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6, 2000 April, 2000

Highlights—July 10, 2010

  • Associated Press, courtesy of Forbes: IBM to get nearly $8M tax rebate for 600 NC jobs. By Emery P. Dalesio. Excerpt: An IBM Corp. subsidiary will hire 600 workers over the next two years and could get a tax rebate of up to $7.8 million while paying wages below the local average. IBM Lender Business Process Services Inc. will open a service center in Research Triangle Park, Gov. Beverly Perdue's office said Thursday. IBM has been a major employer in the area for 45 years. The company's North Carolina campus is its largest in the U.S. with about 10,000 employees.

    If the company hires at least 540 people by the end of next year and retains the jobs it could collect up to $7.8 million in rebated taxes. The company expects to pay an average of $50,000 a year plus benefits for the new positions. It must pay at least $45,000 a year to collect the tax breaks. Durham County's average wage is $57,772.

  • Yahoo! IBM Employee Issues message board: Re: Life after Terminate Employment from IBM? By "Coni". Excerpts: RA'd in March, turned 58 last week....fortunately unemployment is paying nicely, because the emotional aftermath of losing a job after 31 years (a year and a half after losing my husband which affected my performance and led to the 3 rating that led to the RA) has been more difficult to deal with than I expected. I don't WANT to go back to work!!! However, I was a Secretary/Admin Assistant so no where near the "average" IBM salary....I may need to get some work somewhere down the line. Right now I'll start the pension when the unemployment runs out, get the survivor social security at 60, and get my own eventually.

    I don't miss the bullshit, I do miss the people I'd worked with for 20+ years, I don't miss the people from Price/Waterhouse Cooper, however, IMHO that acquisition was the straw that broke IBM as far as employee respect goes.

  • Fortune: Dangerous liaisons at IBM: Inside the biggest hedge fund insider-trading ring. By James Bandler with Doris Burke. Excerpts: At 7:30 in the morning on Oct. 16, 2009, Robert Moffat had already been at his desk at IBM's headquarters in Armonk, N.Y., for an hour and a half. As he had almost every day in his 31-year career at the company, he had left home at 5:30 a.m. to get a jump on work. He had just finished his first call of the day when his phone rang. It was his wife, Amor. He needed to come home immediately, she said. Five FBI agents were at the house to arrest him for conspiracy related to insider trading. "What's going on?" Amor implored.

    "I don't know," Moffat said. He hung up and called a senior IBM (IBM, Fortune 500) lawyer, who gave him the name of a white-collar criminal defense attorney. His heart pounding, Moffat bolted across the marble lobby and nearly bowled over a startled colleague. By the time he reached the parking lot he was sprinting hard for his Lexus. It was the last time anyone saw him at IBM.

    Moffat, the senior vice president of IBM's systems and technology group, was the most prominent tech executive arrested in the federal dragnet that snagged Raj Rajaratnam, founder of the Galleon Group hedge fund. The bust sent tremors through Wall Street, exposing a world of illicit, back-channel dealings between prominent hedge fund managers and senior executives in the high-tech industry. ...

    While the scandal seemed to many people a confirmation of all they've suspected is wrong with Wall Street and the hedge fund industry, Moffat's arrest was utterly shocking to the people who knew him. He wasn't a speculator. He was a confidant of IBM CEO Samuel Palmisano and widely considered a candidate to succeed him. He had plenty of money and a family who adored him. On so many levels it didn't compute. IBM itself, with a squared-away corporate culture and a stock favored by long-term investors, was one of the last Fortune 500 companies you'd expect to be dragged into an insider-trading case. Moffat didn't make a penny from the information he provided, nor did he trade a share of stock. And of all the buttoned-down executives at Big Blue, Moffat was the last one that old friends could imagine being caught up in a scandal, let alone a crime. The former Eagle Scout had a reputation for loyalty as solid as his 6-foot-2, 265-pound frame.

    Kenneth Hammer, a former IBM attorney who had worked with Moffat, recalled his reaction on hearing of the arrest: "There was no planet on which I could have understood what was being said about Bob. I just shut down." Moffat was a number cruncher of the first order: He had been, among other things, the head of IBM's supply chain. Spreadsheets sang to him; he carried three-ring binders stuffed with data about the business. Some people might think his work was dull. But in 2002 he met a hedge fund analyst who found what he did insanely alluring. Danielle Chiesi, a former teenage beauty queen, was a woman for whom business information was the ticket to gratification. She liked older men, and she enjoyed pushing their buttons. "I love the three S's," she would tell them. "Sex, stocks, and sports." ...

    Moffat rose from the very bottom rung of IBM to steps from the pinnacle. His main attributes were loyalty, inhuman work habits, and the mental bandwidth of an orchestra conductor. He moved his family around the world as the company asked him to. Approached several times with offers to run rival tech companies, he turned them down. He worked so hard that on one rare date night with his wife, he fell asleep at the restaurant table. She told a friend she worried that by the time he retired there would be nothing left for her but a skeleton. ...

