Our Lips Are Sealed: More IBM Layoffs
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IBM is at it again. Big Blue has evidently had layoffs again, mainly in Global Services, but you'd hardly know it from IBM. A company spokesperson gave this statement: "IBM is constantly managing resources as client demands evolve across a base of nearly 400,000 employees." That's like saying ice melts in the sun. The company has laid off an estimated 10,000 employees in 2009 so far, say union officials, who are the only ones keeping track of the data publicly. A union member told Computerworld's Patrick Thibodeau that employees are not pleased with the secrecy. "It is not right that IBM continues to keep job cut numbers, locations and divisions secret," said Conrad in an e-mail. "IBM needs to come clean on how many jobs are being terminated as the work is offshored. We call for full transparency." The Alliance@IBM is a Communications Workers of America local that doesn't have enough members to gain official recognition as a bargaining unit. Thibodeau goes on to sharply point out how the only other way you can get employee numbers is in the annual report. The union has a story detailing how IBM is shipping some jobs overseas. From that story:
While moving work overseas is one way IBM can boost profits, it's certainly a contentious predicament for U.S. workers. And when you add in the secrecy when it comes to publicly talking to stockholders and the general public about layoffs, you end up coming off as if you're hiding something. Doesn't IBM owe its employees a little decency? Is it like they never worked there? They weren't doing meaningful, profit-producing work for you? That's sad and rather callous, IBM. Where are the shareholders in all of this? Seems like you are hearing very little dissent from them on this secrecy subject. If it were me, I'd want clear numbers regarding what you are doing with a labor force this large and important to IBM's business. If there ever was a company that is its employees, IBM is that company. Big Blue may be a New York Stock Exchange darling, but it has a long way to go in these questionable investment times in reporting on what it is doing with its key asset. If Global Services--the professional services wing of the company, which makes huge consulting dollars and sells across all IBM product lines--is going through some chaos or slower selling cycles, I think a stockholder would want to know. P.S. Hey, IBM union: Please put dates on your stories. |
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Comments (28)
IBM's layoffs are especially troublesome, given the company receives taxpayer monies through many avenues. These include incentives from states like Iowa and New York, property tax relief / abatements beyond the incentives, plus Federal stimulus funds.
Data from the layoffs (over the past several years) shows strong evidence of age discrimination. And the company over-rewards its executives with perqs while having ongoing reductions in employee benefits. Is this the kind of company that should be receiving taxpayer money?
Posted by Think | August 10, 2009 9:48 AM
They should change the company name to India Business Machines. IBM invented offshoring. For that reason, I would never consider a job offer from them, nor do I ever consider them as an IT vendor. I dumped ISS as a firewall management vendor about a year after IBM got there grubby little hands on that company.
Posted by E-Dub | August 11, 2009 12:48 PM
Perhaps this union shill ought to be complaining to his democratic congress which continues to make laws that encourage US companies to move jobs overseas - through tax laws, compliance requirements and other outrageous and unnecessary actions. IBM, like any other well run and profitable organization, can only react to these government interventions and interference by minimizing contact. Put the blame where it belongs and recognize that money, like water, will follow the path of least resistance.
Posted by Dick Ranes | August 11, 2009 12:53 PM
"Doesn't IBM owe its employees a little decency?" Of course they do. Will they get it? Employees have become widgets to fill a hole in companies, replaceable as wanted.
Hey, Think:
After the AIG fiasco, I'm suprised that any company is allowed to receive any taxpayer / stimulus money without transparency. Looks like something went askew.
This sounds like a good story for a young reporter who wants to make a name for themself.
Posted by njoy_d_ride | August 11, 2009 1:10 PM
IBM is a for profit company, and somehow in some people’s minds this makes destroying the American economy further OK, an acceptable cost of business as long as some “shareholders” can make more money. The sad part is that every time a company “cut costs” the stock prices go up which is precisely why they do it. I don’t think IBM is losing money, profits may be down, but so are the profits of many, many other companies. This practice in my mind is never acceptable. IBM will eventually pay for it though. I once worked for a company who closed the doors for profit, The plant was in the black making money, lot’s of it! But this “Multi-national” company thought they could get more money by off-shoring. I know a few hundred people who will no longer purchase anything from these weasels or their subsidiaries. And the best thing is, is that this company lost a ton of money, skilled laborers, engineers, technicians and the rest only to find out that the skill set necessary to produce these products is not available overseas. I now work for one of the competitors which is privately owned and the owner is aware of the importance of keeping the people with skill sets necessary to produce a FAR superior product and is growing and expanding in spite of the current economic downturn. Some people actually like quality product built and designed by SKILLED people. I for one, will do my darnedest to always recommend against using IBM products and personally will no longer purchase IBM products until IBM renews its commitment to being an American business that serves its own people and treats them like the skilled folks that they are.
