We talk a little more
about block chain and
what IBM is doing then-
>> We moved right from imclusion to
block chain.
How is that?
>> [LAUGH]
>> All right?
This is an excellent segue here.
>> [LAUGH]
>> Okay, who's a blockchain lover?
Okay, I think a small group wants
to meet later, not a big group.
How about Bitcoin lover?
Subset, okay.
So, can I just say,
those of you who didn't raise your hand,
if I could encourage you
to go look into blockchain.
And you think,
why am I bringing this up as a technology?
I honestly think the future on blockchain,
I have a little saying.
Blockchain will do for trusted
transactions what the Internet did for
information.
And I believe this very, very strongly.
It's ability to trade transactions
between people who don't necessarily
know each other, not necessarily trust
each other, in a way to remove friction
on the movement of about anything,
I think is quite high.
And what makes it so possible to really
get some traction, is you don't have
to rip out the guts and rewrite everything
if you're a company to be able to use it.
So the movement to it
is not that difficult.
And so,
you had Doug McMillan here from Walmart.
So Doug and
I started a project on food safety.
You would be shocked at the number
of people who die from food, and
how much food is wasted at food outbreaks.
So how on earth could we
get every competitor and
every food company in
the world to join on to this?
They're competitors, and they're going to
share all the information about what kind
of food avocados, spinach, for
the spinach breakout what happened.
All that spinach wasted, and typically,
we've done the tests on many things now,
but mangos.
Seven days to trace
where a mango came from.
We do it in two seconds now.
So this idea of solving that problem,
we're doing a big joint venture with
the largest shipping company in the world,
Maersk, the paperwork that accompanies
a big cargo container exceeds the value
of the contents of the cargo often.
So there is so much opportunity now.
I said all that, it is not about bitcoin
there's something under co-blockchain,
and it does matter how you implement it.
And you have to have it be permissioned.
Some of what's out that is opaque.
I don't believe those will
be what will take off.
You can't have people, that will in
fact some of, I won't use their names.
Other companies that have stuff out there.
It is a bit of anarchist, and you know,
it will allow crime to go on quite freely.
That is not what we're talking about.
We're talking about what permission
means I know who's on the network,
I can tell them that professor here can
only see three things, you can see five.
I know who governs this thing.
I mean, who do do you think
governs the Internet, right?
There is a governing body,
it's not two people.
So there's a big open,
we're big fans of open source,
it's the fastest growing open source,
Hyperledger is the name of it,
community there's been in time
out in the Linux Foundation.
And so it's governed by 200 companies now.
That's a good thing,
you have to have it be immutable.
Anyways, I won't give you
a lecture on blockchain.
But I'm so optimistic about the things
that it can do on the positive,
like food safety, and
the inefficiencies it can take out to
go to better things on the other side.
It's the fundamental technology.
Not a comment about cryptocurrencies,
that's got a different set.
But I guarantee you, whatever you do
without having governments have an ability
to see some of the money transfers,
you're not going to be able to take off.
So you going to go into that now?
>> No, I'll steer clear of that.
>> [LAUGH]
>> Okay.
>> One last question before
we turn to audience Q and A.
I've been struck by the number of times
you've mentioned the healthcare industry
and cancer in particular, and
I know you're on the board
of Memorial Sloan Kettering.
Is there a reason why this is a mission
that's very personal to you, or
is it just that you see this as
the area of the biggest improvement?
>> To me,
it is the biggest use of our GDP and
it's the biggest inefficiency
with the lowest return.
And it's true in a developed
country like ours, guys.
But I mean, I've spent so
much time in Africa, India,
China, these are unsolvable
problems in these places.
These people never, ever have a chance
to get healthcare of the quality you and
I experience.
If any of us have cancer,
we will be seen by a cancer center.
The odds of that happening outside
this country are like zero.
I mean, outside a developed country.
And so, that does not have to be that way.
And this is to me, I mean, I guess that
they'd call it a moonshot, right, and
a lot to be learned from that.
But I think all of us in our companies get
a chance to work on some of those, right,
so it was healthcare.
But go back on the other side, I'm
the biggest fan of trying to help RegTech
[LAUGH] and really basic things as well,
right, improve on the other side.
But to me, us, and what we've done and
started in healthcare,
it was very symbolic and important.