    Chiesi and Moffat struck up a business friendship. With an impressive array of sources who confided in her, Chiesi had her finger on the industry pulse, Moffat soon discovered. She talked with everyone. She was brimming with ideas about which alliances IBM needed to build and which companies IBM needed to stand up to. In time the conversations took on the intensity of pillow talk, as Chiesi's voice would modulate from sultry whisper to squeak with excitement and delight. I think you should do this! Baby, you gotta pay attention! Some time in 2003, Chiesi and Moffat began sleeping together. ...

    In the summer of 2008, AMD was in talks to spin off its manufacturing business, Fabco, creating a joint venture that would be 50% owned by a Middle Eastern sovereign wealth fund. IBM was involved in the discussions because it had been asked by AMD to provide a license for the use of its technology as part of the reorganization. Moffat was IBM's point man for the talks. With access to the two men in charge of the deal, Chiesi was soon getting detailed information that no other analyst had. Amazingly, she persuaded Ruiz to let her sit in on one of the confidential meetings between him and Moffat. As the deal progressed, Moffat kept her updated, telling her in August that it would be completed by September 9. She in turn regularly briefed Kurland about the developments, according to the criminal complaint against her. "I'm working hard on this AMD thing," Chiesi told Kurland, adding that she would be meeting with Moffat "on fucking Sunday at my mom's house." When Kurland asked whether AMD's stock price would rise after the spin-off, Chiesi said she'd try to get the "lay of the land" from Moffat, talk to Ruiz, and then "triangulate" with Moffat. Kurland directed her to buy several hundred thousand shares of stock. "Don't put anything in e-mail," Kurland told her. "Be careful." New Castle bought 199,400 shares. ...

    After turning himself in to the FBI, Moffat was transported by agents to Manhattan, where he was fingerprinted, photographed, and given a urinalysis. U.S. marshals ushered him to a holding cell with Kurland and Rajaratnam -- both of whom Moffat had met through Chiesi. They'd been arrested that morning too. Also in the cell was a twentysomething African American. Moffat asked him how he'd landed in jail. "Gun possession," said the young man. "Maybe we should swap," Moffat joked. "No, you don't want to do that," the man said. "This is my third offense." At 7 p.m., Moffat was released on $2 million bail. He hugged his kid brother Stephen, who had once believed he was Superman. "Did you do this?" Stephen asked. "No," Moffat replied, looking his brother in the eye. ...

    As for Moffat, he has struggled to adapt to his new life outside IBM as a convicted felon. The toll on the family has been hardest on his wife, Amor. She believes the stress since his arrest has caused her MS to flare after decades of dormancy. On some days her eyesight is so blurry that she can't drive to the grocery store, and her legs are so weak that she can't make multiple trips up and down the stairs.

    In an interview with Fortune, Moffat came across as emotional, repentant, and chastened. He wept describing the embarrassment he'd brought upon IBM, his colleagues, and family. While he showed little self-pity, he rebuffed the notion that he hadn't paid a price for his crimes, noting that by leaving IBM he was giving up an estimated $65 million in lost stock options and pension that he would have collected when he retired at 60. "The biggest thing I've lost," he said, "is my reputation." Moffat was not allowed by his lawyer to discuss his case or his relationship with Chiesi, but when told that Fortune intended to write about the affair, he said this: "Everyone wants to make this about sex. Danielle had an extensive network of business people. And she added clarity about what was going on in the business world...I know in my heart what this relationship was about: clarity in the business environment." He may even believe that.

  • Yahoo! IBM Employee Issues message board: "Re: The Full Moffat Story" by "blue_in_pok". Guess Bobby got himself a publicist. Wonder how much this fluff piece cost him? Am I supposed to feel sorry for this arrogant prick ? Hopefully he does some quality time with Mr. Bubba.
  • Yahoo! IBM Employee Issues message board: "Re: The Full Moffat Story" by "fhawontcutit". Full excerpt: While he showed little self-pity, he rebuffed the notion that he hadn't paid a price for his crimes, noting that by leaving IBM he was giving up an estimated $65 million in lost stock options and pension that he would have collected when he retired at 60. ---- Does he get retiree medical for him and his wife?
  • Yahoo! IBM Employee Issues message board: "Re: The Full Moffat Story" by "Bob". Full excerpt: Regarding this in the Moffat Story "noting that by leaving IBM he was giving up an estimated $65 million in lost stock options and pension that he would have collected when he retired at 60." This is is absolute BS...he has over 30 years and gets a full IBM pension, and SERP (Supplement Executive Retirement Pension). I would estimate it is somewhere between $500K and $1M...per year...GIVE ME A BREAK...I can't stop crying...Poor boy, how is he going to survive? Everyone else should be so downtrodden, but I do agree with his prediction, that he has indeed lost his reputation. Finally, he had to resign, because if he didn't, he would have been fired for violating the Business Conduct Guidelines...It was either "jump" or be "pushed" off the cliff.
  • Yahoo! IBM Employee Issues message board: "Re: The Full Moffat Story" by "ibmretiree2006". Full excerpt: And what of all the employees who were RA'd who suffered the same stress and spouses with health issues who were not making obscene amounts of money? And he brought his misery on himself unlike the hard working employees whose jobs were sent to BRIC for the sake of profit...
  • Yahoo! IBM Employee Issues message board: "Re: The Full Moffat Story" by "nyjints5". Full excerpt: From reading the Fortune article it is very easy to see what ultimately lead to Moffat's downfall. He like so many other senior exec's, suffered from, and was a victim of, his own massively oversized ego. The article has many sentences that allude directly to it.

