Palmisano Rakes in $9 Million for IBM’s 2010 Performance
January 31, 2011 Timothy Prickett Morgan
It is not only good to be the king, but also profitable. Sam Palmisano, who holds the three jobs of president, chief executive officer, and chairman at IBM raked in the dough in 2010 as the company turned in what Wall Street and its top brass believes was a great year.
IBM i shops, who no doubt still call themselves AS/400 customers, probably have a slightly different view of the year, having seen a lot of focus on Smarter Planet and Power Systems running AIX and not enough action on the i front to make them happy. It is hard to say what IBM is doing for the i platform from the outside, but I have to agree that even if it was a lot, I wish it were more.
In any event, Palmisano had a $1.8 million base salary and was paid another $5 million in incentives to meet financial targets plus another $2.2 million in compensation. That was up from the $4.75 million IBM’s chief got in 2009. Mark Loughridge, IBM’s chief financial officer and also the executive who has taken over an internal transformation of its internal operations to help squeeze costs out of the company since a reorganization last July, was paid $1.48 million, up from $975,000 in 2009. Loughridge was given a $720,000 base salary for 2010, but got a raise to $775,000 for 2011. Steve Mills, who now runs the combined Systems and Software Group, had a base salary of only $695,000 in 2010, and received $1.43 million in total compensation; his base salary was bumped up to $716,000 for 2011. Mark Daniels, who runs the Global Technology Services unit of Global Services (and which yields about two-thirds of its revenues), had a base salary of $665,000 in 2010 and was paid $1.37 million for the year. Ginny Rometty, who runs the other third of Global Services, called Global Business Services, had a base salary of $630,000 and received $1.29 million in compensation. For 2011, Daniels got a raise to $825,000 in base salary and Rometty got a raise to $800,000 and both also are having their annual bonuses uplifted by around 65 percent if their bits of Global Services hit their targets. Ditto for Loughridge and Mills.
IBM doesn’t want to lose any of these executives to competitors and seems content to keep the current team on board until 2015, which is as far out as IBM is making projections about its business and the IT sector right now. Over the next four years, we can expect to see IBM cultivate the next generation of upper management. All of the current top leaders of IBM’s divisions are not young enough to take the job of president or CEO at this point, not based on how young Palmisano was (48) when he took the job as Louis Gerstner prepped him for the top job. Whoever Palmisano anoints president sometime before 2015 will be the next leader of Big Blue.