Bank of America: The Crest and Trough of Technological Leadership

The Bank of America literally changed the banking industry during the 1950s by means of its ERMA and IBM 702 computer systems. These innovations in information technology resulted in a dominate design that helped keep the Bank of America in the lead for over a decade and a half. They were the collective work of a leader, Clark Beise, a maestro, Al Zipf, and a group of supertechs, all of whom became the prototypes for these crucial roles. Bank of America was the first organization, among a selected few, to successfully negotiate the innovation cascade leading from crisis to a dominant IT design. Due in large part to IBM's failure to deliver a fully operational operating system for its 360/65, however, coinciding with the leadership's attention toward international markets, in the late 1960s the Bank of America lost its lead. After several decades "in the trough," as a result of aggressive investment and leadership, the bank re-emerged as a strong competitor. This story of achieving alignment in strategy and structure by means of technological innovation, of the almost tragic breaking of that alignment, and of fervent efforts made to gain realignment illuminates some of the most important lessons of IT management that can be learned from the field's relatively recent, but dramatic, history.