Welcome to IBM Employee News and Links

Highlights—May 31, 2014

• Ithaca (New York) Journal:

  Suit says IBM targeted older workers for cuts. By Craig Wolf. Excerpts: IBM’s hiring of recent young college graduates while firing older workers violates federal and state laws barring age discrimination, a Wappingers Falls ex-IBMer alleges in a federal lawsuit.

  The company denies it. “The allegations are baseless and IBM will vigorously defend its hiring practices,” said spokesman Douglas Shelton in an email.

  The case was begun in federal court by John McCormack as lead plaintiff, joined by two Florida-based ex-IBMers. It seeks class-action status, which, if granted, could cover hundreds and perhaps thousands of older IBMers whose jobs were terminated by the company.

  IBM had a campaign of job advertisements in late 2013 calling for applicants with graduations in 2010 or later. That figures in the suit. ...

  McCormack, 46, worked at IBM’s semiconductor complex in East Fishkill until a large-scale downsizing hit him in December 2013. IBM told 697 Dutchess County-based employees in June that the cuts were coming. For several months, McCormack applied for at least 15 internal IBM postings, the suit says.

  He was denied in each case.

  “IBM managers and supervisors told Mr. McCormack that these positions had been targeted for young persons who had graduated college in 2012 or 2013,” Sussman said in the suit.

  But McCormack actually was a recent graduate himself, in 2012, despite his age. This changed nothing, though he “had the qualifications and technical skills to successfully fill many of these positions, IBM uniformly rejected McCormack for these positions without particularized consideration on the basis of his age,” the suit contends. ...

  IBM’s Shelton said, "IBM's long-standing commitment to workforce diversity recognizes the contributions that all individuals make to IBM's success, regardless of age. At any given time, IBM has thousands of open positions in the U.S., many of them are entry level positions in our business' strategic growth areas.” ...

  In September 2013, the Poughkeepsie Journal found and reported on several IBM job postings that clearly limited the recruitment to recent college graduates. Some said in capital letters, “All applicants must have graduation dates of January 2010 or later. Then, the Burlington (Vermont) Free Press quoted Douglas Shelton, “It was a thoughtless mistake.”

  Sussman doesn’t think so. He argues it was a “corporate policy” reflecting one to “discriminate against older workers and to exclude them from consideration from a whole range of jobs for which many would qualify.”

• Computerworld:

  Laid-off IBM workers allege age bias in lawsuit. Former employees say IBM was only interested in recent college grads, a charge the company calls baseless. By Patrick Thibodeau. Excerpts: It may be harder for IBM employees to make similar allegations in the years ahead.

  During layoffs, IBM used to provide details of layoffs to employees, including a list of the age, title and number of employees selected for a job cut. But it stopped doing so this year.

  These resource action documents were provided to help employees determine whether they had an age discrimination case, and agreeing not to sue for age was a condition of severance. Instead of providing these lists of other employees who were cut, IBM is now allowing employees to use arbitration to bring an age discrimination claim, reported Bloomberg.

  The AARP called this shift to arbitration by IBM troubling, and said the lack of disclosure prevents age discrimination victims from joining together in a lawsuit.

• Forbes:

  Why IBM Is In Decline. By Steve Denning. Excerpts: It’s been a striking week for IBM. In its June 2014 issue, Harvard Business Review (HBR) published an interview with IBM’s former CEO Sam Palmisano, in which describes how he triumphantly “managed” investors and induced IBM’s share price to soar.

  But IBM also made it to the front cover of Bloomberg Businessweek (BW) with a devastating article: “The Trouble With IBM.” According to BW, Palmisano handed over to his unfortunate successor CEO, Ginni Rometty, a firm with a toxic mix of unsustainable policies.

  The key to Palmisano’s success in “managing” investors at IBM was—and is–“RoadMap 2015”, which promises a doubling of the earnings per share by 2015. The Roadmap is what induced Warren Buffett to invest more than $10 billion in IBM in 2011, along with many other investors, who were impressed with the methodical way in which IBM was able to make money. (Buffett’s investment was striking because of his long-standing and publicly announced aversion to investing in technology, which he confessed he didn’t understand.) ...

  Yet for critics of IBM like BW, “Roadmap 2015” is precisely what is killing IBM. According to BW, IBM’s soaring earnings per share and its share price are built on a foundation of declining revenues, capability-crippling offshoring, fading technical competence, sagging staff morale, debt-financed share buybacks, non-standard accounting practices, tax-reduction gadgets, a debt-equity ratio of around 174 percent, a broken business model and a flawed forward strategy.

  According to BW, IBM’s RoadMap 2015, if adhered to, virtually guarantees that its woes will worsen. “It would be hard enough for Rometty to bring IBM into the cloud era,” analyst Bill Fleckenstein is quoted by BW. “Doing so while yoked to her predecessor’s $20-per-share earnings promise is almost impossible.” Even if IBM does somehow manage to make its earnings-per share targets, what will be left of this once-great firm?

