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The turnaround of IBM under Louis V Gerstner''s leadership is considered to be one of the most remarkable turnarounds in corporate history. The case details the strategic measures taken by Gerstner to transform IBM from a hardware vendor to a complete IT solutions provider. The case examines IBM''s new ''services-heavy'' business model and its potential benefits for the company in future. It also details the issues facing the new CEO of IBM - Sam Palmisano and the measures taken by him in 2002 and 2003 to boost IBM''s stagnant revenues and declining profits. The case is structured to enable students to: (1) understand the need to continuously reinvent the business model of a company amidst rising competition and changes in the business environment; (2) examine the strategic measures taken by a leader to turnaround a loss making company; (3) study IBM''s business segments and conduct a BCG analysis; and (4) discuss the position of IBM in its various business segments vis-a-vis its competitors. The case is targeted at MBA/PGDBA students and is intended to be part of the strategy and general management curriculum. The teaching note does not contain an analysis of the case.