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Highlights—June 22, 2013

  • I, Cringely: IBM to customers: Your hand is staining my window. By Robert Cringely. Excerpts: A month ago I began hearing about impending layoffs at IBM, but what could I say beyond “layoffs are coming?” This time my first clues came not from American IBMers but from those working for Big Blue abroad. Big layoffs were coming, they feared, following an earnings shortfall that caused panic in Armonk with the prospect that IBM might after all miss its long-stated earnings target for 2015. Well the layoffs began hitting a couple weeks ago just before I went into an involuntary technical shutdown trying to move this rag from one host to another. So I, who like to be the first to break these stories, have to in this case write the second day lede: what does it all mean?

    It means the IBM that many of us knew in the past is gone and the IBM of today has management that is, frankly, insane. ...

    Here comes the experiment. Look at the comments at the bottom of this column. There will shortly be dozens, possible even hundreds, of them. See how many of those comments are from happy IBM customers. If IBM is doing a good job then IBM customers will speak up to support their vendor and tell me I am full of shit. Customer satisfaction is all that matters here, because at the end of the day companies live and die not by their quarterly earnings-per-share but by their ability to please customers. And I’m quite willing to predict that the number of comments from happy IBM customers below will be close to zero, because IBM is a mess, customers are pissed, and management doesn’t seem to care. ...

    Let’s look at IBM’s recent financial numbers, which you can find in several places (I prefer Yahoo Finance, myself). IBM’s Global Technology Services brings in the most revenue, 38.5 percent and 29.4 percent of the profit. Only the software group is bringing in more actual profit. IBM’s big money maker is struggling. Revenue is slipping and profits are being maintained by cost cutting. Cost cutting is hurting the quality of service and that is contributing to the decline in overall business. There is no rocket science to this.

    Internally IBM is amazingly secretive. Employees are rarely told anything of substance. This includes business plans. For the most part the rank and file of IBM do not know anything about the company’s business plans. What is Ginni Rometty (she’s the chairman, president and CEO of IBM) doing? What is her plan? Most of IBM simply does not know. Workers are given the company line, but none of the company substance.

    Take, for example, these current layoffs: how many people have recently lost their jobs at IBM? Nobody outside the company actually knows. The even more surprising truth is that almost nobody inside the company knows, either. I’ve heard numbers from 3,000 all the way to 8,000 current layoffs and you know I believe all of them because there are so many different ways to carve up this elephant.

    Global IBM employment is clearly dropping but employment in India, for example, is rising, so is this a net global number or gross layoffs? Nobody knows. What we do know is that layoffs are happening in nations where IBM salaries are higher than average — Australia, Canada and the USA — yet where regulations more easily allow such cuts. No jobs are being lost at IBM France, as far as I’ve heard, because there would be no associated financial savings in that socialist system. ...

    What has become evident to me about these particular layoffs is that they are extreme. Good, hard-working, useful employees are being let go and their work transferred either to other local team members who are already overworked or to teams in India. Customers are rightly growing wary of IBM India.

    I’ve heard from some IBM customers who say they have been bending Ginni’s ear about IBM screw-ups. So she started an initiative to improve the “customer experience.” Alas, from those who have been touched by it so far this initiative appears to be all marketing and fluff with no substance behind it. The things that are upsetting IBM customers are not really getting fixed, the company is just telling customers that things are being fixed. The truth is that in foreground IBM has more people telling the customer what they want to hear and in the background IBM has more people yelling at the support teams to do a better job. ...

    Internally the story is that Ginni expects each division to make its numbers. No excuses. Failure is not an option. That explains these new layoffs. Each division is looking at its budget and is in the process of cutting itself back to prosperity. We can probably expect IBM to do something like this every quarter from now on.

    IBM executives are fixated on the 2015 plan. That plan is only about increasing shareholder value, AKA the stock price. Ask Warren Buffett, if you have him on speed dial, if this kind of thinking even qualifies as a business plan. He’ll tell you it doesn’t.

    Here’s what’s most likely coming for IBM. As each quarter rolls by it will become more obvious to Wall Street that IBM’s business is flat and/or declining. IBM may make its income and profit goals each quarter, but revenue will continue to going down. The only thing that will change this is if the dollar drops dramatically — an effect that has helped Big Blue before. But if the dollar stays about where it is, perception is an important part of any stock price and when a business is flat or declining, Wall Street does not like that. Regardless of how many jobs IBM cuts, then, the stock price will eventually go down. IBM can make all its income and profit goals yet the stock price will still drag down shareholder value.

    Making its numbers is IBM’s only priority right now. IBM will push its customers to the breaking point and will abuse its employees to achieve this goal. IBM does not care who it hurts. The IBM that used to be the leader in social reform and good corporate citizenship no longer exists.

    Where are the customers in this? In IBM’s big plans its customers are a necessary evil. When you look at the poor quality of service IBM is providing it is very clear IBM does not value its customers. Making the 2015 plan is the only priority and IBM is willing to compromise its service to customers and abuse its workforce to get there. ...

    Sometime, perhaps soon, CEO’s and CIO’s will begin to openly discuss their IBM experiences in Wall Street circles. Perception is a powerful force and it will eventually take a big bite out of IBM. Only then, when it’s already close to over, will the general press, the public, and our government even notice what’s happened.

    At some point IBM will realize its 2015 plan has already failed (remember you read it here first). IBM’s stock price will drop… a lot. When the price is low enough it will force the company to change how they run the business. At that point they may actually go back to doing things right, and IBM’s value might improve again.

    Frankly, by then it will probably be too late. I wish I was wrong about this.

    Selected reader comments follow:

    • Existing customers that have left, and potential new customers that IBM lost… others prominent examples that come to mind: CIA (lost to Amazon), The City of Austin, just off the top of my head. The article that broke the news of the City of Austin loss was great; every reason the city gave for dropping IBM was totally consistent with us employees see first hand within IBM; it’s a complete joke, IBM just isn’t setup to retain talent. It’s just that simple.
    • How about the State of Tx? State of Indiana. Disney. Multiple failures in Australia (might explain why Australia was hit especially hard). Somerset County, UK. You can Google “IBM loses contract” and probably find more.
    • I have a bigger picture question. Why do you find it so important that IBM survive? The vast majority of companies come to an end and IBM has had a far longer run than most. We celebrate capitalism and creative destruction. Are we really better off with a single large IBM, or unleashing all those people to form new companies that react to their customers, best practises, investors, creativity etc? I just hope that no governments treat IBM as too big to fail and hand out corporate welfare.
    • I see no end to this trend with current management.” You might better ask what the other 99% of IBM has that new management could have exploited after having been installed a year ago. I’m just not seeing how Big Iron is part of the solution these days, given that the crown for cutting-edge semi technology left IBM many years ago: they didn’t have a customer base that could pay back the intense R&D the way that Intel and TSMC do. Services? It’s not just computing where services provide high short-term revenue, but is impossible-to-capitalize, difficult-to-leverage business.

      IBM’s culture, its traditions, its values, its employees, all its other resources: I just can’t see why they are more valuable as IBM than as Something Else. Hope its many talented people understand this and plan accordingly. Ditto, the many customers… but of course, the problem is that many of them already made those decisions.

      If Cringely wants to show some first-class thinking, rather than hand-wringing about IBM’s senescence, he could tell us what would revitalize it in a way that would let it thrive another 100 years. I’m joining you, @Roger, in calling his bluff.

    • Bob, your ability to put your finger on the pulse of a company I have worked for continues apace.

      It’s been a long time since I worked for IBM in their huge Boulder complex, but all the things you describe were already in place by the time I left. Employees with no knowledge of the company direction, blind interest in making the numbers, and most damning, the willingness to kill jobs and increase the load on others to do so.

      Back in the day, I was the Tier II Network support guy, contracting for IBM. My job was to monitor the worldwide network for a global services company known for it’s work in the oil&gas market which had outsourced the monitoring job to IBM. And it was a huge job – The company in question has it’s network on every imaginable type of device, from dialup to satellite. (Thou shalt not use SAP to manage your office – well, tent – when one’s only connection is a 128k satellite link.) The monitoring group didn’t make the numbers, so the decision was made to consolidate. They let people go, and I was told that I would now be responsible for monitoring eight other company’s networks, in addition to the 3000+ network nodes I already had on my plate.

      I refused.

      My contract specifically stated what company I was there to support, and in my opinion, doing so well took all of my time. I did so knowing that it would mean my eventual dismissal, which was fine with me. The highest levels of IBM management I saw appeared to know nothing about technology, and entirely too much about internal politics and the fine art of backstabbing. By the time I left, the company I was supporting already had their own NOC in place and was preparing to cancel their IBM support contract, as were many of the other companies that we supported. The quality and timeliness of the support had gone down, and many of the IBM employees I worked with had been forced out – many after paying for their own relocation to Colorado for the promise of continued work for IBM.

      When I walked out for the last time, it was with a determination that I would never work for Big Blue again. Shortly thereafter I moved to greener – much, much greener – pastures in Seattle. Nothing you have said is a surprise. As much as I hate to say it, I don’t think that the company is salvageable at this point. The rot is too deep.

    • Bob I am a Cognos “customer”. At least I was a customer before IBM bought them. To IBM I do not exist except when support renewal time comes and they fumble around trying to increase my support costs by 30 – 50%. I’m in a major metropolitan area and have never met an IBM rep to discuss my 200K investment. While I feel terrible for the IBM employees, the best thing that could happen to me is for IBM to split off Cognos and return it back to it’s former self.
    • I’ve worked for IBM twice in the last 20 years, and both times it was clear that all – _ALL_ – decisions were money-based, and the client was constantly shown legal paperwork which prevented IBM from doing costly services. The last time I was hired, it was temporary, with a promotion to another position promised in a month (50% salary raise). After 6 weeks, I was told the promotion was declined (I went to another, even higher-paying position, elsewhere); however,the client really wanted me to stay. After some discussion, it turned out IBM had been charging 450% markup on my initial hourly wage, and they couldn’t adsorb the hit which would have turned it into only 300% markup … Also, I could be standing at a desktop, wanting to fix a client issue, and because it might affect an area that HP & Cisco also supported, I was told to do nothing, repeatedly.

      Lou Gerstner may have saved the shareholders, but the soul of the company departed long ago.

    • IBM protested Amazon winning a $600M contract from the CIA. The GAO review report nails IBM on future costs and how AWS beats IBM cloud technology.
    • Lee Conrad: When IBM job cuts happen it is the Alliance@IBM CWA that is first with the news and the count. The media then report what we post on our web site. As of now it is almost 3000 notified of job loss. And where is Ginny and the other execs? Why are they silent? Why haven’t they even communicated with employees during this trying time? They don’t deserve to lead IBM.
    • I will be one of the few positive comments about IBM. We are a small company and we use an IBM i (formerly called AS400 and many other things). I buy my hardware from a business partner (as do almost all IBM i customers) so I don’t have to put up with an IBM rep bugging me. We buy hardware and software maintenance from IBM. The hardware is so reliable, I probably average 1 service all per year and most of those are routine maintenance (like change cache battery).

      The software support is great. I call to open a ticket, and get put through to a very knowledgeable tech support person (who all seem to be native English speakers). They usually solve my problem before I hang up. Other times, they can log into my system. They always follow up.

      So my little corner of IBM is running great. All of us IBM i users wish IBM would market the thing. Not market better, they don’t even market it at all. They go out of their way to change the name and do all they can to diminish a very solid hardware/software platform. So we are also aware of IBM management stupidity.

      If they start selling of whole business units, the Rochester Minnesota facility and IBM i would be a great place to start.

    • It would be easy to have a spirited debate about the technology behind the AS/400 or as it is called now, the “I” series. But that would be missing the point. This is a mature platform that is very close to begin turnkey. A firm can get everything they need to run their business on this platform. It is stable, bullet proof, runs forever, and requires very little care and feeding. Many firms can run their business without any IT help whatsoever. In the IT world that is saying a lot. That said, here we have a platform that customers love. The support is great. The customers are happy. IBM makes good money. That should be enough, right? WRONG!

      There are rumors that IBM is planning to close down Rochester and move manufacturing and support offshore. If the rumors prove true, soon i-Series customers will get to enjoy the same terrible support and service everyone else is getting. If you have a product and a line of business that is working very well. Why would you risk it all to find cheaper labor?

      The message is clear, IBM absolutely does not care about its customers, the quality of its service, … Achieving the 2015 Plan goals and getting the exec’s their excessive bonus’ is IBM’s only goal!

    • Ginni’s plan may be just Sam’s plan, warmed up. “Chase the cheap labor around the globe. Make the 2015 targets at all costs. Live off of the past backlog of contracts. Push sales people harder.” Customers may not be happy, but if she can keep reducing the average labor cost, she can perhaps make some “CEOs” happy, by reducing their charges. Skills are not important. It’s been circling the bowl for some time now. It’s a terrible business, and employees are nothing more than widgets, other than the executives and a few of those deemed “technical leaders.” Your article is accurate, and could have been written 2 years ago, and could be republished 2 years from now. P.S. – they are still reducing in France, only at a French “union agreement” speed.
    • Dear Mr. System i fan (AS400): I hope you speak Spanish.
    • Lee Conrad: IBM Jobs ARE being cut in France, Germany, Denmark, UK, Italy and others. The difference is that IBM must negotiate and consult with the workers through their unions and work councils. The numbers are also announced unlike here in the US. Alliance@IBM CWA Local 1701
    • When the layoffs first started in the late 80′s and 90′s, there were a lot of suicides something which is still happening with some frequency to this day. One famous suicide happened in Cary at the SWG building, where a despondent IBMer jumped into the atrium floor from a top floor headfirst. Another famous case outlined in a book about IBM’s layoffs of the 90′s is the case of an older lady in Charlotte who tried to commit suicide by going into the bathroom at her home just after being thrown out of the ATM development facility and slicing her wrists.

      It’s still happening as recently as January…all over the world. “IBM employee commits suicide, jumps from her office building”.

      “My husband never got over the change in the company ethics and the loss of his job. I came home one day and found my husband shot dead. He had taken his own life and had left a suicide note stating that IBM had ruined his life. He had been unable to obtain a new position as he was 50 years old and had worked for IBM for 25 years. He had always been a one in all of his appraisals over the years and had been given many awards for his work.” http://www.ibmemployee.com/Highlights090110.shtml

    • re: IBMers committing suicide – here’s another sad story: Police: Yorktown IBM Employee Dies After Bear Mountain Bridge Jump. As an IBMer for the past 17 years I can tell you that at times I’ve fell like I’ve suffered from depression working for these fools – now looking for an escape route before the ax finally falls – as it is bound to do before 2015.
    • I retired last November after 37 years as a Fed in IT. I watched as the very things that IBM has been doing were implemented within IT after it was placed under Finance. Of the 4 different agencies I worked for throughout my career, these last 10 years were the strangest as staff kept getting cut while goals and scope kept increasing.

      Reading Bob’s series on IBM was a real eye opener. Then the different projects under consideration that referenced IBM case studies started making “connections” in the business decisions. Far too many ITIL/MBAs are reading these IBM case studies without any concept of what IT needs to do its job (and without knowing the hollow shell that these case studies foist on the unsuspecting). They have all been trained by the same curriculum that can’t quantify “quality of service” so don’t include it in their metrics.

    • Midsize IBM mainframe customer here ($10 million in software/year). Really it seems there are two IBMs at work. The support side, insofar as I see it from dealing with mainframe issues, is still top notch. We had a serious issue a couple of weeks ago and in six hours we had the Level 3 guy who wrote the TCP/IP code on the horn working with us. So no complaints there.

      The marketing side however is in utter disarray. Doing contract renewals with many vendors this year, IBM among them. Asked them for a list of what we were paying for (something Bob mentioned doing many months ago) and IBM couldn’t tell us what licenses we hold. A complete joke. An ordered system was built incorrectly. Software packages shipped incomplete. It’s no surprise to me that customers are leaving. I can see the day when we will be as well.

    • Customer here using IBM’s customer support for middleware products. I have used IBM's’s support for years, and I definitely see a degradation in service from years ago.

      When I used to place a call for help with a software issue, the call-back rep, (for the most part) would be incredibly knowledgeable and would be able to get to the bottom of the issue and resolve it within an hour or two.

      Now, when I call, I talk to someone who is obviously based offshore, I can’t understand what they are saying, and they don’t seem all that knowledgeable. I hear them looking through manuals to figure out the issue, and more often than not I am put on hold multiple times while the rep asks someone else.

      The problems linger for days now, and sometimes for weeks. I can’t wait to see what happens now that they have laid more of the older, more experience workers off.

    • There is also another force to be reckoned with. There are thousands upon thousands of laid off/ex-IBMers all over the world that have a bad taste in their mouth towards the company. Every time one of those ex-employees lands in another role that involves I/T decisions (i.e.; purchasing hardware, software, support, etc) you can bet that ‘old-bitter-taste’ will rear its ugly head.

      They know how IBM operates, what they had to deal with and alas, how they were cast-out off like yesterday’s wet newspapers. Do you think they will sign a deal to bring IBM’s products and services into their new company? Heck no. As the number of ex-IBM employees grows, so does the number of ex-IBMers landing in roles in other companies. All this adds up to less work for IBM. They’re killing themselves and they are too haughty to realize it.

    • I got dinged 5 years ago and as they say, revenge is a dish best served cold – in my current IT job, IBM software will NEVER be recommended as it’s worse than garbage, only fit for the thieves (oops high prices consultants) in Global Services; I use OPEN SOURCE stuff which costs little or nothing. Let the IBM Software Group go bankrupt with their crappy, expensive acquisitions. I’ll only “consider” their lousy crap when Hell Freezes Over AND Steve Mills rots there!
    • IBM is pitiful and has been for a good long while – from a former IBMer who was there during some of its golden age. By the way, I was not one of the laid off, but I can understand their frustration with how the company operates.
    • You are wrong about IBM France. There is hundreds to be laid off in France, UK, Germany.
    • Bob.. “IBM executives are fixated on the 2015 plan” you got that right. “At some point IBM will realize its 2015 plan has already failed (remember you read it here first). IBM’s stock price will drop…a lot.”