    The wearing of the "Superman shirt", his bragging to fellow collegiate athletes that caused his wife-to-be to label him a "cocky jerk". The Wall Street Journal article that called him a "miracle worker." Particularly telling is his bragging to his friends, that 'this woman is stalking me' -- "a way of elevating himself in the eyes of other guys" His friends could easily see his inflated ego first hand. That egotistical jerk actually fell for a very old and common Wall Street scam. Women using sex as a method to get what they want is nothing new on Wall Street.

    What's particularly galling is his bemoaning the fact that he said he gave up an estimated 65 million dollars in lost stock options and pension. That's just one more statement that demonstrates his huge ego prevents him from even thinking rationally. To me that translate's to; "I want to have even more money that I cant possibly spend or know what to do with." Didn't he even consider the fact that many IBMers would read this insulting article? John Joyce had enough common sense to decline comment for it, yet Moffat actually gave it! I'm shocked, but not surprised that he gave it. He obviously does not have enough brains to know the less said the better! What could he possibly have expected it to do for him?

    And Bob, it absolutely WAS all about the sex! Sex and your big ego. "Business clarity", what a joke! Even Fortune laughed in your face for that one.

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: Don't forget FAS 106 for retiree medical" by "Kevin W". Full excerpt: Here is the way I look at the FHA money I have. It is something that is there today, may not be tomorrow meaning my understanding is that the money is not vested and IBM can terminate the plan any time they like. I have enough to buy 2 years of medical coverage for my wife and myself on one of IBM's plans. Granted the costs of the IBM plans are outrageous and if we could use the money in some other way we could make it go a lot longer. BUT - it is 2 years of coverage that I can use the virtual money for. I guess I'm not looking a gift horse in the mouth.

    Sure I'd love to have the original forever health promised to me. But I guess if I wanted that I should have taken my first choice during high school. Military career and I would have retired 4 years ago.

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: At retirement eligibility, what am I entitled to?" by "madinpok". Full excerpt: Any pension benefit that you are currently eligible for cannot be taken away. It doesn't matter if you retire, get laid off or are fired for performance reasons.

    If you die before you retire, your spouse will receive only 50% of your pension under the Pre-Retirement Survivor Protection coverage. The 50% PRSP amount is similar to the default 50% Joint and Survivor coverage, but covers your spouse BEFORE you retire. But unlike J&S, you can't change the PRSP percentage.

    J&S coverage does not take effect until you sign the retirement paperwork and actually start your retirement. If you die before retiring, the 50% PRSP is all your spouse will ever get.

    If you are concerned about providing your spouse with 100% of your pension if you die first, you need a life insurance policy to cover you until you do retire.

  • Yahoo! IBM Pension and Retirement Issues message board: "Re: At retirement eligibility, what am I entitled to?" by "madinpok". Full excerpt: Under ERISA, what is protected is your age 65 pension benefit. Also, ERISA prohibits removing certain benefits, such as an early retirement subsidy for an annuity once it have been added to a pension plan. As long as IBM continues to offer an annuity-based pension plan, your vested benefits that you have today are protected.

    If IBM were to force everyone into a cash balance plan, your age 65 benefit would still be protected, but it would now become a lump sum in your cash balance account.

    In 1999, when IBM created the cash balance plan, employees were given opening balances that were less than their protected, age 65 benefit. This created a period of wear-away where they were not earning any new pension benefits. But if an employee left during that wear-away period, IBM had to pay them the higher protected benefit.

    Also, in 1999, early retirement subsidies were not included when calculating the age 65 protected benefit.

    The Pension Protection Act now prohibits wear-away. It also protects any early retirement subsidies earned up to the date of the conversion to a cash balance plan.

    If IBM were to convert employees in the "old plan" to the cash balance plan now, it's anyone's guess as to what your cash balance amount would be, since that is highly dependent on the interest rate that would be used in the conversion.

    Unless IBM is very generous in implementing a cash balance conversion, my guess is that you will probably not be able to buy an annuity that would pay you the monthly benefit that the "old plan" would provide.

    Whether you can take the lump sum and invest it and do better than the annuity in the long run depends on your skills as an investor. I tend to have a pessimistic view on this, since most individuals and most mutual funds can't reliably beat the averages in the long term.

