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Highlights—August 23, 2014

  • Poughkeepsie Journal:

    Latest IBM deal to trim payroll again. By Craig Wolf. Excerpts: IBM Corp. is set to sell a part of its computer business to China's Lenovo, having gained a vital U.S. government approval. And with that, fewer Americans will be working on the payroll of Big Blue.

    Most will shift to a different payroll – Lenovo's. IBM says that worldwide, it's about 7,500 people including those based in major locations including Raleigh, N.C., Shanghai and Shenzhen in China and Taipei in Taiwan. ...

    There's still no word from IBM on its strategy for the semiconductor manufacturing business. It will stay in the design and research side, but has not said the same for manufacturing, thus leaving East Fishkill's plant and workforce in limbo.

    An independent worker group, the union-backed Alliance@IBM, says the x86 move will cut perhaps 2,500 people from IBM's lists in the U.S.

  • Seeking Alpha:

    IBM's Problems May Be Fatal. By Dana Blankenhorn. Excerpts: When I first started working on this piece I believed the problem the company faced was that it was aiming at the wrong customer set in the wrong way, and thus underperforming. Under Sam Palmisano and, now, Virginia Rometty, IBM has abandoned most consumer and small business markets in favor of serving large enterprises, where solutions are often customized and hard to replicate.

    But if it's even failing in that niche it really has no place to go.

    Sales for the June quarter of $24.36 billion, and net income of $4.14 billion, $4.12 per share. A better bottom line than last year's net income of $3.23 billion, $2.91 per share, but the top line was $24.92 million, higher than 2013's figure. IBM shares have been flat all year while those of Microsoft are up 41% and Apple 53%.

    IBM has kept the stock where it is through financial engineering. IBM borrows money to buy back stock, which raises earnings per share. It costs it less to pay the interest on that debt than to buy the stock, thanks to low interest rates. If interest rates rise it's game over for that.

    But veteran tech journalist Robert Cringely, in his new book, "The Decline and Fall of IBM", says the company is even failing within its niche.

    "The company has probably been doomed since 2010," Cringely writes, "Customers no longer trust IBM to manage projects well, get the projects finished, or have the projects work as promised. IBM is now hard pressed to properly support what they sell."
  • The Daily Mail (United Kingdom):

    IBM and Boston authorities tested surveillance software that 'secretly scanned every person at two music festivals'. By Michael Zennie. Excerpts: IBM and Boston authorities tested a new facial recognition software that secretly scanned every person who attended two major music festivals in Boston - all without their knowledge or consent, according to a Boston newspaper.

    The massive surveillance system, run by the company's Intelligence Operations Center, aimed cameras on thousands of people at Boston Calling, a massive concert series near City Hall, in May and September 2013. ...

    According to the newspaper Dig Boston, Boston police officers were on hand to witness the test of the surveillance system - though IBM staffers were running the operation.

  • Glassdoor IBM reviews. Selected reviews follow:
    • “IBM Director”

      Former Employee - Director.

      Pros: Overall IBM is a good company where you are fairly rewarded for your efforts. Opportunities to work in many different parts of the business, but movement will need to be initiated and managed by the employee. Upward mobility is possible, but a personal network and self promotion is critical for recognition.

      Cons: Difficult to align with a great management team. Most managers look out for their own well-being, and not in building a community of top talent and potential leaders. Too many average and below average performers, looking for opportunities to align and claim involvement. Always easy to find people to attend conference calls and “help”, but difficult to find anyone to actually perform the work, which is frustrating for those performing the tasks. Challenging to move into and find new opportunities for growth.

      Advice: There are many policies and tools in place to support succession planning, top talent recognition, performance management, social teaming, but the management breaks down in their ability to execute these programs. Often the leadership continues to execute on programs that are clearly not successful, as they lack the courage to stand up and change. This behavior creates a lack of buy in from the team and disengagement. Need to better build trust and help employees understand their purpose in the organization.

    • “Mundane, un-inspiring”

      Former Employee - Software Engineer in Poughkeepsie, NY. Pros: Good name to have on the resume I guess. Cons: Not a strong culture...most of my team worked at home and other were scattered in a different office and that true collaboration wasn't happening. Cheap company: never invested in their employees even though they're a giant. We were still using CRT monitors in 2011; never got a company sponsored lunch or event either. Aging staff, young people didn't stick around.
    • “Usually great in the beginning and not some much in the end”

      Former Employee - Certified Consulting IT Specialist.

      Pros: Good benefits; office life is rare as work from home is more common. Most of the real IBMers are simply fantastic people to work with.

