THOMAS JOHN WATSON SR. (February 17, 1874 – June 19, 1956) was an
American businessman . He served as the chairman and CEO of
Business Machines (IBM) He oversaw the company's
growth into an international force from 1914 to 1956. Watson developed
IBM's management style and corporate culture from John Henry
Patterson\'s training at NCR . He turned the company into a
highly-effective selling organization, based largely on punched card
tabulating machines . A leading self-made industrialist, he was one
of the richest men of his time and was called the world's greatest
salesman when he died in 1956.
* 1 Early life and career
* 2 NCR
* 3 Head of
* 4 Personal
* 5 Famous attribution
* 6 Famous motto
* 7 See also
* 8 References
* 9 Further reading
* 10 External links
EARLY LIFE AND CAREER
Thomas J. Watson was born in Campbell, New York, the fifth child and
only son of Thomas and Jane Fulton White Watson. His four older
siblings were all girls —Jennie, Effie, Loua, and Emma. His father
farmed and owned a modest lumber business located near Painted Post ,
a few miles west of Elmira , in the
Southern Tier region of New York .
Thomas worked on the family farm in East
Campbell, New York
Campbell, New York and
District School Number Five in the late 1870s. As Watson
entered his teen years he attended Addison Academy In Addison, New
Having given up his first job—teaching—after just one day, Watson
took a year's course in accounting and business at the Miller School
of Commerce in Elmira. He left the school in 1891, taking a job at $6
a week as bookkeeper for Clarence Risley's Market in Painted Post. One
year later he joined a traveling salesman, George Cornwell, peddling
organs and pianos around the farms for William Bronson's local
hardware store, Watson's first sales job. When Cornwell left, Watson
continued alone, earning $10 per week. After two years of this life,
he realized he would be earning $70 per week if he were on a
commission. His indignation on making this discovery was such that he
quit and moved from his familiar surroundings to the relative
metropolis of Buffalo .
Watson then spent a very brief period selling sewing machines for
Wheeler and Wilcox. According to
Tom Watson, Jr. , in his
One day my dad went into a roadside saloon to celebrate a sale and
had too much to drink. When the bar closed, he found that his entire
rig—horse, buggy, and samples—had been stolen. Wheeler and Wilcox
fired him and dunned him for the lost property. Word got around, of
course, and it took Dad more than a year to find another steady job.
Watson would later enforce strict rules at
IBM against alcohol
consumption, even off the job. According to Tom Jr.:
This anecdote never made it into
IBM lore, which is too bad, because
it would have helped explain Father to the tens of thousands of people
who had to follow his rules.
Watson's next job was peddling shares of the Buffalo Building and
Loan Company for a huckster named C. B. Barron, a showman renowned for
his disreputable conduct, which Watson, as a lifelong
deplored. Barron absconded with the commission and the loan funds.
Next Watson opened a butcher shop in Buffalo, which soon failed,
leaving Watson with no money, no investment, and no job.
Watson had a newly acquired NCR cash register in his butcher shop,
for which he had to arrange transfer of the installment payments to
the new owner of the butcher shop. On visiting NCR, he met John J.
Range and asked him for a job. Determined to join the company, he
repeatedly called on Range until, after a number of abortive attempts,
he finally was hired in November, 1896, as sales apprentice to Range.
Led by John Patterson , NCR was then one of the leading selling
organizations, and John J. Range, its Buffalo branch manager, became
almost a father figure for Watson and was a model for his sales and
management style. Certainly in later years, in a 1952 interview, he
claimed he learned more from Range than anyone else. But at first, he
was a poor salesman, until Range took him personally in hand. Then he
became the most successful salesman in the East, earning $100 per
Four years later, NCR assigned Watson to run the struggling NCR
Rochester, New York
Rochester, New York . As an agent, he got 35% commission and
reported directly to Hugh Chalmers, the second-in-command at NCR. In
four years Watson made Rochester effectively an NCR monopoly by using
the technique of knocking the main competitor, Hallwood, out of
business, sometimes resorting to sabotage of the competitor's
machines. As a reward he was called to the NCR head office in Dayton,
In 1912, the company was found guilty of violating the Sherman
Antitrust Act . Patterson, Watson, and 26 other NCR executives and
managers were convicted for illegal anti-competitive sales practices
and were sentenced to one year of imprisonment. Their convictions were
unpopular with the public because of the efforts of Patterson and
Watson to help those affected by the
Dayton, Ohio floods of 1913 , but
efforts to have them pardoned by President
Woodrow Wilson were
unsuccessful. However, their convictions were overturned on appeal in
1915 on the grounds that important defense evidence should have been
HEAD OF IBM
Charles Ranlett Flint
Charles Ranlett Flint who had engineered the amalgamation (via stock
acquisition) forming the
Computing-Tabulating-Recording Company (CTR)
found it difficult to manage the five companies. He hired Watson as
general manager on May 1, 1914 when the five companies had about 1,300
employees. Eleven months later he was made president when court cases
relating to his time at NCR were resolved. Within four years revenues
had been doubled to $9 million. In 1924, he renamed CTR to
Business Machines. Watson built
IBM into such a dominant
company that the federal government filed a civil antitrust suit
against it in 1952.