  • Yahoo! Retiree Information Exchange message board: "New Spouse - Medical Coverage NOT Provided" by "Pablo". Full excerpt: I remarried last month and just found out that I can not upgrade to a family plan to include3 my wife. Anyone experience this?
  • Yahoo! Retiree Information Exchange message board: "Re: New Spouse - Medical Coverage NOT Provided" by "chz_whiz". Full excerpt: Pablo, Congrats on your new marriage. Regarding spouse medical coverage, new dependents (spouse or kids) acquired after retirement can't be covered by IBM. It was a benefit reduction announced in ~2005. The rulebook is available on NetBenefits. Used spouses are fine; new spouses are on their own. <g>
  • Workforce.com: Google to Reimburse Tax on Domestic Partner Benefits. Excerpt: Google Inc. is offering to reimburse its gay and lesbian employees for the additional federal tax they pay on the value of company-paid domestic partner benefits. The offer, which would apply retroactively to January 1, came after a gay employee pointed out the disparity for same-sex couples covered by the Mountain View, California-based technology firm's employee health benefits plan, a spokesman said Thursday, July 1. Laszlo Bock, Google's vice president for people operations, acknowledged that it wasn't fair that same-sex couples were paying an estimated $1,069 more annually in federal taxes on those benefits, the spokesman said.
  • NPR: Annual Job Review Is 'Total Baloney,' Expert Says. Excerpt: Employee performance reviews should be eliminated, according to UCLA business professor Samuel Culbert. "First, they're dishonest and fraudulent. And second, they're just plain bad management," he says The problem with the practice, Culbert tells NPR's Renee Montagne, is that periodic reviews create circumstances that help neither the employee nor the company to improve. As Culbert and his co-author, Larry Rout, write in their book, Get Rid of the Performance Review! annual reviews do not promote candid discussions about problems in the workplace — and their potential solutions.
  • Glassdoor IBM reviews. Selected reviews follow:
    • IBM Anonymous in Hyderabad (India): (Current Employee) "Show me the Money, Honey!" Pros: IBM has good opportunities to explore, but you need to be really proactive and manage your own career. Good work life balance with flexible working hours. Cons: Pay packages for entry level / mid level employees are pathetic. Long time employees are feeling the pinch in terms of not much salary hike or bonus, while lateral hires are given good offers. Highly process oriented company, and finding your way through this ocean, to progress requires patience and a good helping hand. Advice to Senior Management: Management should identify key resources and ensure they are kept satisfied with their compensation and other benefits
    • IBM IT Specialist: (Current Employee) "IBM" Pros: Working from home. Flexibility. Proud to be IBMer. Working with highly talented and smart people Access to the latest technology and knowledge. Cons: Low employee moral due to overwork, RA issues, etc. Pay rise was less than inflation rate or no pay rise at all. Confusing Performance Review. Advice to Senior Management: Cost cutting might not be the best solution.
    • IBM Computer Operator (Batch Monitoring) in Belo Horizonte, Minas Gerais (Brazil): (Current Employee) "It's a very good place to work!" Pros: #1 on Information Technology worldwide, Career Plan, Invests on employee academically, very easy and respectful atmosphere. Cons: sometimes is to slow to solve simple issues, as badges for instance. Mine took 45 days to get. Management isn't reachable feel times... Advice to Senior Management: Should try to be more involved with the base, my manager doesn't even know me!!!
    • IBM Manager in Texas City, TX: (Current Employee) "OK place to work." Pros: Good number of SAP projects...strcutured company...human policies are good. Cons: Competitiveness in market and the way SAP project are sold are putting too much of pressure on consultants. Advice to Senior Management: Change the way you treat employees and concentrate on worklife balance..
    • IBM Consultant in Bangalore (India): (Current Employee) "Consultant Review." Pros: Good Company at a High Level, IBM Learning one of the best, Flexible work options, Policies of the company are good, On Paper has the widest possible options for career. Cons: Senior Management delegates control to Middle Management, some of whom are not as per IBM Standards and do not implement IBM policies correctly. Advice to Senior Management: Cut down bureaucracy, reach out to Engineers, make different divisions work as one IBM, and ensure middle management understand and implement IBM policies correctly.
    • IBM Systems Engineer in Kolkata (India): (Current Employee) "Poor HR Policy." Pros: Work Environment and for learning purpose its gud. Cons: Worst paying company in the IT industry. Advice to Senior Management: Percentage growth even at the time of band movement will never suffice at least in India. There should be a slab for each band and accordingly the salary should be increased on band movement. Apart from that campus hires should get a substantial increment after completion of probation period so that he comes at the market level in terms of salary. Regular market adjustment is required.
    • IBM IT Specialist (Band 7) in New York, NY: (Current Employee) "IBM Overall." Pros: Overall IBM is a great company to work with. If you are willing to stay up to date on technology and are willing to grow its def the place to be. But if you just want to be a geeky computer nerd and want to code all day then IBM is not for you! IBM is meant to take the computer nerd and turn him or her into a leader. Yes, IBM is hiring many people offshore, and yes half of them are idiots, but guess what? Look at the people that are leading them? Folks from the US! Listen, anyway one can code, but not everyone can be a leader, and IBM is a great company in which can turn you into a leader. That's only if you want to be a leader!