Posted by Engineer | August 11, 2009 1:40 PM
IBM is a multinational company, so it is not surprising to see it balancing work around the world. I worked at IBM some years ago, when the one of the first outsourcings to India was attempted, and the particular project was a dismal failure. In my opinion, the project failed due to many factors, and the outsourcing was not the main factor. Inter-divisional politics probably contributed the most, followed by IBM's inability to step outside its rigid, bureaucratic business model. The lesson IBM's employees have learned, painfully, is that the company can't be relied on to look after their interests, and that they need to look after themselves. After all, a corporation is a "person" for legal purposes only, and doesn't have a heart, a soul, a conscience, or even a brain. After saying all that, I still cherish my time at IBM and the experience I gained there, and the people I worked with are among the finest in the world.
Posted by Tom | August 11, 2009 1:48 PM
I was just resource actioned out, effective 9/30. Most IBMers in my dept. were also. IBM wanted us out 8/30 but due to business considerations, they were forced to extend it a month. Our work is going to Boulder (to the GDF), mostly populated by Indians. They cannot get the staff and skills they need and we have NO ONE to turn our work over to. But it will happen anyway. There are hundreds of accounts around the world that we support that have no idea their support is about to go kaflooey.
IBM is literally insane.
Posted by Anonymous | August 11, 2009 1:58 PM
IBM is moving people away from "home" offices and back into central offices, like their new center in Dubuque, IA.
If you don't want to relocate you'd better be ready to find a new job.
Posted by Jerry | August 11, 2009 3:41 PM
I involuntarily left IBM about 3 months ago. They treated me pretty well as far as severance terms, but still, I didn't want to leave. I enjoyed my job, and was widely recognized at being quite good at it. In fact, recently won awards (with cash/stock) for "Innovation", "Contribution", and "Leadership" and was well liked by each and every one of my clients.
But I was also a senior Band-9, at the top of my pay level, and over 55. I was not alone, many of my coworkers also were "laid off". Most were high Band 9 or Band 10 employees. Many were high achievers with great track records.
Last week I was approached by a former client in the insurance industry to see if I was interested in a six week consulting engagement. They are unhappy with the experience level of the engagement leader on their latest IBM staffed project, and wanted an independent review and mentoring by "someone who knows our business". Sadly, I had to turn them down due to my severance agreement and employment contract. Had I taken this on I would have lost my severance.
I understand IBM wants to maintain a healthy profit margin, but in my opinion, they are selling high levels of expertise (senior staff) but staffing with mid-level experience. Client's pay IBM premium rates to get premium people.
You know, If IBM approached me and said we need to reduce spending and will need to either lay people off or have them take pay reduction, I most likely would have taken the reduction over a lay off. Maybe others would not have, but at least IBM could have asked. Instead, we are being replace by Indian and Chinese nationals... often here on a 1HB visa.
IBM is it's people. But in the US, its people are running scared (at least those beyond a band 8). I still have close friends at IBM, and more than a few have commented that they'd leave if they could find another position elsewhere.
Posted by John from Austin | August 11, 2009 3:52 PM
I worked for IBM when the then chairman, Tom Watson followed his father's lead in not laying off employees during the great depression. The Watson's would roll over their graves to see what the greedy SOBs from Harvard Business School have done to their company.
Posted by Lon Aucker | August 11, 2009 3:57 PM
The taxpayer dollars they receive certainly are something that should be taken into account, however, why the stockholders sit back and don't seem to care about the millions that Palisano and his cronies take the company for in salaries and bonuses is beyond comprehension.
This is why I'm actually ALL FOR Government intervention in PUBLIC held companies. Somebody has to watch out for the stockholders and, in this particular case, the employees.
It's ridiculous. If you have financial obligations of any type, IBM simply isn't a good place to work full-time. It a shame. They could be a GREAT company to work for.
Posted by Bob | August 11, 2009 4:54 PM
Huge numbers of my co-workers including the IBM Regulars were recently let go with their jobs transferred to Bolder, India, and the Czech Republic.
A few of us (very few of us) were transferred to work on other projects in the short term (no fixed ending date) but IBM has stated that policy will be that the centers will be in Bolder Colorado, India and the Czech Republic and that's about it for support centers and when the current contracts expire or when they are renegotiated to other centers all of those of us who aren't in these locations will get the boot.