  The ticking money-bomb. Critics point to Palmisano’s exit package from IBM, enabling him to clear an estimated $225 million, including all the options, restricted stock, pensions, deferred compensation, bells and whistles. ...

  However critics—and many staff—suggest that what drove actual decision-making at IBM under Palmisano was not so much “clients”, “innovation” or “trust’, but a relentless drive to grow earnings per share, no matter what the cost. ...

  Palmisano treated the large shareholders as real owners. “We decided to treat our large shareholders with total transparency, as best we could within regulations. We would meet with them. We’d have a couple of them come in every quarter and talk with the entire senior management team… Fidelity, Capital, BlackRock, T. Rowe, Wellington, Neuberger Berman—the big guys. They would each bring four or five portfolio managers…. They could spend as much time as they wanted with the businesses. The meetings went on for hours.”

  Palmisano found that the big shareholders supported his primary focus on earnings per share, ahead of growing the business. “Basically, the shareholders were just asking us to be friendly with capital allocation. They wanted more margin expansion and cash generation than top-line growth, because they knew that if we generated cash, we’d give it back to them in the form of a share buyback or a dividend, not a crazy large acquisition that no one else could see value in.” And so Palmisano became very friendly. ...

  Just think about the scene. You have the IBM C-Suite which is hugely compensated if it jacks up the share price. And you have the managers of the big investors who are also hugely compensated if they get reliable information as to exactly how the share-price is going to be jacked up. Should it be any surprise that this self-interested cabal ends up jacking up the share price? The question remains: is this good for IBM—and society—or not?

  Under Palmisano’s leadership, the steps taken to ensure IBM’s steadily increasing earnings have created significant issues, as you might expect from pursuing “the dumbest idea in the world.”

  • Relentless cost-cutting: Employees bitterly refer to the Palmisano’s Roadmap 2015 “Roadkill 2015.” The cost-cutting began with “Roadmap 2010” has continued, long after obvious fat has been removed. Workers complain that the cuts now affect IBM’s muscle, bone and vital organs.
  • The shift to cheaper expertise: IBM shifted technical expertise from high-paid US staff to low-salaried staff in India, while cutting back on staff in the US. Its Indian operations grew from 3,000 to well over 100,000 employees.
  • Automatic culling of staff: Managers are required to cull a certain percentage of their staff, regardless of absolute performance.
  • Fading technical expertise: IBM’s failure to win the bid for the CIA’s cloud computing contract, worth some $600 million, is highlighted by BW. This bid should have been IBM’s “home field,” given its long experience with mainframes and government contracting. Its bid was 30 percent lower than Amazon’s, which had no experience with government, yet IBM’s bid was rejected on technical grounds. An appeal by IBM was even more humiliating: it only highlighted how technically inferior its proposal was and so the bid was withdrawn.
  • Bureaucracy and lack of agility: Despite talk of delayering and collaboration across silos, IBM still has a steep hierarchy, with thirteen layers of management. When combined with the relentless cost-cutting and offshoring and the fear that these practices generate, the agility of the organization tends to be compromised.
  • Acquisitions instead of innovation: Despite spending some $6 billion on R&D, IBM has been falling behind its competitors technically. This was one of the factors behind its losing bid for the CIA project. IBM’s response has been to buy firms with needed expertise, such as Aspera, which helps clients move large volumes of data quickly; Cloudant, a service for mobile and Web apps; TeaLeaf, a tool for retail marketers, and SoftLayer Technologies, a cloud computing firm. What remains to be seen is how well those acquired firms will do when faced with the demands of Roadmap 2015 and the IBM bureaucracy.
  • Reliance on financial incentives: “People need to understand,” says Palmisano, “that if they execute the model, they will be rewarded.” The problem is that when incentives are purely financial, motivation suffers. And when the financial incentives are as skewed towards the top as they are at IBM, the costs in terms of motivation are considerable.
  • Sagging staff morale: When layoffs are a central part of the business model, especially needless layoffs for financial positioning, it creates disaffected employees. Even IBM’s fans concede that staff morale is low. Despite many talented and committed staff, the relentless cost-cutting, the steep hierarchy and lack of agility have taken their toll, particularly in key areas like innovation and generating customer delight.
  • An imploding business model: “IBM has three core businesses: services, software, and hardware. When times are good, they work in concert,” says BW. “A decline in one of these businesses can hobble the whole company, a destructive spiral IBM is fighting to break. As more customers get their computing done cheaply in the cloud, IBM is selling less hardware, which imperils its high-margin software products. And any perception that IBM is adrift threatens its ability to advise clients on anything at all.”
  • A cloudy future strategy: “The cold-sweat scenario for IBM,” says BW, “is that it does catch up to Amazon and other cloud providers—only to find that competition has driven margins toward zero. In March a price war broke out among Amazon, Google, and Microsoft, as each announced cuts of as much as 35 percent on computing; 65 percent on storage; and 85 percent on other services. Rometty has made two promises to investors: to lead corporate IT into the cloud and to deliver lustrously thick margins. Those goals may be irreconcilable, as long as IBM faces competitors willing to make the cloud a place of ever-diminishing returns.” ...