      Cons: Work/Home life is not the greatest. As a IBM employee I have given up holidays, weekends and family special events due to work. I literally work a minimum of 12 hours a day "on a good day", but I am told I can only bill 40 hours a week. Second bad thing with IBM is that, if I'm going to work so much and sacrifice my family, and personal time I should be compensated with a fair salary. I mean let's really be honest, show me 1 project in which a consultant worked 40 hours a week. Don't get me wrong I have obtained excellence awards and bonuses, but nothing beats a overall good salary.

      Advice to Senior Management: When bidding on projects, be realistic on go live dates. The reason for many consultants working 60+ hours a week is because a lot of the partners/ap's just want to get the sale and not seeing how it affects the workers! LISTEN TO YOUR TECHNICAL ARCHITECT! AND TECHNICAL ARCHITECT'S, STOP LETTING THE PARTNERS/AP'S PUSH YOU AROUND. MAN UP, THEY ARE PEOPLE JUST LIKE YOU AND ME!

    • IBM Financial Analyst in Rochester, MN: (Current Employee) "Review of IBM finance COEs." Pros: Good resume builder. Exposure to Systems and Application a plus that will be a benefit throughout your career Cons: Company policies/decisions are extremely reactive. Communication on strategy/opportunities is often purposely deceitful. Very limited opportunities in the finance field to advance your salary - additional "opportunities" are available as more work, but no more money. Advice to Senior Management: Be more proactive in talent development.
    • IBM IT Specialist: (Current Employee) "Be Prepared for Disappointment." Pros: Health/401K benefits were above average, and (at the time) working from home was available. Other benefits used to be good, but have dwindled away as management stopped spending money on employees. Cons: No Future. No Job Security. No Training. No matter how much evening and weekend overtime you work (unpaid!), no matter how good of a job you do, or how many years of loyal service -- when management wants to lay off thousands of employees to boost earnings per share, your job is gone. Just like that. You might as well have never existed. And it is happening ever more frequently and ever more massively and it will happen to you. Advice to Senior Management: IBM knows exactly what it is doing -- at the expense of the real workers who do the real work -- so what advice can be given? If you want to save your company then start taking care of your people. If you just want to keep cashing out short-term until things collapse, then keep up with your current strategy.
    • IBM Senior Consultant in Washington, DC: (Current Employee) "Minimal bonus and raises, few opportunities for growth." Pros: Networking opportunities at global level. Cons: No bonus or raise even after stellar performance reviews; management does not care or pay attention to professional growth interests; 44 hours a week is required; very few learning opportunities; poor evaluation system; very few competent managers. Advice to Senior Management: Reward the right employees based on merit, not utilization statistics.
    • IBM IT Specialist in Austin, TX: (Current Employee) "IBM." Pros: You work with some of the smartest people in the industry. Cons: Upper management is not good in valuing top performers. Advice to Senior Management: Upper management needs to be flexible towards career advancement and rewarding their top performers.
    • IBM Systems Analyst in Sacramento, CA: (Current Employee) "Not the Place to Spend a Long Time." Pros: Most of the world has not clued in yet that IBM is just another company, so having experience there carries a lot of weight.

      Cons: IBM, from all reports, used to be something special: but no more: it is just another company. In the name of shareholder value -- their only benchmark for policy -- they have reduced education to a set of crummy online classes, all but eliminated salary increases, and slashed staffing levels to the detriment of their clients. Local managers have little control over employee ratings or salary increases: they are dictated by bean counters far removed from the employees. Hence, ratings and raises barely reflect an employee's performance. All travel and discretionary spending has been eliminated. Perks like Christmas Parties or Company Picnics are done. On my project, we had potluck events in which the managers had to pay out of pocket for the meat/BBQ for the staff.

      Morale at IBM is very low, and there is a huge brain drain. In my 10-year stint, most of the long-term IBMers (15+ years and more) jumped ship. Communication, usually in the form of glowing profit reports, comes down from on high, as if the news meant anything to rank and file. Upper management continues to cut everything while crowing about how wonderfully the company is performing. Almost every employee regards this brainless cheerleading as a joke. The company is either clueless or heedless: take your pick.

      All work now -- from application development to project management to administration -- is distributed into separate towers that are physically remote, and often offshored to BRIC countries. Anyone in a job classification not requiring "face time" with clients is a likely target for layoffs, which occur, at minimum, yearly. Opportunity is limited, and in my sector -- government -- IBM's business model, which operates on the idea of premium pricing for premium services, rings hollow to cash-strapped governments. IBM's take is to offshore almost all the work or bid at normal rates and lose. Not a very long horizon for most people, especially in the technical realm.