IBM is a business who's goal is to make money. If someone in another country can do the work at the same quality level for less then they deserve the work. It is important to note that qualifier "at the same quality level".
Someone who's sole criteria for getting a job is that they can speak English or whatever other language rather than real technical and personal skills is irresponsible and does a disservice to the clients IBM is trying to service.
Clients will have to dictate what they want and negotiate what they are willing to pay for it.
Do they want a workforce in North America that will cost them monetarily more or outside of North America that will cost them monetarily less but may (and I stress may) have inferior or inadequate skills.
Other companies are able to provide the same type of service that IBM does. If a client isn't satisfied they can always go elsewhere.
Clients decamping from IBM (with their lucrative contracts) would be an indicator to management that maybe the decision to move these jobs elsewhere wasn't a good idea.
Any company getting hit in the pocket book learns from their errors or doesn't stay in that business very long.
Posted by Anonymous | August 11, 2009 5:47 PM
I was laid off on 5/26 from IBM. I was not getting paid much, but my manager hit everyone located in RTP, NC.
While I agree it makes business sense that if it costs 60% less to find staff in another country, you are also hurting your own country by continuing, and continuing, and continuing to lay off American workers.
IBM will be a small 25k American company within 5 years, and 350k folks overseas. Is this what Tom Watson had wanted? Is Tom Watson Jr still alive?? how about his son, or any family members? I want to see what THEY think.
Phooey on big blue -- more like big brown POS.
Posted by RTPAnon | August 11, 2009 10:54 PM
Friends, it is really more like 26 to 30,000 this year. We feel that there will be only about 45,000 US IBM employees left. All under the radar, no headlines saying that they are offshoring many of the big bases - marketing, tech support, et al. It is so sad, and no one knows.
Posted by Don | August 11, 2009 10:55 PM
The government should cancel all IBM transactions and projects until they start hiring Americans and Permanent Residents. They are getting a lot of tax payer money and yet they still outsource heavily.
Posted by debug | August 12, 2009 6:19 PM
IBM doesn't owe anyone a job. They (apparently) earn whatever tax money they get. It's not up to IBM to 'save' the enonomy, whatever that means. If you are good at what you do, you'll be OK.
This is freedom. This is probably what I would do if I were CEO. That's his job.
Labor is a comodity- yours and mine. No one should tell me how much I have to be paid or when I make too much. I am afraid, my countrymen, that we are developing an attitude of entitlement that has a few paying the way for the many.
I was laid off from IBM in November 2008. Life goes on.
Posted by DFitz | August 12, 2009 9:56 PM
While I am concered about American workers losing their jobs, IBM is not breaking any laws by outsourcing.
One way to stem flow of jobs outsourced is Congress needs to put their foot down by making the likes of IBM, DELL, Microsoft pay an Outsourcing tax. In order to incent them to keep jobs in America an outsourcing tax would help compensate the US for lost income tax revenues and unemployment taxes.
I suppose the carrot method would be to afford firms with a tax breaks to offset some of the cost savings they would have recieved from overseas outsourcing.
It is inexcusable for any US governemental agency such as NYS Finance to not include a clause in their support contract which forbids outsourcing jobs overseas.
Posted by MarcM | August 13, 2009 12:14 PM
If it's all about costs, why don't they fire the top management of Americans and hire the Indian management. Think of the millions to billions that could be passed onto the share holders.
Posted by Ernie | August 14, 2009 11:19 AM
The US is quickly becoming a country of burger flippers thanks to these "multinational" companies that have no loyalty to the people and country that made them what they are today. Soon, nobody will be able to afford the burgers either.
I don't work for IBM, but I've watched my large companies IT department disapear overseas. Now its just expected that its only a matter of time before we are all gone. Its like the childrens game where you walk around as the music plays and when it stops someone doesn't have a cube.
The Indians show up and crowd into a conference room as the "consultants" who are going to be the "technical experts" for the application upgrade or replacement. Then the project goes into production, and the local individuals are walked out the door becuase they have "been made obsolete" in the words of our CIO. Then, the Indians pack up their bags and logins to our databases and head back to India where "we continue to strengthen our position in the asiapac market."
Its just a matter of time before this country goes under from the weight of all of these companies successes.
Posted by drained | August 14, 2009 8:40 PM
This is just the tip of the iceberg. IBM are actively introducing "Local Delivery Centre" working, which will make redundant 1000's of UK staff that have been forced to work from home for years. This stealth move has also been carefully crafted to avoid fallout from the UK and European employment laws, In truth, all they have done is employ twice as many people in India to do the job half as well.. congratulations IBM, customer service went out of the window when you decided to sell your staff out.