IBM owned and leased to its customers more than 90
percent of all tabulating machines in the
United States at the time.
When Watson died in 1956, IBM's revenues were $897 million, and the
company had 72,500 employees.
Throughout his life, Watson maintained a deep interest in
international relations, from both a diplomatic and a business
perspective. He was known as President Roosevelt\'s unofficial
ambassador in New York and often entertained foreign statesmen.In
2001, a book called
IBM and the Holocaust described how Mr. Watson
provided the tabulating equipment Hitler used to round up the Jews.
His Hollerith punch-card machines are in the Holocaust Museum today.
The book describes IBMʼs punch cards as “a card with standardized
holes,” each representing a different trait of the individual. The
card was fed into a ʻreaderʼ and sorted. Punch cards identified Jews
by name. Each one served as “a nineteenth-century bar code for human
beings.” In 1937, he was elected president of the International
Chamber of Commerce (ICC) and at that year's biennial congress in
Berlin stated the conference keynote to be "World Peace Through World
Trade". That phrase became the slogan of both the ICC and IBM.
Watson's merger of diplomacy and business was not always lauded.
During the 1930s, IBM's German subsidiary was its most profitable
foreign operation, and a 2001 book by Edwin Black,
IBM and the
Holocaust , argues that Watson's pursuit of profit led him to
personally approve and spearhead IBM's strategic technological
Nazi Germany . In particular, critics point to the
Order of the German Eagle
Order of the German Eagle medal that Watson received at the
Berlin ICC meeting in 1937, as evidence that he was being honored for
the help that IBM's German subsidiary
Hollerith-Maschinen Gesellschaft mbH) and its punch card machines
Nazi regime, particularly in the tabulation of census
data (i.e. location of Jews). Another study argues that Watson
believed, perhaps naively, that the medal was in recognition of his
years of labor on behalf of global commerce and international peace.
Within a year of the Berlin congress though, where Watson's hopes had
run high, he found himself strongly protesting the German policy
toward the Jews. Because of his strong feelings about the issue,
Watson wanted to return his German citation shortly after receiving
it. When Secretary of State Hull advised him against that course of
action, he gave up the idea until the spring of 1940. Then Hull
refused advice, and Watson sent the medal back in June 1940.
Dehomag's management disapproved of Watson's action and considered
separating from IBM. This occurred when Germany declared war on the
United States in December 1941, and the German shareholders took
custody of the
Dehomag operation. But during
World War II
World War II , IBM
subsidiaries in occupied Europe never stopped delivery of punch cards
to Dehomag, and documents uncovered show that senior executives at IBM
world headquarters in New York took great pains to maintain legal
authority over Dehomag's operations and assets through the personal
IBM managers in neutral
Switzerland , directed via
personal communications and private letters.
During this same period,
IBM became more deeply involved in the war
effort for the U.S., focusing on producing large quantities of data
processing equipment for the military and experimenting with analog
computers . Watson, Sr. also developed the "1% doctrine" for war
profits which mandated that
IBM receive no more than 1% profit from
the sales of military equipment to U.S. Government. Watson was one of
the few CEOs to develop such a policy.
In 1941, Watson received the third highest salary and compensation
package in the U.S., $517,221, on which he paid 69% in tax.
Watson had a personal interest in the progress of the war. His eldest
Thomas J. Watson Jr., joined the
United States Army Air Corps
where he became a bomber pilot. He was soon hand-picked to become the
assistant and personal pilot for General Follet Bradley, who was in
charge of all
Lend-Lease equipment supplied to the
Soviet Union from
the United States. Watson, Sr.'s youngest son,
Arthur K. Watson , also
joined the military during the conflict.