      Almost everyone I know at my former project is trying to leave the company. I got out just in time.

      Advice to Senior Management: None. These guys own a lot of stock, so their main incentive is to raise stock prices.

    • IBM Managing Consultant in Los Angeles, CA: (Past Employee - 2008) "Over-matrixed, overly-complex global organization means politics drives everything." Pros: Large enough that regardless of what you have an interest in, someone, somewhere in the world, is working on it. A good training ground for how to get along in a vast, global organization. Cons: Easy to get completely lost in the maze of complexity and the bureaucracy. 'Difficult to do business with' is consistently the number one complaint levelled against IBM by its customers, but it's exactly the same inside. Their 'transformation' to a services company is a complete myth. On the inside they still look and feels like a 70's something manufacturer. Advice to Senior Management: Push decision making, and budget control much much lower in the organization from where it is now. Either abolish/thin out the dizzying number of policies and procedures, or take them to hear. Example: Budgeting and business cases. Hugely complex, but everyone knows you get money for your initiatives based not on the numbers in the business case, but simply who you are and whom you know--i.e. politics rules. So that's fine, just say 'politics rules, and we operate accordingly' rather than the current situation with the worst of both worlds--lots of forms to fill out, AND non-transparent management. I seriously doubt Palmisano or anyone could steer such a behemoth--it's more about marketing, and trying to create the right impressions in the market (like the story they 'transformed' to a services company'--nope, never happened, not internally)
  • Wall Street Journal: Lockheed Offers Buyouts to Executives. By Joan E. Solsman. Excerpt: Lockheed Martin Corp., facing what it called a "new reality," in which customers have tighter budgets, said it is offering incentives to thin out its executive ranks in a move to lower overhead costs. "Our customers are facing increasing demands with constrained resources, and they're relying on us to give them the very best value within these constraints," said Bob Stevens, chairman and chief executive of the aerospace and defense company. Mr. Stevens cited recent comments from Pentagon officials about productivity and cost-savings programs.
New on the Alliance@IBM Site
  • To Alliance@IBM supporters: The Alliance is the only organization that advocates and supports IBM employees and ex-employees. In fact, there are few like it in the Information Technology field. It is always difficult to keep an organization like this alive, but as a supporter you know how important it is that we exist. We are calling on you today to help keep us alive another year by joining as a member or associate member. See our online forms below. As our membership has dropped, it is imperative that we gain new members or this organization and web site will cease to exist. Help us keep our organizing and advocacy work alive!
  • General Visitor Comments: Due to a lack of membership growth the comment sections will be closed until we see sufficient growth in full membership, associate membership or donations. Many of you that visit our site have not yet joined, but seem to value its existence. The only comment section that will remain open will be Job Cuts Reports. If you have information that you want the Alliance to know about please send to ibmunionalliance@gmail.com. Information of importance will be put on the front page of this web site. To join go here: Join The Alliance! or here: Join The Alliance!
  • Tell-A-Friend! Take action! IBM must employ US workers on ALL Government contracts! Pass your message on to your friends and colleagues, and invite them to sign up for Alliance@IBM.
  • Job Cut Reports
    • Comment 7/06/10: "As I see it the reason IBM is such a lousy company to work for is because most folks don't join this union. A beemer opening their mouth for the right cause is as rare now as a dodo bird sighting. IBM management likes you wishy washy, do nothin', wait and see, no actung, don't stand up and spit types and it gives them all the more ammunition to do job cuts. The fireworks will continue now. If the quarterly numbers finally disappoint you can bet IBM management will have the ax sharper and ready." Well said. It seems like with the waves of layoffs over the last several years have most IBM employees "shaking in their boots" fearful of losing their job. Therefore they keep their mouth shut. Sam Palmisano has created a horrible company culture. I hope someday Sam gets what he deserves. A big kick in the ass for all the pain and grief he has caused to so many people. -IBMer-
    • Comment 7/06/10: I've posted a number of (I think) helpful info answers here over the past year, and now I'm going to post an observation of self-realization in the hopes that it helps some of you who are still with IBM...

      I was one of those old-school (although I am still young - mid 40's) IBMers who really believed the original Basic Beliefs. I lived them, and for most of my career in IBM it served me well. Well, I got RAed. Solid (well above average) performer and all that. Now for the self-realization - I was bitter when I got RAed. I did not cry, I took it like a grown up and moved on. Through some trials and tribulations, I am now well-employed by a company that is doing well financially, I am making more than I was at IBM (and my IBM salary, while not tops, was pretty respectable) and I have good growth prospects here etc etc etc.