  “Last year,” BW reports, “she began distributing black plastic cards bearing the phrase “One Purpose: Be essential” to IBM’s roughly 50,000 managers and has been known to demand to see them as she walks the halls.” When I asked IBM staff whether this story was true, they told me that it was implausible since the cost of printing 50,000 cards was exactly the kind of cost that would be automatically be cut in today’s IBM. ...

  In order to keep up the growing earnings per share despite the internal problems, Rometty has resorted to ever more ingenious financial engineering, including non-standard accounting practices (125 in IBM’s annual 2013 report), borrowing to fund share buybacks, and tax reduction gadgets. ...

  Palmisano makes no apology for being steward of a money-making machine that takes no prisoners. In fact, he celebrates it. Indeed sees no alternative for big companies like IBM. It’s simply the way things are. The possibility that his getting rich—legacy-wealth rich—in the process may have anything to do with it never crosses his lips. As Upton Sinclair noted, “It’s hard to get a man to understand something when he is being paid not to understand it.” Particularly when the amount of the payment is $225 million.

• BusinessWeek:

  The Trouble With IBM. By Nick Summers. Note: This article was summarized in last week's highlights. Additional reader comments since last week are included below.

  

  Selected reader comments follow:

  • Roadkill 2020, $40.00 EPS, come on Ginni byte. Sammie set you up and you fell for it and now you are destroying the Company. IBM always wanted to have everyone in the cloud and they missed it. IBM has been destroying the hardware business since 1990. The problem is it hit the edge with the advent of the cloud and went over. IBM is no longer diversified. It has services, software and consulting. Hardware is such a small portion now that if anyone of the big areas take a hit, the whole company suffers. Power is a looser. Too late to bring the hardware back, you lost or drove out all the skill. Good luck finding another successor with 30 years in the company.
  • Anyone with deep experience in the Software Engineering world knows that IBM long ago switched to an all-offshore staff. They have eliminated all their domestic staff in favor of an India-heavy one.

    Despite the propaganda that you have been asked to believe by CEOs with a vested interest in your believing their propaganda, most of the software engineers that come out of India are of poor quality. Code that comes out of Bangalore or Mumbai has to be silently rewritten by domestic American resources and those Americans doing the real quality work are not free to speak about that reality because the executives who think offshoring is a good idea don't want to hear it.

    But in the case of IBM, there are no domestic resources to do the rewriting and so the poor quality remains.

    Now, you should expect a tidal wave of Indians to react angrily when someone such as myself speaks these facts. But given the cheating that goes on in Indian universities and the general lack of creativity that is seen even in Indians who come to the US on H-1B visas, it's not surprising that they offer poor quality. IBM has made its bed and now it has to lay in it.

  • IBM used to be a world leader. Then it became a 'me too' company. All downhill from there. As a friend of mine ( I was an IBM'er for 30+ years) and a co-worker used to say, 'We're going to downsize ourselves to prosperity'. Looks like that hasn't worked out too well. Think that maybe high level management did not take into account all of the ramifications of downsizing and casting away the company culture in effect during our 'world leader' era.
  • First ff all, when I joined IBM, there were only 7 levels of management between myself (an operator trainee at the time) and Tom Jr. Another difference that occurred between that time frame and today is that when I joined, during our 'world leader' era, the belief was that the purpose of management was to make the worker bee's job easier, while by the time I left, it was a major part of the worker bee's job to make his immediate manager look good and help him advance.
  • This is a repeat, but IBM did well as long as it followed the basic beliefs of it's founder, Tom Sr. Those were; A company has 3 responsibilities:
    • A responsibility to its customers
    • A responsibility to its employees
    • A responsibility to its stockholders

    As long as a company takes care of the first two, the third one will take care of itself.

    When Gerstner took over and we started moving away from the above, that's when the company slowly started it's downhill slide. Though Lou's moves helped save the company in the short term, its long term effects were disastrous.

    I should clarify that the company was in trouble before Lou took over, but his doing away with Tom Sr. beliefs stated above, and then shortly after that, doing away the IBM's 10 Corporate Principles help that downhill slide gain momentum.

