A Conversation with Jon Iwata

Tell me about your new role as Executive in Residence. I know you’ve been getting involved in Ravi Dhar’s CMO class and also hosting some weekly lunches with students. What’s it like to be back in a university environment?
I got acquainted with SOM because Ravi invited me to speak at his classes when I was IBM’s CMO.  I’d come up from New York once or twice a year, and I loved interacting with the students and Ravi.  I learned as much from their questions and observations as anything they might possibly learn from me. I always came away having learned something.

That’s also what I enjoyed about my career at IBM. I was forced to learn every day.  The company lives at the intersection of technology, multinational business, policy, intellectual property, being a big employer, being a big public company. You’re immersed in trends and issues and emergent phenomena of one type or another. When I announced that I was retiring in 2018, Ravi and Jeff Sonnenfeld reached out to me about this Executive in Residence role. It offered a path into another intellectually stimulating environment.  And in return perhaps I could contribute something from my experience in business. 

What motivated you to go into branding/communications?
Coming out of journalism school in California, I joined IBM at its research lab in Silicon Valley.  My first job was science writing. I interviewed researchers about their work and then wr0te articles to explain it to laypeople like myself. My job was to not only make these incredibly complex ideas understandable, but also relevant and meaningful.  After five years in IBM Research, I transferred to corporate headquarters in New York. I was supposed to be there for two years and didn’t leave until I retired!

And you know what? That little muscle of asking questions, trying to understand deeply complex subjects and then helping others understand and care about it turned out to be applicable in almost everything I did throughout my career, whether it was my work in communications, marketing or strategy. They all required critical thinking and a kind of translation. That was a constant throughout my career.

In your three decades with IBM, how did the branding/marketing change?
In brand stewardship, there are several choices. The name of the company could be synonymous with the name of its flagship product. Think of Facebook or Google. That’s a perfectly good choice, as long as the product is what the company wants to be known for.  But if it expands into other things, then that choice of brand strategy is constraining.

The challenge for the IBM brand is that what we make and sell constantly changes. So while it may be seductive to equate IBM with a hot product, it’s a dangerous choice. Because today’s IBM Cloud or Watson is tomorrow’s Thinkpad or Selectric typewriter or punch card tabulator. Hot products have their time in the limelight and then something else comes along. That’s the nature of technology.  So the IBM brand must stand for something other than what we make or sell. Today it’s fashionable to talk about a brand’s purpose, mission and values. But that’s how we’ve managed the IBM brand for a very long time. What do we stand for? What is the character of the company? What do we believe?

Many companies are changing very quickly, such as Amazon or Facebook or even Google. What should companies do in this case to define their brand and change over time as their products are changing?
They should imagine what kind of business they’ll be 100 years from now.

I don’t think Jeff Bezos ever declared Amazon to be an online bookselling company or an online retailer or a streaming media company or a cloud company.  Instead, Amazon stands for innovation, customer centricity and taking friction out of markets. That’s not what they say. It’s what we, as their customers, experience. That defines the brand.

Similarly, if Walt Disney were alive, I don’t think he’d be surprised that his company is into retail, cruise lines, Broadway shows, tours and on and on.  He never said his company would only make cartoons.

I don’t pass judgment on brands. They can be a donut company or NASA. I admire brands who know who they are and are true to that definition of themselves.  The problem with too many brands is that they lack a distinct sense of what makes them, them.

With data and analysis becoming very important in marketing, do you think the job of brand managers will be taken over by data scientists in the future?
I’m tempted to say no, but I believe you’re not going to be a brand steward or a marketer or a communicator in the future if you don’t leverage data. Today, almost every touch point with customers and prospects is digitally instrumented. They’re telling us who they are, what they’re looking for, what’s happening in their lives and at work. How can you be responsible for brand or marketing or communications and not understand and engage people based on all this data? The days of segmenting populations and telling people who they are and what they want and hoping we’re right are over.

Do you think there’s a gap and an opportunity for companies to be more involved in the creation of academic curriculum so that future managers can be better equipped when they enter the corporate world?
There will always been a gap, but that’s not necessarily a problem. Every profession is built upon a foundation of knowledge which doesn’t change very much. The question is, is the gap between what is foundational and the “real world” widening? And today, I think the gap is becoming cavernous because of the era of data and artificial intelligence. Companies don’t see, understand or engage us as a unique individual—whether as a consumer, patient, student, employee or citizen. They see us as part of a segment. We’re an 18-24 year old, a zip code, a freshman, a job title, a diabetic. But digital and data and AI are changing all of that. People are increasingly preferring companies that understand them as individuals, personalize the experience and the offering on that basis. Companies are by and large organized so they see us in a fragmented way, in slices—through their sales force, their websites and apps, their physical store, their call center, their loyalty program. The design of the corporation—its structure, organization and culture—is out of phase with the new reality of seeing and understanding us as a total person, through every touch point and dimension. I’m afraid the academy reinforces this fragmentation. I worry about that.

How do we bridge the gap? You said there’s always going to be a gap. There’s no systematic or organized way we have now where companies are involved in communicating what’s missing. Is there something that can be done in a more systemic way?
I think business schools are advantaged because they tend to have a lot of connective tissue with the business world. Business leaders come through SOM all the time. There are seminars and conferences. My own connection with SOM is possible because IBM is part of YCCI, I came here as a guest lecturer and now I’m here as an Executive in Residence.

Recently, I spoke with a professor of marketing at another university. She teaches digital marketing and has never spent a day in business. I asked her if it’s difficult teaching something that is rapidly evolving and that has its own tools, methods and vocabulary, without any hands-on experience. She said it’s almost impossible. I told her she really ought to spend a summer or a month at a company.  Things are moving so quickly, it can only help academic leaders to spend time immersed in what’s going on in business. I’m not suggesting that students be taught how to become practitioners, but what’s happening with digital and data is fundamental to every field.  

What is one piece of advice that you’d like to give YCCI students or students interested in branding-related careers in general?
Brand is much more than identity—a name, a logotype, fonts and colors—and more than communication, such as advertising. Brand is character. The most powerful way to build brand is to have people experience it.  When I was IBM’s Chief Brand Officer, I spent a lot of time with Human Resources, our Real Estate department and the CIO. That’s because they all bear on culture, our behavior as a company.  So my first piece of advice is to spend more time on culture than on brand positioning and campaigns.

Second, remember that every brand has multiple stakeholders: customers, employees, owners, neighbors. They all wield power and they are all decision makers. So, don’t think of the brand only in terms of customers and potential customers, which most marketers do. Increasingly companies are expected to do more than make great products and generate great financial returns. They’re expected to create value for society, weigh in on issues, use their resources and influence in ways that may seem far flung from the core business. “Brands taking stands” is a term you may hear. “Stakeholder capitalism” is another. Responsible brand stewardship must be in the middle of these issues and debates.