And I think it's a really hard journey.
But it is a deadly disease with
many variants and it's impossible,
we started with cancer so
we started in the hardest spot,
it's impossible to do without the
assistance of these kinds of technologies.
>> Thank you so much, Jenny, and
before you have time to
ask me any more questions,
I think we can turn it over to-
>> [LAUGH]
>> The audience for some Q and A.
>> Maybe you'd like to ask him a question,
yeah, yeah, yeah.
>> No one can ask me questions.
Turning the mic off.
>> [APPLAUSE]
>> Okay, anyone?
>> Hi there, my name's Catherine,
I'm an MBA too.
My question's related to your time
chairing the World Economic Forum.
I think the World Economic Forum is one
of the coolest ways that private and
public leaders can work together to
solve problems in a tops-down way.
But as the world becomes increasingly
decentralized, how should
the World Economic Forum change and
adapt to better address these problems?
>> It is a good tops down, but
I think what happens when you leave
the World Economic Forum, it becomes
a bottoms-up effort of what people can do.
And I will tell you this year,
a majority of it, a lot of it,
was on skills issues and how everybody
can work in partnership with that.
So I think what it can do,
don't try to put more into it
than it's capable of, right?
So it isn't as if it's a standing body,
it is a standing body,
but an organization that can actually
have rules or committees, standards.
And it's more about, I think,
putting standards out there that can
be followed in the rest of the world.
This is a really critical time.
As different countries move more inward
with each other, it's a dangerous moment.
Right now, Europe is setting many,
many standards around data.
Honestly, America should be in there,
because they're going to end up
setting the de facto standards here.
So the regulations like GDPR,
global data protection, it's going to
end up being a global standard, right?
And we're not at the table
as much as we should be.
I know every time I'm in Europe, in
Brussels, they're dying for companies to
come fill a void that maybe is seen
as a void by governments right now.
And so I think what can happen,
when you say what happens next,
I do think companies can help in this.
In this time particularly,
where you might want to call it more and
more countries look out for themselves,
are more nationalistic, whatever words
you would like to put around it.
I think it calls for those of us going
back, particularly around things
like modernization of trade,
skills in the world, and
we didn't talk much about cyber security,
right, and cyber and that impact.
Because cyber is the one thing that will
stop all the, it'll take three steps
forward and five steps back, right,
with cyber here, with what happens.
So I think that's what we
can all go back and do.
I'll always remember a meeting, years ago,
that I'd had with Shimon Peres,
late in his life.
And I remember a quote he had said to me,
I don't know why it's always stuck
with me, but
maybe it's because I feel it's true.
He said, companies can do more to
help countries than governments,
because they know no boundary.
And It's true,
I don't really see boundaries that way.
And so
I think that's the important follow on,
is what this public-private
partnership becomes.
>> Thank you very much for your time.
My name is Yaya, I'm from Saudi Arabia.
I'm a joint degree candidate
here doing MBA and
master's in electrical engineering.
So my question to you was how can AI help
businesses that are outside the US or
Europe, where the infrastructure that
allows AI to let these businesses
flourish, like intelligent investors or
talent,
like data scientists or something, are not
available in these countries or locations?
>> Yeah, look, I think, first off,
many of what we offer is a platform
that is available in any country.
It may not run in the country, but
it's running somewhere else as a platform.
And I was telling John ahead of time
about one of your colleagues here.
Joshua Browder,
who is one of your colleagues.
I mean, I met him only because,
why would I ever meet him
other than he found Watson.
And he then built a business
called DoNotPay, for
people who shouldn't pay parking
tickets that they got wrongly.
>> [LAUGH]
>> And
I think he's handled 200,000 parking
tickets, those of you that know the story,
$11 million.
But he's working on Syrian refugees now,
and
how to get them the right paperwork
to stay in different countries.
And so, I think,
this is more accessible, and
we do work in Saudi Arabia as well,
this is more accessible than you think.
And so to me, I think this is a wonderful
technology to allow entrepreneurs,
as well as big,
as well as them coming together.
Actually see a lot for the coming
together between those two constituents.
And if you think of it as a platform,
it's more accessible than not accessible,
albeit some issues in certain countries,
but still accessible.
In the back?
