IBM’s formula for profit growth has been to cut costs enough to offset declining sales. In the last year, its revenue fell 2.3% while its net income grew 4.7%. If IBM cut enough people, it could meet its profit numbers. ...
Since Rometty took over, Big Blue’s rate of growth in restructuring charges has nearly doubled as IBM’s revenue shrank. For instance, in 2011, Palmisano’s last year at its helm, IBM spent $440 million on workforce restructuring; whereas in Rometty’s first year, that figure nearly doubled to $803 million, according to Bloomberg. ...
IBM claims that it’s just using the layoffs to shift people from declining business lines so it can invest in growing ones. AP suggests that “some of those employees didn’t fit” with IBM’s plans to invest in “social networking, mobile computing, data analysis and storage and cloud computing.” ...
Meanwhile, workers who have lost their jobs are not happy — one of them even suggested an IBM global employee walkout. According to Alliance@IBM, the site of the IBM Employees’ Union CWA Local 1701, 3rd.Generation Watson Scholar, called for the union to “send mass email to all US and/or All IBM Global employees suggesting a time for a walkout – i.e. days near quarter end.”
3rd.Generation Watson Scholar expressed unhappiness with IBM’s treatment of its staff, writing, “IBM has reached rock bottom in its treatment of its employees – no work/life balance, expected to work on vacation, ZERO home office expense reimbursement, buy your own work supplies, do the job of 3 people and then some, rent a car rather than driving your own personal car since it’s cheaper than reimbursing mileage.”
3rd.Generation Watson Scholar concluded his rant by noting the hefty profits Rometty has made on her stock options: ”Ginni has cashed in over $50 million in stock options since becoming new CEO.”
IT spending is up, but IBM is shrinking. That’s why I think IBM needs a vision and a strategy. And if IBM has a strategy, it sure isn’t showing up in the numbers.
Which raises two questions: Isn’t the CEO’s job to develop strategy that yields market-beating performance? And given IBM’s declining revenue and tepid stock price, should IBM’s board hold Rometty accountable?
Selected reader comments follow:
When Gerstner was hired I had nine layers management between myself and the CEO. Also at that time taking risks to develop new markets and products was discouraged. When Gerstner left I had five layers of management to the CEO. Risk taking in order to develop new markets and products was encouraged. By the time I retired in 2010 Palmisano had made it so I had eleven layers of management between myself and the CEO. IBM had become stagnate and unwilling to take risks and innovate. There were many parallels to where we were in the early 90′s. Like then the executives have become so isolated that they cannot steer the ship where it needs to go to deal with market changes and grow.
There’s zero top line growth… no innovation… no “organic” growth of new products… basically it’s just another IT outsourcing company lost amid a field of other vendors who do a better job with their 3rd world labor arbitrage.
IBM does differentiate itself with their ever-declining levels of service at ridiculously expensive rates, however.
Unfortunately for Big Blue and its employees, this just marks yet another round of layoffs -- one of several in the last few years. ...
Bloomberg cited analyst forecasts that the Armonk, N.Y.-headquartered corporation will be laying off anywhere between 6,000 and 8,000 employees worldwide -- close to two percent of its total workforce. The goal is to save approximate $1 billion in expenditures for the company.
Lee Conrad, a coordinator for Alliance@IBM, said that "just about every division at every location is being impacted." On the IBM Employee's Union website, a number of axed employees have chimed in, expressing disappointment in the layoffs and annoyance that "While they are firing in U.S., they are hiring in India."
One poster from Austin said, "More than 30 percent cut in (GBPSAS) Global Business Partner Systems/Application Services (Austin). Her Director was told to go to commercial account. 35 percent cut in IBM Systems & Technology Group, Enterprise Systems & Technology Development eServer CEC Bringup and Integration (Austin). 40 percent cut in GFW IBM (Austin)."
These high ratings appear to be common in this round of layoffs, as many posters say that almost half of their respective departments lost their jobs. One ex-employee said, "Z Virtualization took a big hit. We (including me) lost 48 of 300 positions." Based on the reports, only manufacturing departments appear to have been left untouched.
Meanwhile, a technology website called WRAL TechWire reported that "hundreds" of IBMers in North Carolina had received layoff notices, while Vermont radio station WCAX said that 121 workers had been laid off. ...
In March, IBM announced it was moving the bulk of its manufacturing the Rochester campus to plants in Mexico and New York. The action reportedly cost about 200 jobs locally.
The manufacture of the Power Systems, PureSystems and PureFlex Systems are being shifted out of Rochester to Guadalajara, Mexico, said IBM spokesman Scott Cook. The refurbishing of used machines is being moved to Poughkeepsie, N.Y.
Selected reader comments follow:
Politics have very little to do with IBM laying off employees. It's all to do with reducing expenses to keep stock holders happy and increase dividends. IBM is not the innovative company it used to be. The only way they make profits now is by cost reductions and selling off business units. Wouldn't it make more sense to hire more people and produce more of whatever to increase profits and price of stock. IBM management is some of the worst in the corporate world right now. Ginnie put blame on all of the worker bees saying it was their fault for last quarters results and they had to step up and work harder and smarter. Worker bees just do what they are told to do by management. Put the blame where it really belongs. Upper management where the strategy and business plans are put together.
"Everything is hush hush like always," said one IBM Rochester employee. "Usually we knew who was affected and now it's like top secret and it makes one wonder why. I've had people asking me if I am safe. I know MFG (Manufacturing) got hit hard. Sad day yesterday as RAs continue every year."
"Change is constant in the technology industry and transformation is an essential feature of our business model," said Doug Shelton, an IBM spokesman. "Consequently, some level of workforce remix is a constant requirement for our business. Given the competitive nature of our industry, we do not publicly discuss the details of staffing plans."
Shelton's statement was identical to the one used in Australia two weeks ago, when a woman speaking for IBM was attempting to explain an initiative dubbed Project Mercury, a company effort that might result in the loss of some 200 jobs there. ...
Silence is a requirement for leaving the computer giant with a severance package, so it is rare for any IBM workers on the chopping block to offer insights let alone to speak out. However, a blog maintained by the Communication Workers of America has proven to be one of the best ways for outside observers to track work force cuts by IBM around the globe. The CWA has been trying to organize a union inside IBM. ...
If reports on the Alliance@IBM web site are on the mark, the cuts in the Systems Technology Group (STG) might reach 25 percent. RAs in STG in Canada began on Tuesday with workers given 30 days notice, with more cuts set for Wednesday; one-on-one meetings are reported from STG units in Research Triangle Park in North Carolina, where all server developers reportedly have been cut, at Burlington, Vermont, and at San Jose, California. Other IBM units said to be targeted are the Software Group at sites in Littleton, Massachusetts and East Fishkill, New York. More cuts reports at Austin, Texas... Poughkeepsie, New York... and Chicago. And other layoffs are reported in the United Kingdom.
Selected reader comments follow:
The exact number of Vermont workers to be laid off is not clear. IBM, presumed to be the largest for-private private employer in the state with more than 4,000 employees, stopped releasing data on employee numbers in 2010. ...
Citing competitive reasons, IBM spokesperson Jeff Couture said the company does not publicly discuss the details of its staffing plans. The company reported lower-than-expected quarterly earnings in April. “IBM keeps this between IBM and their employees,” said Lawrence Miller, secretary of the Agency of Commerce and Community Development. He said the number of layoffs apparently is not enough to trigger the federal WARN Act. ...
Morale is not so high among employees, however — both those laid off and those who will remain at the plant for now. Mongeon described a long process of attrition. He’s been with the company for 35 years, and works with the Alliance as a union organizer.
“It’s like the bully at the school yard,” Mongeon said. “He comes one day and take takes your lunch money, he comes the next day and takes your lunch, he comes the next and takes something else.”
"It's hard to deal with the fact that the layoffs are basically saying the shareholders are more important than the employees," the worker said. And with two kids at home something has to give.
Selected reader comments follow:
IBM’s policy is to withhold numbers for employment and for job cuts, and the layoffs in Essex, which were part of nationwide cuts, did not immediately trigger either federal or state reporting requirements. The federal threshold is 500 or more workers in a 30-day period; the state requires notice within 24 hours if 25 or more workers are let go. ...
Lee Conrad, national coordinator of Alliance@IBM, said he was “swamped” Wednesday with information coming in from across the country from IBM workers who had been laid off. “Every division has been hit,” Conrad said. “We’re getting resource action packages, which list the number of people fired only by division, not by location.” ...
“IBM once again seems to be keeping all these job cuts secret,” Conrad said. “We’re asking the governors for states such as Vermont to demand IBM be public on these job-cut numbers. It is unconscionable that IBM should be allowed to keep these numbers secret.” ...
Late Wednesday afternoon, businesses were anticipating the impact.. Rocky’s N.Y. Pizza has served slices to IBM workers for more than a decade. Manager Brandon Longe said the pizza parlor has many regulars from IBM who take their lunch breaks there almost every day. “It’s as simple as: They lose their job, they don’t eat here, we lose money. That’s how it works,” Longe said. “A few have stopped in to tell me they made it. I still don’t know about a few others. I’m worried about them.”
In Dutchess County, 697 employees lost their jobs, according to Dutchess County Executive Marcus Molinaro. IBM would not confirm the number of cuts which "are all throughout the Hudson Valley and Connecticut as well," Conrad said. The list includes employees at IBM's facilities in Somers, Armonk, East Fishkill and Poughkeepsie, among others.
Molinaro said 328 of the jobs lost were in Poughkeepsie and the other 369 were in East Fishkill. Westchester County had not received information on the number of layoffs as of Wednesday evening, said Ned McCormack, spokesman for County Executive Rob Astorino. Local jobs eliminated Wednesday include positions with IBM's systems technology group and global business services, Conrad said. Employees from the former work with IBM's server unit and research and development, while systems technology employees work directly with clients, Conrad said. ...
The company did not return calls on Wednesday but said in a statement, "Change is constant in the technology industry and transformation is an essential feature of our business model. Consequently, some level of workforce remix is a constant requirement for our business. Given the competitive nature of our industry, we do not publicly discuss the details of staffing plans."
Conrad said at least some of the jobs will be moved overseas to make up for lower-than-expected first-quarter earnings and to placate shareholders. IBM has discontinued the practice of publicly announcing layoffs by location and instead compiles those numbers by division in its earnings reports.
Alliance@IBM is asking Gov. Andrew M. Cuomo to pressure IBM to release the layoff figures for New York, particularly in light of tax breaks the company enjoys from the state. Conrad said. "Frankly, we believe the governor of New York should be demanding IBM release these numbers," he said. "This stuff should be transparent." Cuomo's office did not return a call seeking information. ...
The company is probably cutting 6,000 to 8,000 jobs globally, based on the $1 billion cost figure, said Laurence Balter, an analyst at Oracle Investment Research in Fox Island, Wash. That would represent less than 2 percent of IBM's total workforce of 434,246 as of Dec. 31. ...
IBM also has been cutting hours of its contract employees. CDI Corp., a Philadelphia-based provider of staffing and outsourcing services, told its staff working for IBM to limit their hours in May, according to a memo obtained by Bloomberg. IBM at the time said that the company relies on contractors to manage labor costs on information-technology projects for clients.
The company is probably cutting 6,000 to 8,000 jobs globally, based on the $1 billion cost figure, said Laurence Balter, an analyst at Oracle Investment Research in Fox Island, Washington. That would represent less than 2 percent of IBM’s total workforce of 434,246 as of Dec. 31.
Latest estimates are that IBM employs about 7,000 people in Research Triangle Park and about 10,000 across the state. IBM no longer discloses how many workers it has at any location, citing competitive reasons. ...
"Though we certainly don’t have a specific approved action, this [re-balancing] will result in a charge that will additionally impact the operating EPS we report," Loughridge explained. "Like all years, we have a number of actions planned to improve the business for the long-term, acquiring and divesting businesses and re-balancing our resources. This results in charges in the second quarter and gains in the second half, which we expect will roughly offset for the year."
Armonk-based IBM began laying off more than 700 workers in Dutchess and Westchester counties on Wednesday as part of a global restructuring in the second quarter. ...
On Wednesday, the company officially informed the state Department of Labor that 697 people would be laid off at two locations in East Fishkill and Poughkeepsie. It gave state officials no figures for Westchester County. ...
State law requires companies with more than 50 employees to warn New York state 90 days in advance if they are laying off 33 percent of their workforce or more than 250 workers from a single site. ...
Bob Knight, a spokesman for the Westchester County Association, a business advocacy group, concurred. “IBM employees are among the most sought-after labor force in the nation,” he said. “We feel they’ll be on the bench only a short amount of time.”
Based on information coming into Dutchess' Workforce Investment Board, IBM cut 328 employees at Poughkeepsie and 369 at East Fishkill. It appears to be the largest downsizing at IBM in Dutchess for years. ...
IBM issued a statement from spokesman Douglas Shelton that neither confirmed nor denied the downsizing, but spoke of "workforce remix."
"Change is constant in the technology industry and transformation is an essential feature of our business model. Consequently, some level of workforce remix is a constant requirement for our business. Given the competitive nature of our industry, we do not publicly discuss the details of staffing plans," the statement said.
"IBM is investing in growth areas for the future: Big Data, cloud computing, social business and the growing mobile computing opportunity. The company has always invested in transformational areas, and as a result we need to remix our skills so IBM can lead in these higher-value segments in both emerging markets and in more mature economies," Shelton said.
Tom Midgley, president of the Alliance@IBM, who works for IBM in Dutchess County, said details of the downsizing were still coming in, but he was sure of two things. "It's big, and it's agonizing for employees to go through this."
Selected reader comments follow:
Mr. Shelton (IBM communicator?) are you a real person or a recording talking head? You always say the same thing which amounts to nothing but drivel.
IBM did issue a statement that neither confirmed nor denied the latest downsizing, but spoke of a “workforce remix.” Such euphemisms are an affront to the hundreds of people in Dutchess County who found out today that they will be losing their jobs in the next few months.
One man, who has worked at several IBM sites, including in Dutchess, knew months ago that bad news was inevitable.
“I knew I was doomed last year,” he said, “when they said the matching 401(k) money that IBM usually gives in the bi-weekly paychecks would only be given in December now, to employees who still remained with the company in December. I knew they would take this opportunity to get rid of me before this December.” ...
In 1984, IBM boasted a workforce of 31,300 in its three mid-Hudson plants. But in 1993, fiscal losses and the rapid pace of technological change forced IBM into an era of massive downsizing and the mid-Hudson sites dropped 8,300 employees. In 1995, the Kingston site closed.
The company is taking a beating online from employees and former employees with the website ibmemployee.com aggregating some of the commentary.
"IBM's treatment of its employees has been in decline for over a decade. Some of their offices are so poor, the roofs leak in to 50 gallon drums in the hall ways. The lights are so dim you would think the buildings are shut down. Toilet stall doors hanging off broken hinges with locks that don't lock. " wrote one disgruntled employee. "Morale has been low for a long time. The only thing keeping the employees working is fear. They are getting close to the breaking point, I'm sure there will be backlash from those that are left. Its like a ghetto in there and I am not exaggerating. "A far cry from the 60's and 70's when 'human capital' was the most important resource of the company. Now it is just another expenditure. All in the name of profits so the executives can get their latest toys."
The news came quickly Wednesday morning that job cuts had begun. So many employees went to the Alliance web site for information and to post job cut reports that it was down many times.
Many of you posted your job cut reports to us and we thank you and we are sorry for your job loss.
Others sent us their RA packs so we can validate and count the number of IBM workers being fired.
This is the list so far:
If there have been RA's not listed here that you have packs for, please email to the Alliance@IBM at ibmunionalliance@... Thank you. The Alliance@IBM officers and members. Alliance@IBM/CWA Local 1701 • 19 Julian Street • Binghamton, NY 13905. www.endicottalliance.org
I was given the impression that IBM is about innovation and "the people" from that "Succeeding in IBM" orientation and then this RA came and shattered my utopian view of IBM :(
It feels like one of those dystopic universes where there is a seemingly serene community with a periodic cull that drag people kicking and screaming into the dark. sigh.
So, we just passed a new law increasing the number of foreign workers that will be provided visas for their technical skills. Today, IBM fired hundreds/thousands of technical workers, many from our great State.
What do you plan to do to assure these American and North Carolina workers are hired prior to a new visas being approved?
We were all asked to work hard, to keep IBM successful. I had no problem with that. What ensued was a remarkably profitable period for all of high-tech, and what is indeed unconscionable was the transfer of wealth from those who had devoted their lives and skills to the success of the organization, to those who most likely had not. The pension fund, alone, made enough money during that period to ensure retirement at the levels advertised in the "About Your Company" documents when we hired and yes I still have them.
Certainly IBM was feeling the effects of the shift in I/T spending, but I'm extremely skeptical of the repeated claims that IBM was about to go under, declare bankruptcy, etc. IBM had unequaled brand recognition and there was plenty of money to be made. Hardware became a commodity, and services were in demand. History proves this to be so. Those who thought that IBM's fortune was tied to the mainframe, and mainframe software, may have believed that failure was imminent. Rumors of even that death were, as they say, greatly exaggerated. I have a hard time believing that the Cookie Man knew enough about I/T to understand the trends, much less have a vision of the future. It is the talented, creative workforce of IBM that saved the company, if there was any saving to do. Stop giving that clown credit, he didn't do anything a first-line manager of any worth would not have known to do. Dancing Elephants, my eye.
So, the bell tolled, we answered the call, great amounts of money came in, the pension fund grew by leaps and bounds thanks to returns on investments. The money went somewhere, just not to we the loyal employees who kept things profitable. Follow the money, and the truth will out.
I have fond memories, of the hard working people I was teamed up with during those years. I had the pleasure of "growing up" with so many before the bubble exploded.
A side note on Mr. Gerstner. I recall seeing his net worth published at around $630 Million (US) at one point. I would surmise, that a good chunk of that was from the thousands of employees that were let go; or the pension shenanigans that took place.
That's just my take, on the observations I made, after I left the company.
I see thousands more are affected by this latest round of RA's taking place.
I can only say to those people: there is life after Big Blue. Stay strong, and utilize all the tools provided during your transition. Jim.
I'm sad for people who have worked so hard only to be thrown over the moat often with little money or benefits. In the face of so many "wrongs", human goodness still shines through. The decency and human goodness of my IBM colleagues radiates above and beyond the senseless, soulless corporate life. If it feels like the end of the world, congratulations on having a good soul! Now many souls organized into a union could make layoffs a little pricier for IBM.
A layoff exceeding 250 at a work site in any 30 day period by law requires 90 days notification to those affected. IBM also had to report the numbers to Dutchess County officials - 328 layoffs in Pok and 369 in Fishkill, both well above WARN limits in NY.
If you look at the messages on the Alliance site you will find that almost everyone outside the Hudson Valley got 30 days notice, not 90. If any individual has critical skills, IBM provides individual extensions, usually 30 days at a time, to get work finished up.
We, at CrowdWorx, think that this is not the way things should work with crowdsourcing. We believe, employees do not have to be fired in order to crowd source their potential. Our own crowdsourcing approach shows how employee-based crowdsourcing » can work effectively. In our approach the crowdsourcing happens within the company. This is in contrast to traditional crowdsourcing, which is used to gather inputs from consumers or external experts.
IBM management responsible for the bad 2nd QTR deserve to be RAed: to much that is given; much is expected. But they survive and "your selected to participate in the RA" as a martyr.
The Alliance has told you the RA will be coming. The Alliance told the truth. But many IBMers still doubted. IBM CFO lied in the timing of the USA RAs by putting it off as long as IBM has. Now you need to believe no employee is safe and has been safe.
LIFE IS NOT GOOD now for those in IBM, whether RAed now or not.
I think many areas will see R/A's tomorrow that have never seen them before. The savvy people who are the Alliance, we know more about what is happening in the company than many 1st or 2nd line managers. This is scorched earth desperation, folks, Ginny is locked onto Sam's promise: She'll get to $20 earnings per share and she'll destroy the company to do it.
The whole crew at the top has to go. But in the end, great people will be sacrificed instead. Read how Ginny thinks: We chose not to give raises in an entire country because we calculated that we wouldn't lose that many critical employees. I don't know about you, but when I get a raise, even a small one, I usually work harder. Sociopaths at the Helm, Barbarians at the Gate.
No wonder Sam bolted: couldn't finally master a song on the Nero violin. Ginni is the fall gal now. Maybe she see if Jack Akers can give her a tip or so, eh?
The revelation came to light on Friday when the US Government Accountability Office released a partially-redacted report that outlined the reasons for why the spooks plumped for Amazon over IBM for a $600m private cloud contract, and why IBM protested this decision. ...
Although Amazon came in with an evaluated annual price of $148 million per year versus IBM's $94 million, the CIA chose Amazon for its technical sophistication, the report says.
"While IBM's proposal offered an evaluated [deleted] price advantage over 5 years, the [source selection authority] concluded that this advantage was offset by Amazon’s superior technical solution," the report says. ...
Given IBM's recent anointment of OpenStack as the preferred platform for its SmartCloud technology, the fact that OpenStack is several years behind Amazon Web Services in capability, and the lackluster take-up of SmartCloud so far, and even the recently acquired SoftLayer bare metal cloud, we reckon that Amazon's technical dominance over IBM is likely to hold true for some time to come.
The biggest, single factor inhibiting innovation, says Rao, is fear of the consequences. Thus a human resources manager will not engage a new trainer with an unusual approach because anything new is going to be disruptive to some degree. And if senior managers do not like the change and/or will not wait to see the benefits, his or her evaluation could suffer. It’s better to be safe , follow precedent, and go with what has been established as the norm. ...
This is, for example, what held IBM back for decades. Customers didn’t buy IBM products because they were the best or cheapest but because, as the old corporate IT saying goes, no one ever got fired for buying IBM. But in the late ‘80s the company got into serious trouble. It could no longer ignore the changes that were happening in the computing industry. To survive, it had to reinvent itself. ...
In a 2004 paper titled “The Role of Psychological Well Being in Job Performance: A New Look at and Age Old Quest”, Thomas Wright and Russell Crapanzano documented that employees at research and development facilities and in inherently creative positions are more likely to be innovative when their self-reported psychological well-being, or happiness in other words, is high.
"Some companies allow their workers to buy and sell vacation time, a perk that gives workers more flexibility in managing their time off." ...
"Sandi Winant, a 24-year employee at financial services company USAA in Colorado Springs, said she buys a week of extra vacation time every year to work on a side business selling salsas and dips at festivals and events around country. She plans to pursue the business when she retires in a year or two."
"It's spread out over a whole year's paycheck so you don't even notice it," she said. "This gives me that extra padding to do what I want." Jeff Weiss, senior vice president of benefits at San Antonio-based USAA, said about 41 percent of the company's 25,000 employees bought vacation time last year, while 11 percent sold it."
"We think time off is actually critical to productivity," Weiss said. "When people take their time off to refresh and renew, we believe they service the members more effectively."
So, how does IBM handle time off? At least in Global Services, you are expected to "make up" your vacation, sick time, doctor's appointments, holidays, etc., to "pay back" the company for your time off! With expected utilization rates in excess of 100%, in fact, you need to "pay back" Ginni for not only your "time off", but provide free overtime in excess of 2080 hours per year!
What a great company!
Cons: Exaggerated bureaucracy, lack of challenges, misleading strategy.
Advice to Senior Management: Upper management should stop focusing on achieving quarterly earnings per share goals only and start valuing its intellectual capital - people! IBM is no longer what it used to be; it has no clear strategy, some ridiculous (to say the least) initiatives (like Liquid - what a waste - and New Graduate Hires) and a bad, bad way to handle financial crisis ("resource actions" rather than cutting bureaucracy). At some point, executives will need to understand people are not just numbers and they DO make the difference. Walk the talk, guys!
Yes, I would recommend this company to a friend. I'm not optimistic about the outlook for this company.
Cons: The team moved slowly, and individually. There was no sense of teamwork or camaraderie, only individuals with tasks. This was exacerbated by the fact that upper management was forcing the departments into Agile, which led to employees used to doing waterfall to simply do waterfall with iterations. Agile was used entirely as an hour tracking tool for the bosses to send angry emails every day based on their pointless charts, which were based on numbers that everyone was making up.
As a 20 something, being the only one in a sea of long time employees with the next youngest employee being in their 30s is a bit of a shock. The fact that IBM only hires college hires or internal makes for the young ones to want to leave, and the internals to result in an echo chamber where no one advances the team. To have to use a version control system whose last major update was in 1995 is insane and will scare off any new talent to a more modern company (where modern in this case could be someone using CVS.)
Advice to Senior Management: Start upgrading your processes for the modern world. You are competing with the likes of Google, Facebook, and Amazon in talent acquisition, which means your processes need to be competitive as well.
No, I would not recommend this company to a friend
Pros: It's a job and if you like working your life away, go ahead and accept an offer from this company.
Cons: IBM won't pay 401k match until 12/31 and only if you you are employed on 12/15. IBM just laid off $1B worth of people. This saved IBM a boat load of money.
Advice to Senior Management: Look up the Golden Rule mentioned in the Bible.
No, I would not recommend this company to a friend. I'm not optimistic about the outlook for this company.
Cons: 70% of this company is now in India. IBM buys companies with no clue what their products are. They lay everyone off 6 months after you help them integrate onto IBM. Internal IBM programs have no manuals and no tech support. Help desk is in India where no one speaks English. Simple tasks take weeks to complete. IBM does not care about professional development. Upper management does not even get to speak to developers, ever.
Advice to Senior Management: Stop being greedy and value your employees more.
No, I would not recommend this company to a friend. I'm not optimistic about the outlook for this company.
Cons: People are disposable, don't bother going the extra mile, they don't care or appreciate it, it's expected. Then when they have no further use for you they make you redundant. Especially the ANZ Law Department, 8 redundancies at the same time they were recruiting. The replacements started on the same day the staff who were made redundant were leaving—poor form IBM!
Advice to Senior Management: Get rid of the lot of them, all in it for what they can get, they don't put in leave forms and take leave, they then accumulate their leave balances and take extended breaks. Oh and if you're a woman, don't get pregnant, as soon as you do they want you gone.
No, I would not recommend this company to a friend. I'm not optimistic about the outlook for this company.
Cons: Big Blue has long forgotten what made it great - its employees. It used to hire only the best and keep them on board by making it worth their time. Now its ranks are full of laid-off former IBMers, a sea of gray heads. The facilities and equipment used by engineers are just as ancient. The place is awash with defunct computers, chairs, desks, bathroom facilities, you name it. It is messy since they cut back their janitorial staff to just one pass a week. No doubt some bean counter is quite happy with this, but it tugs the morale down just a bit more. Most important in all of this is that IBM has forgotten that they produce more than a bottom line. Especially when that bottom line is sagging, it's most important to stay competitive as an employer to continue to hire the bright new stars of tomorrow's technology.
Advice to Senior Management: Shaking the tree has always been important to get rid of deadwood, but so is doing it right. Letting bean counters drive your employment strategies is like handing the chain saw to a firewood salesman when you are considering pruning your orchard. The salesman just sees wood, but the wise orchard owner remembers the potential fruit first and foremost. Fire some bean counters and hire some technical strategists for a change. Remodel IBM as a small growth company.
No, I would not recommend this company to a friend, I'm not optimistic about the outlook for this company.
Yes, I would recommend this company to a friend – I'm not optimistic about the outlook for this company.
No, I would not recommend this company to a friend – I'm not optimistic about the outlook for this company.
The system needs to be restored to long-term health, but policy makers must realize that broad-based benefit cuts are not really a viable option. For most people, the ability to finance a secure retirement has been ruined by stagnating wages, repeated stock market busts, diminished home equity and weakened or nonexistent pensions. Social Security, whose average monthly retirement benefit is $1,268, is pretty much all that is left. Most people age 65 and older get two-thirds to all of their income from Social Security.
And yet, in the deficit-obsessed, anti-tax world of Washington, closing the shortfall in Social Security has come to mean broadly cutting benefits. That would be a mistake. Targeted cuts — like lower payouts for upper-income recipients who live longer and draw larger benefits — could improve the system’s finances and fairness.
But those who promote across-the-board cuts are not interested in strengthening the system. They want to reduce the budget deficit. And even though Social Security is not a cause of today’s deficits, they would rather cut benefits than improve the system’s finances by imposing tax increases on higher-income taxpayers or phasing in a modest payroll tax increase over decades.
The focus on benefit cuts also conveniently ignores the fact that benefits are already shrinking. Under current law, benefits are being reduced by the higher retirement age, which has been gradually rising from 65 to 67 for those born in 1960 or later. That translates into lower monthly benefits for those who retire at 65 or fewer years of benefits for those who work until 67. For example, a worker entitled to a $1,000 monthly benefit upon retirement at age 67 will get only $867 if he or she retires at 65.
Customers are smarter and better informed now, they have access to so much information they know when IBM is no longer adding any real value and simply marking up huge margins on commodity offerings. Look at "new" establishment: Bezos is 49, Page 40, Brin 39, Mayer 38, Zuckerberg 29 - and many would now consider them "old"! What do you think any one of these leaders would say if someone suggested running their businesses on IBM products? I'm sure there are one-or-two bits of IBM technology around, but not part of the core business. I just don't think that IBM has a clue on where new growth is going to come from. -Exit Strategy-
No one should have been surprised by this action. No one. Any employee listening to or reading the Q1 report transcript would have known what was about to happen. Those around longer (me included) should've known that the $20 EPS by 2015 - rather than a vision to rally behind - was a plan to convert all the deck chairs on the ship to firewood. Rather than harness the 100 years of innovation and patent leadership, the corporation is busy buying back shares, paying excessive amounts to startups in order to catch up in Cloud, and finding every conceivable manouever to reduce cash flow to its employees.
Those remaining: you may indeed hit $20/EPS in 2015 but then what? What's IBM's mission for the next 100 years? Is it product? Services? Cloud? Until the Inner Circle raises its head up from its cozy confines in Armonk surrounded by CPAs and lawyers, it will not realize the world has passed them buy and the West Coast is going to bury them. Not directly, but just in their wake as they take control of the next century of business. -2 Years Free-
Also, an ongoing hemorrhage of long-standing employees (leaving of their own accord or laid off) coupled with hiring freezes had a huge impact on many fronts. Did IBM set us up for success? No. The opposite. Are they punishing us for their lack of investment and long term vision? Absolutely. I don't think they'll be satisfied until the last Cognoid has left the building. Sad.
After the initial shock of being acquired, I think many of us felt there were interesting and exciting new opportunities ahead as IBMers. In the new year, many of us talked about how impressed we were by Ginni's speech. We participated willingly and eagerly in the Client Jam. We were mostly happy about the 40 hours of training (before understanding it to be the watered down version it ended up being, and just something else for our managers to rank us on). How naive we were.
Many of us still love our jobs, the people we work with day to day, the products we are passionate about and proud of. But we also know if we were lucky enough to be spared this time, we'd be fools not to be actively looking for something outside IBM (or at least outside IBM Cognos). So good luck becoming one with IBM, but as others have said, don't believe anything they tell you. And keep your resume up to date. -anon-
One first level manager who is a decent person, after doing required manager shuffle was honest and told his group that they should take their careers in their hands as IBM has only its own interests at heart.
There are some YE/Q4 deliverable's that can not be impacted, yet there is a blank space for 2014 work. Asynchronously, prior to Wed, several veteran Industry and IBM SME's (Subject Matter Expert) colleagues were asked what is the value of their work today vs future in-progress? Three as a result have privately communicated that after Wed's actions they have decided to initiate “Plan B's” that do not include IBM. -LongTimer-
Health plans sold through the state and federally operated health insurance marketplaces, formerly known as exchanges, will be standardized to make it easier to compare prices and benefits.
The National Conference of State Legislatures has state-by-state information on marketplaces.
All the plans must offer the same core package of essential benefits, such as coverage for prescription drugs, maternity and newborn care, lab services, emergency services and preventive and wellness care. And none of the plans can deny coverage or charge higher premiums for pre-existing conditions, meaning illnesses or conditions you already have.
The difference between the four choices will boil down to something called "actuarial value." Simply put, it's how much of the total costs of covered benefits the insurer will pay for an average person.
Those who want to maintain a virtually unregulated and expensive private healthcare system want Americans to keep their blinders on. They want Americans to disregard math, facts, historical data, and empirical data. They want to treat the healthcare system as if it is a market, a healthcare market in which products would be correctly priced based on supply and demand with private entities keeping costs down through competition. ...
Simple math dictates that if there are many entities managing the payment of medical bills, each with its own bureaucracy (CEO, President, Board of Directors, advertising, IT systems, shareholder profits, etc.), it is impossible for such an entity to be more efficient than one entity responsible for paying a medical bill. A single payer system, a system where one entity is standardized to pay all medical bills that ALL abled Americans pay into, is much more efficient. It is basic arithmetic.