Watson worked with local leaders to create a college in the
Binghamton area, where
IBM was founded and had major plants. In 1946,
IBM provided land and funding for Triple Cities College, an extension
Syracuse University . Later it became known as Harpur College, and
eventually evolved into
Binghamton University . Its School of
Engineering and Applied Sciences is named the
Thomas J. Watson School
of Engineering and Applied Sciences. The
IBM plant in the neighboring
city of Endicott has since downsized drastically, however.
After World War II, Watson began work to further the extent of IBM's
influence abroad and in 1949, he created the
IBM World Trade
Corporation in order to oversee IBM's foreign business.
On May 8, 1956 Watson retired and his oldest son, Thomas J. Watson,
Jr assumed the position of CEO. He died on June 19, 1956 in
Manhattan, New York City
Manhattan, New York City . He was interred in Sleepy Hollow Cemetery
Sleepy Hollow, New York
Sleepy Hollow, New York .
Watson married Jeanette Kittredge, from a prominent Dayton, Ohio
railroad family, on April 17, 1913. They had two sons and two
Thomas Watson, Jr.
Thomas Watson, Jr. succeeded his father as
IBM chairman and later
served as ambassador to the
Soviet Union under
* Jeanette Watson Irwin married businessman
John N. Irwin II , later
ambassador to France
* Helen Watson Buckner became an important philanthropist in New
Arthur K. Watson served as president of
IBM World Trade
Corporation and later, as ambassador to France
As a Democrat (after his criminal indictment by the Taft
Administration), Watson was an ardent supporter of Roosevelt. He was
one of the most prominent businessmen in the Democratic Party. He was
considered Roosevelt's strongest supporter in the business community.
The gravesite of Thomas J. Watson, Sr.
In 1936 the U.S. Supreme Court upheld a lower court decision that
IBM, together with Remington Rand, should cease its practice of
requiring its customers to buy their punch cards from it alone. The
ruling made little difference because
IBM was the only effective
supplier to the market, and profits continued undiminished.
Watson served as a powerful trustee of
Columbia University from June
6, 1933 until his death. He engineered the selection of Dwight D.
Eisenhower as its president and played the central role in convincing
Eisenhower to become president of the university. Additionally, he
served as a trustee of
Lafayette College and is the namesake of Watson
Hall, a campus residence hall.
In 1939, he received an honorary degree in Doctor of Commercial
Oglethorpe University .
In the 1940s, Watson was on the national executive board of the Boy
Scouts of America and served for a time as international Scout
E. Urner Goodman
E. Urner Goodman recounts that the elderly Watson
attended an international Scout commissioners' meeting in Switzerland
, where the
IBM founder asked not to be put on a pedestal. Before the
conference was over, Goodman relates, Watson "... sat by that
campfire, in Scout uniform, 'chewing the fat' like the rest of the
boys". He received the
Silver Buffalo Award
Silver Buffalo Award in 1944. His son, Thomas
Jr., later served as National president of the Boy Scouts of America
from 1964 to 1968.
Watson was chairman of the
Elmira College centennial committee in
1955 and donated Watson Hall, primarily a music and mathematics
He was posthumously inducted into the
Junior Achievement U.S.
Business Hall of Fame in 1990.
Although Watson is well known for his alleged 1943 statement, "I
think there is a world market for maybe five computers," there is
scant evidence he said it. Author Kevin Maney tried to find the origin
of the quote, but has been unable to locate any speeches or documents
of Watson's that contain this, nor are the words present in any
contemporary articles about IBM. One of the very first attributions
may be found in The Experts Speak, a book written by Christopher Cerf
Victor S. Navasky in 1984, however Cerf and Navasky just quote
from a book written by Morgan and Langford, Facts and Fallacies.
Another early article source (May 15, 1985) is a column by Neil
Morgan, a San Diego Evening Tribune writer who wrote: "Forrest
Shumway, chairman of The Signal Cos., doesn't make predictions. His
role model is Tom Watson, then
IBM chairman, who said in 1958: 'I
think there is a world market for about five computers.'" The earliest
known citation on the Internet is from 1986 on
Usenet in the signature
of a poster from Convex Computer Corporation as "'I think there is a
world market for about five computers' —Remark attributed to Thomas
J. Watson (Chairman of the Board of International
1943". All these early quotes are questioned by Eric Weiss, an editor
of the Annals of the History of Computing in ACS letters in 1985.
There are documented versions of similar quotes by other people in
the early history of the computer. In 1946 Sir Charles Darwin
(grandson of the famous naturalist), head of Britain's NPL (National
Physical Laboratory), where research into computers was taking place,
it is very possible that ... one machine would suffice to solve all
the problems that are demanded of it from the whole country.