      Don’t underestimate the ability of IBM to use Financial tricks to make the 2015 plan. The 2015 plan is all about reaching $20 EPS (earnings per share). As earnings disappoint and share price falls, IBM just buys back stock. Less shares = higher EPS even as earnings fall. Less shares also keep the $ value of the stock high even as the Market Cap of the company falls.

      Ginny isn’t making money on the market cap of IBM. She’s making money by cashing out stock options and Restricted Stock Units (i.e. a gift of stock that an exec needs to hold for a period of time before they can sell it) . Over $50M worth in the 18 months since she became CEO. And the execs at IBM keep collecting more of these gifts every year, then they turn around and use the companies money to buy back even more stock, inflate the price of the stock and make sure that they can cash out the gift for big bucks.

      You may be right. IBM may be a sinking ship but don’t count out the the Exec’s ability to keep her afloat and even hit the 2015 EPS goal. It may require throwing a lot of people overboard to lighten the load but they still have a lot of smoke and mirrors in the financial toolbox.

    • Customer Support.. I work in an internal QA position. I have been told on more than one occasion “We do not have the time or resources to fix what you found. We will address it when and if a customer reports it.”

      It is more important to get the products out the door to begin generating revenue.

      Last year some executives were stunned to learn that the reason why the number of Sev1 issues were increasing, was that customers are (gasp) testing what we sell them and finding issues that should have never made it out the door.

      We lay off skilled technical people, hire lowest cost workers, what does one expect? Add in Liquid Engineering (contract employees as needed) and downward spiral continues. Too illustrate, we received the following presentation from India: “Crowd sourcing entire project to freelancers – a new way of software delivery”.

      Learn how XXXX’s team adopted the LIQUID concept and crowd sourced their entire project to freelancers through Topcoder.com." LIQUID is a technology-driven transformation in software delivery where resources are planned, engaged and leveraged to drive optimal “outcomes”, improving TIME TO VALUE through agility, flexibility, productivity, and predictability. With Liquid, everything works off the principles of component-based development – something that has been around the software industry for decades.”

    • Cost cutting is not a long-term financial strategy to improve stock value, but it is a short-term tactic for assuring bonus payouts.
    • Being a 25+ year IBMer stuck in the middle of all this crap, I can honestly say that the morale is horrible, employees are extremely overworked and frustrated, and WE cannot stand dealing with a lot of the “gr’d” (Globally Resourced) IBMers. What most have NOT heard about the “2015 Plan” is that the only way they are going to make it is to “resource” most (if not all) of the US people and hire them back as independent contractors (task-oriented hiring). There was a slipped memo on this many years ago and there are a lot of folks in the US (including myself) that do not expect to be around past the end of 2014.

      This is not the IBM I joined many years ago. There is no respect for the individual (a mantra from the beginning) and we, as employees, get all of our news regarding layoffs from the local news like anyone else. We have seen nothing internally about the recent layoffs.

    • I don’t have any insight into what’s going on at IBM now-a-days, but I’m struck by the notion that Google has become the new IBM.

      Mobile devices, which are by their very nature constrained and more communication-style devices, have helped push the importance of cloud services. It just seems to me that the emperor of mainframes, IBM, should have been all over that space. Why didn’t IBM set up shop in the cloud?

      We’re migrating back to the thin client model with smartphones and tablets. All those thin clients need fat servers, not just for data storage, but also processing voice recognition, correlating location data and so on. Seems like a natural fit for mainframes and some branch of IBM. So maybe a tech paradigm shift that could be a natural for them has just been ignored by management too focused on the numbers. A manager I once worked with told me that when accountants are in charge, the business always becomes a slow death scenario.

    • So it’s called International Business Machines, not American Business Machine. If it were called Galactic Business Machines, I’m sure we’d see off-shoring to Mars.

      Worked at IBM for past eight years. Great place to work. Get to work at home and travel to customer sites and data centers when necessary. I understand why people are upset, because IBM has been structured like the US Government in terms of pay scales, low wages, unnecessary mufti-layer management structures, bureaucratic mazes, etc…all the while treating people like their job is a gift, instead of lifetime employment working for the government. So the worst of both worlds in one big conglomerate! Seems a necessity considering the size of the company, like a small country if you will.

      That being said, the brand is valuable. Just like a once no-name company can be valued over $100 billion dollars almost overnight (i.e. Facebook) I think IBM too can make a comeback once all the possible bad decisions have been made, all you have left is the brand with a smaller, nimbler company. Then I suspect they’ll roll out some new ideas that they’ve been hiding at the secret research facility and once again dominate, different & new. All the people like us will be gone or non-influential and the younger crop will not have any baggage about why they like/dislike the IBM brand. Clean slate if you will.

      Let say this takes 25 years to complete. So what? Anyone waiting around for this? Not likely, but with an iconic name like IBM, where else can it go?

    • Business IBM has lost — Hilton, ServiceMaster, Disney, NEHTA, State of Texas, Indiana, DoE, Sprint… Those were prominently mentioned in the press. The real list is much, much longer. I think it is about time for those customers to speak up. The only way IBM is going to be pressured to clean up their act is if their customers start telling their stories.

      There is another way to look at this. IT is a critical tool in running a business. When systems are down it causes a business serious problems. The work force can do their jobs. Products can’t be shipped.

      A couple years ago I called Hilton to get a room. The reservation system was down. They connected me to the hotel and they confirmed manually they could get me a room. When I arrived at the hotel they picked my room from a list of rooms on a clip board. Someone from the hotel accompanied me to my room to make sure someone else wasn’t already using the room.

      Two days later when I checked out, their systems were still down.

      IBM’s terrible service is seriously hurting the business of its customers. IBM is saving lots of money, but it is costing their customers dearly. The indirect costs of IBM’s business practices are enormous. It truly is time for IBM’s customers to speak out!

    • IBM was a good company, and I used to buy hardware, software, and services from them. I stopped a few years ago. There are cheaper and simpler solutions out there, and I don’t have to jump through hoops to get a fix. IBM will find itself where Hostess is, bankrupt, and selling what is left for pennies on the dollar to the highest bidder.

      I actually enjoy hiring ex-IBM folks when I have an opening, most find the grass is greener. From listening to them over lunch I have found most believe Management could care less about them or their skills.

      IBM may one day wake up, but the question is, will IBM finally treat it’s customers and employees as an asset, or will they keep ignoring customers needs, and treating their employees like a number? When IBM finally looks at me and my business as something other than a number, I may let the Sales folks in for more than buying me lunch.

    • Sigh, so IBM misses its 1st quarter revenue numbers. Ginny blames the sales force, the dwindling, less mature, largely ‘acquired’ sales force. Revenue has been flat for a LONG time, primarily because the sales force is in constant churn (large dollar sales take a long time, and usually require a decent relationship with the customer, which the constant sales churn prevents). Amazingly, despite the sales territory churn, and reduced ‘feet on the street’, the revenue has actually remained flat, not declined.

      My opinion (34 year IBM’er in software sales) is that the constant decline in, or churn of, the sales force has finally caught up with them and at this point revenue will likely not recover. This latest layoff has actually reduced the number of sales personnel, and there is no way that the remaining folks can provide the sales increases that IBM needs to turn this trend around.

      At this point, the ‘heritage IBM’ people (the older ones like me, with the historical IBM view of the job where pursuit of excellence was the main thrust of customer support) are mostly gone, and the remaining sales teams have gigantic quotas, and even if they make it are more likely to have management cap their earnings than reward them for it.

      Look at the trend, faster processors and servers, requiring fewer software licenses to accomplish the same work, gigantic quotas with little chance of getting adequately rewarded even if you DO make the number, and only an expectation that next years number will be 25% larger than the one you didn’t make this year, and you can see that the ‘best and brightest’ are no longer staying with IBM. The ones that I know that have left in the past couple of years invariably made more money with less stress. IBM is in much more serious trouble than the market understands.

    • Can someone explain this 2015 plan? What’s special about 2015? How about a 2014 plan or a 2016 plan?
    • IBM’s 2015 plan was hatched to deliver $20 earnings-per-share to the delight of Wall Street. IBMers were offered a carrot, a few shares of stock granted at the end of 2015, as a reward for helping them achieve that target — IF they are still with the company then.
    • So in exchange for working your a$$ off for three years, enduring constant layoffs of team members and fear of your own demise, and assuming (as you’ve said) that you’re still employed, you get five shares of IBM stock (or $500 to $1000) worth of stock while the executives get millions in bonuses? If the plan didn’t pan out you still did all that work and didn’t get anything?

      IBM bonuses is a section in the IBM history books, not a reality today. Not a single department I know today has the “budget” to keep everyone employed, let alone give out even a token bonus. We worked nights, weekends for almost a whole year during a massive migration to move thousands of server applications and data bases from one data center to another so the customer could save money on rent by moving to an IBM data center.

      Not cheaper, only cheaper when they factored in the fees associated with not leaving before the contract expired (and couldn’t be renewed.) What did we get in the end? More layoffs since those local resources were no longer needed after the move to the new data center.

    • With the IBM Management fixation on Roadkill Map 2015, one things stands out – What happens after that date (2015)? Does the world end, Ginny ascend into Heaven (or descend into a Hell of her own making) or is that the time of the Second Coming? I guess whatever few IBM employees are left will have to wait to find out.

      And am I glad Randy Macdonald of HR is gone? Absolutely, and I hope he gets what’s coming to him – bad Karma by the truckload! He needs it in his retirement – no one is going to shed a bitter tear for that evil man. (I’m still waiting for the verdict from the UK High Court of the IBM UK Pension scam.)

      Same goes for Sam Palmisano who tries these days to reinvent himself as an education advocate – he did away with the EXITE camps where schoolgirls learned technology.

      IBM is nothing but a disaster zone with social marketing! They need to cut more middle managers in Armonk as they did in this last round of cuts to worthless and clueless MBA managers and executives reduce your profit, IBM! Go, cut, cut cut.

    • Bob - Since disgruntled people will always be more vociferous than satisfied ones, I don’t think the number of comments to your post has anything to do with the validity of the post (though I think it’s valid).

      One thing that will keep IBM going, at least in a slower decline than you predict, is that its customers and competitors are all in the same terrified position…do more with less. The companies and government agencies have exactly the same mandate as IBM – cut costs but not services. Sure, they may realize that the promises are more than likely to be unmet, but the Nobody Ever Got Fired For Choosing IBM mentality still exists. IBM dangles a great support deal, the customer chooses IBM, sweats it out for a year or two, then gets to say, “if IBM couldn’t do it, nobody could.” And the customer CTO keeps his job and budget for that time.

      Competitors have the same tactics to keep costs down: drive out the expensive workers (nobody gets a 1 rating, forced unsatisfactory ratings for x% of a group), only hire people with less than 5 years’ experience, demand immigration reform. If the numbers look good they hope for the “bigger fool” theory to kick in where a competitor with money (who’s left?) will buy you out. HP might have money but they’re still trying to divest EDS – nobody wants to buy a services company – and Oracle definitely has the money but they can wait and pick over the carcasses for pennies on the dollar.

      So the agony will continue. Despite customers abandoning IBM (and others) there’s nowhere else to go so the merry-go-round whirls. There haven’t been major infrastructure calamities – the customers with smarts have gotten out before a catastrophe – so there isn’t any sort of watershed or domino to trigger a major change. As several commenters have noted, it’s a race to commoditize the support business before that moment occurs so that if not Skynet we have the utility grid with mobile devices (and people) each handling snippets of support that add up to adequate coverage.

      We’re in the wrong business at this moment in time. Like the fine journalists who wrote for top quality magazines and now the magazines are gone, it’s disappointing to see quantity replace (or overwhelm) quality. It’s exhausting to try and keep up with the engineering flavor of the month when the trend changes and a kid out of trade school has 3 more months of experience with NewTool than you do, so you’re out. I’m not wishing for an infrastructure catastrophe, nor do I think one will happen, so how can we effect change under these circumstances?

    • I have worked at four other software companies, two of which are effectively out of business. Both of which followed the same model IBM has been employing for the past several years:
      1. Not recognizing that the least expensive sale that can be made is the second (and third…) license of a product to a very happy customer,
      2. Not realizing where the real revenue is coming from – maintenance and upgrades, and not investing in current highly profitable product line to keep that revenue stream healthy.
      3. Thinking that the front line technical staff are interchangeable parts.
      4. The belief that ‘we can acquire our way out of stagnation.

      This model is often seen in companies where the executives have been too long away from actually being responsible for complete delivery of a product. Where failure is glossed over at the top levels, and brutally punished in the ranks.

      IBM can return to a position of preeminence in the technical world. It will require sacrifice on the past of the leadership, not the workforce. It will require a new vision rather than a continuation of failed and failing policy. Quite possibly the best thing that could happen right now is if 1/2 of the executives were fired on July 1. It would be months before anyone noticed they were gone.

    • GottaLoveIt said: ”Quite possibly the best thing that could happen right now is if 1/2 of the executives were fired on July 1. It would be months before anyone noticed they were gone.”

      LOL! Here is a current example of IBM Bloated Management “Smarter Planet Club”. Take the VP of something called Global Smarter and Innovation Alliance Solutions. This VP has only 4 people reporting to him.

      An isolated case you say? But his boss has the title General Manager, and this GM has only 7 other people reporting to him (mostly people with the title Director, but who don’t have anyone reporting to them so what is it that they are directing?). The entire chain of report for this GM is 12 people. That looks more like a 1st line managers role than a General Managers role to me.

      But wait, there’s more. That GM reports to another GM, who reports to a Senior VP, who reports to the CEO.

      So you have Director->VP->GM->GM->Sr.VP->CEO Lots of Managers but no one producing anything.

      If all of those managers were fired July 1 as GottaLoveIt suggests, who would notice, indeed. That’s your Smarter Planet at work.

    • It would indeed be a Smarter Planet@Work if Watson was to take over the IBM Company and give the CEO and her Executive Staff the boot (which they rightfully deserve) and the IBM Board (for sleeping on the job) the same treatment. That would be True Intelligence@work, not the made up PR BullS**T from the IBM Social Business Marketing Wonks!

      Pity the guy who developed Watson technology also left the company (I kid you not) to work elsewhere – I guess he saw the writing on the wall or Watson told him what could be coming his way in July 2013 ! Sad, sad, sad…no excuses for a pile of horse manure to be running a public company.

    • Has anyone realized the IBM is also HIRING new skills they need? The layoffs are a restructuring and there is an effort to hire more UX Designers etc so there are more people in the company with client experience skills. Learn about it here : http://www.ibm.com/design/
    • The fact that IBM’s own web site describes a rosy future for IBM is hardly news to anyone here. However the view from inside is remarkably different. IBM’s internal job listings show almost 24,000 supposedly “open” positions. But if you actually put yourself in play for any of them, the response is a deafening silence — at least if you are a US-based employee.

      Anyone smart enough to be employed by IBM in the first place is (in general) smart enough to learn a new skill. But IBM has no interest in retraining current employees. The HR office has a revolving door with well-paid, experienced workers who have been loyal to IBM for years leaving with pink slips while a line of dirt-cheap offshore labor comes in the other side. Meanwhile the top execs shed crocodile tears as they cry to the media and Congress, “there just aren’t enough skilled workers in our own country!”

    • Why is any of this news to anyone? The lack of caring of IBM executives for anything but their large salaries and bonuses has been evident for at least the last 6 years. My question is, why don’t shareholders care? At the end of this, the company will be decimated and their shares worthless. Do they really all think they are savvy enough to sell at the right time before things crash? As with most issues in this country, the problem comes down to pure, unadulterated greed.
    • Robert X. Cringely: Shareholders don’t often bother with the deeper story. They’ve been taught by the business press to concentrate on earnings-per-share so they do. And as several savvy commenters have explained here, IBM management has an almost foolproof way to achieve $20 in earnings-per-share by 2015 through share buybacks, layoffs, and selling divisions. But as other commenters have mentioned there seems to be no plan at all for post-2015. And maybe management doesn’t care. Shareholders and executives alike will ride earnings until those turn and then they’ll leave, simple as that.
    • Mr. Cringely is spot on as usual. Why do I say this? Because I spent over 25 years working for big blue and watched the place erode beneath my feet like a limestone rock under rushing salt water. The place is eat up with executives who are nothing more than corporate politicians looking out for their own careers and wallets. It’s become a financial engineering holding company in major decline.

      Working at IBM as a rank-n-file technical person had become a case study in career suicide. If you have technical skills, get out ASAP! I did last year and was most pleased, and consider myself very fortunate, to have found employment where they actually value their employees as ‘people’ and not ‘resources to be discarded in order to prop up quarterly EPS.’

      IBM has Wall St. totally bamboozled but that, too, will end soon. Sadly, when the end approaches, IBM executives will take their spoils and run, leaving the employees, clients and remaining shareholders in the mud. Classic case of ‘The Emperor Has No Clothes’ and someday to be published as a business class entitled ‘Do Not Attempt This.’

    • The IBM top dogs (no pun intended) can spin these latest layoffs however they want: ‘remix’, ‘re-balance’, just pick your slogan. But the truth is that IBM is in fast decline all because of executive (and Wall St.) greed. The leadership has gutted the company, destroyed morale, offshored to the cheapest labor possible (irregardless of skill) and sent a once-great company swirling around the toilet all in the name of ‘maximizing shareholder value.’ I’m now (very happily) with another company and we continue to be amazed, in a bad way, how horrendous IBM service has become. You never know who you’ll get on the line when you call 1-800-IBM-SERV support. But one this is for sure, you definitely won’t get anyone from Armonk as they wouldn’t know what to say in the first place.
    • You didn’t say it first. I said it a long time ago. This all started with Gerstner, then Palmisano and now Rometty. They are not tech savvy. They don’t know how to do anything new; all they can do is cut costs. Cutting costs only works once. IBM has been bent to get rid of the hardware as they learned by following Microsoft that software was more profitable. First they went to services which are labor intensive. Yes IBM does middleware but how many companies need middleware? Notice how small the software revenue is for IBM; it may have high margins but it's not a majority of the incoming revenue. So IBM jumped on the services bandwagon and started to do better as Gerstner straightened out some things. Then when Oxley Sarbane went into force, Gerstner didn’t want to sign the financial statement and retired. The little RJR Tobacco CEO in his prior life ran away with his tail between his legs. By the way, he was the 2nd choice to lead IBM; it's just after the first candidate turned it down that the IBM board said he was the first.

      Palmisano, this is the CEO who stuffed the PC channel for 8 quarters at one point. Oh yeah he is real good. So he cut some more and of course he doesn’t bring anything new in. Then just before he sets up Rometty by appointing her CEO, he makes this stupid promise to have $20 earnings per share by 2015. The author is correct in his opinion that IBM has its blinders on and doesn’t care about anything else.

      What has thrown the effort into crisis is that Lenovo walked out on the purchase of the x86, System x server business. The CFO had already booked the profit in the deal in his plans. And now that its not going as expected, IBM executives are scrambling for a recovery plan. Yes there are rumors that Lenovo is looking for funding to support the purchase, the fact is it isn’t going to close when IBM wanted it to. I dont’ know why Lenovo would want it, I heard it was only the commodity x86 servers and not the server blades. All Lenovo needs to do is wait till IBM gives up on it and pick up the manufacturing capacity that IBM is no longer using.

      The fact is that IBM has no vision to bring in new revenue, there is more competition in service and even what they have is labor cost intensive, no profit margins. Its just too late, most of the experience employees are retired or laid off, lost benefits. Why would anyone go back to that to help some company that lied to them and broke promises. There will be other companies that will pick up the slack.

    • This would be the US centric “GM and VP” club who are foul-mouthed, overpaid, and spend their time abusing subordinates, working out ways to avoid tax (they should have been at the inquiry with Apple), and siphoning money from the world back to Armonk. The good people are leaving (most have gone) in droves (many by choice). There is no strategy. IBM missed the boat on “cloud” and still doesn’t get it. They are trying (again) to force customers into a “one size fits all” approach. It doesn’t work. They have failed twice before. The Services company is in dire trouble, I believe it is terminal.

      Sam P started this rot (and undid so much of the great platform Lou built) , and one of his deputies ( and co-architects of the ridiculous 2015 commitment) is now keeping the oil tanker headed directly at the rocks.

      As an employee it is somewhat disconcerting to see this happening, but in all honesty as a top rated performer in the company for 10+ years, with no pay rise worth mentioning in that time, or thanks for 80+ hours weeks ( while watching the fat cats in the US blunder along and get paid fortunes.) I don’t give a shit. Now I work much less, and the weekends are mine...so I’m sure I won’t be around long.

      I pray for another Lou...there is no senior exec talent in IBM, smart enough to save it.

    • Over the past 10 years, IBM has stopped listening to its employees or middle-management, even up to the Sr. VP-level. As for U.S. executives, they continue to play musical chairs. The only new additions to replace the rapidly retiring are recent immigrants from IBM offshore organizations. They are so happy with finally getting recognition and advancement that they are ignorantly loyal, passive, and unthinkingly conformist.

      The customers these days have IT organizations that are chaotic messes, on the verge of collapse, due to mismanagement–lack mature services management, process and systems. They believe IBM can save their IT and cut costs, including whacking resources. The reality is that IT realignment and transformation comes at a premium and the contracts are basically “your mess for less.”

      The customer decision makers won’t expose they made huge mistake and after transition to IBM cannot afford to change. It’s the really big customers who can walk away. So, IBM CRM is symbiotic and parasitic at the same time.

    • I remember at the University in Business law I studied briefs on IBM and how they rewarded risk. Well I was a relative (4 years) newbie with the company when Gertsner took over. A lot of the old time IBMers who retired and have medical just can't swallow this but it’s all true. I saw a good company go south.

      In the mid 90s I watched managers lay off employees to save themselves (i.e. they took their job). I was under the old pension plan and got caught up in the layoffs in 2007 (i.e. target on my back). I warned a friend it was going to happen to him too and he called me a nut case. A few months down the road sure enough he was gone too.

      They have been getting rid of the defined pension people for years and they don’t do it in one big swoop so as to not attract scrutiny. Now I didn’t have to train my replacement because I’m sure that she/he just took on extra work load. I went from a team of 3 to me. It was horrid working 6am-10pm everyday and most weekends (because I was worldwide). If I didn’t make my numbers I got dinged – if the execs were failing they just moved to another division without any accountability.

      It’s too bad. It used to be a great company. I went to school part time to get my degree so I could go to work for IBM. I’m sure Watson is rolling over in his grave.

  • The VAR Guy: IBM to 1,700 Laid Off Employees: You've Been Remixed. By DH Kass. Excerpts: In April, on the heels of a disappointing Q1 performance, IBM vowed heads would roll, first of the executive type and then from the rank and file in a worldwide restructuring the cost of which the vendor pegged at $1 billion.

    As promised, IBM set the guillotine loose on Wednesday, issuing known pink slips to some 1,650 workers in multiple geographic locales and departments, with the overall layoffs expected to run to as high as 8,000 jobs worldwide, according to reports. ...

    Information on the cuts flowed to the Alliance@IBM site so fast and in such volume—there were, in fact, 229,000 hits Wednesday and another 200,000 on Thursday—that it slowed the server to a crawl.

    IBM, while acknowledging the layoffs, declined to provide any details. “Change is constant in the technology industry and transformation is an essential feature of our business model,” said Douglas Shelton, an IBM spokesperson. “Consequently, some level of workforce remix is a constant requirement for our business.”

    Don’t you just love how IBM uses that word—remix? It’s enough to be furloughed out of a job but quite another matter to be “remixed” out of employment. What’s wrong with IBM that it simply can’t call a layoff a layoff? At least be honest about it.

    The company’s language with employees does make you wonder what’s going on there. Post its Q1 disappointment, IBM chief executive Ginni Rometty in an all-hands-on-deck meeting made a point to scold employees, in part, for not communicating well enough with accounts to seal the deal. This, from the same people who don’t have the fortitude to call a layoff a layoff. Go figure.

    The vendor’s attitude certainly hasn’t ingratiated itself with some employees. One poster at the Alliance@IBM site gave the company an earful:

    "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, continuously subjected to working on out of date green screen applications that do not communicate with each other yet we try and convince customers to transform the way they do business, no worthwhile training - take a new role and told to learn from peers, rent a car rather than driving your own personal car since its cheaper than reimbursing mileage - well, what if the nearest rental car company is 10 miles away, ruin year-end holiday and New Years with family by demanding people to work - change the fiscal calendar year end to Jan 31st so people can enjoy 12/24 through 1/1 -that would make so many people happy. I could go on and on. Last note, Ginni has cashed in over $50 million in stock options since becoming new CEO. Looking for new home."
  • New York State Senator Greg Ball: Senator Ball Statement on IBM Layoffs: ‘Case Study in Poorly Managed Corporate Welfare’. Excerpts: Senator Greg Ball (R, C, I – Patterson) issued the following statement after the news that hundreds of IBM employees in Westchester and Dutchess Counties have received pink slips.
    “This simply confirms what we have know about IBM’s tendency to accept taxpayer dollars, lay folks off and shift responsibility,” said Senator Greg Ball. “We’ve asked Governor Cuomo to get solid commitments from IBM in writing, in return for taxpayer subsidies, yet he has refused to do so. If anyone needs a case study in poorly managed corporate welfare, in a state set to unveil billions more, this is it.”

    In October of 2011 Senator Ball demanded answers after Governor Cuomo announced plans to give $400 million in taxpayer incentives to IBM, a company known for outsourcing, with no strings attached.

    In 2009, Ball demanded an investigation into IBM’s offshore practices after they received over $100 million from New York State. In December of 2008, IBM also accepted $45 million from the Empire State Development Corporation in return for not cutting jobs at its East Fishkill facility. Just two weeks later, the company laid off 274 workers.

  • Ottawa Sun (Canada): IBM makes major cuts at Ottawa offices. By Chris Hofley. Excerpts: IBM is laying off several hundred workers in Ottawa this week as part of a major international cut in its workforce.

    Employees have also been told not to discuss workforce issues, though several of them confirmed to the Sun Wednesday that layoffs — believed to be as many as 200 or more in Ottawa — were taking place. ...

    In a somewhat unusual recruitment effort, Shopify.ca set up a booth at the entrance to the IBM property on Riverside Dr. While some employees called it a “gutsy” way to try and land new employees, the recruiters said they had been busy talking to people with a variety of skillsets.

    “We thought it was the ultimate in efficiency,” said Doug Tetzner, who said his company has hired former IBM workers in the past.

    An IBM spokeswoman declined to confirm the layoffs, but made a brief statement when contacted by the Sun.

    “IBM is constantly rebalancing it’s workforce and what that means is reducing in some areas and hiring in others based on shifts in technology and client demands,” said Carrie Bendzsa.

    Selected reader comments follow:

    • People have to read between the lines. “IBM is constantly rebalancing "Outsourcing" it’s workforce "To India" and what that means is reducing "Canadian Jobs" in "All" some areas " in Canada" and hiring in "India" as "India daily wages are cheaper than a pack of smokes" based on shifts in "Outsourcing " technology and client "Investor" demands,” said Carrie Bendzsa. Yep, that sounds about right!
    • They didn't get 9 months warning and the ability to have someone take an early retirement in their place?
    • What does IBM even do anymore besides rip off the government with hefty contracts that return shoddy products and support?
    • People, our greatest resource. Or was that shareholders?
  • Nelligan O'Brien Payne LLP (Canada): Important Information for Employees Impacted by IBM Layoffs. Excerpt: You will have a lot of questions, and will need experienced counsel and guidance to help you work through these issues. The experienced employment lawyers at Nelligan O'Brien Payne are ready and able to help you. A free group information session was held on June 21st at the Travelodge Hotel & Ottawa Conference Centre with general information on employee rights and entitlements.

    For more information on the next steps in the legal process regarding this recent layoff, please click here to contact our Employment Law Practice Group by email (employmentlaw@nelligan.ca) or call us at 613-231-8216 during our office hours.

  • Vermont Digger: Scores of laid-off IBM workers seek help at state Rapid Response session. By Hilary Niles. Excerpts: About 125 laid-off IBM workers showed up Wednesday morning at the first of four Rapid Response sessions the Vermont Department of Labor has planned to help those who lost their jobs at IBM’s Essex Junction plant last week.

    Officials said it was difficult to know how many attendees to expect because they had not received firm numbers from the company. To cover their bases, 200 information packets were prepared for each of Wednesday’s two sessions. Two more meetings are scheduled for 9 a.m. and 1 p.m. Saturday at the Sheraton Burlington Hotel and Conference Center on Williston Road in South Burlington.

    At least 2,930 layoffs have been counted by the Alliance@IBM, an unofficial union for the corporation’s at-will workers. In 2010, IBM stopped providing a public breakdown of how many employees work at each of its locations. Federal and state thresholds requiring the company to provide firm numbers to the state have not yet been met, said Rose Lucenti, director of workforce development with the Labor Department. ...

    Workers who have been given notice that they’ll be laid off are encouraged to call the Labor Department as soon as possible to discuss the best timing for their unemployment application and claims.

  • PC Advisor: IBM says Australian job cuts part of business transformation. By Hamish Barwick, Computerworld Australia. Excerpts: IBM has responded to media reports that it will be cutting up to 1500 Australian jobs by saying that transformation is an "essential feature" of its business model.

    The Sydney Morning Herald reported on June 19 that jobs would be sent offshore to New Zealand and Asia. According to the SMH report, Australian executives were told by the company's New York office they needed to cut approximately 10 per cent of the Australian workforce this year following disappointing global first-quarter results.

    An IBM Australia spokesperson told Computerworld Australia that change is constant in the technology industry and transformation is an "essential feature" of its business model.

    "Consequently, some level of workforce remix is a constant requirement for our business," said the spokesperson. "Given the competitive nature of our industry, we do not publicly discuss the details of staffing plans."

  • The Sydney Morning Herald: IBM quietly slashing Australian jobs. By Ben Grubb. Excerpts: IBM Australia is in the midst of axing up to 1500 Australian staff in a reshuffle that will send many jobs offshore to Asia and New Zealand, according to sources. Affected staff have told Fairfax Media between 1200 and 1500 local jobs are being made redundant this year in several waves.

    Local executives were told of the redundancies in a March teleconference, one source said, ahead of a global restructuring plan announced in April. Australian executives were told by the company's New York office they needed to cut about 10 per cent of the Australian workforce this year following disappointing global first-quarter results. The company is estimated to employ between 12,000 and 14,000 staff in Australia.

    The redundancies add to simmering ICT job losses in Australia due to offshoring and cuts by other giants such as HP. Technology workers in banking and other large industries have reported being fired but only after training people in India, China or the Philippines or workers on 457 visas to do their jobs. Government agencies have also shed IT jobs, with the Queensland Government this month announcing 1700 IT jobs are likely to go. ...

    IBRS analyst Alan Hansell, who specialises in advising on outsourcing of IT and the IT skills market, said the IBM job cuts mean there will be fewer IT jobs for Australians. "It's another reason why it's important to review the 457 visa program," Mr Hansell said. "Why bring people in on 457 visas to do IT work when Australian IT jobs are being shed?" ...

    "IBM has made a lot of acquisitions... and it would appear that they have not managed them very well," Mr Hansell said. "I suspect that IBM is going to be in more trouble [soon] as it is losing more of its senior managers and specialist thought leaders." ...

    Several hundred Australian employees have already been made redundant, sources who spoke to Fairfax on the condition of anonymity, said. They said the redundancies were being rolled out in three or five phases, the first beginning at the start of last month, with another planned for July and September.

    About 450 staff at IBM's Global Business Services division are expected to go by June 30, one source said. Many support staff at the company's Ballarat facility in Victoria are also expected to go by the end of the month. ...

    An IBM Australia spokeswoman declined to comment on specific details of the lay-offs or offshoring, but reiterated a statement given to Fairfax last week which said "change is constant in the technology industry and transformation is an essential feature of our business model". ...

    IBM staff members who spoke to Fairfax said morale was "awful" and that many employees were fearing they would be the next asked to go. "This is the company where the bad news is never announced to the staff," one former employee said.

  • EE Times: What do IBM layoffs mean for New York's chip initiative? By Dylan McGrath. Excerpts: Reports of IBM initiating a new round of layoffs have been intensifying in recent days. According to the IBM employee group Alliance@IBM, as of late afternoon Friday (June 14), the total number of jobs that had been reported eliminated totaled nearly 2,300.

    According to the Alliance@IBM website, http://www.endicottalliance.org/, some 500 of the jobs that have known to have been eliminated have been from the Systems and Technology Group, IBM's hardware division, which includes not only the company's microelectronics activities but also servers, storage systems and other hardware. ...

    Lee Conrad, the administrator of Alliance@IBM, said the group has seen analyst reports speculating that the total number of IBM job cuts worldwide could totally between 6,000 and 8,000. Conrad said that sounds about right and speculated that the number of U.S. job cuts would likely be 4,000 to 5,000.

    Conrad's group believes that states where IBM is a major employer should force Big Blue to disclose concrete information about job cuts.

    "It should be mandated that IBM publicly release these job cut numbers," Conrad said in an interview. "For many years, IBM has been hiding these things. For a company that gets taxpayer money that should be a mandate."

    Conrad notes that the latest round of layoffs—which are taking place worldwide—continue to the trend of IBM decreasing the size of its U.S. workforce. Ten years ago, he said, IBM had over 160,000 U.S. employees. With the latest cuts, that number is now below 90,000 he said.

    "There's a lot of stuff going off shore," Conrad said. ...

    The big question in semiconductor circles is how many of the job cuts are related to IBM's semiconductor R&D work and what impact that will have.

  • Burlington Free Press: IBM still not talking. Labor Commissioner says company has to notify her when 25 or more workers are let go. By Dan D’Ambrosio. Excerpts: IBM maintained its silence Thursday on the layoffs at its Essex facility that began early Wednesday, leaving Vermont Labor Commissioner Annie Noonan to conclude the company had yet to cross the threshold that would require notifying her of a “mass separation” of employees.

    Noonan said Thursday state rules require companies to notify the Labor Department within 24 hours of laying off 25 or more workers. She said IBM had made a commitment to the governor’s office to comply with the rule. Federal rules require notification for layoffs of 500 or more workers.

    “We did not hear from IBM,” Noonan said. “The question that begs is have they yet separated 25 employees or given notice of impending layoffs.”

  • ZD-Net: As end of Q2 nears, IBM employees fret 'resource actions'. IBM appears to be making good on its promise that it will make the bulk of its workforce rebalancing moves in the second quarter. Employees ranging from consultants to data center workers to sales are sweating. By Larry Dignan. Excerpts: Given it's June 18 and the quarter ends June 30, unions seeking to represent IBM workers are noting layoffs. Specifically, the Communications Workers of America have tallied 3,000 cuts and are keeping a running tab of units affected. We're getting numerous reports that IBM is cutting more workers than expected and global business services is a big target. The problem is that IBM employees don't have confirmation on the number of job cuts and whether there are 6,000 cuts or 12,000. ...

    It's possible that IBM would need to pare down its server unit before Lenovo was really serious about a purchase. Other likely areas for IBM to cut would be in strategic outsourcing where the Big Blue acquires assets and people from another company and then runs the infrastructure. Those deals, which often feature losses in the early years of an outsourcing agreement, are increasingly risky for IBM. Many of these job cuts would be overseas as well as in the U.S. For instance, Europe, Middle East and Africa workers are likely to get hit, IBM employees are saying.

    Selected reader comments follow:

    • 'Resources' Gotta love how corporate America has finished the total marginalization of humans. We're now resources. Not human resources, not employees, not even human. Just resources. Like coal or iron ore. Mine us, ferry us around, grind us up, burn us out and then dispose of us like furnace ash. All for the highest profits so the executives can get their bonuses from their buddies on the board. Just like the two-story outhouse with the upper floor reserved for management.
    • One More Reason Not to Work for Big Blue. IBM has had odd priorities for decades. In the '90s, it was a big deal that people no longer had to wear ties, but they still couldn't have competitor's software at their desk. So much for learning from the competition. Notice that Lenovo is trying to buy another part of IBM. It looks as if the functional part of IBM has become Lenovo, and that IBM will become little more than a collection of server farms.
    • Why is it MANDATORY for double digits? I have never understood the mentality that unless businesses achieve double digit growth EVERY YEAR, then it is considered a failure. When do we finally saturate the markets this year, then have the expectation of having double digit grow the next year. What is so bad with maintaining the current level or maybe 3-5% growth. I think that we do have small growth, and then inflate number by getting rid of the people who worked so darn hard the previous year, just so Corporate America can show a larger profit.
    • "Year over year growth" is not sustainable in a finite world. I totally agree with you sir. "Year over year growth" is impossible in a finite environment such as the planet we live in. I hope some time in the very near future this madness of eternal growth created by the capitalism is stopped, otherwise the practices to simulate growth (such as the one you describe) or the politics (wars) to steal the richness from someone/somewhere else will continue.
    • Just part of the deal. This is just the latest round. IBM is not talking about the trickle of terminations that occur every month, the resource actions with the contractors. The contractor side got hit HUGE over the first quarter.

