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Fall 1999



As IBM Thrives on E-business, Tech Alumnus Plays Key Role

E-business is driving IBM's growth, and as the company's vice president of e-commerce for IBM Global Services, Virginia Tech alumnus Karl Salnoske (EE, '76) is responsible for a critical component of that growth.

Salnoske is responsible for IBM's overall e-commerce services strategy, and for leading the development of capabilities and offerings in areas such as web selling, e-procurement, security and privacy, bill presentment, and payments.

He was promoted to the post this summer after a highly successful stint as general manager of electronic commerce in which he was responsible for development and marketing of IBM's e-commerce software.

E-commerce software is critical to IBM's strategy. "For every dollar of software we sell, there are $10 of hardware and services that accompany that sale," he explained. The software component alone is growing two to three times a year.

"We are working to help customers reinvent the way they do business," Salnoske said. While e-commerce generally refers to buying and selling over the Internet, e-business is an IBM term for the larger effort of using Internet technologies for many key business processes, including distribution, customer service and support, supply chain management, and internal information, in addition to buying and selling.

"Basically, we ask how we can use this new connectivity medium and standard that connects anybody to anybody to change the way companies do business," Salnoske explained. "We want to help companies solve business problems and we want to be able to provide an integrated solution that includes hardware, software, networking, consulting, and other services."

Salnoske finds that managing growth in e-commerce involves a variety of development, technical, and marketing issues. However, a big challenge is tracking innovations within IBM and the industry at large. "We spend many, many hours with this," he said. "One of the neat things about the Internet is the tremendous amount of innovation. Much is happening in IBM's own research laboratories, but there is also tremendous activity in garages and warehouses from the Silicon Valley to Haifa, Israel.

"Not only do the suppliers keep innovating, but so do the customers. They are watching their competition and raising the bar on their requirements of us," he added

As an electrical engineer, computer technology has always been a part of Salnoske's life. After earning his BSEE from Tech in 1976, he worked for Xerox Corp. as a member of the field engineering staff analyzing electronic components. There he was involved in failure analysis, determining what parts needed redesign and what parts needed a change in maintenance. He became involved in an effort to improve the quality of data from field engineers, and moved into application design and data processing.

"Because the EE program at Tech required us to get programming experience, I had a solid understanding of software," he said. Over time, he became more immersed in software than in hardware.

After Xerox, Salnoske worked for Exxon, in an office systems group that manufactured electronic typewriters. "I spent three years performing software and systems development functions." However, during that time, the personal computer was introduced, which destroyed the market for typewriters, and the business was downsized. Salnoske then moved into telecommunications, working for Telenet, which was acquired by GTE, then folded into U.S. Sprint. He was initially involved in revamping the internal business systems and subsequently took over the network management products. "That was my foray into the actual software products side of business," he said.

He then joined a consulting and systems integration startup firm that was acquired by McKinsey & Company. He spent five years at McKinsey, involved in strategy consulting. "I came from the technical world and technical jobs," he said. "Even though I had management experience, my efforts at McKinsey took me deep into many strategic business issues. I was dealing with different strategies and issues where technology played a role, but was a means to an end, not the end."

One of his last assignments at McKinsey was working with IBM to develop the strategy that the company soon termed "e-business." Salnoske said he is thoroughly enjoying the satisfaction of implementing a strategy that he took part in devising. "I'm happy to be back in the corporate environment," after several years in consulting.

Salnoske's electrical engineering education is still benefiting him today. "One of the skills we learned is all around problem solving," he explained. "We learned to take complex problems and break them into component parts and follow one piece at a time. That method of structured thinking is useful to the complex area that I'm in now," he said.

"Also, working in a high tech company, my knowledge and understanding of hardware and software is useful in communicating and in working with technical and business teams," he added. "However, it's been a while since I've done a Fourier transform."

The Bradley Department of Electrical and Computer Engineering
Virginia Tech

Last Updated, October 15, 1999
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