In 1985 the story was discussed on
Usenet (in net.misc), without
Watson's name being attached. The original discussion has not
survived, but an explanation has; it attributes a very similar quote
to the Cambridge mathematician Professor
Douglas Hartree , around
I went to see Professor Douglas Hartree, who had built the first
differential analyzers in England and had more experience in using
these very specialized computers than anyone else. He told me that, in
his opinion, all the calculations that would ever be needed in this
country could be done on the three digital computers which were then
being built—one in Cambridge, one in Teddington , and one in
Manchester. No one else, he said, would ever need machines of their
own, or would be able to afford to buy them.
Howard H. Aiken made a similar statement in 1952:
Originally one thought that if there were a half dozen large
computers in this country, hidden away in research laboratories, this
would take care of all requirements we had throughout the country.
The story already had been described as a myth in 1973; the Economist
quoted a Mr. Maney as "revealing that Watson never made his oft-quoted
prediction that there was 'a world market for maybe five computers.'"
Since the attribution typically is used to demonstrate the fallacy of
predictions, if Watson had made such a prediction in 1943, then, as
Gordon Bell pointed out in his ACM 50 years celebration keynote, it
would have held true for some ten years.
IBM archives of Frequently Asked Questions notes an inquiry
about whether he said in the 1950s that he foresaw a market potential
for only five electronic computers. The document says no, but quotes
his son and then
IBM President Thomas J. Watson, Jr., at the annual
IBM stockholders meeting, April 28, 1953, as speaking about the IBM
701 Electronic Data Processing Machine, which it identifies as "the
company's first production computer designed for scientific
calculations". He said that "
IBM had developed a paper plan for such a
machine and took this paper plan across the country to some 20
concerns that we thought could use such a machine. I would like to
tell you that the machine rents for between $12,000 and $18,000 a
month, so it was not the type of thing that could be sold from place
to place. But, as a result of our trip, on which we expected to get
orders for five machines, we came home with orders for 18." Watson,
Jr., later gave a slightly different version of the story in his
autobiography, where he said the initial market sampling indicated 11
firm takers and 10 more prospective orders.
"THINK " - Watson began using "THINK" to motivate, or inspire, staff
while at NCR and continued to use it at CTR. International Business
Machines's first U.S. trademark was for the name "THINK" filed as a
U.S. trademark on June 6, 1935, with the description "periodical
publications". This trademark was filed fourteen years before the
company filed for a U.S. trademark on the name IBM. A biographical
article in 1940 noted that "This word is on the most conspicuous wall
of every room in every
IBM building. Each employee carries a THINK
notebook in which to record inspirations. The company stationery,
matches, scratch pads all bear the inscription, THINK. A monthly
magazine called 'Think' is distributed to the employees." THINK
remains a part of IBM's corporate culture; it was the inspiration
behind naming IBM's successful line of notebook computers , IBM
ThinkPad . In 2007,
IBM Mid America Employees Federal Credit Union
changed its name to
Think Mutual Bank .
Jeannette K. Watson Fellowship
Thomas J. Watson Fellowship
Thomas J. Watson Research Center
Thomas J. Watson School of Engineering and Applied Science
* ^ A B "
Thomas J. Watson Sr. Is Dead. I.B.M. Board Chairman Was
New York Times . June 20, 1956.
* ^ "Early Ambitions". IBM. Retrieved January 28, 2012.
* ^ Belden (1962) p.105-106
* ^ A B C D "Founding IBM" at the
Wayback Machine (archived October
* ^ Rodgers, William (1969) THINK, Stein and Day, p.18
* ^ A B C D E F G Maney, Kevin (2003). The Maverick and His
Machine: Thomas Watson, Sr. and the Making of IBM. John Wiley and
* ^ William E. Krattinger (November 2000). "National Register of
Historic Places Registration: District School Number Five". New York
State Office of Parks, Recreation and Historic Preservation .
Retrieved June 14, 2009.
* ^ A B C Watson Jr., Thomas J.; Petre, Peter (1990). Father, Son &
Co.: My Life at
IBM and Beyond. Bantam Books.
* ^ "
IBM Archives: 1910s". IBM. Retrieved January 5, 2013.
* ^ "
IBM Archives: 1956". IBM. Retrieved September 8, 2009.
* ^ Ridgeway, George L. (1938). Merchants of Peace: Twenty Years of
Business Diplomacy Through the International Chamber of Commerce
Columbia University Press.
* ^ Belden, Thomas; Belden, Marva (1962). The Lengthening Shadow:
The Life of Thomas J. Watson. Little, Brown and Company.