      But here's the thing - there is a part of me that wishes I was still with IBM. I see all of the continued lousy raises, overlooked recognition, rotten working environment, uncertain stability and future and so on, but there is something still nagging me that I would like to still be part of that insanity. Perhaps it was the familiar environment, the (whatever are left) perks that come with working for IBM, but I suspect, and here is the relevance to this post and the forum, that it is this unexplained emotion that causes many to hesitate to join the Alliance (it did for me - to my detriment) out of fear, biting the hand that is for now still feeding you, wanting to to just "be all right" etc. Even now, after getting shafted, there is still this unexplainable nagging want to still be part of it. Please learn from others, and perhaps this post of self-realization, and JOIN the Alliance and GET a CONTRACT. -RAed Jan 09-

    • Comment 7/06/10: Of all the insulting things to do to justify lower pay and recognition. Research Division management presented this in order to inspire us. The higher the reward, the lower the performance is the message. http://www.youtube.com/watch?v=u6XAPnuFjJc -Anon-
    • Comment 7/07/10: To Anon, That is an interesting YouTube video. Funny thing IBM is doing the exact same thing. The greedy bastards are integrating the work for free opportunities for the suckers out there. They offer a measly reward for the solution, however, there is no audit to show that they do not steal the solutions offered by everyone. Relative to their idea's program several years ago; I was denied this small reward, however, they used the idea anyway. Like I said, the "bastards". -Anon-Too-
    • Comment 7/07/10: Huffington Post: The More CEOs Make, The Worse They Treat Workers, Says A New Study. -Anon-
    • Comment 7/08/10: MEMORANDUM To: All CDI ITD Resources. From: Andy Morgan, Director.

      Subject: Extension of 2010 Q2 Work Reduction and Zero OT Restriction Programs

      IBM recently notified CDI that the 2nd quarter work reduction and zero OT restriction programs have been extended through October 2nd, 2010. All CDI ITD/DSS resources are required to reduce normal work schedules by 15% and are not allowed to work any OT (AWS excluded) without prior written approval by IBM Management (IBM OT approval should be forwarded to your Account Executive named below) through October 2nd. This action is not a reflection of any dissatisfaction over the services provided by you or CDI but rather an IBM business decision. Your IBM Manager will work directly with your CDI Account Executive to coordinate a reduced work schedule that minimizes any impact to IBM or its clients. You should receive the communication regarding your reduction schedule from your CDI Account Executive. When you begin working the reduced schedule and notifying CDI of these reduced work hours, please enter 0 hours into the CDI Web Based Time reporting tool and note the words â??work reduction?� in the comment section. CDI Resources exempted from these programs in Q2 by IBM Management may by exempt in Q3 as well - confirmation should be made with your IBM Manager. This decision and action is not to be discussed with any IBM clients. It is expected that normal work schedules will resume after this request is completed. You should understand that this action is being taken by IBM to retain as many CDI resources as possible for future work. Please address any questions to your CDI Account Executive.

    • Comment 7/08/10: Nothing new here, but now a study proves it: "...rising CEO pay results in power asymmetries in the workplace such that top executives come to view lower level workers as dispensable objects not worthy of human dignity..." http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1612486 -Canonymous-
    • Comment 7/09/10: Jobs cut in Application Hosting Services. I'm in Endicott and was not hit but we lost 5 people who were geographically disbursed throughout the US last week -Anonymous-

News and Opinion Concerning the U.S. Financial Crisis
Minimize "It is a restatement of laissez-faire-let things take their natural course without government interference. If people manage to become prosperous, good. If they starve, or have no place to live, or no money to pay medical bills, they have only themselves to blame; it is not the responsibility of society. We mustn't make people dependent on government- it is bad for them, the argument goes. Better hunger than dependency, better sickness than dependency."

"But dependency on government has never been bad for the rich. The pretense of the laissez-faire people is that only the poor are dependent on government, while the rich take care of themselves. This argument manages to ignore all of modern history, which shows a consistent record of laissez-faire for the poor, but enormous government intervention for the rich." From Economic Justice: The American Class System, from the book Declarations of Independence by Howard Zinn.

  • New York Times op-ed: Pity the Poor C.E.O.'s. By Paul Krugman. Excerpts: Job creation has been disappointing, but first-quarter corporate profits were up 44 percent from a year earlier. Consumers are nervous, but the Dow, which was below 8,000 on the day President Obama was inaugurated, is now over 10,000. In a rational universe, American business would be very happy with Mr. Obama.

    But no. All the buzz lately is that the Obama administration is "antibusiness." And there are widespread claims that fears about taxes, regulation and budget deficits are holding down business spending and blocking economic recovery.

    How much truth is there to these claims? None. Business spending is indeed low, but no lower than one would have expected given widespread overcapacity and weak consumer spending. Business leaders are feeling unloved, but giving them a group hug won't cure what ails the economy.

    Ask the Obama-is-scaring-business crowd for some actual evidence supporting their claim, and they'll tell you that business spending on plant and equipment is at its lowest level, as a share of G.D.P., in 40 years. What they don't mention is the fact that business investment always falls sharply when the economy is depressed. After all, why should businesses expand their production capacity when they're not selling enough to use the capacity they already have? And in case you haven't noticed, we still have a deeply depressed economy. ...