      Cons: Wow, where to begin. L1-L2 management are largely nothing more than puppets. I actually had a manager say they made a decision based on a coin flip. That sounds funny at first, but it really isn't.

      Work-life balance? What's that? I've missed numerous big family events for essentially nothing in return.

      Personal work reviews are a joke. HR gives first line a manager a bucket of numbers to assign their employees regardless what the team is really worth. Very few get what they actually earn.

      Roadkill 2015 is a huge morale killer because of all the layoffs (actually mass unjustified firings is what they really are). Execs have finally gotten as corrupt as other big companies. Very sad what this great company is becoming. Watson is rolling over in his grave.

      Advice: Stand up and take the company back. Join the IBM alliance. Kick out the c-level execs.

    • “Great Employees!”

      Current Employee - Event Coordinator in Dallas, TX. Pros: IBM's old values still exist even though things are changing day to day. I am proud to be apart of this company and I happy I had the opportunity to work here. Cons: I am not sure of any cons, with IBM I am working behind the scenes. I am sure there are some but I am not aware of any.
    • “Exciting technology, but at what cost?”

      Current Employee - Anonymous Employee.

      Pros: The people are some of the best and brightest in technology. There are opportunities to work on cutting edge technology and to create new markets.

      Ginni Rometty is driving a significant shift in the IBM business and culture. This is an exciting time to be part of that transformation.

      Cons: Expense controls continue to be severe to meet the 2015 EPS goal. This is causing projects in key investment areas to be understaffed. The performance evaluation system drives a competitive culture that is counter to the teaming culture that is needed for success with aggressive schedules and reduced staff.

      Advice: Empower your employees to make more decisions and remove more of the bloated business processes that cost the business more money that the controls are in place to save. We spend thousands of dollars in business process to save hundreds.

    • “Great place to work...Best company i worked so for”

      Current Employee - Anonymous Employee. Pros: employee friendly environment and flexible working culture. Cons: Slow growth in salary and promotion
    • “Heading in the wrong direction”

      Current Employee - Anonymous Employee.

      Pros: Flexible, lets you work from home. On-going education allowed, if you can find the time to take advantage of it.

      Cons: Long long hours, required just to keep up. Constant cost cutting measures, that make your job much more difficult. Annual US resource actions with the roles filled by less qualified overseas employees. No regard for employees welfare; deferring 401K matches to annual from per paycheck and not offering any to employees let go; annual bonuses pushed back months each year and reduced to close to little. Also, little to no raises. It's a hard place to give your all, knowing how little the company cares for you.

      Advice: Treat you employees like they matter and are respected, then you have employees who will fight for IBM and give their all. Which in turn makes for great new products and offerings. It also will show to the customers they work with which in turn will make IBM the proud, strong company it once was. Stop letting only the number crunchers run the company.

    • “Once great, hope will recover”

      Former Employee - Managing Consultant in London, England (UK).

      Pros: Lots of variety—can move to all sorts of interesting areas. Some great, decent people. Generally positive, helpful and decent culture. Fantastic global coverage, excellent research and comprehensive products and solutions. Reasonable long term prospects.

      Cons: Overly financially engineered—lurch from quarter to quarter—bad one leads to resource actions. Generally dour management style, many uninspiring leaders—though many exceptions. Can be overbearing IBM, deep blue culture, normal death by PowerPoint and conference call.

      Advice: Need to provide some variety and inspiration to staff. Kill unnecessary internal conference calls/huge presentations. Focus relentlessly on client. Continue focus on future opportunities, keeping best attributes from heritage.

    • “Downhill Slide And Getting Worse”

      Former Employee - Sales Specialist in New York, NY.

      Pros: Used to be a great company to work for but now it is not. Eventually, some day, they will turn things around and become a reasonably good company to work for again. But that won't be anytime soon as their downhill slide shows no signs of slowing down.

      Cons: Systematically destroyed employee satisfaction over the course of time, all in lieu of their stupid 2015 roadmap earnings plan. Everything has been cut to the bone. Product quality is low, employees are completely expendable, employee satisfaction is at an all time low, customers are leaving in droves because they have grown tired of IBM delivering lower and lower quality while simultaneously raising prices.

      Advice: Wake up. What was not too long ago a great company with great products and very proud, dedicated employees, you have chosen to destroy and turn into a sinking ship.

    • “IBM needs to know who to stay and who to let go.”

      Current Employee - Consultant.

      Pros: IBM has been quite popular with Watson and now with Apple joined partnership to compete with other enterprise players. Benefits are great for full time though not as good as last time. A good opportunities for fresh grad who wants to train and work hard to be a consultant.

      Cons: As a consultant, be prepared to work long hours and work late when you come on board to a project. Be positive in the project and you will survive long.

      Advice: Please hire the right people and do not randomly assign someone who are not capable of the role into the project. Local IBMers whom I worked with are better and more efficient than those who comes from other countries. Of course, not all but majorities are. Management seriously need to check these people up if they really have the real talent to be the role. I guess most of the great people have left IBM which explains the downfall.

    • “Turning the corner to lead with innovation again”

      Current Employee - Solutions Sales in Tampa, FL.

      Pros: Enormous reach, rich talent pool and strong brand. Focus is slowly turning back to Innovation and being essential to clients. Competitive sales environment with generous benefits. Strong culture of ethics and strict controls.

      Cons: Too much attention to shareholders at the expense of employees and maybe even clients. Work-life-balance can be very challenging, specially for consultants in GBS. Employee morale issues in GBS and STG. Matrix organization is very hard to work with. New employees get lost in the maze...enablement needs to be better.

      Advice: Best companies find the right balance between client, shareholder and employees. Take a cue from your largest investor...Warren Buffet...strong leadership, defined purpose, motivated employees make for an enduring enterprise that creates value over the long term.

    • “A good company to work for a Fortune 500 Company with great benefits, but could improve with compensation and bonuses.”

      Current Employee - UAT Analyst in Beaverton, OR.

      Pros: 4 weeks vacation (3 weeks plus 6 personal days). Depending upon the job, work-life balance can be good. Opportunities to work from home are higher than other businesses.

      Cons: Compensation could be more competitive. Bonus structure makes it difficult to get a significant bonus unless you are a top producer in your band/group. Only get 6 holidays off each year (other 6 are given to you as personal days).

      Advice: Improved training—need to centralize all training in one place, and the system should have the ability to automatically tally how many hours an employee has completed towards their 40 hours/year.

    • “Highly Skilled People, Executive team too Short Term Focused”

      . Current Employee - Anonymous Employee in Somers, NY.

      Pros: Highly skilled professionals to collaborate with across functions. Competitive salaries. Good (not great) benefit package. Global teaming.

      Cons: Executives short term focused. Culture has shifted from client and employee centric to 'make this quarters financials' at any cost. Benefits keep getting cut. High pressure environment impacts work/life balance.

      Advice: Communicate clear long-term strategy. Return focus to creating clients and employees for life not just the next 6-12 months. Empower employees in the trenches to make 'fast' client decisions and not get second guessed by middle management layer.

    • “High stress for low wages across the board.”

      Former Employee - Supervisor in Bremerton, WA.

      Pros: IBM benefits are excellent and affordable for the employee. Group of peers very supportive, in general. Lots of long-time employees that earnestly want to see the company do well.

      Cons: Constant fear of being demoted or fired. High-stress, low-reward environment. Minimal pay for the position due to client contracts (CRM) and operating margins.

      Advice: Management does what they can, most of the time, but also gets caught up in the "you're going to get fired" mentality. They're under the gun as well, just not to the same level (no managers have actually been fired in years).

    • “Not your father's IBM”

      Current Employee - Sales. Pros: Large incumbent base. Everybody knows IBM. Cons: Pay is less than industry average; complicated pay plans make determining commissions difficult; sales targets increase on average 38% each year; unrealistic expectations. Advice: Understand what the true potential of a territory is before assigning quotas. Look at what large software companies are paying and the types of compensation they are offering and align your compensation to that.
    • “Awesome place to work”

      Former Employee - Intern in Bangalore (India). Pros: Work from home; -Really amazing atmosphere; -Amazing infrastructure at Manyata tech park. Cons: None as such. Quite an awesome place to work. Advice: None as such.
    • “Gradually going down”

      Current Employee - Information Architect in Calcutta (India).

      Pros: Excellent work-life balance. Laptops for all employees and work from home facilities. Onsite opportunities and onsite benefits. Less micro-management compared to Indian IT counterparts.

      Cons: Poor Indian salary with zero hike in the last 3 years and zero to non-existent bonus payout in the last 2 years. Not many new projects are coming in and IBM is losing many of the existing big accounts. Resource deployment is a joke as senior people are in bench for months and nobody cares. Poor HR policies.

    • “Going down hill”

      Former Employee - Managing Consultant in London, England (UK).

      Pros: Used to be a great company, still has a reputation.

      Cons: The resourcing of staff is one way, you get treated like a piece of meat. Emails to you state you will be taking roles (can't yet specify what the role will be, where or for how long) but you will have to take it even if you only match the spec by 50%—this is mandatory and non-negotiable!