  • Biggest issue with IBM is now short-termism. They are big on talking "vision", but everything, EVERYTHING, has to be a profit center. Product development is based on a) who will pay, b) who shouts loudest .... z) visionary developments for future markets. We are being pushed now to cram as much billable time before the end of the month so that "this month" looks good. But what does that do to next month, next quarter, next year? A company like IBM shouldn't need to scrabble round for pennies in the gutter.
  • The IT sector, and IBM specifically, have turned into rent seeking corporations that extort earnings from customers rather than actually delivering any new technology that provides a reasonable return on investment. This company has jettisoned its most prize capital. That is, its highly-skilled employees. IBM is in serious trouble. It could easily cease to exist within a decade or so. Rometty is a bureaucrat who has absolutely no idea what she is doing. Umm...that statement can be confirmed by insiders.
  • The market will allow IBM to slash and burn it's way to fictitious and arbitrary $20 EPS, but after that all bets are off. When IBM decided that EPS are more important than their employees, they sealed their fate. IBM is rife with top heavy, disconnected, money hungry management. 2015 and beyond are the big question marks. IBM has lost site of what once made them great, innovations, respect for the employees and respect for the communities they were located in. It is all about about money now.
  • First, blaming Rometty for a strategy that Palmisano laid down and Loughridge (the CFO until recently) was instrumental in executing, is counterfactual at best. Rometty is, in my opinion, at fault for not reversing Palmisano's course, but she didn't chart the course, and it was pretty baked into IBM's public statements long before she became CEO.

    Second, Rometty is plenty geeky and passionate about technology. That she lacks the courage or board support to make bigger bets (and to be fair, she's bet pretty big on Watson, to cite an obvious example) means she's not off the hook for the coming denouement, but again, it won't because she lacks technology chops.

    Finally, your sexist rant about men being obviously more passionate about technology, and therefore more qualified to lead technology companies, is obnoxious at best and factually wrong. I work with plenty of women who are passionate about technology, and plenty who are better executives and managers in a technology company than men with geeky hobbies.

    Finally, your sexist rant about men being obviously more passionate about technology, and therefore more qualified to lead technology companies, is obnoxious at best and factually wrong. I work with plenty of women who are passionate about technology, and plenty who are better executives and managers in a technology company than men with geeky hobbies.

    Nobody awards you brownie points as an executive for swooning at gadgets and algorithms - you get the job and the rewards for recognizing where the technology matters, creating a channel to monetize it, and executing effectively. That's where Rometty's failure lies - not in geek quotient.

  • On point remark. This other commenter is clearly a misogynist insecure with his manhood. Girls don't like technology and science? Girls aren't passionate? Ha! You mean like Vera Rubin who turned the male-dominated astrophysics community on its head with her repudiation of their incorrect scientific beliefs?

    Actually, while I am not a fan of IBM's broken business model or absolutely horrendous management culture, Rometty could almost certainly run technical circles around the "brilliant man" remark. She's a graduate in electrical and computer engineering.

    At one time I worked in IBM's mainframe CPU design group before moving on to other pastures. I met Ginny on more than one occasion. She is quite far from stupid. To the contrary. But, she is indoctrinated and institutionalized into a dying corporate culture. She had a reputation as a brutal manager. I suspect that's an overcompensation mechanism driven substantially by men who believe women should be home baking cookies.

    At one time I worked in IBM's mainframe CPU design group before moving on to other pastures. I met Ginny on more than one occasion. She is quite far from stupid. To the contrary. But, she is indoctrinated and institutionalized into a dying corporate culture. She had a reputation as a brutal manager. I suspect that's an overcompensation mechanism driven substantially by men who believe women should be home baking cookies.

  • I completely agree. IBM's troubles didn't start with Ginni. They started with Gerstner who stole employees' pension and retiree medical benefits, and started the financial engineering that is with us today. Sam accelerated the financial shenanigans, established the focus on short-term (this month!) goals, and destroyed employee morale.

    I completely agree. IBM's troubles didn't start with Ginni. They started with Gerstner who stole employees' pension and retiree medical benefits, and started the financial engineering that is with us today. Sam accelerated the financial shenanigans, established the focus on short-term (this month!) goals, and destroyed employee morale.

  • Better, Faster, Cheaper. I still do work for IBM and the cheaper part is the only thing correct. Well Cheaper at first, but they will get you with all the extras and mistakes, Yes you will pay for their mistakes.

    Morale sucks; they have gone to a system that rely on many Ad Hocs, temp or contracted employees. They would love all the employees to share knowledge and help expand IBM but in 9 to 10 months you have no job. This cycle repeats itself until IBM has bled its employees.

    I on the other hand do not share what I know with IBM; they bleed employees I bleed IBM. I share and document nothing. I only solve problems when they arise and documentation is not provided. They need that documentation since the turnover rate is horribly out of control.