>> I'm Ching Hou from the MSX program.
IBM is a company, a global giant,
with a storied history.
I'm wondering how you keep the IBM
family nimble, creative, and innovative,
is it more more of a top-down or
bottom-up approach or?
Just like to hear your views.
>> What's your perception?
>> [LAUGH]
>> I think it has to be both.
>> It's okay.
>> Yeah, I think it has to be both.
Myself, I'm from the Air Force,
it's a big organization.
Anytime you want to get something going,
you want to start small.
You want to create space for
people, but at the same time,
you need some top down direction
to say this is the vision.
I'm just wondering if you have
a slightly different take on it.
>> I do, I mean not that- this has
been one of my biggest learnings,
perhaps one of my biggest
mistakes as well.
So, you know, Jordy asked me this.
So IBM today is an $80 billion
company in 170 countries,
we talked about 46% of it new.
Lots of new entrants obviously
into this technology field,
and so
how do you get change to happen fast?
So I'll tell you my quick- I'll try to
make a very quick story about what my
learning was.
So probably my first two years as CEO I
would say to the group, because it's true,
the world is moving so fast,
come on, faster, faster, faster.
You gotta work, I think if anyone would
have said what does she talk about they
would have just said go faster.
Go faster, go faster, go faster,
go faster constantly.
And I thought about after
two years what did I do?
I exhausted them,
that's about what I got done.
Until it dawned on me that,
I have to check,
it's my job and
we have to change how work is done.
And so while much will ever be written
about the portfolio, and how it's changed,
I think the far more,
one day revisionist history, one day when
we're distanced enough we will look back
in the far more interesting story will be
how work gets done and what happened
to the people and to their skills.
And on the how, what we had to learn was,
we were a B2B company, so
the shortcut of this is,
it meant you can be big and be fast, but
you do have to re-architect work.
And that means a lot of things like,
even in B2B, hey, they
expect everything to be as simple as the
consumer world we all live in everyday.
That means design thinking, that means we
hired 10,000 best designers from around
the world, brought back that culture
that had once existed by the way in IBM.
Everything is done with empathy from
the end user in, not from an engineering
culture out, which is a what a lot of
tech companies are engineering out.
And so it started with that.
Then it started with really agile,
easy buzz word,
really hard to change the way you do
work unless you truly embrace it.
So we probably now 200,000 agile
experts trained, black belts.
It means small, multidisciplinary,
co-located, minimum viable products.
And think about minimum viable products,
I mean, when you think of big things we do
like run airlines, banks,
you think of these big complex things.
Going fast doesn't mean make that big,
ugly thing faster.
It means no but it means start with
something little, get it right,
make it bigger, make it bigger,
make it bigger.
That's way different on
the way you build things.
So we had a change what agile,
put that in what did it mean?
Then we had a co-locate.
Talk to me about a billion dollars
later in real estate, renovations and
all that kind of thing around the world.
And so it's been- You know, we had to
change the performance management system,
we had to move in that promoter score,
I mean, sorry, there's like heavy
work underneath real transformations.
And that's what had to do to
happen to make you work fast.
So, is that top and
that's bottom and top, it's both?
But I tell you until we as leaders
help people change how they could do
their work, that wasn't going to happen.
And so, that to me and
then the people on skills,
the skills part for
anybody changing a company,
actually I'm going to talk about this
again tomorrow I think I have to do
We're all going to have to change
the skills of everybody in our company.
I lectured for the first Friday of every
month for four years, I taught a class.
For four years, amook and it was about
what the future was, what it would be,
had clients saw it over and over and over.
So you paint the picture of the world that
you are building then you have to say
to people, okay now I need to make it so
you can change your skills, and
then I'm going to pay you for
changing them.
Meaning I'm going to put compensation for
those that then go ahead and
change skills.
And then the third thing you have to
do after you've done that kind of
reinforcement of it,
then you've got to say okay,
now I'm going to make this transparent,
it's going to be obvious.
We're going to post who's got that skill,
who doesn't have that skill.
And that's the world of
transparency we live in, stale,
hot, and you'd be surprised,
people will move.
There's nothing to do with age,
this is nothing to do with age.
And that's why it's changed the way I even
think about hiring and we were talking
about what's cool, is it better to hire
an MBA or an- there's room for everybody.