      IBM has been shuffling customers to the GDF model, but are unable to retain those customers after being sent overseas. So they are losing huge accounts, and the ones that are left you have HUGE SLA issues. But the staffing level is at 1/3 or often worse on what is required to maintain the accounts, and they come back after the employee's saying do more.

      It's a horrific mess. Everyone keeps talking about the 2015 goal of 90% staff reduction in global services.

  • Yahoo! IBM Employee Issues message board: "Awfully quiet out there" by "dogbreath127k". Full excerpt: At work that is. This RA seems to have sucked the life blood out of those remaining, including bottom end management. Meetings and conference calls canceled, no new business requests, no interaction with peers. Everyone licking their wounds, considering alternatives to IBM, who knows.

    I did hear of a hot potato being passed between people on at least four different continents, A process formerly owned by a past USA RA candidate, the lady has been gone for years, responsibility transferred to the BRIC, process now broken, BRIC disavows all working knowledge of the process, no currently employed subject matter experts or data warehouse contain info on how to fix it. Puts a smile on my face.

  • Yahoo! IBM Employee Issues message board: "Don't bother with politicians" by "finitewisdom". Full excerpt: They're in bed with IBM. Look up earmarks, campaign contributions, lobbying, etc. Some will be covert & likely undiscoverable.

    Also, look at incentives, tax abatements, etc. given to IBM in NY over the years, all written with loopholes. IBM probably extorted some of the incentives by using threats to move CHQ out of NY.

    Do you really think Schumer and Gillibrand will be helpful? If so....

  • Yahoo! IBM Employee Issues message board: "Re: Is the RA over yet?" by Paul Sutera. Excerpts: As a young IBMer I was raised in the post-Watson IBM where the employee was well-treated, with great benefits, though underpaid by industry standards. Alcoholic workers were sent to treatment facilities. We all collected plaques and monetary awards for jobs well-done.

    The early '90s changed that. In the first round of mandatory layoffs people were escorted out of the building by security guards. Soon management realized that jack-booted militias were not the way to handle "surplused" people. And that's when "surplus" became a verb. Surplus: like some excess inventory on a shelf. To be sure the 1980s IBM had its share of folks who used "full-employment" as an excuse to do very little.

    We are ranked regularly against our same-level peers. Being one-of-a-kind helped some folks in this latest round. If you had a teamleader doing the same work, you were vulnerable.

    I think you should get a year or two at IBM and then start looking elsewhere. We had new-hire orientation June 12th, the same day as the layoff.

    I did meet some great people at IBM and "politics" among my peers was almost nonexistent. I've never gotten on so well with so many people.

    There is that to say in defense of the IBM environment. If you are writing code and in the bowels of some components for 20 plus years, you may not see great opportunities for innovation. The younger generation is going to pick up the pieces of this world. I see greater humanity and kindness in the young people coming into the world... and it's not just my imagination.

  • Yahoo! IBM Employee Issues message board: "Re: Is the RA over yet?" by "user32167". Full excerpt: Yeah, I do think IBM people to be quite nice and intelligent. However, I find the bureaucracy to be very inefficient. The executives' innovation is contrasted by our antiquated products and procedures. Who here likes Notes, Symphony, SameTime, and W3 in general? What is in IBM that is different to any other tech company (barring the likes of Google, Adobe, Apple, and even Microsoft, which are actually innovative companies).

    Our loss of the cloud contract to Amazon is a very monumental indication of how far behind our company is relative to others.

  • Yahoo! IBM Employee Issues message board: "Re: Is the RA over yet?" by "user32167". Full excerpt: Yes I am in fact a newbie in IBM Canada. Came here for some months.

    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.

  • Yahoo! IBM Employee Issues message board: "Re: Is the RA over yet?" by "johnngai2002". Full excerpt: The IBM you think exists does not exist anymore. RA'ed is now a way of life, if your job disappears. It is not Utopia anymore.
  • Yahoo! IBM Employee Issues message board: "You could have this conversation with a lot of people" by "nyjints5". Full excerpt: I'm an IBM retiree. I was fired in 2009 after 30+ years. Little did I know at the time what a favor IBM was doing for me, but that's another story for a different day.

    Recently I met another retiree. He and I discussed what it was like working for "The Good IBM" of yesteryear. Now, this wont come as a surprise to anyone that frequents this particular board, and like I said in the subject line, you could have this same conversation with literally thousands of people.

    He told me "I couldn't wait to get in to work each day. I loved what I was doing. I had a great boss, good teammates, and we were working on a project that was important to the company."

    Then he added "Yeah, that project got bumpy towards the end. We were late delivering it to the customer, and it had a few bugs in it that we had to fix when it went in to production. But after we stabilized it, (we had to work around the clock for three weeks) the customer was thrilled with what we had delivered. And our management team thanked us with real nice award checks. And I dont mean a dinner for two!!"

    "But now" he said "It's different. They tell you that you have to work harder, put in more hours, and be grateful you have a job."

    Now tell me the truth. How many times have you had that same conversation with somebody that's a former or current IBMer? Unbelievable, isn't it?

  • Yahoo! IBM Employee Issues message board: "Re: You could have this conversation with a lot of people" by "ceome60". Full excerpt: We have those discussions every month or two when we meet for lunch. You usually remember the good times/
  • Yahoo! IBM Employee Issues message board: "Re: You could have this conversation with a lot of people" by Lee Conrad. Full excerpt: And to add to this from a comment sent to the Alliance: "The morale is so low at this point. People are hiding in their offices. Few people respond to emails. Everyone is looking out for themselves. Great culture created by Rometty.

    This is across all divisions and multiple countries, STG, GBS, and SWG. Everyone I talk to is in paycheck mode. Survive long enough to get your next paycheck. So much for innovation... I've talked to many who actually envy those who were RA'ed. Such a waste and for what? Quarterly numbers to appease a schizophrenic Wall Street?

    Anyone look at the stock today? It is almost down to 195. Great job Rometty.

    Gerstner did make some tough cuts, but I accepted them as necessary given the cash flow and they hit execs. What Rometty is doing is an absolute disaster and is destroying a great company.

    The people cut have nothing to worry about though. They will find jobs or retire. I haven't found a single employee cut who was not competent and best of breed in the IT industry.

    Rometty doesn't get it... My guess, she will be another failed woman CEO, like Fiorina, which is sad, because I don't think it has anything to do with being a woman. If Rometty really wanted to fix problems, she wouldn't have to look further than the bloated management chain.

    I haven't heard of any execs RA'ed. If the buck stopped with the leaders, they should be the first to go."

  • Glassdoor IBM reviews. Selected reviews follow:
    • Client Technical Professional” Client Technical Professional (Current Employee), London, England (UK). I have been working at IBM full-time for more than 10 years. Pros: Interesting technology, get to meet with and work with some great people. Company well respected in the market. Cons: Terrible HR processes—no interest in employees welfare. You are really just a number. Education is based on skills you will never need but 'look good' to management. Pay rises don't exist. Everybody wants to be a manager. No 'team' any more; employees taught to compete with each other like gladiators—only one winner;, do what you can to get up the ladder etc. Actually, not a nice place to be. 15 years ago it was a different place and people enjoyed working there! Advice to Senior Management: Loose at least one layer of lower management. Start to 'manage' instead to just bean count. Understand your customers instead of just reading somebody else's marketing presentations. Stop sending mass mails about 'working harder', 'you are not working hard enough', 'we had a great quarter but you must do better' etc. Let your people know that they are doing a good job. Listen to them - we do have names!!!
    • Spouse of a formal IBMer” Staff Engineer (Former Employee), East Fishkill, NY. I worked at IBM full-time for more than 3 years. Pros: Great and talented colleagues to work with. Cons: Unreasonable workload requests—prolonged working hours at night and in weekends; work-life balance is a joke. Incompetent management: assigned tasks were only useful to his own career goal rather than meaningful to the company or employee development. Constant layoffs. Lower pay, terrible benefits, and the company does not respect its employees. Short-sighted upper management. Advice to Senior Management: There is basically no cure to this rotten management system. No, I would not recommend this company to a friend. I'm not optimistic about the outlook for this company.
    • A shell of its former self...” Program Manager (Current Employee). I have been working at IBM full-time for more than 10 years. Pros: Flexibility, work at home, diversity, okay health benefits, bright coworkers who really care, good training for early career in certain professions.

      Cons: Bureaucracy, out of touch executives, TOO MANY executives, lack of communication, poor leadership, constant threat of layoffs, poor morale, too much secrecy, decisions seem to be made by Finance and Legal instead of technologists or business leaders.

      Advice to Senior Management: FIRE YOURSELVES instead of the people who have been creating and delivering your products. You have created an environment in which it is now impossible to be productive due to the fear, secrecy, and total lack of communication on what is going on with the recent layoffs. I have many long-time coworkers who say to me, "There are so many VPs...this feels like it did before Gerstner came aboard." In other words, TOO TOP HEAVY. Stop giving yourselves golden parachutes, shut down Sam's $1M "retirement" office, and save the jobs of the people who actually bring VALUE to the company.

      Most of the people I know who are top performers and who were "spared" by the recent layoffs are looking elsewhere for employment anyway. There are only so many blood-lettings a human being can handle—and after 15 years with what I once felt was an exciting, proud-to-be-here company, I now find it depressing and rage-inducing to come to work every day and see how yet another VP can waste my valuable time (and salary) on work that provides NO VALUE to our clients or business.

      It's no coincidence, IMO, that "Respect for the Individual" was removed from the IBM Values. You are out of touch, bloated, and look beyond ridiculous to those of us on the "front lines". You lead only through fear now. Good luck getting the best and brightest to stick around.

      No, I would not recommend this company to a friend. I'm not optimistic about the outlook for this company.

    • IBM: The ongoing decline of a once-great company” Anonymous Employee (Former Employee). I worked at IBM as a contractor for less than a year. Pros: The name recognition still carries some weight worldwide. Also, the Watson commercials are pretty cool. Back in the day, no other company treated it employees better. Emphasis, of course, on "back in the day".

      Cons: Job security has become an oxymoron; just ask the hundreds of people who were just let go as part of IBM's latest resource action/workforce remix/whatever. They actually called us "Surplus Employees" back during the Great Purge of 1993 (two decades from to what's being done now). Evidently, people run a distant second to profits in today's IBM environment.

      Advice to Senior Management: Maybe you should rename the company "IB". After all, you do lots of "International Business" these days but don't seem to manufacture "Machines" anymore. I could also recommend treating your remaining employees humanely and fairly, but I have my doubts you'll even read this anyway.

      No, I would not recommend this company to a friend. I'm not optimistic about the outlook for this company.

    • Great professional working environment full of career growth opportunity” IT Specialist (Current Employee), Kuala Lumpur (Malaysia). I have been working at IBM full-time for more than a year. Pros: Plenty of training available, great global support. Cons: Not so competitive salary model. Yes, I would recommend this company to a friend.
    • Good People” Program Director (Current Employee), Poughkeepsie, NY. I have been working at IBM full-time for more than 10 years. Pros: Leadership development, great people, excellent work-life balance. Cons: Shrinking Hardware division. Very low new hire rate in the US. Advice to Senior Management: Decrease the number of levels between the CEO and the engineer. Do we really need more than Engineer - Manager - Director - VP - SVP- EVP-CEO? IBM research has that kind of flat layering and seems to work well. Maybe we should do it everywhere. No, I would not recommend this company to a friend. I'm not optimistic about the outlook for this company.
    • Hardware business increasingly being marginalized by higher-margin services” Advisory Hardware Engineer (Current Employee), Hopewell Junction, NY. I have been working at IBM full-time for more than 7 years. Pros: IBM still has some of the world's best engineers, and we have access to cutting-edge technology. Work-life balance is excellent. Compensation is decent.

      Cons: Our new CEO, Virginia Rometty, seems to have no vision for the future of the company. She's a manager, not a leader. The semiconductor business, where I work, is increasingly being pushed aside in favor of IBM's higher-margin services business, which is itself increasingly moving to India. Working in semiconductors has become mostly an exercise in cost-control rather than innovation.

      Advice to Senior Management: If you're serious about being a technology leader, you need to invest in the resources to make it happen. If not, then just go ahead and sell the Systems and Technology Group to another company before all the good engineers leave.

      No, I would not recommend this company to a friend. I'm not optimistic about the outlook for this company.

    • Good technology company” Anonymous Employee (Current Employee). I have been working at IBM full-time for more than 7 years. Pros: Lots of opportunity to explore and work with. Work on cutting edge technology. Cons: HR policy is not strong or does not exist. Advice to Senior Management: Employee friendly HR policy to be laid. Yes, I would recommend this company to a friend. I'm not optimistic about the outlook for this company.
    • Misogynist place: bad place for women” Researcher (Former Employee), San Jose, CA. I worked at IBM as an intern for more than a year. Pros: The setting was nice and quiet.

      Cons: I worked in two different groups as intern. Both in Almaden. In both cases the mentors treated me really bad because I was a woman.

      In the first I have been explicitly told to "bend over and please my boss so he can dump all his frustration on me".

      The second kept insisting that since I am a woman I should stay home and have babies instead of working.

      In both cases they stole my work, meaning they showed it to upper management as their own work saying I didn't do anything.

      In both cases they felt uncomfortable that a woman was better than them and tried to overpower her with their authorities.

      I don't even want to hear the name IBM now, and prefer to die of starvation that to work for that company.

      Advice to Senior Management: Use better methods to see the situation of employee, especially women. Don't put misogynist with a record of bad behavior towards women in a position to hire and manage women. No, I would not recommend this company to a friend.

    • Good place to grow up, for early career building” Engineer (Former Employee), Burlington, VT. I worked at IBM full-time for more than 10 years. Pros: Team environment is good; , flexibility also good. Cons: Salaries are lacking & not much advancement to follow your title. Advice to Senior Management: Pay good $ to get good talent. When you promote from within, make sure the salary follows also. No, I would not recommend this company to a friend. I'm not optimistic about the outlook for this company.
    • IT Consultant—IBM, not a bad place” IT Consultant (Current Employee). I have been working at IBM full-time for more than 7 years. Pros: Support of talented people varied work good social side. Cons: Not a great choice of roles making it hard to follow your career of choice. Managers are usually looking to progress their career without worrying about the damage to yours. Advice to Senior Management: Allow resources to make occasional account/industry changes. Yes, I would recommend this company to a friend
    • Pennywise, poundsilly” Managing Consultant (Current Employee), Pittsburgh, PA. I have been working at IBM full-time for more than a year. Pros: Wealth of information, working with key customers makes just about anything possible because of simply the brute force of the IBM Executive Smash™ or a well-written business case. Individuals are good people and knowledgeable. Lots of potential for mobility, but it's generally not self-directed. Need to move somewhere? IBM has an office there, or you can work from home.

      Cons: I don't know how this company survives, given its day-to-day operations. Its email system is atrocious, crashing frequently across multiple platforms and delaying inbound email 10-15 minutes. The officially sanctioned office suite software is very outdated - the new versions of the software from which it is derived are miles better.

      Its timekeeping system has so many layers of red tape and is so user-unfriendly that anyone who has to use it loathes it. Those who track time often track it through other programs or on paper and transfer the time to the system at week's end.

      Everything is self-service. Need something from HR? There's not really anyone to ask, or if you do ask, it may be days before you get a response. That response will usually be a reminder to search first. Intranet search is terrible, too, so actually finding what you want is difficult. Need something from IT? What IT? Buy it yourself on the company goods store and hope that it gets approved. Don't even ask for a second monitor or backup hard drive. Keyboards are a little easier to come by, but still difficult to get.

      Apparently yearly or bi-yearly layoffs. Changes in 401k match payouts and/or annual raise dates in order to avoid having to pay people who are laid off.

      Technically, when traveling, IBM won't pay for your lunch. You'll get a per diem for breakfast and dinner, as long as you start before a certain time and end working after a certain time.

      Advice to Senior Management: The finance-driven approach to managing a company worked for an IT company in the early days, when IT was still trying to figure out its path divergent from factory work and blue collar labor. Now, a tech-driven or people-centric approach is emerging as the best for both the company and its employees. IBM's competition is not Oracle's software. IBM's competition is the thousands of startups whose software is better than IBM's and Oracle's. IBM's competition is the hiring power, caring management, and perks of those startups and small companies. IBM needs people, and moving forward, it's going to have a hard time getting the people with the ideas if it doesn't change its culture.

      No, I would not recommend this company to a friend. I'm not optimistic about the outlook for this company.

    • Overrated and bureaucratic” Software Developer (Former Employee). I worked at IBM full-time for more than a year. Pros: The brand. Except from the name on your CV there is not much to get from this company. Cons: Crappy salary, if not European or American. Rigid management. Too many processes and unnecessary procedures. Advice to Senior Management: Resign. No, I would not recommend this company to a friend.
    • “I worked at IBM for over 12 years now” Manager (Current Employee), Austin, TX. I have been working at IBM full-time for more than 10 years. Pros: Flexible, high tech company, grows its people. Very good in giving work-life balance to employees. Cons: Too big of a company, globalization causing impacts on US workforce. Change in upline management in some divisions and revenues caused lot of layoffs lately. Advice to Senior Management: I don't understand how IBM can be laying off people when other companies are hiring. Also IBM survived 2008 financial crisis without many lay offs. Not sure why they are laying off so many now. EPS target of $20 by 2015 is a good target, but it shouldn't come at the cost of laying off so many good employees. Yes, I would recommend this company to a friend.
    • Too many cuts, old (business) mindset, bad facilities, and terrible internal tools.” Advisory Software Engineer (Current Employee), San Jose, CA. I have been working at IBM full-time for more than 3 years. Pros: It's extremely easy to be an outperformer. All the technology is at least a decade old and development (due to bureaucracy and process) proceeds at a crawl. Show the tiniest bit of talent and you'll be a rock star. Low level managers are pretty flexible. It's pretty easy to get approval to work from home, which is advisable because the buildings are falling apart.