    IBM is no longer your granddad's IBM. To say one works for IBM is no longer a proud thing to say. Since starting with IBM my family, friends, and I have lost a tremendous respect for IBM. Keep it up. I actually cant wait to see you go under!

• Bloomberg BusinessWeek:

  IBM Faces Further Trouble in China. By Nick Summers. Excerpts: IBM has a new problem in China. Amid an escalating international dispute over spying, the government there is pressing banks to replace the U.S. company’s servers with China-made machines, Bloomberg News reported today. It would be the latest development in a back-and-forth that intensified last week, when U.S. prosecutors indicted five Chinese military officers on charges of stealing trade secrets. In addition to straining relations between the U.S. and China, it is also making business more difficult for multinationals looking to the world’s second-largest economy for growth.

  IBM urgently needs to increase sales after eight consecutive quarters of declining revenue—a trend that’s the focus of this week’s Bloomberg Businessweek cover story. China is supposed to be one of the company’s most important growth markets, but revenue there has fallen 20 percent or more in the last two quarters. The biggest declines have come in hardware—a magnified version of the problem facing IBM worldwide, as startups and large corporations alike shun expensive servers and mainframes in favor of cheaper cloud computing solutions. Changing hardware needs are affecting IBM’s software business and the services division that knits everything together.

• Testosterone Pit:

  Stockholders Got Plundered In IBM’s Hocus-Pocus Machine. By Wolf Richter. Excerpts: I’m not picking on IBM. I’m almost sure they have some decent products. So they had a crummy quarter – the sixth quarter in a row of sales declines. And their hardware sales in China have collapsed since Snowden’s revelations about the NSA and its collaboration with American tech companies. But in one area, IBM excels: its hocus-pocus machine.

  IBM isn’t alone in its excellence and isn’t even at the top of the heap in that respect. There are many corporations like IBM, mastodons that successfully pull a bag over investors’ heads, aided and abetted by Wall Street with its “analysts,” and by the Fed, to hide the stockholder plunder taking place behind a billowing smokescreen of verbiage.

  CFO Mark Loughridge put up that smokescreen himself, right in front of everybody, during the earnings call. “We’ve returned just over $11 billion to shareholders this year,” he said. “We paid out $3 billion in dividends and spent over $8 billion and grow share repurchases to buy back almost 40 million shares. ...

  Mr. Loughridge spoke passionately of the “over $8 billion” IBM spent in the third quarter “to buy back almost 40 million shares” to create “value” for shareholders. What a smokescreen these words were!

  So far in 2013, IBM spent $14.2 billion to repurchase 72 million shares. In 2012, it spent $12 billion on 61 million shares. In 2011, it spent $15 billion on 89 million shares. Since January 1, 2011, IBM spent $41.2 billion to buy back 222 million shares. But the math doesn’t quite work out...

  On January 1, 2011, there were 1.228 billion shares outstanding; on September 30, 1.098 billion shares: IBM lowered the share count by 130 million shares – not 222 million. What happened to the remaining 92 million shares it bought back?

  At the prevailing price over the period, that’s a cool $17 billion in cash.

  Those were shares that IBM issued for executive compensation and acquisitions during that time and then turned around and bought them back. In the process, $17 billion changed ownership, from IBM stockholders to the executives of IBM and to the owners of the acquired companies

  That’s the hocus-pocus machine. Only 58.6% of the cash IBM spent on share repurchases served the purpose IBM claimed, namely reducing the total number of shares outstanding and creating “value.” The remaining 41.4% served to fatten the paydays of IBM executives and the owners of companies that were acquired with stock. So that these 92 million shares wouldn’t chop EPS every quarter – for example, in Q3, EPS would have been 8.4% lower – and to keep the scheme from the public, IBM blew $17 billion.

• Seeking Alpha:

  Bloomberg Business Week Joins DoctoRx In Warning About The Risks In IBM. By DoctoRx. Excerpts: As a long-only investor, and thus not especially happily, I began promoting the idea that something was seriously wrong in Armonk when I realized it. My first article on International Business Machines (IBM) came after Q2 earnings were released last summer, with IBM And The Media Attempt To Obscure Its Declining Business Results. In that article, my poster child for the media pumping/defending IBM's stock was Bloomberg.com. I criticized it for titling its earnings-related article positively. That title was: IBM Raises Annual Forecast After Earnings Top Analyst Estimates.

  But the quarter was actually a stinker, as I went on to demonstrate. I followed that article with several others, all stemming from the viewpoint that IBM shares were unattractive to new investors. However, I did not believe there was enough evidence for satisfied long term IBM shareholders to sell their stock. However, after another dismal quarter (Q1), recently I turned even more against IBM's stock, raising the more trenchant question of whether long-time IBM shareholders should desert Mr. Buffett in Same Stuff, Different Year: Should Shareholders Stick With IBM? ...

