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IBM hands the reins to Virginia Rometty

Virginia Rometty will take over for Sam Palmisano effective Jan. 1. Now women run both HP and IBM.

IBM on Tuesday made its CEO succession plan official: Virginia Rometty will take over for Sam Palmisano effective Jan. 1.

The move has been widely expected and IBM telegraphed its succession plan. At IBM's Think conference in New York, Rometty had a high profile with customers.

Palmisano remains chairman.

When Rometty takes over at IBM there will be two females running two behemoth enterprise technology players. Meanwhile, Xerox, another large enterprise player, is run by Ursula Burns.

IBM's has planned a smooth leadership transition before. IBM CEO Lou Gerstner handed off to Palmisano, who is now stepping aside from Rometty. Rometty knows IBM's key businesses well. She led IBM's global services unit as well as its growth markets.

As noted last month, the IBM hand-off appeared to be near.

Big Blue chief Sam Palmisano worked the room and the crowd as he pondered the next 100 years. Palmisano took over from Lou Gerstner in 2002. Palmisano's likely successor, Virginia Rometty, also had some time on stage. The baton wasn't officially passed, but rest assured it was back stage to be handed off at some future date.

Palmisano became CEO in 2002 and took over as chairman in 2003. During Palmisano's tenure, IBM ditched the PC and printer units and focused on emerging markets, software, services and analytics. IBM also made a lot of dough--$100 billion in free cash flow.

Related: IBM's Palmisano on innovator's dilemma, avoiding tech's 'bone pile' | HP's biggest challenge vs. IBM, Oracle: Continuity

In a statement, Palmisano said:

Ginni's long-term strategic thinking and client focus are seen in our growth initiatives, from cloud computing and analytics to the commercialization of Watson. She brings to the role of CEO a unique combination of vision, client focus, unrelenting drive, and passion for IBMers and the company's future.

Rometty said:

There is no greater privilege in business than to be asked to lead IBM, especially at this moment.

She added that IBM plans to stay its current course with a roadmap through 2015. In other words, IBM won't veer off course with a CEO change. The company will continue to push software, services, analytics and spend heavily on research and development. IBM's most recent quarter indicates that Big Blue is pretty much firing on all cylinders.

That roadmap, unveiled in 2010, goes like this:

IBM also said that it will authorize a $7 billion stock buyback as it declared another dividend, the latest in a line of quarterly payouts dating back to 1916.

This item first appeared on ZDNet's Between the Lines blog.

Update, 2:03 p.m. PST: Added additional material on IBM roadmap, stock buyback and dividend.