      Cons: The management is clueless, nobody has the will to change anything, the internal tools are horrid (ask an IBMer about any Lotus or Rational product, if they've ever used an alternative, they'll have plenty to tell you about). No, I would not recommend this company to a friend.

    • GBS: Great at first, Not a healthy long term fit” Senior Consultant (Former Employee), Washington, DC. I worked at IBM full-time for more than 3 years. Pros: People—I have really enjoyed most of the people I worked with at IBM. That being said, most of the young ones who were great moved on to other companies. There were some really great employees who had been there longer and were just sticking around because their project was a good fit.

      Projects—There are a lot of projects that will give you exposure to all sorts of different clients and industries. However, if you aren’t staffed on a project you only have a certain amount of time (30-60 days) before you’ll be let go. There are a good number of projects but if you can’t find one in your location you’ll have to look across the country so be prepared to travel anywhere in the US if you aren’t staffed locally. Some practice areas are more particular than others that you work on a project in THAT practice area which can make finding a project even more difficult.

      Health/Vision/Dental—pretty standard, you have good options to choose from each year.

      401K—IBM does have a good 401K match percentage (up to 6%) but they don’t match until the very END of the year so if you leave anytime before 12/31 you won’t get your match. Something to consider before ever leaving IBM.

      Cons: The experience at IBM varies WIDELY depending on which department and practice of IBM you join, as well as the project you are assigned to. For IBM GBS, like the other major consulting companies, their talent model is to hire the best talent they can, overwork them so their profit margins are high, and only promote those that contribute the most; they expect the rest to leave voluntarily after they’ve had too much.

      For those that stick around, the responsibilities continue to pile up the further up the chain you go. Having a good work/life balance isn’t realistic if you plan to move up, unless you want to stay at the same level on the same project for as long as you can. I know several people who are doing this and will quit if they have to move to another project. On top of regular project work, employees are expected to help out with recruiting events, assist with bids and proposals (B&P), contribute to their practices areas in various ways, and have at least 40 hours of training every year. Consider that a full plate? I've also heard that most of the very high-ups don't even have time to take their own vacation. Sad.

      Performance Reviews—everybody is given a rating (1, 2+, 2, 3). Mostly everyone is given a 2 if they meet their goals. People have to work a LOT more to get a 1, something in the 150% utilization range and lots of “giveback”. All that work and the bonuses aren’t even that much. Not worth it in my opinion.

      Managers—In three years I only spent 3 minutes face to face with my personal manager and we never worked on the same project. The quality of managers varies widely across GBS and each practice area. I knew another IBM manager on one project who was thankfully quite frank about things since he's near retirement age. He described the upper management of GBS with terms such as 'shady', 'selfish', 'backstabbing', and 'dishonest'.

      Promotions—employees have to fill out a promotion application and submit it for review. The process can take 6 months or longer and the application itself is quite extensive, mine came out to 30 some pages in Microsoft Word. There is no visibility in to how they actually decide (other than that you have good utilization).

      New Hires—I also found out that GBS was offering new hires $10K more than my current salary, and a $7K signing bonus. I was hired during the recession in 2010 when salaries were lower, but even still I was pretty angry there was such a large difference. After I got promoted I was still making ~$3/4K less than what they were offered. Unbelievable if you ask me.

      Advice to Senior Management: Where to begin?

      Yes, I would recommend this company to a friend. I'm optimistic about the outlook for this company.

    • Big ship but lots of hierarchies and bureaucracy” Software Engineer (Former Employee). I worked at IBM full-time for more than a year. Pros: Relatively stable job. Big name. Open-source friendly. Good process management for development. Some very cool tools and advanced research (but not always accessible to software engineers). Cons: Too much bureaucracy. Too many hierarchies and bloated. Too many politics. Bad compensation. Technologies aging, Too old for the fast-paced tech world today. Moving slowly when it comes to innovation and new ideas. Work/life balance is bad, sometimes you have to work 60 hrs a week and standby/work on weekends, and manager will bug you after you left the office for the weekends/holidays. Firefighting is a common thing, testing is not through enough. Weak in the internet world. No great engineering/creative culture and belief, the company is more and more business/money-making focused. Advice to Senior Management: Reward well your core contributors, less politics, less bureaucracy and hierarchies. Foster great engineer culture and move fast when it comes to new ideas. Move to the internet, the traditional software days are counted. No, I would not recommend this company to a friend. I'm not optimistic about the outlook for this company.
    • Good company but the hardware group is not the place to be. Seems that they want to be a service or software company.” Hardware Engineer (Former Employee), Austin, TX. I worked at IBM full-time for more than 3 years. Pros: Flexible schedule. Management does not micro manage (may depend on manager). Good 401K matching, except that they now give it at the end of the year. You lose it if you leave or are let go before the end of the year. Lots of smart people. Cons: Salary is below what the market pays. Raises and bonuses are very low. People have low morale. Advice to Senior Management: Lower management has little to no control over compensation. All the decisions are made further up the chain. No, I would not recommend this company to a friend. I'm not optimistic about the outlook for this company.
    • “Non existent HR Policies and poor management makes life hell in more ways than one” Anonymous Employee (Current Employee), Noida (India). I have been working at IBM full-time. Pros: If you end up with a good manager, you can work from home at times, changing accounts and building a diverse skill set is a strong possibility.

      Cons: On average the work doesn't get very technical and slows learning. Since HR policies are really weak, you don't have a foot to stand on when discussing issues with the management. The work life balance isn't too great for most people. If you are hard working you'll really have to shrug off the weight that will be placed on you and scrounge for any appreciation whatsoever. Management makes lots of promises and comes up with odd, on the spur policies to keep from fulfilling those promises.

      Advice to Senior Management: Get an HR policy in place and stick to it for one and all, not just your relatives and brown nosers. Please research if you are in a position to make the promises you are making before you make them.

      No, I would not recommend this company to a friend. I'm not optimistic about the outlook for this company.

    • Smart People, Too Big” Design Engineer (Current Employee), Essex Junction, VT. I have been working at IBM full-time for more than a year. Pros: Smart colleagues. Cutting edge technologies. Lots of responsibility relatively quickly. Very flexible work schedule. Very flexible work environment. Cons: Almost no promotion or growth possibilities. Work very minor in IBM's overall strategy. Review process more formality then development tool. Lack of communication between groups. Advice to Senior Management: Allow growth possibilities Communicate purpose of work in IBM No, I would not recommend this company to a friend. I'm not optimistic about the outlook for this company.
    • This is a company that is doing many things right as evidenced by the stock price, and they take care of their customers” Industry Segment Manager (Current Employee), Indianapolis, IN. I have been working at IBM full-time for more than 3 years. Pros: The customer is #1 as should be the case. Stock price holds steady in the low $200 range typically. Is a big company so lots of opportunity to move around inside the company.

      Cons: The most process laden company I have EVER seen. There are processes for processes, and tools designed to track everything which makes getting anything done extremely onerous. Yet they have incredible people working there so they somehow persevere. Woe the person that does one of the multitude of processes incorrectly while trying to move quickly through all of them & still get things done—you will be audited by internal auditors whose sole job is to checkpoint everything. As many things as they are doing right, they make it extremely difficult on employees. This is a hard place to work. Count on not knowing your job for many years in its entirety—there are just SO many processes.

      Advice to Senior Management: Streamline the processes. Surely it is possible to track spend without approving budgets and then requiring each spend to get additional approvals prior to actually embarking on any work. But, again, IBM must be doing many things right - the stock price has held steady while other tech giants have suffered in this still challenged economy.

      No, I would not recommend this company to a friend. I'm not optimistic about the outlook for this company.

    • Big Blue” Anonymous Employee (Current Employee). I have been working at IBM full-time for more than 10 years. Pros: There are so many different jobs within IBM, that you can literally do anything and have a career that travels the globe. Your job can have a global impact, even if you never leave your local area. Their policies supporting work at home, leave of absence, training and charitable giving are top notch. Cons: Bottom line decisions made at the corporate level can feel heartless and callous. Being such a large company, if budgets and profits are on the line, sharp changes can occur with little or no notice. Advice to Senior Management: Your people are some of your biggest assets, while the bottom line is important, if you neglect the moral needs of your people, you risk damaging their creativity.
    • Which side of IBM do you work for?” Unix Administrator (Current Employee), Dubuque, IA. I have been working at IBM as a contractor for more than 3 years. Pros: Lots of work to do, I have a good manager and he has a pretty good manager and he has a pretty good manager and he has an OK manager, and they all recognize someone who is good at their job. Cons: You notice I mentioned there are four layers of management noticeably interacting with the technical team? Also one of the downsides of such a big company is you might not get a job one of the good managers. From that, it's almost like working for a different company. HR is a big iron wall that nobody seems to be able to move one way or the other. Advice to Senior Management: Unfortunately, I can't think of a better way to do it. It sucks to work at a company that regularly fires and then hires thousands of people at a time, but that might be the only way to turn out the problem employees, but it's not like congregating with ex-employees is encouraged. Yes, I would recommend this company to a friend.
  • IBM: A Smarter Workforce is a Social Workforce. Executive Breakfast Briefing. Melbourne—24th July. Sydney—25th July. Excerpt: At its heart, business comes down to people doing business with people. In IBM’s 2012 CEO Study, 71% of CEOs admitted that human capital is the key source of sustained economic value1. With today’s changing workforce dynamics and economic challenges, business leaders are turning their focus to their most valuable asset — their people. Organisations who engage and motivate their people can achieve significant competitive differentiation and market leadership.
  • Alliance for Retired Americans: Friday Alert. This week's articles include:
    • Initial List of Members of Congress Joining July 2 Human Chain Events is Revealed
    • 103 House Members, 20 Senators Co-Sponsor Resolutions Rejecting Chained CPI
    • Help Sen. Bernie Sanders Address Poverty among Seniors
    • Vote in the Alliance’s Social Security Bumper Sticker Poll!
    • Generic Drugs, Consumers Win in Supreme Court Ruling
    • ACLU of Indiana Files Suit to Keep Seniors and the Disabled in Their Homes
  • New York Times: A Call for a Movement to Redefine the Successful Life. By Alina Tugend. Excerpts: Every day, news releases and books cross my desk that promise success in all sorts of areas — getting a job, getting a better job, managing your employees, managing your boss, managing your relationships.

    Some are interesting, some are ridiculous and many are repetitive takes on the same theme. But recently, I came across two items that, separately, talked about an issue I’ve tackled before in one of my columns — questioning what we actually mean by success.

    That column, which appeared almost a year ago to the day, discussed how we shouldn’t always aim for the extraordinary, but celebrate the ordinary. It was one of my most popular articles ever.

    So I was intrigued when I was told that a conference was being held on the very issue of redefining success. And, separately, that American Express had recently released a study showing that Americans were thinking of success in different ways than in the past. ...

    The concepts seem a little fuzzy at times, but the overarching thesis is that it is time to rethink the common wisdom of how to achieve success: sleep four hours a night, work 20 hours a day, see your family rarely and never admit the need for downtime.

    That system is wearing us down, Ms. Huffington said. In her commencement speech this year at Smith College, she told students, “If we don’t redefine success, the personal price we pay will get higher and higher. And as the data shows, the price is even higher for women than for men. Already women in stressful jobs have a nearly 40 percent increased risk of heart disease and a 60 percent greater risk for diabetes.

    “Right now, America’s workplace culture is practically fueled by stress, sleep deprivation and burnout,” she said.

  • Financial Planning: Retirement Reality Check: Which Rules Still Matter? By Scott Wenger and Rachel F. Elson. Excerpts Rules, as they say, are made to be broken. Yet as financial planning has grown as a profession, collective thinking has coalesced around a few solid pieces of advice. A panel at the Morningstar Investment Conference on Friday set out to debunk some of those rules and establish new guidelines. Here are a few of the biggest myths they tackled.
  • Wall Street Journal: Social Security—Call It 'Married With Benefits' by Jennifer Waters. Excerpt: For married couples planning their retirement, the quintessential question is this: "Who will die first?"

    That mortality forecast can turn out to be a do-or-die financial issue for the surviving spouse, who could end up living a much longer life with less income, or worse yet, run out of money.

  • AARP Blog: Why Are Boomers Retiring So Early? By Carole Fleck. Excerpts: So much for boomers’ predictions that they’ll be working until they drop. A new study finds that more than half of the nation’s oldest boomers — those turning 67 this year — are now retired and not working at all.

    Most of them say they were ready to leave the working world for good. But one in six say they retired because of health problems, and one in 10 blamed a job loss. ...

    What topped the list of their retirement concerns? Long-term care costs.

New on the Alliance@IBM Site
  • Job cuts have begun. So Far in North America:
    • STG Storage Systems Development: 121
    • STG lab Services and Tech Training: 52
    • STG Test Site Design: 59
    • STG SSE Intellectual Property: 64
    • BT/IT CIO Enterprise Transformation: 4
    • Corporate Marketing and Communication: 83
    • Software Group Tivoli: 98
    • Software group WW Services and Education: 22
    • STG Semiconductor Research and Dev: 165
    • SO Delivery Integrated Competencies: 46
    • GPS Solutions and Delivery: 116
    • Software Group Marketing: 222
    • Research: 65
    • GBS AMS IBM Global Account: 123
    • STG Operations and Transformation: 34
    • Software Group NA Software Sales: 63
    • SO sectors (GSSR): 31
    • Software Group Information Management: 137
    • Software group Industry Solutions: 126
    • STG High Speed links, Cores and Memory: 67
    • SO Delivery HQ Cloud Development and Delivery: 40
    • GBS AMS Commercial Delivery: 27
    • STG Power Software Development: 64
    • GBS PS Business Analytics: 39
    • STG Pureflex & System X Software Development: 32
    • STG Advanced Microelectronics Solutions: 114
    • STG Worldwide Client Care: 30
    • STG IBM I Development: 60
    • STG System Z Software Development: 45
    • Software Group Security: 22
    • STG ISV Global Support: 35
    • IBM S&D Communications Sector: 3
    • Software Group Rational: 59
    • ISC Sales Transaction Support OIST: 70
    • STG Systems Technology Development: 24
    • SWG Application and Integration Middleware: 86
    • STG Systems Solutions Dev: 56
    • GBS CS Industrial Sector: 32
    • STG Electronic Design Automation: 106
    • STG Competitive lab and Technical Sales Centers: 35
    • Software Group Collaboration: 115
    • STG Storage (ISSA): 41
    • STG Server & Storage Engineering System Test: 97
    • Total cut so far: 2930
  • Job Cut Reports
    • Comment 06/15/13: I got RA'd on 6/12 in the morning. My manager called. Really hated to get that news. We have lots of work but I'm not sure why IBM cut me off. Not sure what should I do. Should I enjoy my time off from it, or be sad?-AliAli-
    • Comment 06/15/13: IBM Developer Relations (IDR) had a 9% loss from June 11 RA, 15 cut and 167 left. I am happy to be leaving. This group has lacked decent leadership for many years. The top dog slowly destroyed us and just stepped down himself, much too late. Have talent, will travel. Bye-bye Big Blue. -OnTheList-
    • Comment 06/15/13: Has anyone submitted Alliance membership as a TEA item? It *is* job related. Reading and participating here should count towards ones 40 hours education target. If participating in LinkedIn forums is considered OK, then why not here? All your first level has to do is approve its submission ;-) -Anonymous-
    • Comment 06/15/13: Part of SWG Marketing - told on June 12th, last day on July 12th. Came in as part of an acquisition. -Anon-
    • Comment 06/15/13: re: Amazon being now recognized as a leader in Cloud technology ... maybe that is why Jeff Bezos was invited to hobnob with the rich and politically powerful at the Bilderberg Group meeting in the UK last week. (See the attendee list at http://www.infowars.com/breaking-official-bilderberg-attendee-list-released/) -Anonymous-
    • Comment 06/15/13: @Retired The way things were in 1994 no longer exist. I personally know a guy that was laid off and hadn't been appraised below a 2+ ever since they started using that designation. He had 20+ years with the company and was laid off because they defunded his mission. It is not a matter of "if I get laid off" in the US anymore, it is "when I get laid off". They will eventually rid themselves of all US employees no matter what their contribution or appraisal is. Everyone needs to be prepared because everybody except the execs will be gone in the US. -longtimebeemer-
    • Comment 06/15/13: My thoughts and prayers are with the IBMers who were recently RA'd, and those left behind. For over 13 years, I've been aggregating comments from the Alliance@IBM, links to articles in the press about IBM, and comments from Glassdoor and other sources. These archives are available at my site, www.ibmemployee.com. Although I am a member of the Alliance@IBM, www.ibmemployee.com is my own endeavor...it is not affiliated with or run by the Alliance@IBM. If interested, I will e-mail you "weekly updates" of the "latest IBM news you'll never see on W3". Just send a request to news@ibmemployee.com. -Anonymous-
    • Comment 06/15/13: My SWG Marketing position was cut. I was a top performer and seniority was held against me. Classy. And no communication from the execs. -Anonymous-
    • Comment 06/15/13: Why isn't the larger media covering the IBM layoffs? -CNN, Fox, MSNBC, WSJ,-where R U?- Alliance reply: Good question. Some Alliance members have been asking the same question, every time IBM fires thousands (every year it seems). It never seems to be a "top story" for the MSM. If you'd like to know the answer, then call their offices and ask them. Let us know how that works out for you, OK? :-)
    • Comment 06/15/13: At IBM East Fishkill NY after the layoff were seeing young new hires that replaced seasoned veterans in there fifties and sixties. One young female environmental engineer in her early twenties was hired only a week before the layoff and hearing that she has ties to upper management and wasn’t touch. New hires make considerably less than a person who have 25 or more years of service and are considered expendable. That’s IBMs coin work called workload rebalancing? With a union the motto is “last one hired,first one fired” and that is what you call fair and equitable! -Roadkill 2013!!-
    • Comment 06/16/13: I was in BTV ASIC's development for 20+ yrs. They have effectively gutted the organization and expect that IBM will wind this line of business down in the next couple of years. Time for a new life w/o Big Blue. It's sad to see the path the company is taking to meet that 2015 target. Profit at ANY cost. -Glad It's Done-
    • Comment 06/16/13: I had 39 yrs + 10 mos (2 mos short of my anniversary!) - and yes they offered the same package to those of us on the old plan. They will bridge benefits to the end of the month, allow us to retire (w/o dignity - but with award, dinner, letters), collect pension and the severance. The usual platitudes that what they are grateful for what we did - but that what we are working on (Cloud HA for P Systems) isn't important to the organization - huh? So since I was going to retire anyway this isn't too bad - but I feel for the team that needs to continue the work without me (India of course) and those who aren't situated as fortunately as I am. The OLD IBM was a great company - this one couldn't care less for its employees. -Anon
    • Comment 06/16/13: @SEM poster, similar experience here too. Working on Open Source secure boot code. Part of upcoming products, release dates out of my control - nothing proprietary, already announced. Considered of value to the product line but local management wants to see value Today. I need to justify my existence. What is wrong with this picture? -Anon-
    • Comment 06/16/13: Six years later... an interesting read about the Cognos acquisition: http://datadoghouse.typepad.com/data_doghouse/2007/11/ibm-acquies-cog.html -anon-
    • Comment 06/16/13: re: "Lots of the field team left to competitors. Several in Cognos left...". Can you Cognos people tell us how things transpired from the point of acquisition to now? What was the honeymoon like? When do things get worse? It's something we'd like to have some info about, since we are also an acquisition in another part of the world and are, frankly, frightened about what happened to Cognos which was once a darling of IBM. -anon3-
    • Comment 06/16/13: Cloud Computing is killing IBM. Their ability to sell services into this model is not working. They are getting killed by the Amazon's of the world simply because you don't need to pay for a ton of services to keep them up and running. Private clouds are another matter. They could be profitable for a company like IBM but those legacy applications just take awhile to get modified or removed from an application portfolio. That time spent is IBM's loss.