* ^ A B Black, Edwin (2001).
IBM and the Holocaust. Crown
* ^ Belden, Thomas and Marva (1962). The Lengthening Shadow: The
Thomas J. Watson (1st ed.).
United States of America and
Canada: Little, Brown and Company, Inc. p. 207. LCCN 61-8065 .
* ^ "
IBM Archives: 1940s". IBM. Retrieved July 30, 2007.
* ^ "Compensation and the I.R.S.: It\'s not the \'Good\' Old Days".
New York Times .
Business Day. 2010-12-01. Retrieved 2014-01-21.
* ^ "The Creation of the World Trade Corporation". IBM. Retrieved
January 28, 2012.
* ^ "Watson Yields I.B.M. Helm at 82. Son, 42, Is Elected Chief
Executive of Company".
New York Times . May 9, 1956.
* ^ "Lafayette Honors Foremost Benefactors". Retrieved 2016-10-04.
* ^ "Honorary Degrees Awarded by Oglethorpe University". Oglethorpe
University. Retrieved 2015-03-22.
* ^ Goodman, E. Urner (1965). The Building of a Life. St.
Augustine, FL: Standard Printing.
* ^ "Laureates Inducted in 1990". U.S.
Business Hall of Fame .
Junior Achievement USA . Retrieved January 28, 2012.
* ^ "Authors". Doi.acm.org. doi :10.1145/2465.314899 . Retrieved
* ^ Copeland, Jack (2006). Colossus: The Secrets of Bletchley
Park's Codebreaking Computers. Oxford University Press. p.109
* ^ Brader, Mark (July 10, 1985). "Only 3 computers will be
needed..." (Forum post). net.misc. Citing Lord Bowden (1970). American
Scientist. 58: 43–53)
* ^ The Language of Computers a transcript of a talk given by Lord
Bowden of Chesterfield, at Brighton College of Technology. the first
Richard Goodman Memorial Lecture
* ^ Cohen, I. Bernard (1999). Howard Aiken: Portrait of a Computer
Pioneer. MIT Press. p.292
* ^ Cohen, I. Bernard (1998). IEEE Annals of the History of
Computing 20.3 pp. 27-33
* ^ The Economist, 367(8322-8326): 201
* ^ Bell, Gordon (1999). Denning, Peter J. , ed. The Folly of
Prediction (PDF). Talking Back to the Machine. New York: Copernicus.
p. 4. ISBN 978-0-387-98413-1 . Retrieved June 17, 2013.
* ^ "
IBM Frequently Asked Questions". p. 26
* ^ Current Biography 1940, p. 846
* ^ Dell, Deborah; Purdy, J. Gerry. "ThinkPad: A Different Shade of
Blue". Sams ISBN 0-672-31756-7 ISBN 978-0672317569
* Belden, Thomas Graham; Belden, Marva Robins (1962). The
Lengthening Shadow: The Life of Thomas J. Watson. Boston: Little,
Brown and Co. 332 pp.
* Greulich, Peter E. (2011) The World's Greatest Salesman: An IBM
Caretaker's Perspective: Looking Back. Austin, TX: MBI Concepts. ISBN
978-0-9833734-0-7 . The bulk of the book consists of abridged texts
from Watson's Men—Minutes—Money.
* Greulich, Peter E. (2012) Tom Watson Sr. Essays on Leadership:
Volume 1, Democracy in Business. Austin, TX: MBI Concepts. ISBN
978-0-9833734-3-8 (electronic version only)
* Greulich, Peter E. (2012) Tom Watson Sr. Essays on Leadership:
Volume 2, We Are All Assistants. Austin, TX: MBI Concepts. ISBN
978-0-9833734-4-5 (electronic version only)
* Greulich, Peter E. (2012) Tom Watson Sr. Essays on Leadership:
Volume 3, We Forgive Thoughtful Mistakes. Austin, TX: MBI Concepts.
ISBN 978-0-9833734-5-2 (electronic version only)
* Maney, Kevin (2003). The Maverick and His Machine: Thomas Watson,
Sr. and the Making of IBM. John Wiley & Sons. ISBN 978-0-471-41463-6
* Ridgeway, George L. (1938) Merchants of Peace: Twenty Years of
Business Diplomacy Through the International Chamber of Commerce
Columbia University Press, 419pp. There is a 1959 revised
* Rodgers, William H. (1969) THINK: A Biography of the Watsons and
IBM. New York: Stein and Day. ISBN 978-0-8128-1226-8
* Sobel, Robert (2000). Thomas Watson, Sr.: