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6, 2000 April, 2000

Highlights—July 26, 2008

  • MarketWatch: IBM earnings up 22% on services, software deals. By Rex Crum. IBM Corp. on Thursday said second-quarter profit rose more than 22% from a year ago as the technology and services giant reported sales of almost $27 billion, led by strong growth in the company's software and services businesses. Additionally, IBM felt strongly enough about its performance that it raised its full-year earnings forecast to at least $8.75 a share from $8.50 a share. ...

    "It was probably the best quarter Big Blue has had in recent memory, if not ever," said Bob Djurdjevic, president of Annex Research. "Wall Street doomsayers and recession buzzards had better look for trouble outside the IT industry, for things could not be better in this sector." ...

    IBM also said it signed new services deals worth $14.7 billion, up 12% from a year ago, giving the company a total backlog of $117 billion in services deals.

  • The following are selected comments from readers of the MarketWatch article:
    • I retired in 1995, at that time I received my medical benefits as part of my retirement package. Then about 2 years later I had to start paying for the medical (= retirement pay cut). I returned to the active IBM payroll in 2002, at IBM request. My retirement was suspended and I was told that it would resume when I next left IBM. In 2007 (after 5 years with NO increase in salary) I did leave again, my retirement was started again but at a lesser amount. Now my medical benefits take half of my retirement pay. YES I am glad to know that the big wheels are doing wonderful when we, who made IBM great, are not even getting a Thank You.
    • I don't know much about business, but I know something about common decency, and the manner in which IBM treats its employees is nothing short of disgraceful. While executives are making obscene salaries and cashing in even more obscene amounts of stock, most US employees received no raises at all. My first-line manager had the audacity to tell me that there was no money for raises because this was "the worst year ever". If record profits qualify as "the worst year ever", then words have no meaning. IBM lies, obfuscates, and makes life as miserable as possible for its employees in order to incite them to quit.

      It's not much of a stretch to say that the environment at IBM is psychologically abusive. The constant threat of layoffs, the deliberately-circulated ominous rumors, management's incompetence, and the strangling red tape we all deal with, all combine to create a workplace that breeds anger and resentment, and stifles both productivity and creativity.

      I'd like to respond to the commenter who asked why we don't quit. Most of us would love to quit, and intend to as soon as we can. But when you're the breadwinner of a young family, or in any situation where others depend on you to provide for them, quitting your job--no matter how miserable it is--is not a trivial matter. Many IBM sites are in places where there aren't many other employers to choose from, complicating things even more. Most of us signed onto a very different company than IBM is today, and as much as most of us would love to quit, the practicalities can make it almost prohibitively difficult. IBM knows this, and takes full advantage of it.

    • Other reader comments for the MarketWatch article are available in last week's edition of these highlights.
  • The Register (United Kingdom): IBM misses memo on economic slowdown during Q2. By Austin Modine. Excerpt: IBM has yet again shrugged off the global economic slowdown with second quarter profits leaping 22 per cent and revenues rising. Although improvements were reported across most operations, IBM's bread-and-butter services division was the star of the show. "I've got to say that this is one of the best quarters I've ever seen," said CFO Mark Loughridge, during the companies quarterly investor conference call.
  • The following are selected comments posted by The Register readers in response to the above article:
    • Try STG Modular Systems if you think the grass is Greener. By Anonymous Coward. STG is now the poor boy of IBM UK and Modular,,, oops sorry System x and BladeCenter (it changed again!) is the poor boy of STG. We have a new general manager who refuses to acknowledge our existence, and I have SUN and Lenovo beating at the door with hugely better offers. Now that's the way to get a payrise!
    • It's really not that tough. By Blockhead. Dear Employee, You are not receiving a pay rise because the employment market in your locale does not currently demand it and we are smart enough not to pay beyond market price in any economic transaction. You may expect us to apply the same discipline with our supplier contracts and in negotiating business with our client base. Yours, etc.
    • Exploitation. By Anonymous Coward. Same story here, in SWG (contradicting the earlier post about life being OK here - it's no different). I'm another 2+ performer, I'm another one with zero pay rise. It doesn't matter that I have direct responsibility as part of a very small team for nearly $2M revenue last year. I echo previous comments about our leadership. Thomas Watson must be spinning in his grave. He started this company under Quaker beliefs, hence the egalitarian approach - such as the "single status company" tenet that has been quietly erased, along with "respect for the individual". We now appear to be under the leadership of a very real "Gordon Gekko".

      It's bad enough without Gordon emailing us all to rub it in; to paraphrase, "hey, what a great year it's been, and if we work hard it's just going to get better!". If this is a good year, I'm not sticking around again for a bad one... I've seen not far short of 20 years in IBM, and I can tell you that this is probably the worst period for employee morale that I have ever seen. I'm serious.

      Looking wider than just our own immediate circumstances, these cost-cutting circumstances might result in a nice bottom-line for IBM in the short-term; mid- to long-term however, the future doesn't look so rosy. Those who leave will be the best (trust me, I've seen a few go already and I KNOW they are missed), those who stay will be the ones who know they're not up to scratch and might find it difficult to find another position, let alone survive in it.

      What Palmisano has instigated here is a form of inverse-evolution of the IBM workforce; it's not "survival of the fittest", it's "departure of the fittest". IBM will become a shell of its former self, staffed by those who are either aren't really up to scratch or are so disillusioned they no longer perform to their capacity.

      Advice to any shareholders reading this - by my reckoning you'd be advised to sell up within 12 months. I think you're "safe" to the end of the year - Palmisano will make sure of that - but the staff losses are really going to start to bite, and with that, so will the results.

      Me? I've got a job interview at a competitor coming up. The easy route for me would be to go to a Business Partner - but if I do that I'm still effectively working for IBM, it's win-win for them. No, if I go, I'm going to a competitor. IBM has had more than its pound of flesh from me, I want some of it back.

    • Dreadful company - treats employees abysmally. By Anonymous Coward. What great news this is. It means (yet again) a load of fat americans with their snouts in the trough do very well thank you while the vast majority of hardworking IBMers get little or nothing. Why do we bother? There's no incentive to work here. Morale is on the floor, management are weak and ineffectual, talent isn't rewarded, and cliques rule. There's only one thing for it ...
    • I already have interviews. By Anonymous Coward. I work in data sensitive situations which are being quietly offshored, and let me tell you once its gone its gone, no matter how bad it is. You WILL now get fired for buying IBM :)
    • Read between the lines. By Anonymous Coward. I'm a contractor for IBM in the UK (hence AC) on the Services side. Understandably a lot of my IBM colleagues are seriously upset by this. But you have to understand what's going on here. What IBM would like to do is sack everybody on the Services side and set up cheaper, more profitable operations elsewhere. They can't do that, it would cost a fortune in redundancies, they would alienate a large percentage of their customers, and would be logistically impossible. So they are doing it incrementally, which means a gradual reduction in the workforce.

      Now the last thing you want to do as a company if you want to get rid of people is encourage them to stay with decent pay rises, pensions, etc. You piss them off enough that enough people vote with their feet, and bingo! - no redundancies to pay. Not only that, but you can turn around to your customers and say 'sorry Guys we really can't get the skilled staff here in the UK, but we've got lots in India who can do a job'. In the meantime the loyal IBMers are the ones who stick around long enough to allow IBM to make the transition before they lose their jobs too. I've seen it happen elsewhere. What can you do about it? Find another job!

    • IBM = In Bad Management. By Anonymous Coward. IBM gave me an opportunity. Only to teach me how worthless this Corp is. I have been under pay for 3 years, with no help from the so called w3 and HR. Those 9 years were hard learning. No matter how good and hard i work i only hit a wall of bad management (my direct line is useless and does not care), we are hammered with empty talk and notes. Nothing positive here. W3 is no more then a propaganda machine, PBC's are predefined, targets are complete fib and IBM HQ are living the good life among themselves. I was proud to be an IBMer, now i am miserable and a shame.
    • Pissed off Uk IBMer. By Anonymous Coward. You guys getting pay rises are lucky been 5 years yes FIVE since i got a rise and in that time been a 1 or 2+ performer. I would not trust IBM management one inch, all you get is the usual nonsense about times are hard, yeah for us poor sods looking after their systems, its all empty promises.

      Now the support is going to Hungary which is a no brainer, someday IBM will realise it's its techies that keep the company afloat - how many Salesman are gonna work for No money when the salary system crashes due to it being run by a load of people who 1_ don't speak english; 2) haven't a clue what they are doing; 3) are cheap. I've been here 30 years and just waiting to walk with a nice big wedge. As to pensions well forget it, even people who work for pensions UK are getting out of the schemes as its not worth paper its printed on And they wonder why the office is empty at 4.30!!!

    • You couldn't make it up if you tried. By Anonymous Coward. 70% of 1's are not getting a payrise. 80% of 2+'s are not getting a payrise. Fortunately the execs have been trousering some very nice options just recently.

      Little wonder that in the UK it is 37 hours and everyone is done. We have a clueless exec team that while being very concerned about morale, do nothing to affect it. In fact, they make it positively worse by sending notes out that congratulate us for our hard effort. It's like an episode from "Are you being served?" where young Mr. Grace says "you've all done very well", and exits stage left. As HR remind us, people are not leaving. So, that's alright then.

    • Other reader comments for the Register's article are available in last week's edition of these highlights.
  • New York Times: Given a Shovel, Americans Dig Deeper Into Debt. By Gretchen Morgenson. Excerpts: Years of spending more than they earn have left a record number of Americans like Ms. McLeod standing at the financial precipice. They have amassed a mountain of debt that grows ever bigger because of high interest rates and fees. While the circumstances surrounding these downfalls vary, one element is identical: the lucrative lending practices of America’s merchants of debt have led millions of Americans — young and old, native and immigrant, affluent and poor — to the brink. More and more, Americans can identify with miners of old: in debt to the company store with little chance of paying up.

    It is not just individuals but the entire economy that is now suffering. Practices that produced record profits for many banks have shaken the nation’s financial system to its foundation. As a growing number of Americans default, banks are recording hundreds of billions in losses, devastating their shareholders.

    To be sure, the increased availability of credit has contributed mightily to the American economy and has allowed consumers to make big-ticket purchases like homes, cars and college educations. But behind the big increase in consumer debt is a major shift in the way lenders approach their business. In earlier years, actually being repaid by borrowers was crucial to lenders. Now, because so much consumer debt is packaged into securities and sold to investors, repayment of the loans takes on less importance to those lenders than the fees and charges generated when loans are made. ...

    For decades, America’s shift from thrift could be summed up in this familiar phrase: When the going gets tough, the tough go shopping. Whether for a car, home, vacation or college degree, the nation’s lenders stood ready to assist. Companies offered first and second mortgages and home equity lines, marketed credit cards for teenagers and helped college students to amass upward of $100,000 in debt by graduation. Every age group up to the elderly was the target of sophisticated ad campaigns and direct mail programs. “Live Richly” was a Citibank message. “Life Takes Visa,” proclaims the nation’s largest credit card issuer. Eliminating negative feelings about indebtedness was the idea behind MasterCard’s “Priceless” campaign, the work of McCann-Erickson Worldwide Advertising, which came out in 1997.

    Mortgage lenders took to cold-calling homeowners to persuade them to refinance. Done to reduce borrowers’ monthly payments, serial refinancings allowed lenders to charge thousands of dollars in loan processing fees, including appraisals, credit checks, title searches and document preparation fees. Not surprisingly, such practices generated dazzling profits for the nation’s financial companies. And since 2005, when the bankruptcy law was changed, the credit card industry has increased its earnings 25 percent, according to a new study by Michael Simkovic, a former James M. Olin fellow in Law and Economics at Harvard Law School.

    The “2005 bankruptcy reform benefited credit card companies and hurt their customers,” Mr. Simkovic concluded in his study. He said that even though sponsors of the bankruptcy bill promised that consumers would benefit from lower borrowing costs as delinquent borrowers were held more accountable, the cost of borrowing from credit card companies has actually increased anywhere from 5 percent to 17 percent.

  • Wired: Former VP of HP Charged with IBM Trade-Secret Theft. By David Kravets. Excerpts: A former Hewlett Packard vice president is being charged with trade-secret theft for allegedly forwarding "confidential" IBM sales information to his HP superiors, according to court documents filed in U.S. District Court in San Jose. Atul Malhotra, the HP vice president for imaging and printing services, was fired from his job in September 2006, a company spokeswoman told Threat Level on Tuesday.

    According to a charging document (.pdf), Malhotra was the director of IBM global printer sales between 1997 and 2006. Two months before he moved to HP, he requested and received an internal memo titled "IBM Global Services, CC Calibration Metrics," which was marked "IBM Confidential" on each page, according to court records. The authorities said a pricing coordinator for Armonk, New York-based IBM informed the defendant that, "given the sensitive nature of the material, please do not distribute." ...

    Emma McCulloch, a spokeswoman for Palo Alto-based HP, which has been embroiled in its own spy scandal, said in a statement that "The activity with which Malhotra is charged was in direct violation of clear HP policies, including HP’s standards of business conduct." McCulloch said "HP detected this activity, conducted an internal investigation, terminated Malhotra from his employment, and self-reported the activity to all appropriate enforcement agencies and to IBM. HP has cooperated fully with the government’s investigation."

  • In a Vault message board post, "ancientblueconsultant" comments on the IBM trade-secret theft. Full excerpt: In the old days, this executive would have brought with him his entourage with him to HP one of him would have warned him of the stupidity of how he did it. I guess now that they are screwing even their staffs they can't even convince them to join other company's with them. You sow what you reap. If you don't show the value of loyalty, you won't get loyalty back. Note that I said HOW he did it, not what he did. Strict ethics is not a required skill for IBM executives. How can you be ethical in an amoral company? HP, once again shows it's more of a quality and ethical company than the Blue Pig. This has happened a number of times over there and it shows they are on their toes when it comes to ethics. Ever hear of an IBM executive thrown in jail by his peers for this type of transgression at the pig? Yep, you've got your answer.
  • Yahoo! IBM Employee Issues message board: "GM retiree health cuts will cause sticker shock" by "mr_quarkwrench". Full excerpt: Actually, IBM doesn't lay people off, layoff implies one will be rehired when the work picks up again. My uncle was laid off from Lockheed many times over his career and now has a fine pension and health benefits. IBM fires people. The first mass firings started in the '80s when they asked for volunteers by offering buyouts. However, some "volunteered" only after a closed door discussion with their managers. -- Don
  • Yahoo! IBM Employee Issues message board: "Re: Don't let the door hit you in the ..." by "ibmaccountant". Full excerpt: Very well said, quarkwrench. You are fired, cast off as a used "resource" no longer needed, just like a worn hammer or broken screwdriver. Termination is even too kind of a word for what they do to "resources" they can't easily exploit anymore.

    The only difference between this brand and most other brands in the world is that the other brands deliver on some sort of morality and compassion and are willing to consider bringing back the worn or broken people they call assets into the family as valued equals, not as lower life forms called "contractors" or "supplemental resources" with no implied or moral commitment to them.

    At the brand called IBM, you are easily exploitable or they aren't interested in you as a "resource". That's why they cherish innocent, willing youth they can ravish and grind to a mass of human used pulp in places like the IBM Global Slaves Division. Don't call it working for IBM. Call it legalized prostitution of your time, reputation and good health at the cost of your good name, life and family well being.

    Funny.....most moral institutions and brands called their people "assets" IBM is one of the few that calls human beings resources. Even armed forces, sending young soldiers, sailors, airmen and guardsman to death call them "assets" all the way to the end because they know the moral value of life, unlike the cold hearted management of IBM.

  • Washington Post: Raiding the Retirement Stash. By Michelle Singletary. Excerpts: Would you still put money in a tax-advantaged retirement fund if you couldn't touch it until you retired? And when I say you couldn't touch it, I mean you couldn't take out loans or withdraw funds under any circumstances. If Congress were rewriting the rules for 401(k) s and similar retirement plans, that's what the Washington-based Pension Rights Center would recommend. Why this hard stance from a consumer-oriented group that works hard to protect and promote retirement savings?

    A new study found that an increasing number of employees are raiding their retirement funds by taking out loans against their 401(k) accounts. Strangled by debt and rising consumer prices, workers are turning to these plans as the only stash of cash they have. "The result is that families leverage their future retirement security to ease their present financial insecurity," wrote Christian E. Weller and Jeffrey B. Wenger, authors of "Robbing Tomorrow to Pay for Today: Economically Squeezed Families are Turning to Their 401(k)s to Make Ends Meet." The report was issued by the Center for American Progress. ...

    The report says that over a 15-year period, loans against retirement savings accounts increased fivefold in inflation-adjusted terms, to $31 billion in 2004, up from $6 billion in 1989 -- an increase of more than 400 percent. Between 1998 and 2004, an average of 12 percent of families with 401(k) plans borrowed from them.

  • New York Times: Update: New Proposed Legislation on 401(k) Debit Cards. By Ron Lieber. Excerpts: A few weeks ago, I wrote a column about the wisdom of taking loans against your 401(k) account. The story mentioned a company called Reserve Solutions that allows customers to access their loan via a debit card at an A.T.M. or any merchant that accepts Visa. Skip to next paragraph There’s a lot about Reserve Solutions system that is advantageous. Rather than getting their 401(k) loans in a lump sum, which is how the loans often work, borrowers in the Reserve Solutions system can draw down money as they need it. That helps reduce the amount of interest. And if they leave their employer, they don’t have to pay the loans back right away, unlike the usual 401(k) loans. ...

    Over 10 years ago, I read in the paper that Bank One was offering access via a card to 401(k) loans, and I thought, this is outrageous. America has to save. If people need to access their 401(k)s because of unusual circumstances, that’s one thing. But to encourage people to take money out with a card is encouraging all the wrong values. So I said then that I was going to put forth legislation, and the bank dropped it and I thought it was over.

  • New York Times: Who Wants to Retire Later? (Don’t Laugh). By Harry Hurt. Excerpts: WORK longer and retire later? The very idea sounds depressing, especially to overworked, underpaid, aging baby boomers like me. But we may have no choice if we want to avoid a precipitous decline in our accustomed standard of living. That is the basic thesis of “Working Longer: The Solution to the Retirement Income Challenge,” by Alicia H. Munnell and Steven A. Sass (Brookings Institution Press). ...

    Ms. Munnell and Mr. Sass define succinctly the problem faced by baby boomers, and for that matter, by all Americans who aspire to retire now or in the near future. They note that the nation’s retirement system, as embodied by Social Security and Medicare in the public sector and I.R.A.’s and 401(k) plans in the private sector, is contracting in its ability to replace workers’ lost income — even as life expectancy is increasing. ...

    So what do we do about the looming retirement income crisis? Ms. Munnell and Mr. Sass recommend that people postpone their retirements from age 63, the current average, to 66. Interestingly enough, 66 was the average back in 1962. They also say that it is time to look at raising the earliest eligibility age for Social Security benefits. (It is currently 62.)The authors write that four more years of work alters the ratio of retirement to working years from 1 to 2, meaning 20 years of retirement and 40 years of work, to almost 1 to 3, or 16 years of retirement and 44 years of work. ...

    As a baby boomer, I strive for the best, but I have learned to expect the worst. It may be a stretch to ask government to act rationally. Asking my contemporaries to recognize that it is in their long-term interests to delay the immediate gratification of retirement may be wishful thinking. As far as many of us are concerned, the Who’s rock anthem of 1965, “My Generation,” still says it all: “I hope I die before I get old.”

  • Yahoo! IBM Retiree message board: "Re: IBM’s Pay Cut is Bad Symbolism" by "bits_bytes_and_bugs". Full excerpt: Lest any of you question abouthadit's post, the 2080 target is for real. Not only is it hours, it's billable hours. Education is typically NOT billable.

    Suppose an older employee has 5 weeks of vacation, two weeks of non- billable time for education, 7 holidays, 5 personal choice holidays and 3 sick days (to make the math easier). That's a total of 10 weeks of time off. To reach the minimum 2080 hours and to rate no less that a 3 PBC, that person has to work 24% overtime or 9.6 hours of overtime per 40 hours week.

    If you want more than a 3 PBC, you'll put in more than that.

    Employees will never see that 2080 figure in print because IBM doesn't want that used against them in a possible legal case. I do have a hardcopy of manager foils with the date on them. Not long ago, there was a proposal to up that 2080 to 2160, primarily for GBS employees. Any resemblance to the IBM services business to a sweatshop is merely coincidental -NOT!

  • Yahoo! IBM Retiree message board: "Re: IBM’s Pay Cut is Bad Symbolism" by "flatsflyer". Full excerpt: The real question is how many hours customers are billed. Even if an employee fails too make his/her 2080, I'll bet the "PIG" is still billing the customer for the whole ride. You can't possibly believe that IBM would give up multi Billion, (i.e.) 75,000 employees, 100 hours each, $300. billing rate, pretty soon you talking Executive Bonus. The 3,500 Gredy Bastards could get an easy $100,000 each very simply and without lifting a finger. Now you really don't THINK they would condone such a scheme, do you?
  • Yahoo! IBM Retiree message board: "Re: IBM’s Pay Cut is Bad Symbolism" by "alwaysontheroad4bigblue". Full excerpt: Actually, there's a constant battle that goes on between consultants (or their managers) and the IBM management that is responsible for profit and loss on the project. Consultants are directed to bill as many hours as possible in order to increase utilization for their organization. IBM management responsible for profit and loss on the particular project, on the other hand, do everything they can to minimize the number of hours billed, because that affects profitability. It's not unusual for projects to be "capped"...i.e. no more than 40 hours per week can be billed.

    Also, it's becoming common now for projects to request and accept only low-band consultants, or "global resources." Even band 8's are now difficult to place. This, of course, means that projects are staffed with young, inexperienced consultants who now work without the benefit of more senior mentors...because projects can't "afford" senior people. It's a formula for failure, of course, but a formula that appears to be well established.

  • Yahoo! IBM Retiree message board: "Re: IBM’s Pay Cut is Bad Symbolism" by "thekanck". Full excerpt: When a "1" performer in a VERY GOOD year for IBM is typically getting a salary increase that does not even keep him/her even with inflation why would ANY employee care about making sure they met their 2080 target? Sorry, my cynical comment for today.... TK
  • Yahoo! IBM Retiree message board: "Re: IBM’s Pay Cut is Bad Symbolism" by "alwaysontheroad4bigblue". Full excerpt: In addition, many GBS employees must travel to their assignments, and travel time is *not* billable. Door-to-door travel time if you're traveling a time zone away is easily 12 hours a week when everything goes right (rare for air travel these days). 20 hours a week isn't unusual if you're talking two time zones or coast to coast.
  • CNN/Money: IBM Opens Service Management Center of Excellence in India. Excerpt: IBM today announced the opening of the IBM Service Management Center of Excellence in India which will act as the regional hub for IBM Tivoli service management software and strategy. The Center has been designed to develop specialized focus and skills in high value areas such as telecom, security, automation and asset management. This first of its kind Center has been established in Pune. The Center will be staffed by IBM Service Management experts from around the world and will provide infrastructure and resources for enablement and education; client engagement support to sales team and business partners; and facilities for proof of concept, demos and workshops. It also will offer certification and joint education programs with local universities, access to industry models, best practices and proven methodologies based on IBM's worldwide service management experience.
  • The Motley Fool: IBM's Cheaper Than You Think. By Tim Beyers. Excerpts: IBM: Center of the tech universe. Most importantly, IBM offers investors instant tech diversification. Big Blue competes with Oracle and Microsoft in databases and other infrastructure software; Intel in chips; Sun Microsystems and Dell in servers; and Accenture in services. No other firm covers so much, so well. ...

    You'd need an army comprised of the world's smartest people to accomplish what IBM does regularly. Good luck hiring them; most already work for Big Blue. That's why it owns more patents than anyone else. At one time, it even considered selling R&D outsourcing services. With so much brainpower, IBM can afford to take risks, as it has in broadly adopting open-source software and ideas. Its newest idea is to put $1.5 billion into semiconductor manufacturing facilities in New York, IDG News service reports.

  • Reuters: IBM sells $1 bln 3-yr floating-rate notes-source. Excerpt: International Business Machines on Wednesday sold $1 billion in three-year floating-rate notes, said a market source familiar with the sale.
  • PlanSponsor: One Fifth of DB Participants Had Plans Frozen. Excerpt: More than one fifth of active defined benefit plan participants have had their plans frozen as part of the continuing trend for employers to redirect new employees to a defined contribution program, a new report says. The Government Accountability Office (GAO) report prompted a statement released Monday by U.S. Congressman Earl Pomeroy (D-North Dakota) calling the report "disturbing." The GAO report, entitled "Defined Benefit Pensions: Plan Freezes Affect Millions of Participants and May Pose Retirement Income Challenges," said 3.3 million Americans will have lower pension income because of the defined benefit freeze trend.

    "The accelerating trend in pension freezes is disturbing, especially as employers face greater economic pressure today," Pomeroy said in the statement. “For older workers, a frozen pension can leave them with little time to make up for the loss in income under a 401(k) plan” ...

    “GAO found that sponsors decided to freeze pensions for two main reasons - because of the impact on cash flow and funding volatility, both of which have increased under PPA (Pension Protection Act),” Pomeroy continued. “Unfortunately, faced with greater uncertainty employers may decide that offering a pension no longer makes good business sense. More frozen pensions would mean a big loss for workers who already are increasingly less confident about their retirement security.”

  • Wall Street Journal: U.S. Pushes for Clearer Disclosure of 401(k) Fees. By Daisy Maxey. Excerpt: It soon may be easier for investors to understand and compare expenses for investment choices in 401(k) plans. The Labor Department on Tuesday revealed proposed rules meant to clearly lay out the fees and expenses associated with each investment option, along with any administrative costs. It proposed the regulations would be effective for plan years beginning on or after Jan. 1, 2009. Companies offering 401(k) and other employee-benefit plans would be required to disclose to participants the investment options available, fee and expense information, past performance data, comparable benchmark returns and a Web-site address. Retirement-plan providers would be required to provide a description of fees and expenses charged to participants and beneficiaries for plan administrative services, such as legal, accounting and record keeping charges, as well as how those charges will be allocated to their individual accounts.
  • US News and World Report: Cracking Into Your Nest Egg Early. By Emily Brandon. Excerpts: The Pension Rights Center in Washington, D.C., is advocating a zero tolerance for preretirement access to 401(k) accounts. "While this might mean that some employees would not contribute quite as much to their 401(k) plans, it would also mean that what they did contribute would be there for retirement," the center says in a statement for the U.S. Senate Special Committee on Aging, which held a hearing on reducing 401(k) losses caused by loans and withdrawals last week.
  • Human Resource Executive: 'Golden Coffins' Offer Big Payouts. By Andrew R. McIlvaine. Excerpts: Lavish payments to deceased executives are being publicly revealed due to the SEC's revised disclosure rules. Such transparency may soon lead to their demise, but the need to attract and retain the most talented executives will remain.

    To the list of golden parachutes and golden handcuffs, add "golden coffins": lavish death benefits for CEOs that can include massive severance payments made to an executive's estate after he or she dies. According to an analysis of federal filings in June by the Wall Street Journal, companies such as Nabors Industries, Occidental Petroleum, Shaw Group, Lockheed Martin and others have promised their CEOs and their families death benefits of up to hundreds of millions of dollars.

    At Nabors Industries, CEO Eugene Isenberg's estate will receive a "severance" payment of at least $263 million if he dies this year, according to the Journal. The estate of Brian L. Roberts, the CEO of Philadelphia-based Comcast Corp., will receive a $298 million "severance" if he dies, while the estate of Ray R. Irani, CEO of Los Angeles-based Occidental Petroleum, will receive $115 million after his death. ...

    However, Rich McHugh, a partner at the law firm of Dow Lohnes in Washington, who specializes in employee benefits and compensation, says that, while there's no "consistent rationale" for golden coffins, they do play an important role in the war for talent. "It's all about attraction and retention of these executives," he says. "You've got to stay competitive." ...

    Golden coffins have also been pushed by compensation consultants, who are, in many cases, brought in to justify excessive compensation packages, says Fugate. "They impress upon the board the need to 'stay competitive' with a list of 'comparable firms' by offering these perks," he says. "It's all about keeping up with the Joneses. And no one says, 'No.' " Johnson says he nearly always counsels compensation committees to turn down requests for golden-coffin packages by CEO candidates. "These things are expensive, a pain to administer and they drive a wedge between management and employees," he says.

  • Knowledge@Wharton: 'Don't Touch My Perks': Companies that Eliminate Them Risk Employee Backlash. Earlier this summer, when employees first learned of a Google plan to upgrade and dramatically raise the price of its day care program, they wept, according to an article in the New York Times. The price for infant care rose from $1,425 to $2,500 a month and the cost for two children in the day care program went up from $33,000 to $57,000 a year. The two-year waiting list of 700 families fell off by more than half. And Google, which has enjoyed a largely charmed reputation in the press, was chided in the Times headline for making a "rare fumble" with the changes to its daycare program.

    Wharton faculty and compensation experts say the flap over Google's decision to change its employee day care program illustrates the difficulty in eliminating any employee perk. "Once you have the perk, to take it away is seen as a violation of a psychological contract you have with your employee," says Wharton management professor Nancy Rothbard.

    Employee perks can range from traditional offerings -- such as a company car, use of the corporate jet and extended retirement benefits -- to highly personalized perks, such as personal trainers, laundry service, and pet-friendly offices. At Google, parents get $500 to spend on takeout dinners during their first weeks with a new baby. ...

    Wharton management professor Sigal Barsade agrees. "I do not recommend taking away perks, but if a company has to, management needs to remember that taking things away from people almost always leads to feelings of unfairness," she says, noting that employees typically come to feel that even a small perk is something they "own." To remove it is one of the most direct routes to employee anger, which in turn, leads to lower levels of motivation and retaliatory behavior. The retaliation can take on a psychological form, such as less commitment to the job, or a behavioral form, such as working less hard. "If management does such a thing, it has to be very sure to explain very, very clearly why it was necessary -- in a way that seems fair to the employees," says Barsade.

News and Opinion Concerning Health Savings Accounts, Medical Costs and Health Care Reform
Minimize
  • Detroit News: Healthy Americans impose higher costs. By Froma Harrop. Excerpts: The word "prevention" has a nice ring in any health-care discussion. Thus, many politicians argue that programs to stop smoking, improve diets and otherwise promote wholesome living save money in the long run. A healthier population at less cost -- sounds like a win-win situation. Unfortunately, that formulation is a pleasant fantasy. Medical economists agree that cancer screenings and gym classes can lead to physical well-being and longer lives. But in the interests of honest accounting, they add that prevention does not reduce overall health-care spending. On the contrary.

    Let's put it bluntly: Longer lives cost more money. Those who make it to 90 thanks to exercise and six daily servings of vegetables are more likely to suffer the expensive ravages of old age. Everyone dies of something. So he who avoids a fatal heart attack at 70 is more at risk of cancer at 80. Those extra 10 years can mean extra CT scans, hip replacements and physical therapy, even for those in relative good health. ...

    Author of the book "Health Care Half Truths," Garson cites a recently published study on the high cost of healthy people. Dutch researchers found that medical spending on smokers, who died at an average age of 77, was $100,000 less than on non-smokers who were thin and died at 84. Companies that include wellness programs in their employee benefits may indeed see a savings in lower medical costs and absenteeism. But what they have done, really, is delay the onset of serious illness during the employees' working years and pass it onto Medicare, when the taxpayers take over.

  • Dissent Magazine, courtesy of Physicians for a National Health Program: "Show Me the Money": Labor and the Bottom Line of National Health Insurance. By Marie Gottschalk. Excerpts: A WELL-KNOWN political scientist once declared that the definition of the alternatives is the supreme instrument of power. The simple question—single-payer or not—conceals major differences over whether to frame the health care issue primarily as an economic question or a moral one. Economic considerations are critical to propelling the cause of universal health care. But advocates of universal health care should not cast the economic competitiveness of U.S. business as the central economic issue at stake in the debate over health care reform.

    If we are to finally achieve a fair, affordable, and truly universal health care system, other economic considerations need to frame the debate. These include: How efficient is the U.S. health system? How is the health care cost burden distributed between business, government, and the public? What are the trends in health care cost shifting? What is (and what should be) the role of insurance companies in the U.S. health system and the wider political economy? To their credit, single- payer supporters have been some of the loudest and most articulate voices raising these important questions. ...

    As we stand at the brink of another major attempt to overhaul the U.S. health care system, organized labor is divided about how to define the alternatives. At one pole is Andrew Stern, president of the Service Employees International Union (SEIU), the nation’s largest union, and arguably the best known labor leader today. He stridently contends that health care reform must be pitched primarily as an economic competitiveness issue, not a moral one. Stern also has indicated that the single-payer approach, for all its virtues, is a political nonstarter. At the other pole is the growing number of national unions, locals, labor councils, and rank-and-file members pledged to the single-payer solution. Somewhere in between is the AFL-CIO, the nation’s largest labor federation, which in March 2007 endorsed the idea of “Medicare for All” but carefully avoided mentioning the “s” word, that is, single-payer.

  • Physicians for a National Health Program: Dr. Steffie Woolhandler on the Presidential Candidates & Single-Payer in the 2008 Elections. Excerpts: I’ve been asked to make some comments on the upcoming Presidential elections and developing a strategy around them. I am an expert in health policy, not on political strategy. But I want to talk a little about where I see us going in the single-payer movement within the broader political context. I am paradoxically optimistic about the political situation right now. I say paradoxically because if we look at the actual health policy proposals of Obama and McCain, they are not good.
  • New York Times: Health Plan From Obama Spurs Debate. By Kevin Sack. Excerpts: It is one of the most audacious promises in a campaign that has been thick with them. In speech after speech, Senator Barack Obama has vowed that he will lower the country’s health care costs enough to “bring down premiums by $2,500 for the typical family.” Moreover, Mr. Obama, the presumptive Democratic nominee, has promised that his health plan will be in place “by the end of my first term as president of the United States.”

    Whether Mr. Obama can deliver is a matter of considerable dispute among health analysts and economists. While there is consensus that the American health care system is bloated with waste, eliminating enough to save $2,500 per family would require simultaneous and synergistic solutions to a host of problems that have proved intractable for decades.

  • The Huffington Post: Your Health Care May Decide The 2008 Election. By Robert L. Borosage. Excerpts: In this assessment, I suspect that one issue, seldom mentioned now, is going to matter a great deal by November. Iraq will be big no doubt; the economy bigger. But health care may just be the pothole that cracks up McCain's Straight Talk express. People worry a lot about affording health care. Workers accept lower wages with employers that offer health care. They hang onto lousy jobs to keep their health care. Most labor negotiations and disputes center largely on the costs of health care. On this issue, attention is paid over kitchen tables across the country.

    So this fall, Americans will discover an inconvenient truth about John McCain. He wants you to lose your employer-based health care. He thinks you aren't sufficiently conscious about the cost of your health care, and you are using too much of it.

    His plan is designed -- with sugar and sticks -- to push you to negotiate on your own with the friendly insurance companies. He'll give you a tax credit -- $2500 for an individual; $5000 for a family -- to help you pay the price. And he'll revoke the tax exemption for any health benefits your employer provides. Under his plan, those benefits will be taxed as income. McCain says this will reduce our health care expenditures. He might be right. His preferred option -- health saving accounts -- generally feature low monthly payments and very high deductibles. People tend to insure themselves against catastrophe, and take a chance on routine health care.

    On average, they'll work pretty well if you are young and healthy and lucky. But if you are sick, if you have suffered serious illnesses in the past, if you have what insurers call a "pre-existing condition," or if you are older and at higher risk, you're in trouble. For many, insurance won't be available at any price. That's why Elizabeth Edwards noted that, neither she nor McCain would be eligible for coverage since both have struggled with cancer. Many more will find adequate coverage unaffordable. Others will have to wrestle with choosing between paying to see a doctor or buying the weekly groceries. You'll be more "sensitive to price," but you might not think that a good thing.

    McCain extols the benefits of private health insurance, but he's never had to negotiate with insurance companies. He's been on government provided health care virtually his entire life. He was raised on military health care, as the son of an admiral. He then went to the Naval Academy and to the military. A year after leaving the military, he was headed to the Congress and enjoying the best government supplied health care of all.

  • Kaiser Network: California Gov. Schwarzenegger Signs Law That Bans Insurers From Linking Employee Bonuses to Health Insurance Coverage Limits, Cancellations. Excerpts: California Gov. Arnold Schwarzenegger (R) on Tuesday signed legislation (AB 1150) that prohibits health insurance companies from rewarding employees who cancel or limit an enrollee's coverage, the Los Angeles Times reports. The measure was introduced by Assembly member Ted Lieu (D) after the Times reported that insurer Health Net based employee bonuses in part on meeting or exceeding targets for rescinding individual health insurance policies. Some critics say that health insurers use confusing applications so that when a plan member begins filing claims for coverage, the insurer can find mistakes that can be used to justify a cancellation or rescission. ...

    Schwarzenegger said, "Until we achieve comprehensive health care reform, stopping unfair health care rescissions is an urgently needed consumer protection," adding, "This terrible practice further illustrates the erosion of our health care system and the need for comprehensive health care reform." Schwarzenegger said he will "continue working with my partners in the Legislature to stop unfair health care rescissions once and for all" (Girion, Los Angeles Times, 7/23).

  • Los Angeles Times: Medicare Part D a boon for drug companies, House report says. Taxpayers pay up to 30% more for prescriptions under the privately administered program than under Medicaid, the House Committee on Oversight and Government Reform finds. By Nicole Gaouette. Excerpts: U.S. drug manufacturers are reaping a windfall from taxpayers because Medicare's privately administered prescription drug benefit program pays more than other government programs for the same medicines, a House committee charged in a report Thursday. The House Committee on Oversight and Government Reform found that taxpayers are paying up to 30% more for prescription drugs under Medicare's privatized Part D program for seniors and the disabled than under the government's Medicaid program for the poor. "Medicare Part D has given the major drug companies a taxpayer-funded windfall worth billions of dollars," said committee Chairman Henry A. Waxman (D-Beverly Hills). ...

    In the two years Medicare Part D has been in effect, drug manufacturers have taken in $3.7 billion more than they would have through prices under the Medicaid program, committee investigators found. "The drug companies are making the same drugs. They are being used by the same beneficiaries. Yet because the drugs are being bought through Medicare Part D instead of Medicaid, the prices paid by the taxpayers have ballooned by billions of dollars," Waxman said. He said Bristol-Myers made an additional $400 million from higher prices for a single drug, the stroke medication Plavix.

New on the Alliance@IBM Site:
Minimize
  • Is IBM offshoring the IBM Payroll Help Desk to Manila, Philippines? If you have documentation please send to: Allianceibmunion@gmail.com
  • Job Cuts Status & Comments page
  • General Visitor's Comment page:
    • Comment 07/20/08: Just found this site after leaving IBM in June. I had 39 years and the last 15 in management. I have had a great career and felt it was time to move on. Hopefully I can contribute to some of the questions and concerns raised on this site. Being on a PBC 1 my management was surprised that I would leave. I just felt it was time after I put together the last ranking. I guess I was just tired or burned out with the process, but now I don't have to worry about that and look forward to a good retirement. Thanks -Happy Blue-
    • Comment 07/21/08: Help me out here. What does IBM mean by "landed resources"? I'm guessing that means foreigners under the h-1b or L1 visas only that work here, or is it also or only green card permanent workers? I saw an IBM document that says the target percent to achieve for domestic workers is 10-20% (the remaining being GR global resources), and that if 20%, then it is 15% landed resources and 5% domestic. Can you tell me specifically what it does mean and not a guess? -Anonymous-
    • Comment 07/22/08: I'm sorry for this tangent of a question, but can someone tell me how I can dump the few shares of IBM stock I own? Several years ago, I joined their employee stock purchase plan and accumulated just a few shares (maybe 18.5) before I bailed out. I'd rather throw my money elsewhere. I still have these stocks and I cannot own them anymore. I get physically ill whenever my teensy-little dividend check comes in. I'd rather just dump them and not be part of this problem. I can't reconcile in myself the fact that I am an "owner" of a tiny little piece of this Godforsaken company that I so detest. Can someone provide this stock novice with some guidance? Thanks! I apologize for interrupting this website, but I don't know who else to ask. -Mistressofthei5-
    • Comment 07/22/08: LANDED resource by definition is IBM Global Services India, AMS Software Export (IGSI) that are physically located in the United States. So not only are our jobs being shipped off, but now we are being replaced by India staff in the US. -anon-
    • Comment 07/22/08: Anon RE: Landed Resources. You have likely found your answer by now. If not: http://www.ebizvitals.com/cms/content/indian-%2526%2523039%3Blanded-resources%2526%2523039%3B-phenomenon Never good news.-BlueBlows-
    • Comment 07/23/08: I was a lucky winner, and was asked to participate in the current Pulse Survey. Needless to say, in light of the pension freeze, FHA boondoggle, 15 percent pay cut, zero raise (as opposed to the ridiculous perks our executives receive), and the constant Resource Actions we endure, I had no choice but to flat line my response at Very Dissatisfied. -IBM Slave-
    • Comment 07/26/08: The need for working people to once again, unite for a common cause is more apparent than ever. But will it ever happen? Since the 1980's; unions have come under increasingly harsh criticism and harassment. This is because of many factors; but it's more about an ideology shift. The basic conservative tenet is this: Destroy unions. Cons believe that the US economy and Capitalism, in general should operate with competition as it's core value. That is, no minimum wage, no benefits, no pension, no sick time, and no group or job description raises... ever. Cons believe that working people must compete with each other for every dime they earn. Cons believe that only the best workers will survive and 'win' the competition to keep their jobs. Don't give anything to anyone.

      This scenario occurred in the 19th century and led to much strife between co-workers trying to 'get ahead'. What Cons fail to see is that once workers collectively discover that they are pitted against each other; they will develop Alliances to gain strength in numbers. That is why unions evolved in the first place, around the mid 19th century (pre-Civil war). The US underwent a swing to the right in the 1980's; and now the pendulum is swinging back. Yes, business is still exploiting illegal immigrants and children and selected ethnic groups.

      Business has managed to successfully divide the working people by politics, religion, and race as well as income. It's time once again, for the working people in this country to fight back. Drop your resentment of H-1b's and L1's. Drop your resentment of illegals. Get them to organize, by example. Let's make a surge of our own. Organize your co-workers and build a group of contacts within your dept. or work group. Let's start changing the IBM workplace environment to suit us; not IBM executive management. Someone suggested a Global union; great idea, but we have to start here in the USA, and build outward. Alliance@IBM already has contacts in Europe and Asia. Alliance@IBM has, admittedly, a small core membership (dues paid). That core needs to act as one and make the effort that needs to be made. As a member of Alliance@IBM, it's the least I should do. Step up, step in and organize. -ubuntu2u2-

  • Pension Comments page
  • Raise and Salary Comments
    • Comment 07/18/08: Salary = 106K; Band Level = 9; Job Title = Marketing Manager; Years Service = 23; Hours/Week = 60; Div Name = ITS GTS; Marketing Location = US; Message = Zero salary increase for me again this year, five years in a row with no increase! -Im Justan IBMachine-
    • Comment 07/18/08: "the excuse that IBM was worried about the balance of the year".. in regards to the pay raises. If you believe this crap from your manager who was coached by HR and IBM compensation, then just quit IBM now! If you don't believe it; join the Alliance and dispel the lie. -anonymous-
    • Comment 07/18/08: IBM CHQ Armonk executives are literally laughing all the the way to the bank now: and also at you. An increase in 2nd QTR of 22%. Did they make this happen? No. You did! They got much richer with their equity. Did you get much richer in June? And what was your raise? Like if you got one...

      With the great 2nd QTR 2008 and a nice 1st QTR 2008 don't you deserve more? With a union contract you have more than a fair chance of getting a decent pay raise. And you'll get it in writing: a contract, a promise that IBM cannot got back on, like they have time and time again with our benefits. With a union contract you have a decent chance of keeping your job. Without a union contract as it is now you will not be getting a raise and/or not have a job. IBM delayed the pay raises 2 weeks due to the "global economic environment".

      They knew the USA economy would be in the dumper and the longer they waited the worse it got. All to make you feel lucky you have a job even without a well deserved pay raise. They secured their fabulous 2nd QTR profits at your expense! And they did it. And you let them get away with it. Join the Alliance. Or else kiss a raise and quite possibly your job, goodbye. -sby_willie-

    • Comment 07/20/08: Salary = ~43,000; Band Level = 6; Job Title = Software Engineer; Years Service = 14; Hours/Week = 40+; Div Name = STG; Location = WFH; Message = I work from home, so I guess there is that when we all wonder how to make ends meet with paltry raises and high cost of living. I received a 4% raise this year, giving me an additional net $100 each month. I asked my manager if he ever thought I would reach midpoint (band 6 midpoint is MANY thousands higher than 43K) and he said once IBM gets back on track it "could happen." I know that will never happen.

      The math doesn't work on any level. The worst part is that a month prior to the STG layoff I was re-org'ed into another dept. and since that point my job has stagnated in a big way due to lack of focus and planning by the people who hired me with claims that "this is the next big thing." I feel now that my move was merely a way to shuffle staffing numbers and nothing more. Further I think that this "lost" time is one way or another going to result in my employment being ended with IBM. I feel this way because each passing day I seem like less and less of an employee of this company due to a process of disengagement that started when I took this new job. i.e. Old doors get closed, new doors get opened and go nowhere.....time passes...... nothing.....we ask questions, get no answers and all of sudden we are accountable for deadlines....Deadlines for WHAT !!! you haven't even told us what you want us to do ??? and then the cycle repeats....

      Each morning I awake trying to think of a way to make this meaningful somehow, but so far, nobody seems to have a clue what to do with me or my peers in this new project. Since I have been most vocal in asking the questions, I have been renamed as "Application Architect." So now it's my job to assign work to my peers even though I still don't know what it is we are supposed to accomplish. Utterly pitiful... I have been with IBM for 14 years and never seen this much garbage. I think I am working in a project that has realized they cannot complete the goals they were funded for and are now looking for a scapegoat.

      I'm feeling very much like my days are numbered here. The only thing I console myself with is that I should be able to find a job making around 40k/year with a BS degree, even if that means leaving behind my skills as a J2EE developer. Who knows, if the economy hasn't completely tanked yet I may find something on DICE, etc. that will allow me to continue the work that I enjoy. thanks for the vent -Anonymous-

    • Comment 07/21/08: Band Level = 9; Job Title = Senior SW Engineer - retired; Div Name = SWG; Message = To the $43K J2EE developer: You don't say where you are geographically, but, unless you're in a super rural area, you should be able to do better than $43K as a Java programmer, even as a contractor. Assuming you like development, use your time at IBM to get better at Java--online classes or leadership on your floundering project. If you're the App Architect, suggest, and start writing, some prototypes or tools. Don't worry that they might not get used; they'll go on your resume regardless. Go to the chief programmer, STSM, whoever, associated with your project to get some ideas. Tell him/her you don't want to waste time during the plan swirl. If you want to stay at IBM, it sounds like you've been given an opportunity. If it doesn't work out with IBM, you have the chance to add to your experience and resume. Most of all, don't go to bed at night without a plan for the next day--even if it's just some code associated with an online course. Otherwise, you'll get to the point where you just want to pull the covers over your head, and life's too short for that! -alreadyGone-
    • Comment 07/22/08: Salary = ~43,000; Band Level = 6; Job Title = Software Engineer; Years Service = 14; Hours/Week = 40+; Div Name = STG; Location = WFH; Message = Thanks -alreadygone- No, I don't live in a super-rural area, but I used to when I started at IBM at a lower band level. Even with raises and promotions there doesn't seem to be any way for those in my situation to ever match that of my peers who enter IBM under different circumstances at the same band. I have had three managers in the last year due to reorg's and they have expressed sympathy that this is wrong, but there just isn't a method for them to give an employee a 20k pay bump, even if that is what it would take to put me in line with my peers. So I know that my future cannot be with IBM unless I have some sort of masochistic desire for low pay going forward. However I do like and always have liked what IBM can offer to those that want to learn. This is the biggest benefit to working for this company and as your advice suggests that is what I plan to focus on even if it leads me out of here in the future. I guess you can't put a price on education, but there is a fine line here between opportunity and exploitation that I find myself walking. thanks and regards, -Anonymous-
    • Comment 07/22/08: To -Anonymous- at around $43K Yes, you are grossly underpaid even if you live in a real rural backwater area where there is no competition for IBM. Your salary sheet your manager should have given you this June spells the low and high end pay ranges for your geographic area for band and job family so if you are far on the low end of the scale from midpoint then you are getting screwed from a pay perspective for sure IBM doesn't even give out MBA's (market based adjustments) now like they did last year. I haven't heard of anyone getting one.

      IBM apparently didn't fund it just like they did fund the recent pay raises to speak of. Not that an MBA would even help you to substantially catch up..it would not. Being so low paid might have given you the 4% raise. That's one of the highest raises I have heard of this year. PBC 1's largely didn't even get a percent that high. But 4% for you is no real consolation since you are so low paid, I can empathize with you. You probably started like I did, as a low paid hourly worked, like a band 2 or 3 perhaps? I know I started in IBM in 1984 making $8.08 and hour as a computer operator. Suffice it to say I am now band 08 for the last 11 years and still am 25% below my midpoint and I have been a good PBC performer. the whole time.

      .I have been pursuing the reason why my pay is so laggard and I never get a straight believable answer from IBM. They deflect it all the time. But I came to this conclusion: In short, if you started at real lowball pay in IBM you will have that "ball and chain on your feet" in an IBM career as being low paid in despite what IBM wants you to believe. Like the other poster mentioned to you: do market yourself. Java programmers are still in demand and in development shops they do make decent $$$, but not necessarily in this pale blue IBM. Good luck to you. You definitely deserve much better. -sby_willie-

    • Comment 07/22/08: Salary = 2660€ PER MONTH; Band Level = PRG 6; Job Title = PROJECT MANAGER; Years Service = 22; Hours/Week = 35; Div Name = GTS; Location = FRANCE; Message = We never work 35 H/W, the réality is 40.. But 35 is a law. -lomelet- Alliance Reply: Do you belong to a works council or union, where you work?
    • Comment 07/24/08: No raises for I/T Specialists. I got an MBA year. More record profits for IBM. What the hell is going on??? Wasn't it enough retribution to get a 15% pay cut IBM? Hey, Palmisano, McDonald, Daniels, Kelly, etc.: you'll make up all the Rosenburg settlement up by end of the year in stock options so why not be civil and play fair for maybe the first time in your wretched lives? Go Alliance! No sense in working in IBM without the Alliance. IBM just sucks. Period. Wake up people! What R U waiting 4? -I/Tbody-
  • PBC Comments
    • Comment 7/20/08: Almost an equally worthless program is the IDP (Individual Development Plan). It is still a carryover program from the EEO (equal employment opportunity) program days when the government asked companies like IBM to promote. You can put anything on your IDP and your manager will sign it. You can just use last year's IDP and just change the dates and your manager will sign it. Beware: It can be used as rope to hang yourself. IBM will hold you to your IDP promises which can affect your PBC but they make no commitments to your IDP and never will. Unless you are just starting out in IBM or a candidate for executives resources it doesn't hold much weight. Even if you pursue it religiously, chances are you will never be able to fulfill what you put into it in this IBM. One goal everyone should have in their IDP is learning to adapt and survive in the global marketplace sans IBM since they will outsource any one of us in less than a nanosecond. -anonymous-
  • International Comments
Vault Message Board Posts:
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Vault's IBM Business Consulting Services message board is a popular hangout for IBM BCS employees, including many employees acquired from PwC. Some sample posts follow:

  • "IBM or Grant Thornton" by "fedgovacct". Full excerpt: I have offers from GT & IBM as a Sr. Consultant in the public sector (fed gov't). The salaries are about the same, so does anyone have any advice on which offer I should accept?
  • "Depends - Grant Thorton by a nose" by "ancientblueconsultant". Full excerpt: The "depends" is an ever present caveat used by many in career placement. The real answer lies in you and no one else. One always needs to know where the person is coming from (are you a techie of a business person? for one) and where you want to go or wind up (i.e. old unemployed bit twiddler or executive management).

    Since I don't know your background I'll only give you one word of advice if you are a tech seeking more tech work. Start a plan to get out of IT tech. The handwriting is on the wall. As IT continues to commoditize, IT as a career growth discipline will disappear. CIO's are now becoming CTO's and "change agents" to keep their jobs. "Techiness" is quickly becoming irrelevant except at tech companies and they themselves are under pressure (even IBM despite the propaganda). So if you like tech, make it a skill and move into a line of business. End of advice for techies, now to the question, based on no background.

    Although there's an IT element to GT, the focus of GT is the business line, not the technology. Most of the GT folk I've encountered and financial or line of business types, some with IT as an adjunct skill. Although I'm not enamored by the future prospects of its real estate operations and investment service lines in the short term, the fact that they've focused on the mid-tier type of customer of public sector entity gives me warm fuzzies for their prospects. They also don't seem to have much complaining among their graduates when it comes to how they treat their people. GT also has according to many a better salary progression plan for its people than IBM.

    If you've been offered something at IBM, if you are a techie, the depending on where you go it might be beneficial to have some technical exposure, but that's losing it's edge as IBM becomes more and more a technological has been company.

    IBM and any line of business work? No way unless what you want is to work in a big federal agency. The current PS has basically abandoned most of the non-federal work except for large outsourcings to their business partners. Tech? May be IBM depending on where. Accounting and Line of Business true management consulting? - GT

  • "You'll end up at GT eventually" by "bluejules". Full excerpt: In federal, Grant uses IBM as their pipeline for junior experienced hires. They know exactly how long it takes for someone to grow tired of IBM's lack of training, project experiences and salary increases. Then they are able to offer a nice pay jump to pull the good ones away from IBM. Such an increase isn't a big stretch for Grant due to their better salary progression as noted.

    The managers at IBM know this happens but are powerless to stop it. They know what they need to pay to keep their best people but their hands are tied. The one-size-fits all salary plans that come out of Armonk take away all their options. "I'm just a vice-president, I'm not able to have much influence on decisions like salary. That's decided at a level much higher than me." Aaaarrrggghhhhh!

  • "Contract lost" by "inthesunmeohmyoh". Full excerpt: IBM Canada lost a big contract the other day. The BC Government is trying to outsource their server hosting and related business.

    IBM already has a 10 year outsourcing contract with the same ministry to manage the desktop (all pc's in gov). IBM succeeded in pissing off the muckymucks and f-ing up the contract so badly that the BC Gov is now looking much harder at these deals and performing what they call 'due diligence' to determine if the winning firm can actually deliver as promised. Well IBM was awarded the new contract for hosting services pending approval after they'd gone through the diligence process. That's when they were disqualified and now the contract is with EDS (unless they flub it too).

    Nice to see some payback. IBM screwed over and pissed off almost every single government employee with the way the workstation deal was implemented. heeheehee.

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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