      I also agree with Anonymous pertaining to the skills gap propaganda. I have seen well seasoned and valued professionals get released from IBM. Yet the management line supporting that seasoned professional would never be able to backfill that person, ever. All the while the message to upset clients over the departure and impacts to their business is "we have the skills". Meanwhile, management tears through IBM's ranks ad-nauseum trying to identify someone who has a chance. You see, money is spent on containing cost rather than satisfying the client. It is "cut costs" at "any cost".

      The only skill IBM is developing amongst their leadership is that of silence, because in my years in IBM there HA NOT BEEN ONE Director or Vice President I know that understands what is happening in Armonk. And they are not about to rock the boat out of fear for their own job and financial security. IBM is in a downward spiral; enough said. -Anonymous-

    • Comment 06/16/13: I got laid off last week in BTV with 30 yrs, age 59 and on the old pension plan. I wonder how many of "us" were targeted?? Is there anything we can do about it? -Anonymous- Alliance reply: There is a law firm that the Alliance recommends that has dealt with age discrimination and IBM for years:

      Law firm working on age discrimination in job cuts:
      McTeague, Higbee, Case, Cohen, Whitney & Toker, P.A
      PO Box 5000
      4 Union Park
      Topsham, ME 04086-5000
      Phone: (207) 725-5581
      Fax: (207) 725-1090
      Contact Us: http://www.me-law.com/CM/Custom/Contact.asp

    • Comment 06/16/13: I have two questions about the layoff package: 1) Did IBM offer to pay partial "matching" 401K funds for the period January'13-June'13 as part of your package? 2) As part of the package, did IBM immediately vest the 5 IBM stock shares that each U.S. IBMer was given two years ago? I was not impacted by this layoff, but am particularly interested in the answer to question #1 above. I do "potential job change" analysis each year, and if IBM isn't covering the 401K match in the event of layoff, I will remove it from my "total pay" calculation. IBM just isn't trustworthy enough to bank on being able to complete a year's work and get the payout match. Removal of this 401k benefit might be the final straw that pushes me over the edge. Thanks everyone for the info, and best wishes for your futures. -SI-
    • Comment 06/16/13: Two hits in STG POWER AIX development. Ironically, new hire arrived a few days before. Multiple hits across POWER SW. -Anon-
    • Comment 06/16/13: Some brave souls are suggesting a walk out on this forum. We all know that that is going nowhere because not enough people will join an effort like that. Again I encourage fellow IBMers to sign up with the Alliance before it is too late and all our jobs are gone. What else can we practically do? -Anon-
    • Comment 06/16/13: I think some IBMers that come here, need to change the batteries in their BS detector. Why? Because they talk about how they can't believe that IBM is firing them. They're "stunned". Yet, they sometimes ask Alliance questions that sound distrustful or downright disrespectful of Alliance organizers...hmmmmm.

      First, it's well known that BS "sells" things...quite well as a matter of fact; so that means that IBM has convinced these "stunned" IBMers that up until they are fired, that IBM is a fairly good company...or whatever. Huh? If BS sells, then must be Alliance@IBM has been telling the truth since its inception; otherwise, Alliance would have 30k members and we'd all believe in union contracts...but nooooooo...not most IBMers. They believe the opposite! LOL! What IBM says is just like what George Carlin (a genius IMO) described in one of his last standups: "It's BS folks and it's bad for ya!" Join the union, and get a BS detector or have someone that has one that works, BUY you a BS detector. Join the union, will ya? Quit believing the IBM BS. It's bad for ya! -BS_Detector_is_on-

    • Comment 06/16/13: "I just celebrated my QCC late last year." I got tossed after 25 years and my QCC book had not letters or signatures. Persona non grata IBM? Did IBM management do there job or care here? Thanks for the memory IBM out of my rear view mirror. -anonymous-
    • Comment 06/16/13: Could this really be true? 70% layoffs due to crowdsourcing? I know there is lots of focus on the Liquid initiative. I am still with the company but feel so paralyzed by these RAs and news, I think this is affecting everyone's productivity. https://www.crowdworx.com/news/ibm-plans-lay-70-employees/ -really.scared- Alliance reply: This scenario has been around and discussed the past few years. Will it come true or be possible? Only IBM knows. What IBM employees need to do is organize and help build the Alliance so we have a say in the workplace and any changes that affect workers.
    • Comment 06/16/13: They would never lay of 70% then rehire after severance; that would be a huge waste of money -whatever-
    • Comment 06/16/13: Anyone RAd last week that was part of an acquisition and told their recent date of hire is the transfer of employment date and not their original hire date? Appreciate any guidance. -Want-my-due-severance-
    • Comment 06/17/13: Your service date, if you are from an acquired company, should be the date you originally started pre-IBM acquisition. You should have this documented somewhere, either in your employment contract or the whatever you signed when you got acquired. Personally I don't object to the cuts, if they are necessary, what I do deplore is the way IBM have gone about them and the management pretending nothing is happening - that part is disgusting. -Borrowed Time-
    • Comment 06/16/13: Somebody mentioned health insurance as part of RA package. What does it really mean? IBM would pay for your previously selected insurance which you've had before the RA for 3 or 6 months? -details-please-
    • Comment 06/16/13: To -SI- to answer your two questions: "1) Did IBM offer to pay partial "matching" 401K funds for the period January'13-June'13 as part of your package? 2) As part of the package, did IBM immediately vest the 5 IBM stock shares that each U.S. IBMer was given two years ago?" The answer to both questions is no. No mention of partial 401K matching dollars. Also I was one of the ones who received those 5 IBM shares of Restricted Stock Shares (RSU's ). The stipulation at the time was that you would not be vested until 2015, so I will lose those as well. -$crewed-
    • Comment 06/16/13: IBM Australia: June 15th - supposedly about 1000 odd laid off. June 28th a further 300 The package given this time round was reduced from packages of the past by 13 weeks pay...downsizing here to move jobs to India/China of course. -disgusted-
    • Comment 06/17/13: When Cognos was acquired in 09 we were told that in 5 years IBM would rip our company apart and get rid of the old guard, etc. Looks like that was pretty much right on. -cognos_anon-
    • Comment 06/17/13: I have a question. How does the layoffs affect the 401K contribution change? Anybody know? 401K change then a layoff, sounds to me like some planning was done. -4mrIBMr-
    • Comment 06/17/13: Long Term Supplemental, notified that I hadn't been proactive enough about maintaining and expanding my skillsets so I was not offered a"regular position" in the transition process. Hired in as a Java Application Developer 9/8/10. Never assigned to Any Java development project in my 3 year contract term. Happy to get out actually! P.S. what's an RA Pack? Never discussed -Anonymous-
    • Comment 06/17/13: Friends in Ottawa are telling me that 200 of 800 were cut in Cognos/Business Intelligence - not seeing that on the count page, unless it's under some different name. -HowMany?-
    • Comment 06/17/13: Hat tip to the guy in the Rochester lab who showed up on June 12 wearing his red Star Trek shirt... -Still Here-
    • Comment 06/17/13: Just when I thought I missed the cuts got the call first thing this morning. Mixed feelings I love my job and my IBM team members but have to look at this now as an opportunity to leave this toxic environment. -RTP-er-
    • Comment 06/17/13: In order to justify the insane market premium needed to buy any company, the deal owner has to promise crazy and unrealistic "synergy revenue" that will grow the acquired companies 3x, 5x once integrated. As pointed earlier, Cognos like most acquired companies lost many of key field resources. IBM sales team have no knowledge in the acquired technology or relationship with customer decision makers who are no longer IT

      SPSS is not far behind Cognos. The direction from SVP is to embed these technologies in other IBM products or solutions. It is now clear that Cognos/SPSS will not deliver the promised synergy revenue as standalone products. Competition for analytics are fierce in the market place and even more fierce inside IBM. The CFO sounded bells since 3Q12 when the organic revenue was flat. The latest organic products like Pure have been flops in market. Most acquired technologies hit the IBM process and complexity wall once integrated. IBM can only cut its way to EPS of $20 in 2015. -cognos insider ottawa-

    • Comment 06/17/13: Just FYI IBM in Brazil is also firing lots of resources since last week. So this thing is bad everywhere -Braziltoo-
    • Comment 06/17/13: IBM did the same thing to Lotus as they did to Cognos (although Loti got to stay slightly longer). I was a casualty of the RA actions in 2009 and will enjoy watching IBM flush themselves out of existence. I will never buy another IBM product for as long as I live. -Anonymous-
    • Comment 06/17/13: I am most incensed at the 401k issue - especially at 55 and looking forward to the match. I agree with a previous poster that "this was planned in Dec 2012" There is a huge amount of cash now left behind for IBM to recover. I Wonder if a class action suit is now worthy of attention to reclaim the 6 months due. -Gonetopasture-
    • Comment 06/17/13: "I have a question. How does the layoffs affect the 401K contribution change? Anybody know? 401K change then a layoff, sounds to me like some planning was done. -4mrIBMr-" You're not getting your match. Surprised? You shouldn't be. This website has been saying this would happen since the 401k change was announced. Its a shame IBM seems to be the only side doing any long term planning. Planning how to take everything you have without you joining the union to try to stop them. Their plan seems to be working to perfection. -Exodus2007-

      Alliance reply: We also ran a petition for 3 months (in the beginning of 2013), on Change.org, and only got 1,030 signatures. We thought IBMers would be outraged enough to get 15,000 signatures. We were wrong. It is baffling to Alliance members. Yes -4mrIBMr-, you lose your matching contributions. IBM will continue to change their policies to benefit the company...NOT the employees. As hard as you may think Exodus2007 may be with the comment; the intention is to draw attention to what action US IBMers must take. Organize now.

    • Comment 06/17/13: Has anyone else noticed this website is blocked by the IBM firewall. It will let you on the landing page once and then report back a network issue from then on. -AnonInCanada- Alliance reply: No one inside IBM's premises is supposed to be accessing the Alliance@IBM web page. It's against Federal law for IBM management to do it (see the bottom of our front page), and workers doing it are taking a risk, too, as far as their job is concerned. Please access this site from your own equipment, on your own time, from a non-IBM location. It's the best practice.
    • Comment 06/17/13: I quit on 6/10 for a better job paying about $50k more a year. Looks like my timing was off by a week to get the package. Oh Well -Left in time-
    • Comment 06/17/13: IBM executives have shown over the last few years they do not value the employee as the "asset" we once were called but now openly label us as a "resource" to be used/abused/intimidated/harassed and eventually thrown away EVEN when there is dire need for your skills.

      With each successive round of layoffs/firings the true depths of their insanity deepens. The executives directing this company further into oblivion have shown they are either clueless on how to grow the business or just to lazy to do the hard work needed to make any valuable business growth. Instead these Ivy League washouts have reverted to a form of business mutilation/destruction that has only one possible outcome.

      If it weren't for the current $11.2 Billion (just increased by another $5 Billion in Q1) stock repurchase program that continuously props the stock price when its under pressure it would be more reflective of the companies true value of well under $99. When will the market wake-up?

      Some in the market are aware but when they question IBM's massive repurchase program it is able to hide its massive fraud by removing shares from distribution. Until these funds run dry this massive executive fraud and incompetence will continue to be hidden. Quick note, Bloomberg does give Ginni the #10 slot on their CEO Underachievers list.

      The executives won't listen to me as an individual, I have tried. The only hope for this company is for all of us to band together and form a UNION. Only as one voice can we return sanity to this madness. Only with the power a union provides can we, Stop the daily intimidation that beats all our morale to the ground. Stop the monthly /quarterly layoffs of needed skills/talent just so an executive can replace a high paid/skilled person with a low/unskilled one. Stop the culture of the employee being treated as a worthless "resource" but instead treated as the ASSET that we are! The ASSET that makes this company what it was, what it can become once again.

      WE are what makes IBM, IBM. Not the executives, The executives have destroyed IBM. Turned customers against the brand, against the products, against the services. WE, the employees are what makes this behemoth run. WE are the ASSETS, the ASSETS that makes the customers return for more saying job well done!

      This was a long rant coming. IBM is on a precipice, lead their by executive negligence, greed and short sighted motives. This is our last opportunity to band together before the executives decimate all Geographies of the remaining skills/talent in search of every last penny, cent, fen, centavos, kopek, …. Become a union member today. Remember, your lack of action makes you just as responsible as those performing the action. At an Associate Membership price of $5 per month and being one of the only honest sources of information there is no excuse. -Anonymous-

    • Comment 06/17/13: I am able to view the website from the IBM Markham Software Lab. From my source just found out a IM product managers were laid off. -Johnny-
    • Comment 06/17/13: From talking to my Canadian friends that got packages, I hear they are getting from between 2 to 3 weeks salary per years service with no indication of a capped amount. How does that stack up to the US package? -Dirty Money-
    • Comment 06/17/13: 3 cut from my group of 40 or so, but all 3 came from US based employees. Any information on why severance is based on the acquisition date, rather than vacation eligibility date? Anyway, RA viewed as blessing to be able to pursue new ventures. -Anonymous until 7/12-
    • Comment 06/17/13: The number that keeps coming up for cuts to Cognos staff in Ottawa is about 200: http://www.ottawasun.com/2013/06/12/ibm-axes-staff-at-ottawa-offices We've also heard about Cognoids being RA'd in other offices - the US and England. RA'd include technical writers, build team, globalization, product managers, QC, development.... and from band 7 up to VPs. Ottawa Law firm Nelligan O'Brien Payne is offering a free information session on Friday to employees laid off recently as a result of job cuts made by IBM on June 12, 2013: http://www.nelligan.ca/e/sessionibmlayoffs.cfm -Ottawa-
    • Comment 06/17/13: Heard from a colleague in research that a good number of supplementals/postdocs were converted to regulars just before the RA. Maybe mgmt avoiding an age discrimination issue. -Anon-
    • Comment 06/17/13: Interesting to hear that the Alliance held a petition regarding the changes in 401k contributions. I bet most IBMers never heard of it. What else is the Alliance doing? -Anom- Alliance reply: All the more reason to bookmark the Alliance website. An email about the petition went out to 25,000 email addresses.
    • Comment 06/17/13: I used to think unions would be the death of IBM. But now it's clear that senior managers & their junior mgr phantasm will be responsible. -T
    • Comment 06/18/13: Aside from losing their 401K match, any payroll increase due to the date move. Aren't folks that get 90 days and six months salary hit by a potential tax bite? By getting the six months of salary in a lump sum payment (in 2013) assuming a 9/12 separation date, one could end up with year plus three months salary and be pushed into a higher tax bracket that affects the entire year. - IBMnTax's-
    • Comment 06/18/13: Just so everyone knows that if you take retirement following this RA you do get you TDSP match. I also found that when checking my position history to work resume i got an error accessing it. That bugged me since a lot people are probably I. That process. I still don't have clear understanding on getting any unemployment if you retire. Do you? - BlueLadyGone-
    • Comment 06/18/13: To RTPer. Sorry to hear about your lost. I thought most of RTP was safe. I knew that SWG in Pok took a big hit. I am sadden for you and myself as I too loved my job and will miss it. But I find myself feeling mixed emotions and realize that I won't have to deal with lack of team work due to team members not sharing knowledge and working together for fear of losing their position. Measurements of talent have been wrong for years. You always hope that IBM mgmt will discover their mistakes and fix the model. IBM will discover that the people they let go were also the ones that would stay and dedicate their time to get the job done -SWGerGone-
    • Comment 06/18/13: I was laid off last year and have some advice. If you have a Health Care Spending Account, spend as much money as you can now. IBM fully funds the account at the start of the year, so all of the money is there to spend now. After you leave IBM you will have the option of continuing to contribute to the HCSA with after tax money. If you do this, you can use the account to pay for expenses through at least the end of the year. If you stop contributing, you can use the full year amount, but the expense period ends when you stop contributing. I left at the end of a pay period and was covered by the HCSA through the middle of the next month, but I'm not sure how it works if you leave in the middle of a pay period. -Glad to be out-
    • Comment 06/18/13: Just laid off in Tucson. STG Product Management. 34 years of service. -John Doe-
    • Comment 06/18/13: 14.4% of inscope UK delivery Staff (1870) to go by Aug 5th 2013 ! most backoffice technical people, you know, the ones that do the work. -UKToo-
    • Comment 06/18/13: I got RA'ed in 2010 March and trust me have made much much more money yearly (>60k from my IBM salary) more consulting. It is much better to e your own master than work for IBM or any other company and am much happier. I get benefits through my wife so it is easier. -Boca Phantom-
    • Comment 06/19/13: I'm curious about the last day of July 12 for those RA'ed. If you retire, don't you have to retire at the end of the month? What happens between July 13 and July 31? What do you do about health insurance between July 13 and July 31? Are health insurance premiums paid in advance so the last paycheck would cover the second half of July? Or are health insurance premiums paid in arrears? -hadenoughyet?-
    • Comment 06/20/13: This was Rometty's approach when she ran Global Services. Cut cut cut. In her mind, technical people are widgets. We'll see how it works out for her as IBM is well past cutting the dead weight. Judging from some of the people cut, I anticipate it won't be very good.

      Contrary to Rometty, I would argue senior managers/execs are more like widgets than those on the front lines, which includes some first lines who are doing PM + people management roles. After all, there is always another Harvard business school hot shot IBM can bring in to be an exec. But, good luck finding an engineer who spent the last 20 years or so understanding how a product evolved and all the details around decisions made in that evolution (especially in India or China).

      Executive management is easy, be able to BS in public (car salesman) and do simple arithmetic. If !(EPS > Plan) { Cut(employees) );

      While companies like Google, MS, and Amazon are investing in people and technology, Rometty is basing every decision on quarterly numbers. It is actually a good time to get RA'ed. People used to think of IBM as a career, now it is simply a job... I do feel for those who wanted a few more years though. -Anon-

    • Comment 06/20/13: I remember how proud I was to be part of IBM when I was first hired a few years ago as the result of an acquisition. There were a few rough spots, but I figured those were just growing pains and we would soon be on our way to a productive and rewarding future. Unfortunately those rough spots were just the beginning. The IBM experience became a slow-motion train wreck as I watched our once-productive team increasingly burdened with useless reporting requirements and worthless “training”. Of course no internal charge code was provided for all this unproductive time. We were expected to bill it all to the client.

      Where we were once focused nearly 100% on client tasks, we were now spending two or more hours each day on internal busy-work that added no value for the client. Not surprisingly, the client soon terminated their contract with IBM.

      The priorities of IBM management are upside-down. IBM’s stated values of “Dedication to every client's success”, “Innovation that matters, for our company and for the world”, and “Trust and personal responsibility in all relationships” now seem hollow and hypocritical. Instead of “dedication to every client’s success”, the only thing that management is dedicated to is gaming the system by any means possible to artificially boost earnings per share.

      Who would want to be a customer of IBM knowing that service to the customer is only an afterthought, a necessary evil to be accomplished at the lowest possible cost; that their primary value to IBM is as a resource to be milked for every possible dollar in order to support the almighty stock price? -Greg-

    • Comment 06/20/13: To the Australian and the News. In the USA, IBM Layoffs have become so commonplace they receive scant mention in the news and especially nothing in the mainstream national news. Instead they keep running"happy" stories about the economy getting better. Their better means engineers/programmers handing out shopping carts. To the IBMers that are left, you should consider joining the alliance. If enough of you do, this practice can and will end. -Anonymous-
    • Comment 06/20/13: Ginni Rometty - You have awakened a sleeping giant and filled him with a terrible resolve. -Anonymous-
    • Comment 06/20/13: Got the RA notice on 12 June. 1s and 2+s for 9 years. Wondering how many others cut had ADA accommodations on file? Anyone ever tried to negotiate severance package? Rather avoid lawyer if I can. -Stunned-

      Alliance reply: First, your "1s and 2+s for 9 years" has nothing to do with you being RA'ed. Second, you as an "At Will" IBM employee have NO NEGOTIATION POWER for your severance. You may hear from others that claim they have done so, but if true, they are the rare exception. Spending your money on a lawyer that will most likely tell you to "move on" is not the best advice. Others have said so on this board, many times, if you don't believe what Alliance@IBM says. Just read the comments archives, and you'll discover many things about why IBM has managed to abuse and discard their employees, year after year after year after year, because the employees do not have a collectively bargained contract. We are truly sorry for your job loss.

    • Comment 06/20/13: Pardon the insensitivity; but working at IBM is like an abusive relationship. You have 3 choices.
      • leave the relationship (quit IBM on your own)
      • get a bodyguard (unionize)
      • keep taking the abuse and keep saying "woe is me"

      Too bad the masses are opting for 3)

      If you're hanging on for an RA package you're gambling your sanity and increasing stress for you and your family. Chances are you won't land a new job before that severance runs out.

      For those of you complaining about "I was lied to!" Well no sh*t, Sherlock. Have you been reading the archives? IBM's been lying to people in your level for YEARS. Why are you still shocked?

      I'm SOOOOO glad I left on my own last year for much greener, and higher paying , pastures. The only regret I have is I gave 2 weeks notice. I wish I had given less, because they don't deserve 2 weeks. -Glad-I-Left-

    • Comment 06/20/13: I had a consultation with a lawyer yesterday. Though 2/3 of employees laid off in my division are >50, they kept some as well, and laid off some <40, so IBM can argue they were not getting rid of older, simply saving money, which the Supreme Court agreed companies can do. Bottom line: Attorney said take the package and move on. -AnonSecurity-
    • Comment 06/20/13: Long time reader...quick question. If I were to be a member of Alliance and were part of this RA, what advantage or benefit do I have over the people who got laid off but not a member? -Anon

      Alliance reply: Alliance members have resources and some help available to them through our parent organization CWA and some benefits/programs through Union Plus(see the link on our web site). It is limited though.

      But the key thing to remember is that as a member you are helping build an organization that helps all IBM employees with the goal of a collective bargaining agreement. Without the Alliance the world would not know what is going on inside IBM and employees would not have an advocate.

    • Comment 06/20/13: Got RA today from Mexico, official source for this round 400 layoffs in the country; my fault was only to ask be in the bench, PBC 2+ as usual, just 3 days on the bench. -ExIBMfromMexico-
    • Comment 06/20/13: To -AnonSecurity- I too consulted an attorney and got similar advice. So that is what I"m doing just looking ahead and moving forward!! (And praying the stock market rebounds before 7/12) -Take the money and Run-
    • Comment 06/20/13: A few weeks ago I posted as an ex IBM employee, ex GLOBALFOUNDRIES employee and commented how IBM stabbed GF in the back and sold Intellectual property (that GF helped to develop) to one of GF's main competitors. This was the straw that broke the back forcing GF's decision to pull out of East Fishkill early. Now look who IBM has formed a partnership with... http://www-03.ibm.com/press/us/en/pressrelease/41294.wss

      IBM is EVIL and I'm sure will ultimately screw UMC, just like they screw everyone else, including their employees. -stabintheback-

    • Comment 06/20/13: Thousands laid-off. Years of RAs. This is the one that I am sending in my money to help out the Alliance. Why? I just found out a person on our team, 'THE' go to guy who is by far one of the most dedicated, smart, kind people I have ever worked with was let go. You could call him any time of the day or night, and he would promptly log on and work any issues. He is the heart and guts of the commercial application we support. They just removed the heart and I must do something. Maybe this time, is truly the one has wakes everyone up. It did me. -Anonymous-
    • Comment 06/20/13: Organizing and joining the Alliance is a must but a resistance movement inside IBM needs to develop. Do only what is required. Do not do anything extra. Work 40 hours no more. Take sick time. Slow down. Get information to the Alliance. Managers need to choose sides. Do you support Ginny or the employees? The resistance begins. -resist-
    • Comment 06/20/13: I am stunned to get a notice from Manager (on 06/12/2013) that my permanent departure date from IBM will be 07/12/13. I work at IBM@Albany Nanotech (STG) unit process group. I joined as a Unit process engineer (Regular employee) last June 2012. Within a year of joining I got this notice. My management team never discussed before about this and in the lay-off notice it is written "as we discussed earlier". They are super lier. You work all-day and night and even weekend coverage without any substitute day off. I was about to quit the job, but they gave me notice before that. Advice: Never work in such a horrible environment. -Anonymous-
    • Comment 06/20/13: 119 cut from IBM Rochester ISC, rumor has it over 500 from site. -Anonymous-
    • Comment 06/20/13: Organizing and joining the Alliance is a must but a resistance movement inside IBM needs to develop. Do only what is required. Do not do anything extra. Work 40 hours no more. Take sick time. Slow down. Get information to the Alliance. Managers need to choose sides. Do you support Ginny or the employees? The resistance begins. -resist-
    • Comment 06/20/13: 90 from GBS Public Sector Strategy and Transformation -I shall weep anon-
    • Comment 06/21/13: Just heard an excellent developer in Poughkeepsie got the ax. Now, I don't feel so bad that I got the ax before. It wasn't me. It's IBM that doesn't know what it's doing. It thinks it can shift all developer jobs overseas. Which part of Microsoft Windows lesson did it not understand? IBM hired Microsoft to do DOS, OS/2 and ended up losing everything to Microsoft. Now it hires India and China to do the development on the cheap, for a while, and will end up losing the shop once the technology is fully transferred. The latest news is China just beat the U.S. on supercomputing, again. -A Lawyer-
    • Comment 06/21/13: I was an IBM Manager who left several years ago, as it became clear to me that the company was making a mockery of its stated values. I chose to go elsewhere where employees and their contributions were truly valued and frankly, the salary a lot better. It pains me to read this forum today, and to see that the situation has only become worse for my former colleagues. My 2cents for those who are still there: There are plenty of great opportunities outside of IBM, especially at this time. There is no reason to be working for a company that *will* treat you like crap. And if you don't have the option to move on, at least organize! -former_IBM_manager-
    • Comment 06/21/13: 30 days in Endicott, 90 in Poughkeepsie. (I assume it is based on total RA'd from each location -stillPlayingMusicalChairs-
    • Comment 06/21/13: The 401(k) plan even without a match has taken a beating. When the economy was supposedly recovering the widgets were just barely tolerated. Now when the economy stumbles the widgets suffer mightily. Impeccable timing of an RA IBM. You sure know how to hit your widgets (resources) hard to line your greedy EP$ projections and pockets. -anonymous-
    • Comment 06/21/13:I was a 3-year Supplemental since Jan 2011. My managers were trying to hire me as regular, but I was let go May 8th. I am 58 years old and had worked at IBM for 14 years, but had left for another 14 years to raise my kids. I was glad to be back in Engineering, sorry to go. -Anonymous-
    • Comment 06/21/13:To let everyone know, if you were acquired, the date of hire is the acquisition date not your original date of hire. -Anon-
    • Comment 06/21/13:Wonderful, just notified today that I will be taking on ALL the coding work from one of the recently RA in our group. I am not a app coder, never have been, but seems I have the most experience at this in our remaining group because I once fixed a web app by Googling the solution. Hoping to catch the next RA wave, after some analysis at least for me getting an RA would be better than just leaving on my own. Told manager exactly what I thought about this development. Hopefully it will speed up the move out of IBM. Waiting for the ax to swing back, and wishing it would hurry up. -working drone-
    • Comment 06/21/13: To those who have been RA'ed on June 12, has anyone in Canada negotiated with IBM for more severance successfully? - IBM_No_More-
    • Comment 06/21/13: How does IBM get away with stealing years of service from acquisitions employees? I have 12 years they claim 6! Is there a document on file somewhere for at least IRS records? -BopM- Alliance reply: IBM gets away with that and many other things because they can. When an acquisition by IBM occurs, the employees of that company become IBMers via the acquisition agreement. The employees are effectively "sold" and have no rights to their service time if they are "At Will Employees" of the former company. When they become IBM employees, they are still "At Will Employees". This means no contract between the collective employees of either IBM and/or the "acquired company" exists to protect their former service time.
    • Comment 06/21/13: For those that have asked about membership go here: http://www.endicottalliance.org/why.html The only way you would be identified as Alliance members is if you choose to be public. You also have more rights under labor law as a public member of the Alliance. The Alliance sticky on the right hand side also has information. -Alliance-
    • Comment 06/21/13: I am in SWG, ISSW specifically. I will be leaving in the next month, just finalizing my next employment opportunity. I am leaving because about a month ago they added another guy in my management chain. The guy is between the VP and the Director level. Not sure what that makes him, a semi VP-Director. Anyway, I am just tired of these useless managers that bring in zero revenue but get huge bonuses. Keep up the great job IBM, I just can't wait until only managers will be left in this company! -Leaving-
    • Comment 06/21/13: Canned at BTV after working there 36 years at age 64.5 years on 6/12/13. Product development engineering STG -canned@BTV-
    • Comment 06/21/13: Attended the free information session hosted by a local employment law firm in Ottawa. Around 30 people attended and a few more from Toronto and Manitoba. Since no "Form 1" was filed with Ontario Ministry of Labour, the number of people impacted in Ontario should be 199 or less keeping the minimum notice period of 8 weeks.

      The session was originally scheduled from 2-3pm. People didn't stop asking questions until almost 4:30pm. Before the session, I didn't plan on spending any money with these guys. I will now invest ~$300 to review my severance package because of what I learned today.

      Ontario has a statutory minimum in notice and severance. But there is also another standard called "Common law reasonable notice" as set by the courts. The rule of thumb is # of months x years of service capped at about 24 months.

      Where you end up in that range will depend on different factors. This will include your age, length of service, salary ... etc. This is the best summary I found on this topic. http://www.hrlawyers.ca/pdf/wrongful_dismissal/employers_guide_to_termination_law.pdf

      They also pointed out at least 2 issues in the standard severance package that can be used as basis of a class action lawsuit. For obvious reasons, I will not repeat them here. You have to ask around to see who attended today session. I sure hope there are enough people willing to fight this fight. I'm in! -EPS victim #199-

    • Comment 06/22/13: So sad here. Halls like a morgue...all frowns and no one greeting each other as they pass any more. No one knows what to say to each other; although my friends that have been cut say all the avoidance only makes them feel worse. I think it's time for a "black out" to show support to our mentors, and to express our sorrow for the loss of so many of our friends and coworkers. They gave their heart and soul to an ungrateful company. I am purposing that every IBM worker come to work wearing all black (world wide) on July 12th. Sometimes silent protests get more attention (and media coverage) than picketing. They can't fire you for wearing black clothes in the office and 400,000 people wearing black would make a statement. If nothing else, it would mean something to those being forced out. Yes, I'm a new full paying member. It took an eclipse of the sun for me to finally see. -Anonymous-
    • Comment 06/22/13: For those of you in Canada especially in Ontario, please email me at epsvictim@gmail.com if you're not happy with accepting severance offer by July 12. -EPS victim #199-
    • Comment 06/22/13: From last year, but worth reading. "The company is being run by executives who for the most part don't understand the products and services they sell." http://www.cringely.com/2012/04/18/not-your-fathers-ibm/ -Anon-
    • Comment 06/22/13: They just laid off approx. 200 Admins in the US (along with admin mgrs.)and the support for directors in GBS has been offshored to Malaysia! They are treating execs that are not Sr.VPs just like the rest of us now. -stillthere-
    • Comment 06/22/13: Gerstner saw this all coming. That's why nine years for TFL was enough for him. Why would he leave if he was doing next to nothing and becoming a billionaire at it? Palmisano saw it coming FAST so that is why he got out last year. Why would he leave for the same reason as Gerstner? Rometty will soon follow or be a captain of a sinking ship. She will not do as well as either of her predecessors. Is it possible she might do worse than Akers? -decisions-
    • Comment 06/22/13: I hope and pray for a miracle all who just got RA'd get a job elsewhere before their 30-90 days are up. Then tell IBM to go where the sun don't shine, tell them to stick their severance, and just leave at the instance. IBM must need 90 days for some to train and fill the position somewhere. It would be great to foil IBM's dastardly, callous plan for this RA wave. -anonymous-
    • Comment 06/22/13: GDFers: Is their life out there? Or are you all too busy working on your tickets using those TWO stupid problem and change management apps. Maximo (Minimo(!)) and TSRM that lack all navigation and an automated change and problem approval process? -GlobalDeliveryFarce-
    • Send the RA pack to ibmunionalliance@gmail.com so we can validate and count the number of workers fired. Names are confidential.
News and Opinion Concerning Health Savings Accounts, Medical Costs and Health Care Reform
Minimize
  • The Union (Western Nevada County, CA): Competition in Medicare programs: Boon or boondoggle? By Carole Carson. Excerpts: Does competition to provide insurance for Medicare recipients reduce costs? Or does competition simply increase the tab picked up by taxpayers?

    Dr. Ida Hellander, policy director for Physicians for a National Health Program, a nonprofit research and advocacy group, thought taxpayers should know the answers to these questions.

    In her research study published in the International Journal of Health Services, Hellander found that competing insurance programs, called Medicare Advantage plans, did not save money. In fact, since their introduction, the private (mostly for-profit) insurance programs have cost taxpayers an extra $282.6 billion.

    Hellander adds, “In 2012 alone, private insurers are being overpaid $34.1 billion.” This money, Hellander believes, should have been used to reduce the federal deficit, shore up Medicare’s trust fund or improve patient care — not to enrich private insurance companies.

    In 1985, Medicare contracted with private (mostly for-profit) insurance plans such as UnitedHealth and Humana for coverage of Medicare enrollees in a plan called Medicare Advantage. The idea was that Medicare Advantage plans would compete with the traditional fee-for-service Medicare insurance.

    Ironically, part of the argument for introducing the Advantage plans was that the competition would lower Medicare costs. Indeed, since their inception, the Advantage plans have become increasingly popular because they offer enrollees additional benefits at reduced premiums. But because of the added benefits, the lower premiums and the need to make a profit, the Advantage programs cost Medicare about 25 percent more than the traditional Medicare program.

    Medicare currently pays these privately run plans a set premium per enrollee (about $10,123). This amount is $2,526 more than the premium paid for enrollees covered under the standard Medicare plan. ...

    Just how profitable are these programs for the private insurers?

    UnitedHealth Group could afford to bump the annual compensation of its chief executive officer, Stephen J. Hemsley, to $13.9 million from $13.4 million in the prior year. The increase was based in part on his leadership in solidifying the company’s position as “the biggest provider of the privately run, subsidized versions of the government’s Medicare program for the elderly and disabled people.” ...

    Can taxpayers afford the extra cost to help private insurers make a profit from Medicare? Given the intent of Medicare to provide basic healthcare coverage to all enrollees, should all enrollees receive the same benefits? Or are some recipients entitled to expanded benefits at reduced premiums? If so, should taxpayers cover the cost of paying for these extra benefits and lowered premiums?