Every industrialized country in the world except the US has either a single payer system or some form of it. Most of these countries have better outcomes than the US. Inasmuch as they have better outcomes, they do it at a lower cost. ...
According to Kroft, after the 60 Minutes piece aired, HMA’s admissions fell and their profits declined. While Obamacare will put more controls to protect the consumer, until a single payer system is implemented to wring inefficiencies out of paying for healthcare, until doctors’ educations are subsidized to protect them against unbearable student loans, and until the government gets paid by drug companies for profits made on research paid for by the American taxpayer, the American healthcare system will remain expensive and inefficient. It will remain nothing more than a wealth transfer engine to the shareholders of hospitals, medical groups, insurance companies, and drug companies.
But when the Federal Trade Commission finally decided to look at the deal, it encountered an entirely different objective: to gain market power.
Mark Neaman, Evanston’s chief executive, had told his board that the deal would “increase our leverage, limited as it might be,” the investigation found, and “help our negotiating posture” with managed care organizations.
The commission caught Ronald Spaeth, the Highland Park C.E.O., talking about the corporation’s three hospitals and explaining how “it would be real tough for any of the Fortune 40 companies in this area whose C.E.O.’s either use this place or that place to walk from Evanston, Highland Park, Glenbrook and 1,700 of their doctors."
It was a great deal for the hospitals. The fees they charged to insurers soared. One insurer, UniCare, said it had to accept a jump of 7 to 30 percent for its health maintenance organizations and 80 percent for its preferred provider organizations. ...
What was learned from the investigation is more relevant than ever today. It should draw policy makers’ attention to an elephant in the room that appears to have been overlooked in the debate over how to rein in the galloping cost of health care: a lack of competition in what is now America’s biggest business — accounting for almost 18 percent of the nation’s gross domestic product. ...
What is missing from the stampede of policy innovation is something to tackle one of the best-known causes of high costs in the book: excessive market concentration. ...
Two decades ago, there were on average about four rival hospital systems of roughly equal size in each metropolitan area, according to research by Martin S. Gaynor of Carnegie Mellon University and Robert J. Town of the University of Pennsylvania. By 2006, the number of competitors was down to three. ..
And consolidation is continuing. Professor Gaynor counts more than 1,000 hospital system mergers since the mid-1990s, often involving dozens of hospitals. In 2002 doctors owned about three in four physician practices. By 2008 more than half were owned by hospitals.
As a result, not only will clients have unfettered access to health insurance coverage starting in 2014, but they will have that access regardless of employment status. This represents a significant distinction from the environment of today and decades past, where individual health insurance policies were individually underwritten - with the potential for coverage being declined, limited due to pre-existing conditions, or rendered unaffordable - and the only guaranteed coverage without pre-existing limitations or potentially severe health-specific premium increases or exclusions was via an employer. ...
Those who are considering a job change no longer need to ask or worry about whether a new employer offers a comparable - or any - health coverage, because access to health insurance will no longer be contingent on getting it through an employer's group plan. This means clients can actually make job decisions based on the merits and prospects of the job itself, and not feel limited because a new job may or may not offer (good) health coverage! In addition to benefitting clients by allowing for more flexibility in their job decisions, this may also be a big boon to very small businesses that have struggled to offer health insurance and consequently struggled to attract quality employees without having it available. Going forward, providing health insurance through an employer will be less and less of a relevant factor in the job decision-making process at all; instead, it will simply be about total compensation, used to purchase food, shelter, clothing, and now health insurance, along with all other types of insurance employees buy (auto, home, life, long-term care, disability, etc.), and anything else employees wish to do with their money!
Clients who are considering retirement no longer need to wait until age 65 and Medicare eligibility to ensure health coverage in retirement, which research finds is still a significant factor in the timing of retirement. Although in theory an individual who previously had health insurance through an employer could continue it through COBRA and then HIPAA to ensure ongoing individual coverage, the reality was that HIPAA policies were often significantly more expensive than employer-based health insurance. Now, those who want to stop working can do so and be assured of health insurance coverage that is priced substantively the same as what they already had while working (although premiums may still rise with age), with the exact same availability of benefits and no worry of limitations due to pre-existing conditions or future health changes.
Clients who are interested in starting a new business - whether as an opportunity to start a career, grow their current career, or as a second (or third or fourth!) career after completing their first - will no longer be constrained to having at least one spouse work for a "larger" employer offering health insurance. Those who want to go start a business can do so without being hampered by worries about whether or how they will get access to health insurance!
The law’s tepid cost control measures targeted at healthcare spending that is gobbling up an increasing percentage of the economy and pricing more people than ever out of access to care have been widely viewed as the ACA’s biggest pitfall.
But from the outset, the Obama administration dismissed the most effective means to reduce costs by:
Those fateful decisions left only one option for significant reduction of overall health expenditures – saving money in the delivery of care by shifting costs to those who use health services and discouraging them from getting care even if they have insurance.
Perhaps that’s not surprising given the decision to craft the ACA in concert with pharmaceutical, insurance, hospital, and Chamber of Commerce lobbyists, and, as recently reported, top Wall Street investment firms and hedge fund executives.
The healthcare giant has the highest rates in Southern California and some other areas of the state, surpassing rivals such as Anthem Blue Cross and other smaller competitors. The relatively high premiums from such a strong supporter of the federal healthcare law surprised industry analysts, and it has sparked considerable debate about the company's motives.
Some experts say Kaiser intentionally bid high to avoid drawing too many customers next year who are sick or who have been uninsured for years and may be costlier to treat. Others suspect Kaiser was worried that lower premiums would bring an influx of newly insured patients that could overwhelm its in-house roster of doctors and hospitals.