  I'd like IBM to succeed. My guess is that it will be helpful ultimately to shareholders if it stopped all share buybacks for a while and improved its operations, as the CIA and the judge noted when they judged IBM so harshly in comparison to the new kid on the block, Amazon.com. Capitalism is full of creative destruction, as we see from Hewlett-Packard and other once-important high tech companies such as Sperry Rand and Digital Equipment, among a long list of names.

  IBM can prove the short sellers wrong by rolling up its sleeves, adhering to GAAP first and foremost, spending cash not on its shares but on improving operations, and dropping the focus on non-GAAP EPS in favor of building a brighter future. That is the path I see that would attract me and many who would like to see the company become an example of profitable innovation once again.

• The Register:

  Botched SAP billing system helps Npower reach No 1 on gripes list. Consumer advocates: 'Unacceptable... serious falings'. By Gavin Clarke. Excerpts: Failure to fix problems with an SAP-based customer billing system has seen UK energy giant Npower earn the most complaints for a power supplier during 2013. ...

  Npower earned 10 times as many complaints as the least complained about supplier, SSE. Complaints included late bills, bills going early, payments being stopped, new accounts and direct debits not being created. ...

  Npower started to transfer its 5.4 million customers to a new billing system based on SAP in 2011 following completion of the first phase of a multi-million pound IT project to overhaul Npower's legacy, inhouse systems led by IBM Global Services UK and Ireland.

  IBM GS ran systems integration, business change and implementation, the design and build of the SAP billing and customer system, and the build of a new contact centre telephony infrastructure that was to be integrated with the SAP system. IBM was also put in charge of training Npower staff.

• Kingston Daily Freeman:

  IBM returning to Kingston — in the form of a retrospective exhibit.

  

  For 40 years, IBM reigned as the manufacturing giant of the Kingston area, its presence forever changing the landscape of the city and its surroundings.

  Friends of Historic Kingston will spotlight the impact that the company known as Big Blue had on the community in an exhibit called “Kingston -- The IBM Years.” It be on display from May 2 to Oct. 31 in the Friends of Historic Kingston gallery at Wall and Main streets in Uptown Kingston. ...

  “For those who did not work at the Kingston plant, the exhibition will be a fascinating education about one of American’s most successful and nurturing corporations,” Mintz said in a press release announcing the exhibition. “It will also be a reminder of the extensive development that took place in Ulster County starting in the 1950s.”

  The IBM plant actually was in the neighboring town of Ulster but was known by most as “IBM-Kingston.” IBM closed the plant in 1995 and sold the property in 1998 to downstate developer Alan Ginsburg, who renamed it TechCity and has attracted several smaller companies to the property. ...

  By 1985, the computer giant occupied 2.5 million square feet in Ulster and employed 7,100 people. Ten years later, though, all were gone — either laid off or moved to other IBM sites.

• Poughkeepsie Journal:

  Linuo to demolish 1 old IBM building. By Craig Wolf. Excerpts: A major building on the property owned by Linuo Solar Group is being demolished. The Chinese company bought the former IBM Corp. West Campus in September 2011, hoping to use it to launch a U.S. solar panel business. It hasn’t, as yet. ...

  As Linuo was buying the 157-acre site and its nearly 1 million square feet of buildings, the solar industry was heading into a time of overcapacity and plunging prices for panels, industry analysts say. IBM put the campus up for sale in 2005, having moved chip research to its eastern campus, also on Route 52 here, where IBM still conducts much of its semiconductor business.

  The structure being demolished was known to IBM as Building 650, the Semiconductor Research and Development Center. It opened in 1989 and was expanded in 1990. In its early years, it was among the world’s most advanced chip research and development facilities.

• Glassdoor:

  Top Companies for Compensation & Benefits. Excerpt: Want to work for a company where employees are satisfied with their compensation and benefits? Glassdoor has announced its report of the Top 25 Companies for Compensation & Benefits, based on workplace insights shared by the people who know these companies best — their employees. The following companies stand out for high compensation & benefits ratings and insightful reviews.

• The Fiscal Times:

  10 Best Companies for Pay and Benefits in 2014. Google came out on top in a new survey of employees. By Marine Cole. Excerpts: If your dream job includes free food all day long, overnight ski trips to Vermont, lavish holiday parties, and easy (and largely free) access to such personal service amenities as dry cleaning, a fitness center and massages – not to mention a decent salary and ample opportunities for advancement – you might want to work for a technology company. But not just any tech company, of course – we’re talking about that one called Google, based in Mountain View, Calif. ...

  Costco, the wholesale retail company headquartered in Seattle, came in second place after Google – and for totally different reasons, as it turns out. One employee raved about the high salaries as far as retail jobs go, as well as the bonuses and attractive benefits, especially affordable health insurance. Another worker particularly liked Costco’s flexible hours and noted that even part-time employees qualify for benefits (as long as they average 23 hours a week and have been with the company for more than 6 months). ...