I think the most distinguishing
characteristic is your curiosity.
If you are a life long
learner I would like you,
because that's what is in front of us and
it doesn't matter to me what school you
came out of because that's got to do with
passion, it's this life long learning.
So those, the thing about the skills and
the people and then changing how
work gets done, to me, that was, that will
one day be the real sense of learning,
that comes out of, how do companies
re-invent themselves in this day and age?
>> This must be the last question.
>> Is it a good one?
>> A lot of pressure.
>> Or it will be the second to last?
[LAUGH]
>> I'll try [LAUGH] So thanks so much for
coming in.
My name's Stephanie Young,
I'm an MBA 3, we exist.
>> Is that a good thing?
>> [LAUGH]
>> It depends on the MBA 3.
>> Okay.
>> I'm doing a joint program, and
my question for you was you talked about
companies potentially crossing borders
that governments couldn't cross.
And I was curious for you,
personally, with IBM,
how you see IBM's role in
government in the US and globally.
And conversely, flip that, and think about
what you think government needs to be
doing to make it effective, to make them
effective working with companies like IBM.
>> Yeah, look, this is a good question
because you can imagine even earlier in
the year I got asked this question many,
many times and in with my whole workforce,
actually to explain and
reexplain to them what is our role.
And I feel, every IBM CEO has worked
with every United States President,
as an example, since Woodrow Wilson.
And as I said to my workforce and
my teams, I say guys,
this is not about politics,
it is about policies.
In fact,
we are the only tech I know of that
makes no political contributions, zero.
Always have a position about it,
zero, zero, zero, everywhere, zero.
By the way when your answer is like
no it's easy to be consistent, no.
>> [LAUGH]
>> And so then don't start.
But it does give you a freedom
to then debate policies.
And so it's policies, not politics.
And so that is what I have firmly
stuck on is what my issues.
I don't care in every country we
have to deal with because mind you,
whether I was with last week.
This week I'll do
Prime Minister Trudeau in Canada or
whether it is,
She Shung Ping it doesn't matter.
I've never met a country that didn't
want you to increase your workforce
there, never.
Labor is the currency, jobs is currency.
I don't care who you are that is true for
as long as I can remember.
So I think what we can do,
is each of us, so
you adapt the things that
are important to you, right?
So, what's important to us is education,
in every country that we work on.
What's important to us is inclusion,
and diversity and this ability and why?
You want it for innovation,
it's not just for
an altruistic reason,
you want it for innovation.
So, we're very strong
supporters of open innovation,
very strong supporters of education, and
very strong supporter of free trade.
I worked very hard on things like TPP
because I think they're not only good for
business, they were good for
those countries, too.
It held them to a level and a standard,
not to steal IP, to let data flow freely,
to have wages be a certain way.
There were lots of good things, and
they were modernized for the digital era,
by the way, which most trade
agreements are not modernized for.
So those are some of the main main issues
we have really devoted our self to.
And of course, in the US,
we wanted a competitive tax system,
because otherwise it allows other
countries to buy companies here, and
all for those kind of reasons not for
the right reasons.
So, that to me what we should do, and in
return what do you want government to do?
Well you want them not to have regulate,
I've never met a place where
regulation was a really great thing.
But there is- you do want them to create
in every country a level playing field.
So that's what I want
out of most governments.
And of course the treatment of people and
the focus on education but that level
playing field and that's what we work
on in almost every country which is how
to be sure there's a level playing field.
That people can move freely,
ideas can move freely.
Right, I love that old saying, just it's
true, good ideas have no passport, right?
And so that is what you want
to be able to have happen.
And I'm sure it's why we fought so
hard around immigration too right.
So that regardless of country,
that there should be good, and
done a lot of work on immigration as well.
So that would be my takeaway,
be it's always about policies,
not politics and if you focus on that,
my view is you can change the world.
You can change the world.
>> Well Ginni, as an international
student struggling to get a job,
I hugely appreciate that and
also want to say,
believe me, you answered my questions
a lot better than I could have done.
So thank you very very much for coming.
Ladies and gentlemen, Ginni Rometty.
>> [APPLAUSE]
>> You're a good sport.
[APPLAUSE]
[MUSIC]