    So where's the evidence that an antibusiness climate is depressing spending? The answer, supposedly, is that this is what you hear when you talk to entrepreneurs. But don't believe it. Yes, when you talk to business people they complain about taxes, regulations and the deficit; they always do. But the Obama's-socialist-policies-are-wrecking-the-economy chorus isn't coming from businesses; it's coming from business lobbyists, which isn't at all the same thing. Read the report on the U.S. Chamber of Commerce in the latest Washington Monthly: peddling scare stories about what Democrats are up to is a large part of what organizations like the chamber do for a living. ...

    The charts at the back of the report, showing trends in business perceptions of their "most important problem," are even more revealing. It turns out that business is less concerned about taxes and regulation than during the 1990s, an era of booming investment. Concerns about poor sales, on the other hand, have surged. The weak economy, not fear about government actions, is what's holding investment down.

    So why are we hearing so much about the alleged harm being inflicted by an antibusiness climate? For the most part it's the same old, same old: lobbyists trying to bully Washington into cutting taxes and dismantling regulations, while extracting bigger fees from their clients along the way.

    Beyond that, business leaders are, as I said, feeling unloved: the financial crisis, health insurance scandals, and the catastrophe in the Gulf of Mexico have taken a toll on their reputation. Somehow, however, rather than blaming their peers for bad behavior, C.E.O.'s blame Mr. Obama for "demonizing" business — by which they apparently mean speaking frankly about the culpability of the guilty parties. Well, C.E.O.'s are people, too — but soothing their hurt feelings isn't a priority right now, and it has nothing at all to do with promoting economic recovery. If we want stronger business spending, we need to give businesses a reason to spend. And to do that, the government needs to start doing more, not less, to promote overall economic recovery.

  • New York Times op-ed: Punishing the Jobless. By Paul Krugman. Excerpts: There was a time when everyone took it for granted that unemployment insurance, which normally terminates after 26 weeks, would be extended in times of persistent joblessness. It was, most people agreed, the decent thing to do. But that was then. Today, American workers face the worst job market since the Great Depression, with five job seekers for every job opening, with the average spell of unemployment now at 35 weeks. Yet the Senate went home for the holiday weekend without extending benefits. How was that possible?

    The answer is that we're facing a coalition of the heartless, the clueless and the confused. Nothing can be done about the first group, and probably not much about the second. But maybe it's possible to clear up some of the confusion. Read more...

  • New York Times op-ed: Are Profits Hurting Capitalism? By Yves Smith and Rob Parenteau. Excerpts: Over the past decade and a half, corporations have been saving more and investing less in their own businesses. A 2005 report from JPMorgan Research noted with concern that, since 2002, American corporations on average ran a net financial surplus of 1.7 percent of the gross domestic product — a drastic change from the previous 40 years, when they had maintained an average deficit of 1.2 percent of G.D.P. More recent studies have indicated that companies in Europe, Japan and China are also running unprecedented surpluses.

    The reason for all this saving in the United States is that public companies have become obsessed with quarterly earnings. To show short-term profits, they avoid investing in future growth. To develop new products, buy new equipment or expand geographically, an enterprise has to spend money — on marketing research, product design, prototype development, legal expenses associated with patents, lining up contractors and so on.

    Rather than incur such expenses, companies increasingly prefer to pay their executives exorbitant bonuses, or issue special dividends to shareholders, or engage in purely financial speculation. But this means they also short-circuit a major driver of economic growth. ...

    So instead of pursuing budget retrenchment, policymakers need to create incentives for corporations to reinvest their profits in business operations. One way to do this would be to impose an aggressive tax on retained earnings that are not reinvested within two years. Another approach would be a tax on the turnover of corporate financial investments that would raise the cost of speculating with profits, rather than putting them into the business.

  • New York Times editorial: China, the Sweatshop. Excerpts: The labor strife spreading through China's factory cities has clearly frazzled the government. Last month, it deployed Prime Minister Wen Jiabao, a k a "Grandpa Wen," who told laborers at a Beijing subway station that the government and society "should treat migrant workers as they would their own children." China's exploited workers don't need an extra parent. They need higher wages, better working conditions and a chance to form independent unions. They need China to stop being sweatshop to the world.

    Worker unrest has spread after reports of suicides at two campuses in southern China owned by Foxconn Technology, an electronics maker that employs 800,000 people in China who assemble products and parts for Western companies, including Apple, Dell and Hewlett-Packard. Since May 17, workers struck at three Chinese plants that make transmissions, exhausts and locks for Honda, the Japanese carmaker. There also have been reports of labor action in dozens of other factories.

    Working conditions in too many of these factories are dismal, and the pay is, too. At the Pingdingshan Cotton Textile Company, The Toronto Star reported, workers make 65 cents an hour, working grueling two-day shifts, often in 100-plus degree heat. Workers at Honda Lock demanded a 70 percent raise from their $132-a-month wage. There are no independent unions allowed.

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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