  Here are the top 10 companies for pay and benefits, by Glassdoor’s ratings:

  • Google
  • Costco
  • Facebook
  • Adobe
  • Epic Systems
  • Intuit
  • USAA
  • Chevron
  • Salesforce.com
  • Monsanto
• Glassdoor IBM reviews. Selected reviews follow:

  • “Great place to build your career, but move on when you can”

    Account Executive (Former Employee), Toronto, ON (Canada). I worked at IBM full-time for more than 5 years.

    Pros: IBM is a great place to build your sales career. It's large enough where you have the resources to get the help you need and can really push work off to other departments (marketing, brand, etc). Education system is second to none. Really gets you ramped up fast and invests in your education.

    Cons: Very political. Moving up can be easy, but there is really a wall at times. Pay is not great...seriously. If you want to make money at IBM...leave. They also don't give proper raises. 1-2% is the average unless you change positions. The endless paper work also gives you little time for sales and more time in giving forecasts and daily updates.

    Advice to Senior Management: Take the burden of reporting off the rep and on the manager. This should be monitored and caught. I can already see the talent loss. Also, start paying what your competition is paying. The last comment I had before I left IBM was "why is this company willing to pay you so much?" This was insulting and if feels great making money over IBM's loss in almost 100% of my accounts.

  • “A challenging place to work. Once great, not so much anymore.”

    Software Engineer (Current Employee), Research Triangle Park, NC. I have been working at IBM full-time for more than 10 years.

    Pros: There are a lot of smart people and it used to be a good place to get skills with every project you worked on. And to some degree, some of that still happens. But you're mostly on your own for education. It can be found, but it's mostly on your own time. If you're a technical person, there is a path for that and most of the management team is happy to have people that have good quality technical skills. There are some select projects that are still good to be on.

    Cons: I also know a lot of smart people who have left the company. Bonuses for the most part are gone. Raises, non-existent. The constant threat of getting caught up in a resource action. A lot of people are often double booked (depending on the project you work on) and those who are smart enough to go, often do when they realize that the peaks and valleys of a project have now just become constant peaks with the expectation that you are available all the time. Customer issues have ballooned because of the sales-oriented culture. Just have things to sell, even if it's not ready yet (which often happens).

    Advice to Senior Management: There are a lot of employees who are only staying until something better comes along. What was once a company full of innovation is now a sales and services company looking for something to sell. The company seems to be selling its soul right now in order to make the 2015 numbers.

  • “OK — could be worse”

    Anonymous Employee (Current Employee).

    Pros:

    • Decent benefits
    • Good education reimbursement
    • Lots of nice people
    • Facilities are beautiful in several locations. Armonk has a computer history museum in it. Littleton has a nice gym.

    Cons:

    • Pay was below average, especially after eliminating the bonus structure.
    • Three managers in three years because of the Middle Management Shuffle. They force people to be career middle managers and just keep shuffling them among the various middle management positions.
    • No work/life balance.
    • You're just a number to them, replaceable, dispensable. They don't let you forget it.
    • A lot of people have really useless jobs there — they literally do nothing productive, yet still get paid.
    • IBM is NOT a technology company. They are a company that buys and sells other companies. If you sell your company to them, be prepared for them to end-of-life your product after 10 years. They milk companies they buy for 10 years and then kill them off or dump them on someone else.

    Advice to Senior Management: If someone were to do an investigation into whether you paid men and women the same for the same job, what would they find? That day is coming. I think you should true up those salaries pretty soon.

  • “Work-life balance? What balance?”

    Anonymous Employee (Former Employee).

    Pros: IBM provides employees with challenging and unique work opportunities. As a consultant you work with some of the top corporations world-wide.

    Cons: If you work as a consultant, prepare to work extremely hard and travel extensively. I usually flew out to the client site on Sunday and made it back home late Friday evening. Also, you'll be expected to contribute to other projects and assist in scoping new opportunities. Most of these activities occur after hours of your primary project.

    It's all about billable hours, so if you're not on vacation, you are expected to be on the road at a client site — no exception. To compound matters, for your hard work you will receive no bonus on top of your base salary so negotiate your base carefully on the front end.

    Advice to Senior Management: Management should come clean with prospective employees regarding time away from home. Instead of saying that you will travel up to 70% of the time, simply say that you will travel up to 98% of the time. People will appreciate the honesty and make a more informed decision concerning whether to accept a job offer.

  • “Don't expect Google wages and benefits”

    Global Commodity Manager (Current Employee), Rochester, MN. I have been working at IBM full-time for more than 10 years. Pros: Can work from home if you want. Cons: Little to no pay raises and small or no bonuses. Expect selective hiring with industry average pay. Advice to Senior Management: You hire people with top GPAs, but only pay them average salaries. I can do better at many other firms.

