The Downfall of IBM

BetaNews.com ^ | April 27, 2012 | Robert X. Cringely

[Daffynition]

Reducing employees by more than three quarters in three years is a bold and difficult task. What will it leave behind? Who, under this plan, will still be a US IBM employee in 2015? Top management will remain, the sales organization will endure, as will employees working on US government contracts that require workers to be US citizens. Everyone else will be gone. Everyone.

[blueunicorn6]

Boards are going to have to do a better job of picking CEOs. Anybody can talk a good fight about running a business. If we could sell talking, our country would own the world. Look at our President. He talks a good fight, but he’s inexperienced and dumber than donuts. Hire the best person for the big jobs. Hint - that is the person who will get the most effective and efficient use out of the resources.

[DManA]

To say it could have implications for the election is something of an understatement.

[discostu]

Another 150,000 unemployed people over the course the of the next 3 years won’t really change anything in the election. For one thing this has nothing to do with who’s in the White House, this is all part of a direction IBM has been going in for close to 20 years. The “international” part of their name used to be a pipe dream, now it’s their core market.

[aimhigh]

When was the last time IBM was relevant?

Years ago, I read that IBM held the patent to the 'cursor'.

[tanknetter]

Global Services is IBM’s business now and they are struggling to renew their major contracts because their offshore competitors are now viable on that scale and can usually deliver high customer satisfaction, so IBM can’t renew their contracts at their current pricing structures and they have to find savings in their delivery.

In IBM's defense, they can always make a good buck - one that usually requires a US citizen-based workforce - off the Government's ineptitude.

[Uri’el-2012]

0bama can destroy even the best run enterprises.

[DManA]

The symbolism is unmistakable.

[oh8eleven]

BetaNews.com ^ | April 27, 2012 | Robert X. Cringely
I don't know what IBM is planning, but I do know that Robert X. Cringely is not the reporter's real name - it's Mark Stephens.
He has a bit of a checkered past and perhaps a bias, axe to grind, shorted IBM ... who knows?

[PapaBear3625]

Reduce their work force by 3/4? When did they announce this? How has it been kept so quiet?

IBM has not been publicizing their downsizing. Business Insider reports on layoffs and unhappiness among IBM sales people.

[oh8eleven]

IBM has not been publicizing their downsizing.
If a company lays off 100 or more employees at the same time, they are required to publicize it by Federal Law.

[djf]

I heard they own the ZIP algorithm.

IBM has patents up the rear. It wouldn’t surprise me one bit if Big Blue makes a couple bucks on EVERY car, camera, PC, cell phone, television sold in the world. Well, maybe 99% of them.

[PapaBear3625]

This is the first I’ve heard of this “plan”, but I can believe it. The “bean counters” run the company and they are not known for looking into the future very far. The end result will be another U.S. company destroyed as they get rid of the “Dead Wood” also known as older employees with all of the experience necessary to keep things running smoothly.

The problem seems to be intrinsic to large, public companies. CEO's have little incentive to look further than the next quarterly report. They therefore focus on what will deliver short-term profits, and ignore the fact that they are bleeding institutional knowledge and trade secrets.

[waterhill]

Ding, ding, ding, Ping!

[AlexisHeavyMetal1981]

“I heard they own the ZIP algorithm.”

It is “ZiiP”, yes?

[dljordan]

“Global Services is IBM’s business now and they are struggling to renew their major contracts because their offshore competitors are now viable on that scale and can usually deliver high customer satisfaction, so IBM can’t renew their contracts at their current pricing structures and they have to find savings in their delivery.”

They just lost some major contracts due to unresponsiveness and poor service. They shifted the customers call centers offshore and they were getting huge complaints not to mention they cut staff until they couldn't keep up with the work.

[PapaBear3625]

If a company lays off 100 or more employees at the same time, they are required to publicize it by Federal Law.

The federal law says:

A WARN notice is required when a business with 100 or more full-time workers (not counting workers who have less than 6 months on the job and workers who work fewer than 20 hours per week) is laying off at least 50 people at a single site of employment.

You can get around this by having the layoff numbers be under the threshold at any one time, moving people around, and spacing the layoffs in waves.

Also, IBM has a program where they are transitioning to contract workers. So you're told that you can keep your job for a while if you move your job to a contracting basis. Then when contractors are laid off, there is no reporting requirement.

[Tai_Chung]

The original article said IBM was to reduce its US workforce by 78%. The response from IBM denied they were going to reduce their “worldwide” workforce by 78%.

Both articles could be true if they hire 3 unskilled workers in India and China for each US worker.

[ex-snook]

" It is in Global Services where you see the most jobs being shipped offshore. "

It must be because of Unions. No, wait, IBM doesn't have unions. Like in all such offshoring, it's not taxes, it's not regulations, it's the cheap labor, stupid.

[djf]

No.

ZiiP is a special Processor on some of the newer mainframes.

I mean ZIP, otherwise known as PKZip. I think the guy who invented PKZip worked for IBM at the time.

[Lancey Howard]

BUMP