Another possible reason is that the current Kaiser patient population is relatively stable at about 40 percent of the California insurance market. When patients change their PPO or HMO plans that use provider networks, they do not have as much disruption as they do when they move into or out of Kaiser Permanente. Such a move always entails a complete change of their physicians and hospitals. Since Kaiser realizes that they have not only dominant market share but also a stable group of satisfied patients who do not want any disruption in their care, they know that they can charge a little bit more for their plans since patients are willing to pay the modest differences to avoid such disruptions.
"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.
For more than three years some of us have fought the policy elite’s damaging obsession with budget deficits, an obsession that led governments to cut investment when they should have been raising it, to destroy jobs when job creation should have been their priority. That fight seems largely won — in fact, I don’t think I’ve ever seen anything quite like the sudden intellectual collapse of austerity economics as a policy doctrine.
But while insiders no longer seem determined to worry about the wrong things, that’s not enough; they also need to start worrying about the right things — namely, the plight of the jobless and the immense continuing waste from a depressed economy. And that’s not happening. Instead, policy makers both here and in Europe seem gripped by a combination of complacency and fatalism, a sense that nothing need be done and nothing can be done. Call it the big shrug. ...
Why isn’t reducing unemployment a major policy priority? One answer may be that inertia is a powerful force, and it’s hard to get policy changes absent the threat of disaster. As long as we’re adding jobs, not losing them, and unemployment is basically stable or falling, not rising, policy makers don’t feel any urgent need to act.
Another answer is that the unemployed don’t have much of a political voice. Profits are sky-high, stocks are up, so things are O.K. for the people who matter, right? ...
The tragedy is that it’s all unnecessary. Yes, you hear talk about a “new normal” of much higher unemployment, but all the reasons given for this alleged new normal, such as the supposed mismatch between workers’ skills and the demands of the modern economy, fall apart when subjected to careful scrutiny. If Washington would reverse its destructive budget cuts, if the Fed would show the “Rooseveltian resolve” that Ben Bernanke demanded of Japanese officials back when he was an independent economist, we would quickly discover that there’s nothing normal or necessary about mass long-term unemployment.
So here’s my message to policy makers: Where we are is not O.K. Stop shrugging, and do your jobs.
America, for instance, has an exceptional economy. GDP-wise, it is the largest in the world, making it the planet's most powerful engine of technological innovation and wealth creation. At the same time, the economy is exceptional for creating the industrialized world's most financially unequal society; producing one of the industrialized world's highest rates of childhood poverty; and mandating the industrialized world's least amount of off time (paid sick days, maternity leave, etc.).
In terms of health care, we have an exceptional system that stands out for spending more than any other nation's. According to the Cato Institute's Michael Tanner, that gets us a system that “is at the top of the charts when it comes to surviving cancer (and) drives much of the innovation and research on health care worldwide.”
Then again, America's health care system is also exceptional for being the only one in the industrialized world that doesn't guarantee health care to every citizen. Results-wise, that contributes to a society that, according to a recent National Academy of Sciences report, is far more unhealthy than 16 other developed nations.
“Americans have been dying at younger ages than people in almost all other high-income countries,” the report noted. “Not only are their lives shorter, but Americans also have a longstanding pattern of poorer health that is strikingly consistent and pervasive over the life course.” ...
In terms of military might, America is exceptional for having the planet's most dominant fighting force. We are also exceptional for our spending - we devote more resources to military programs than the next 19 biggest-spending nations combined. And compared to the rest of the industrialized world, we are exceptional in the number of ongoing wars we prosecute; the amount of people we kill; and the amount of casualties we regularly incur. ...
Can, for instance, we have an exceptional economy without the exceptionally crushing inequality and poverty? Can we preserve the exceptional parts of our health care system, but also have a system that is less exceptional for how it denies access to all citizens and often delivers substandard health outcomes? Can we preserve exceptional freedoms while also being a less exceptional in our incarceration policies? And can we preserve an exceptionally effective military but be a little less exceptional in how much we spend on the Pentagon, how many wars we initiate, how many casualties we incur and how many people we kill?
It's as if an entire branch of the federal government -- the branch that's supposed to deal directly with the nation's problems, not just execute the law or interpret the law but make the law -- has gone out of business, leaving behind only a so-called "sequester" that's cutting deeper and deeper into education, infrastructure, programs for the nation's poor, and national defense. ...
A great nation requires a great, or at least functional, national government. The Tea Partiers and other government-haters who have caused Washington to all but close because they refuse to compromise are threatening all that we aspire to be together.
Hanauer talked about a “virtuous cycle,” where middle class consumers have enough money to buy things, which stimulates the economy and creates more jobs. Nick Hanauer was an original investor in Amazon.com, and he founded the company that became Overstock.com. He said that as an investor, he helped start dozens of businesses, but he added, “if no one could have afforded to buy what we had to sell, my businesses would have all failed, and all those jobs would have evaporated.”
During his testimony, Mr. Hanauer called for higher taxes on the wealthy and corporations, and said that money should be used to invest in our middle class. He said, “Prosperity is built from the middle out.” Nick Hanauer understands that we must invest in our nation to get our economy growing again… hopefully, our lawmakers were listening.
The backstory of the 401(k). What's he mean? To understand, let's back up, to the accidental rise of the 401(k) -- to the 1960s and 70s. Back then, if you worked for a big company and retired, you got a pension. A regular check.
Benna helped run these plans. He was a consultant. And in the late '70s, he was unhappy.
"Most of what I was doing was working with business owners," he says. "Their main interest was, 'how can I get the biggest tax break, and give the least to my employees, legally?'"
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