Posted by UK Home Worker | August 18, 2009 3:17 AM
:Dick Ranes
What, are you a shill for the GOP? Companies now are paying *less* taxes than ever while collecting tax incentives for outsourcing. I call B.S. on you.
Companies are outsourcing jobs at an alarming rate and it is only going to hurt them in the long run. For every employee that loses their job, that is one less person who is able to purchase that company's (and other companies') products.
For every job that is outsourced, that is one less person who is able to pay taxes.
Do the math.
Posted by Unhappy Productive US Worker | August 18, 2009 3:53 PM
Work in ibm's software development labs is marginal to say the least. They are developing and shipping poorly tested and buggy products. Do youself a favor and steer clear of ibm products.
Posted by rtpcrude | August 18, 2009 10:17 PM
Since IBM bought PwCC and integrated its processes into IBM, GBS has been run and is being run by the former PwCC people. It is real odd that PwCC was under federal regulator scrutiny and had to quit its business, yet the current PwC does still do consulting. Rather odd I think. Being run by the bean counters is not a good place to work. Work/life balance is non-existent - you have such a high utilization target that you can't even take your vacation time without working 50+ hours every week in order to take your earned vacations.
Posted by Jack Smith | August 19, 2009 11:02 AM
Guys,
First the basics - IBM is for shareholders money which requires credibility/quality/efficiency in the long run, and is not mandated with protecting excess US jobs. Black & white: US vs. India is an oversimplification. Being slightly provocative, I will say that staff of IBM S/W Dev Labs in Haifa (Israel) or Krakow (Poland) are not only cheaper than US alternatives, they also provide quality AT LEAST comparable to their US colleagues (btw - Poles won the 2003 & 2007 ACM International Programming Contests). For me, coming from a post-communist country of (past) equal no-chance, some of you sound simply like scared welfare company beneficiaries. PS. I know - my job may evaporate.
Posted by Jan Kowalski aka John Smith | August 19, 2009 6:14 PM
IBM has only resources, no assets among its lower management and non-management personnel. That's been the case for decades. What do you expect from a company that has screwed it's most loyal long term shareholders and it's most locay employees? Being an IBM employee or a investor/shareholder for more than 20+ years has been nothing less that mediocrity when compared to other IT businesses.
They should act accordingly. No loyalty and don't give them any more than the minimum required, if even that much.
It's time that American youth ignore the propaganda IBM HR hands out to try to keep recruiting young Americans. If they believe the propaganda and fall prey to IBM' sweet nothings about career and riches, shame on them.
That's why I enjoy screwing IBM any chance I can get in the market place. After having screwed them out of millions in services and product revenue, I will happily keep taking any business I can from them. They don't deserve my business, and I've been much better business success for that.
Posted by A Resource | August 29, 2009 7:54 PM
I am a result of IBM layoff in Feb 09. IBM was clearly on track to profit, our products were shipping and my performance evaluation was a solid performer. I hold patents with IBM and worked 10years growing a large list of competent friends within the company and then the axe fell. My job was offshored and is still available if I want to move to Portugal, Russia, Brazil to do the same job I was doing on American soil. I will also never praise IBM products to any future employers and prefer to take this chance to lobby support to fight IBM and expose their political agenda. Barak meets with IBM CEO - next day thousands were cut from IBM and YES THEY RUINED MY LIFE, MY CREDIT, MY CAREER and I do not even worry about me, I worry about my children that see everything they know in life slowly disappearing. IBM - The American anti-American company. Sincerely Screwed-over IBMr
Posted by Ex-IBMr | September 1, 2009 2:42 PM
But hasn't this been happening since a few years? I mean, the companies that have been offshoring like HP, IBM, Dell, Microsoft etc wouldn't be doing so if they were not making any profits. If the workforce in offshore regions were short in quality or skills, these companies would not be doing this. So, I urge you to step aside and look at what those folks are doing differently and come up with a better option. These money minded companies would sure come back if they see that things are green here! :-)
Posted by Jake Martens | September 22, 2009 10:22 AM
I worked at IBM since late 80's. Seen lots of changes since then. The biggest change is morale. Employees used to be proud of working at IBM. Not anymore. Now, everyone (except the executives) is trying to find another job outside IBM or waiting to get pension. When you are not signed up in a project, you go on bench. A month later, if you are lucky, they give you a good bye note and a package. What is worse is they send security to walk you out the door in case you go berserk and scream at the management. I have seen many latter cases, very sad indeed.
Posted by Joe McSing | October 26, 2009 7:50 PM