      Advice: Get real in how you treat people. I know you are doing this so people will leave, as you are over staffed, but what happens when you get your numbers down to the required level? More will leave and even less will want to join you.

    • “Software Specialist/Architect at IBM”

      Current Employee - Software Specialist in Milano (Italy). Pros: Good colleagues. Fits good on CV. Possible to make patents. Remote working generically possible. Cons: Technically not at the bleeding edge. Tons of bureaucracy. Poor management. Totally lack of technical competence inside the organization. Advice: Trash the 2015 plan; invest in people.
    • “Intern”

      Current Employee - Anonymous Employee. Pros: Great high school opportunity. Cons: I didn't encounter any cons, honestly.
    • “Not a good place to work”

      Current Employee - Service Delivery Manager in Bangalore (India).

      Pros: Nothing comes to mind. There seem to be a few good people here and there but they are disappearing fast. But this really depends on who you are.

      In IBM, the higher you are the better life is. If you are an executive this is the right place (this include Indians who are US employees assigned to India)—good pay, job security, profit sharing, overseas assignments etc. and you are treated like a god. Don't think that you will work your way up through the rank and file to the executive level—most of the executives have not. So, if you have a fair bit of experience, negotiate your band and salary package well.

      The other category are campus hires: My advise is—choose wisely your team, technology and job role; if you do this you will he happy. Lot of campus hires get stuck in roles which have absolutely no market value and no future. This is a good place if you want to learn for 2-3 years and then jump. Don't expect a detailed training and induction plan on the lines of Infosys.

      The other category of people who may be happy are the vendors of IBM especially the canteen and facilities contractors—they earn good money for doing very bad work for IBM—the food is very bad, the facilities are terrible. The air conditioning is so bad that many meeting rooms are stuffy and suffocating.

      Cons: It's very difficult to list down the number of cons, there will be no end to it—I will edit this some other time. But it should suffice to say that nothing really works in IBM the way it is expected to.

      Both employee and manager empowerment is low, everything is controlled by someone sitting in U.S. with spreadsheets adding to high decision cycle time and decisions which are totally not relevant to the reality on the ground.

      Being productive in IBM is an uphill task. 60-70% of your work will usually be some reporting work (e.g. incident metrics, change metrics, SLAs etc.) so that someone (in the management) can look at it analyze and ask questions. Another 30% of your time will be in meetings where you will have to answer questions on the reports which you made using 60-70% of your time. You will have to work on the remaining time you are left with to meet your objectives.

      Employee development is not in the back seat—it is in the last seat. Remuneration is low, salary hikes are less—so negotiate well before you join.

      Advice: Perform external audits on canteen, facilities and hiring processes. Don't confuse metrics and Excel sheets with good management and leadership. Go back to the management by objective philosophy and dump the current management by control processes. Focus on retaining employees and developing employees. Standardize the salary structure with the market standards.

  • New York Times:

    Secrecy About Salaries May Be on the Wane. By Alina Tugend. Excerpts: Discussing money, as it is often said, is the last taboo. But that taboo, especially against revealing what we earn, has been slowly eroding. The question is, Will that make for a happier or more miserable workplace? ...

    Although the National Labor Relations Act of 1935 has long said that employers can’t forbid employees (excluding supervisors) to discuss and disclose their compensation, a 2010 study by the Institute for Women’s Policy Research found that over 61 percent of private sector employees surveyed said discussing their wages was either specifically prohibited or discouraged.

    The executive orders signed by President Obama reinforce and expand the existing law, as does the proposed Paycheck Fairness Act. The bill was introduced by Senator Barbara A. Mikulski, Democrat of Maryland, and was blocked by Senate Republicans in April, but is expected to be reintroduced.

  • Politico:

    The Secret Committee Behind Our Soaring Health Care Costs. By Katie Jennings. In 2012, national health care spending in the United States reached $2.8 trillion, or more than 17 percent of the country’s gross domestic product — more than any other industrialized country. And yet overall our citizens aren’t healthier than those in other industrialized countries. Of course, there are a million complicated reasons for this: Generally speaking, prices in the United States are just higher than those in other countries. In addition, the payment system is fragmented and includes a mix of government funding and private third-party payers, which leads to huge variation in cost for the same medical procedures. Some economists also point to our high administrative costs and the fact that pharmaceutical companies and medical device manufacturers set their own prices, whereas in most other countries, these prices are negotiated by the government.