    Or does a single-payer, not-for-profit model with universal benefits and premiums make more financial sense?

  • New York Times: What Sweden Can Tell Us About Obamacare. By Robert H. Frank. Excerpts: Last month, for the 37th time, the House of Representatives voted to repeal Obamacare, with many Republicans saying that its call for greater government involvement in the health care system spells doom. Yet most other industrial countries have health care systems with far more government involvement than we are ever likely to see under Obamacare. What does their experience tell us about Republican fears?

    While in Sweden this month as a visiting scholar, I’ve asked several Swedish health economists to share their thoughts about that question. They have spent their lives under a system in which most health care providers work directly for the government. Like economists in most other countries, they tend to be skeptical of large bureaucracies. So if extensive government involvement in health care is indeed a recipe for doom, they should have clear evidence of that by now.

    Yet none of them voiced the kinds of complaints about recalcitrant bureaucrats and runaway health costs that invariably surface in similar conversations with American colleagues. Little wonder. The Swedish system performs superbly, and my Swedish colleagues cited evidence of that fact with obvious pride.

    The United States spends more than $8,000 a person per year on health care, well more than twice what Sweden spends. Yet health outcomes are far better in Sweden along virtually every dimension. Its infant mortality rate, for example, was recently less than half that of the United States. And males aged 15 to 60 are almost twice as likely to die in any given year in the United States than in Sweden. ...

    Doctors in the two countries also face different financial incentives. In the United States, under the fee-for-service model, they can bolster their incomes, often substantially, by prescribing additional tests and procedures. Most Swedish doctors, as salaried employees, have no comparable incentive.

    Another important difference is that, unlike many American health insurance providers, the government groups that manage Swedish health care are nonprofit entities. Because their charge is to provide quality care for all citizens, they don’t face the same incentive to withhold care that for-profit organizations do. That more hip-replacement operations are performed per capita in Sweden than in most other countries is almost certainly a reflection of the generous care options rather than of any inherent deficiency in Swedes’ hip joints. ...

    Is there a catch? When I asked my Swedish hosts to describe any downsides to their system, several mentioned the waiting times for certain nonemergency services. One told me that whereas in the United States a wealthy or well-insured patient might schedule a hip replacement with only a week’s notice, in Sweden the wait could be as long as three months. He described such waits as a design feature, noting that they allowed facilities to be used at consistently high capacity, and thus more efficiently.

  • New York Times: Choice of Health Plans to Vary Sharply From State to State. By Reed Abelson. Excerpts: When a typical 40-year-old uninsured woman in Maine goes to the new state exchange to buy health insurance this fall, she may have just two companies to choose from: the one that already sells most individual policies in the state, and a complete unknown — a nonprofit start-up.

    Her counterpart in California, however, will have a much wider variety of choices: 13 insurers are likely to offer plans, including the state’s largest and best-known carriers.

    With only a few months remaining before Americans will start buying coverage through the new state insurance exchanges under President Obama’s health care law, it is becoming clear that the millions of people purchasing policies in the exchanges will find that their choices vary sharply, depending on where they live.

    States like California, Colorado and Maryland have attracted an array of insurers. But options for people in other states may be limited to an already dominant local Blue Cross plan and a few newcomers with little or no track record in providing individual coverage, including the two dozen new carriers across the country created under the Affordable Care Act. ...

    But the insurance landscape will be highly varied, with some of the states that have been slow to embrace the law potentially offering the fewest options — and plans with the highest premiums — in the first year.

  • Pueblo Chieftain, courtesy of insurancenewsnet: Colo. Health Insurance Companies Post Rates. By Loretta Sword. Excerpts: Colorado's insurance companies have filed their proposed 2014 rates with the Division of Insurance -- including their rates for plans that will be sold in Connect for Health Colorado, the "health exchange" marketplace required under federal law.

    Connect for Health Colorado will include 11 carriers offering a combined 243 plans, including 150 plans in the individual/ family market and 93 in the Small Business Health Options Program (SHOP) market. The exchange is for families, individuals and small employers that have been priced out of the insurance market in the past. Open enrollment in the health exchange will start in October, with coverage taking effect on Jan. 1, 2014. ...

    ''It looks like Goldilocks -- just right. Despite doomsday predictions, the state is not seeing 'rate shock' (because) so many of the choices will be more affordable, especially with the subsidies,'' de Percin said.

  • In These Times: The Hundred Years’ War for Healthcare Reform. Until the ACA, reform attempts have been thwarted throughout the last century. By A.W. Gaffney. Excerpts: The story of healthcare reform in the United states begins not with Obama, Clinton or even Johnson, but almost a century ago, in the years leading up to World War I. Although the Socialist Party of America had called for insurance for workers “against accident, sickness and lack of employment” as early as 1904, it wasn’t until 1912, when the platform of Theodore Roosevelt’s Progressive Party called for a system of health insurance, that it emerged as a major political issue. Roosevelt lost the election, but progressives were nonetheless optimistic that healthcare legislation could be passed at the state level, and in 1916, progressive state legislators submitted “compulsory” health insurance bills to the legislatures of New York, Massachusetts and New Jersey. Much like the “employer mandate” of the Affordable Care Act, these plans would have required industrial employers to contribute to medical coverage and sick pay for workers and their families.

    These were bold ideas, but they met with unfortunate timing, as two developments in Europe furnished powerful ideological weapons to those who opposed the legislation: in April 1917, the United states entered the war against Germany, and the following October, the Bolsheviks seized power in Moscow.

    These global events proved politically useful to physicians in the American Medical Association (AMA), who had come to see health insurance legislation as a threat to both their independence and income. The AMA could now paint state-based health insurance as both pro-German (given its roots in Otto von Bismarck’s 19th-century social insurance) and pro-Bolshevik. Though the former claim had far more basis in fact, the latter smear was to prove the more enduring—throughout the healthcare reform debate of 2009-2010, even the most moderate of reform proposals were lambasted as communist by the Right. The effect in 1918 was a turning of the tide against the promising state plans that ended in their total defeat and decades of inaction. ...

    This series of missteps and lost opportunities gives a sense of the stakes when the healthcare debate again took center stage after the election of Obama in 2008. But Obama also had to contend with a corporate healthcare industry that had grown enormously in power and influence in the hundred years between the WWI-era campaigns and his first term. Indeed, the relatively crude public relations campaign of the AMA in the 1910s was nothing compared to the massive lobbying machines of the insurance and pharmaceutical industries in the 21st century. These corporate “stakeholders” were to critically influence the terms of the healthcare reform debate of 2009-2010.

    For instance, the health insurance lobby agreed to support the elimination of “pre-existing” conditions in exchange for a number of industry-favorable provisions, such as an individual mandate. Similarly, the pharmaceutical lobby agreed to support reform legislation so long as it did not allow Medicare to negotiate directly with pharmaceutical companies over drug prices, a reform that by one estimate could have saved the government between $230 billion and $541 billion over ten years. And there’s no doubt that industry influences limited reform in other, less obvious ways, whether it was the early exclusion a single-payer system or the elimination of a “public option” from the final bill.

News and Opinion Concerning the "War on the Middle Class"
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 editorial: Don’t Blame the Work Force. Excerpts: There is a durable belief that much of today’s unemployment is rooted in a skills gap, in which good jobs go unfilled for lack of qualified applicants. This is mostly a corporate fiction, based in part on self-interest and a misreading of government data.

    A Labor Department report last week showed 3.8 million job openings in the United States in April — proof, to some, that there would be fewer unemployed if more people had a better education and better skills. But both academic research and a closer look at the numbers in the department’s Job Openings and Labor Turnover Survey show that unemployment has little to do with the quality of the applicant pool. ...

    Unemployment is also stubbornly high — 7.5 percent in April, or 11.7 million people, a ratio of 3.1 job seekers for every opening. No category has been spared: unemployed workers outnumber openings in all of the 17 major sectors covered by the survey. The biggest problem in the labor market is not a skills shortage; rather, it is a persistently weak economy where businesses do not have sufficient demand to justify adding employees. ...

    THE RESEARCH Peter Cappelli, a professor of management at the Wharton School, has noted sharply different opinions between corporate executives, who typically say that schools are failing to give workers the skills they need, and the people who actually do the hiring, who say the real obstacles are traditional ones like lack of on-the-job experience. In addition, when there are many more applicants than jobs, employers tend to impose overexacting criteria and then wait for the perfect match. They also offer tightfisted pay packages. What employers describe as talent shortages are often failures to agree on salary.

    If a business really needed workers, it would pay up. That is not happening, which calls into question the existence of a skills gap as well as the urgency on the part of employers to fill their openings. Research from the National Bureau of Economic Research found that “recruiting intensity” — that is, business efforts to fill job openings — has been low in this recovery. Employers may be posting openings, but they are not trying all that hard to fill them, say, by increasing job ads or offering better pay packages.

    Corporate executives have valuable perspectives on the economy, but they also have an interest in promoting the notion of a skills gap. They want schools and, by extension, the government to take on more of the costs of training workers that used to be covered by companies as part of on-the-job employee development. They also want more immigration, both low and high skilled, because immigrants may be willing to work for less than their American counterparts.

  • Washington Post opinion: Great Gatsby economics are no party for the middle class. By E.J. Dionne Jr. Excerpts: You don’t need me to tell you, but it’s a whole lot tougher leading a garage band than being a superstar. What you might not have known is just how much harder.

    If you want an example of growing inequality, try the rock ‘n’ roll industry. Between 1982 and 2003, the share of concert income taken home by the top 1 percent of performers more than doubled, rising from 26 percent to 56 percent. The top 5 percent collected almost 90 percent of all concert revenues.

    The rock world is simply a more extreme version of the larger American experience. The top 1 percent of families doubled their share of national income between 1979 and 2011: Their take went from 10 percent to 20 percent of the whole. We live in a superstar economy.

    That phrase and the examples come from Alan Krueger, the outgoing chairman of the White House Council of Economic Advisers, in a speech last week at Cleveland’s Rock and Roll Hall of Fame that drove home the danger of growing economic inequality. To paraphrase Bruce Springsteen, we are not taking care of our own as we should. ...

    Krueger, who has a gift for popularizing economic concepts, has invented the Great Gatsby Curve,” which measures income mobility across generations. It turns out that the United States has far less “intergenerational earnings elasticity,” to use the technical term, than do many other countries, including Denmark, Norway, Finland, Sweden, Germany, or New Zealand. Economically speaking, “Born in the USA” doesn’t mean what it once did. ...

    As the song goes, it’s a long way to the top if you want to rock ‘n’ roll, and Krueger points out that the three decades or so after World War II — when the United States firmly established itself as the global economic leader — were a time of greater economic equality than we enjoy today.

    He argues that we need to grow again “from the middle out,” not from the top down. This is the theme of a symposium in Democracy, a journal I’m involved with, and the “middle-out” idea needs to be our era’s answer to inequalities rationalized since the 1980s by supply-side economics.

  • New York Times opinion: Structural Excuses. By Paul Krugman. Excerpts: I promised in an earlier post to say something about why these days I tend to get annoyed when I hear the phrase “structural reform”, especially in Europe

    Part of the reason is that the phrase sounds good, but could mean lots of things. In many cases “structural reform” is code for eliminating worker protections and/or sharply cutting social benefits. Sometimes this may be necessary — let’s face it, France has made it much too attractive to retire at 55 — but such things should be called by their proper names, not wrapped in vague language that conceals the nature of the pain.

    That brings me to a second problem: whenever some catchphrase becomes part of what Very Serious People say because it sounds Serious, it’s time to stop using the phrase, to force the VSPs to talk about what they really mean. In the US context, “entitlement reform” is VSP boilerplate — I mean, who can be against reform? But there’s a world of difference between trying to move away from fee for service medicine — a reform I support — and, say, raising the Medicare age, which would be a terrible policy. These things should not be lumped together.

  • Smirking Chimp: Celebrate the Defeat of the Granny Bashers! by Dean Baker. Excerpts: It isn't often that progressives in the United States have much to celebrate. After all, the news has swung between bad and worse for most of the last three decades. That is why we should be celebrating the victory over the Campaign to Fix the Debt and its efforts to cut Social Security and Medicare.

    Just to remind everyone, the Campaign to Fix the Debt (CFD) is yet another Peter Peterson-inspired initiative that has as its main goal cutting and/or privatizing Social Security and Medicare. Peterson has used the billions of dollars he earned as a Wall Street investment banker and private equity fund manager to finance a whole slew of Washington-based outfits for this purpose over the last two decades.

    The CFD was the biggest and boldest effort yet, incorporating funding and support from the heads of many of the largest corporations in America. It hoped to take advantage of the deficits that resulted from the collapse of the housing bubble.

    The idea was to whip up hysteria over a deficit crisis. They wanted to paint a picture of out-of-control government spending that could only be addressed by major cuts to the country's two most important and popular social programs. While they got the cooperation of much of the national media, who consistently put the CFD's views and spokespeople at the center of the budget debate, the facts refused to cooperate.

    First, the real scary projections of exploding deficits in the next two decades largely disappeared as the rate of health care cost growth slowed sharply. When the Congressional Budget Office and other official forecasters incorporated slower health care cost growth into their numbers, the deficits projections no longer provoked the same sort of hyper-ventilation. Slower projected health care cost growth eliminated almost 70 percent of the projected shortfall in Medicare. ...

    But we should take a moment to celebrate the victory we have achieved. So pick up a glass of the beverage of your choosing and drink a toast to Social Security and Medicare, to the people whose lives they have made more secure, and to the people who have worked to ensure that these programs are there for current generations and those yet to come in the decades ahead.

  • Smirking Chimp: Low-Wage, Low-Tax States Only Bring Race To Bottom. By Dave Johnson. Excerpts: Texas Governor Rick Perry is on a “job-poaching” trip to New York. Let’s say he “attracts” some businesses to move to his low-wage, low-tax state. That means good-paying jobs in one part of our country become low-paying jobs in another and business taxes that supported good schools in one part of our country don’t support good schools in another part. This adds up to a net loss for our country, economy and society. ...

    “Higher taxes. Stifling regulations. Bureaucrats telling you whether you can even drink a Big Gulp.” And, “Our state is number one for business because we have no state income tax, fair and predictable regulations, and lawsuit reforms that keep trial lawyers out of your pockets so you can grow your business.”

    Let’s look at what he’s pitching here:

    • Lower taxes, meaning government doesn’t have the resources to educate people, maintain the infrastructure, etc.
    • Fewer regulations, meaning terrible pollution, few protections for consumers, few on-the-job safety inspections, terrible working conditions, etc. Maybe not even regulate and inspect fertilizer plants.
    • Lawsuit “reforms,” meaning people can’t go to court when a corporation does something that harms them. Companies free to scam, con, exploit, defraud, etc. with impunity.
    • Texas is also a “right-to-work” state, meaning that state policy works to suppress unions, which lowers wages and benefits and worker rights are limited. Some employers like that — more money to the top and the workers can’t do anything about how you treat them. ...

    The Moral Of The Story. You have to look at the effect of these policies on the larger economy. Low wages don’t help any economy, anywhere. Low taxes don’t “create jobs” they actually kill jobs and the entire economy in a few years because defunded government can’t educate people, maintain infrastructure, etc. All that these “race-to-the-bottom” policies do is make working people poorer while enabling exploiters to force people into humiliating desperation.

  • ProPublica: Bank of America Lied to Homeowners and Rewarded Foreclosures, Former Employees Say. By Paul Kiel. Excerpts: Bank of America employees regularly lied to homeowners seeking loan modifications, denied their applications for made-up reasons, and were rewarded for sending homeowners to foreclosure, according to sworn statements by former bank employees. ...

    The employee statements were filed late last week in federal court in Boston as part of a multi-state class action suit brought on behalf of homeowners who sought to avoid foreclosure through the government’s Home Affordable Modification Program (HAMP) but say they had their cases botched by Bank of America. ...

    Sometimes, homeowners were simply denied en masse in a procedure called a “blitz,” said William Wilson, Jr., who worked as an underwriter and manager from 2010 until 2012. As part of the modification applications, homeowners were required to send in documents with their financial information. About twice a month, Wilson said, the bank ordered that all files with documentation 60 or more days old simply be denied. “During a blitz, a single team would decline between 600 and 1,500 modification files at a time,” he said in the sworn declaration. To justify the denials, employees produced fictitious reasons, for instance saying the homeowner had not sent in the required documents, when in actuality, they had. ...

    Five of the former Bank of America employees stated that they were encouraged to mislead customers. “We were told to lie to customers and claim that Bank of America had not received documents it had requested,” said Simone Gordon, who worked at the bank from 2007 until early 2012 as a senior collector. “We were told that admitting that the Bank received documents ‘would open a can of worms,’” she said, since the bank was required to underwrite applications within 30 days of receiving documents and didn’t have adequate staff. Wilson said each underwriter commonly had 400 outstanding applications awaiting review.

    Anxious homeowners calling in for an update on their application were frequently told that their applications were “under review” when, in fact, nothing had been done in months, or the application had already been denied, four former employees said.

    Employees were rewarded for denying applications and referring customers to foreclosure, according to the statements. Gordon said collectors “who placed ten or more accounts into foreclosure in a given month received a $500 bonus.” Other rewards included gift cards to retail stores or restaurants, said Gordon and Theresa Terrelonge, who worked as a collector from 2009 until 2010.

  • AlterNet: Big Lie: America Doesn't Have #1 Richest Middle-Class in the World...We're Ranked 27th! America is the richest country on Earth. We have the most millionaires, the most billionaires—and a increasingly poor "middle class." By Les Leopold. Excerpts: America is the richest country on Earth. We have the most millionaires, the most billionaires and our wealthiest citizens have garnered more of the planet's riches than any other group in the world. We even have hedge fund managers who make in one hour as much as the average family makes in 21 years!

    This opulence is supposed to trickle down to the rest of us, improving the lives of everyday Americans. At least that's what free-market cheerleaders repeatedly promise us.

    Unfortunately, it's a lie, one of the biggest ever perpetrated on the American people. ...

    In short, financialization is when making money from money becomes more important that providing real goods and services. Here's a chart that says it all. Once we unleashed Wall Street, their salaries shot up, while everyone else's stood still.

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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