    Another explanation, debated by experts in health policy circles but less known to the public, lies with a secretive committee run by the American Medical Association (AMA) which, with the assent of the government, has enormous power to determine Medicare prices by assessing the relative value of the services that physicians perform. For decades the committee has done so in a way that has skewed Medicare fees in favor of expensive specialists over ordinary general practitioners like Fischer, who are the nation’s first line of defense against serious illness. Because Medicare fees are the baseline for the rest of the pricing in the health care system, this has had a broad effect, contributing to a situation where primary care doctors are in general underpaid, underappreciated — and in critically short supply as medical students flock to where the money and opportunity are. Only 30 percent of practicing physicians in the United States today are primary care doctors, while in most other industrialized nations, 50 to 70 percent of doctors practice primary care. That, in turn, explains a good part of what’s costing Americans so much for their health care. Primary care doctors often treat patients before their conditions get so complicated that they need to seek specialty care, which of course drives up health costs enormously.

  • Alliance for Retired Americans Friday Alerts. This weeks articles include:
    • Alliance Members Continue Social Security Birthday Celebrations
    • Alliance Protest Targets Paul Ryan’s Book Tour
    • Sen. Schumer Introduces Bill to Stop Social Security Office Closures
    • Stand Up Against Social Security Service Cuts
    • Sunday Marks 50th Anniversary of Seniors’ Rally for Creation of Medicare Program
    • Unexpectedly High Medical Bills Often the Result of a Few Common Issues
    • Fiesta Attends DNC Seniors Council Meeting in Georgia
New on the Alliance@IBM Site

Job Cut Reports

  • Comment 08/17/14:

    Any IBM managers want to chime in on what is being reported? I.e. being told to give employees artificially lower reviews, putting people on pip to force them out? You can post anonymously here. -Anonymous-
  • Comment 08/18/14: "what happens when wall street sees the stock price and EPS growth party is over, with IBM left as a weak shell of an IT -steve-"

    That is not important to management or Wall Street. IBM is simply a host vehicle to profit from. Whether it is left as a dry exoskeleton of its former self is immaterial to management or to investors. It's more important to Wall Street and current management that they profit! That's all. The Watson's had a personal stake in the company and its people. Current management doesn't. Today, society has become more secular. Humans are simply resources to use or abuse, not your brother or creation of God etc. -Fubar-

  • Comment 08/18/14:

    IBM China SWG cut people by 10-15% in the first half of Aug. The package this time is lower than STG cutting people in March of this year. Manager said if employee does not accept this low package, the manager will issue PIP within one week. -China IBMer-
  • Comment 08/19/14:

    According to sources, what happened in China will happen soon in the US—RAs in SWG. No numbers, but supposed to be similar to what happened in STG earlier; this as SWG "needs to be right-sized". -Ginny Tookus-
  • Comment 08/20/14:

    US SWG services employees have been told to make sure they charge the full 40 hours every week they are deployed. This applies to the rest of Q3 and Q4. Things are going downhill. -Anon SWG-
  • Comment 08/20/14:

    Although this is old news, after the strike in IBM China over the sale to Lenovo, the remaining workers were given $6000 to accept the transfer to Lenovo. How much did US workers get? Zero! -Alliance-
  • Comment 08/20/14:

    Development and test schedules in Tucson are being modified (i.e., line items de-committed) to accommodate resource movement (i.e., certain regulars are being re-assigned to other managers to be saved no doubt and contractors are being let go gradually heading into 4Q). You don't need to look at the writing on the wall. There WILL be more mass firings in the Tucson labs before 2014 401k matches are paid. Better join the Alliance as you're looking for a new job before you get labeled as "distracted, disconnected, or disengaged" for 2014. -Shaun-
  • Comment 08/21/14:

    If you are still with IBM, you need to update your resume and start networking. The company has become so short-sighted that quarter results are all that matters for the 2015 management bonuses. Left on my own recently, so glad to be a place that wants everyone to do well within normal work week hours! - Be Prepared -Glad to be gone-
  • Comment 08/21/14:

    The selling continues http://finance.yahoo.com/q/it?s=IBM+Insider+Transactions -Insiders still selling-
  • Comment 08/21/14:

    In the Netherlands and some other European countries IBM has made contracts about severance. In the Netherlands the workscouncil has negotiated a contract that gives up to 24 months severance based on your years employed and your age. So you see that the company has different standards per country. So I say to my American colleges get a severance contract with IBM. -dutchibmer-
If you hire good people and treat them well, they will try to do a good job. They will stimulate one another by their vigor and example. They will set a fast pace for themselves. Then if they are well led and occasionally inspired, if they understand what the company is trying to do and know they will share in its sucess, they will contribute in a major way. The customer will get the superior service he is looking for. The result is profit to customers, employees, and to stcckholders. —Thomas J. Watson, Jr., from A Business and Its Beliefs: The Ideas That Helped Build IBM.

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