  • “An implosion case study”

    Senior Technical Staff Member (Former Employee), Austin, TX. I worked at IBM full-time for more than 10 years.

    Pros: Flexibility to work from home. Opportunity to work on extremely advanced systems technologies, but see cons section. Good 401K match percentage but only applicable if employed on Dec 15th.

    Cons: Revenue is in a tailspin and profits are up at the expense of employee compensation. Quarterly layoffs are the norm, and specifically target the 40+ population in the US. If you're very good, you have job security but don't expect bonuses or career growth; that's reserved for the low cost geographies. If you're not good, you'll be laid off swiftly, unless you're in a low cost geography. In short, all stick, no carrot. In short, the culture the made IBM great no longer exists.

    Advice to Senior Management: The talent has left in droves. You're continually loosing people to competitors; from subject matter experts to Distinguished Engineers and Fellows. The business is basically unsustainable and Wall Street has taken notice. Backtrack on the idiotic Roadmap 2015 and you might have a chance at keeping folks around.

  • “Decent people but average work at best.”

    IT Manager (Current Employee), Boulder, CO. I have been working at IBM full-time for more than 10 years.

    Pros: Been working here for 17 years. I have had a lot of great experiences and a variety of positions and promotions. Through experience I have received a tremendous amount of training and education. The "lower level" employee base are very good people.

    Cons: All actions are centered on cost reduction. IBM will not actively support employee development. During "resource actions" (i.e. lay offs), employees cannot actually compete for open internal job positions. HR may say that you can — but the approvals to allow it are the extreme rare case.

    During the MANDATORY Value Jam session all related feedback about treating the employee with respect were ignored. Instead the executive team put forth "Be the wild duck!" as an IBM value. The intent was to foster employees to make necessary changes to cut through IBM's bureaucracy. Unfortunately, this idea is not supported and people would more likely lose their jobs if they strive to follow this value.

    In the halls this "value" has become a bit of a joke: "Duck You!" and "Duck off" have been heard as a play on words and a jab at the internal company value communications.

    90% of this company's IT support is made up of contractors who do not have the same stake in the company.

    Advice to Senior Management – Executives: Prove you care about each person as deeply as you care about your stock options and salary bonuses. One easy way without undo costs is to allow employees to actually compete for jobs internally. Remove the silly restrictions and allow employees to move from one division to another without restraint. Invest in a usable shadow training program with mentors. What exists now is just a few tools with no real participation or soul.

    Stop with short sighted quarterly actions to address stock price fluctuations. Build the company by showing you care about them. The employees in turn will care about the customers. Right now...it appears that people are just going through the motions. Client First efforts will never work if the company does not actually care about the employees.

  • “Lowest pay”

    Package Solution Consultant (Current Employee), Bangalore (India). I have been working at IBM full-time for more than 3 years.

    Pros: Only pro is work from home facility. That too is not available in some projects,

    Cons: Worst pay. Even if you work for 5 years and get 1 rating for all the years, your hike will be 2-5% max per year. That is rs 500 hike per year.

    Advice to Senior Management: Treat your employees like humans.

  • “Great Company, Lousy Employer”

    Field Technical Sales Specialist (Current Employee). I have been working at IBM full-time for more than a year.

    Pros: Great on the resume; hard to get fired; great training (based on the job).

    Cons: Never can grow within the company. Forget pay raises. Easy to get laid off. Upper management will never let you move up, etc, etc, etc.

    Advice to Senior Management: 1) Please understand the needs of your employees. 2) Need to cool off of not giving your current, hardworking, reliable, dependable, knowledgeable employees a good pay raise so they will stick with you. 3) Let your employees grow within the company. If you hold them back it's going to be bad for you (not the employees) and will be a huge loss for your company, not just your team.

  • “IBM Great Potential and Opportunity; Lack Performance Methodology for Employee Benefits”

    SAP Security Consultant (Former Employee), New York, NY. I worked at IBM full-time for more than 10 years.

    Pros: Flexibility. Large company with resources globally. Working in the IBM Global Services allowed for a variety of experiences. IBM stock, IBM name; work/life balance efforts. Great people.

    Cons: Salary stagnation; not willing to take a chance on initiatives from remote workers; unrewarded 150%. The bell curve performance rating process.

    Advice to Senior Management: The Performance Methodology leaves people feeling unmotivated. The top 10 have survived in an area and then are systematically made to be on the "bottom". The people who step up and take on additional responsibility are never rewarded during reorganizations.

  • “I think IBM has lost it way”

    Senior Technical Staff Member (STSM) (Current Employee), Austin, TX. I have been working at IBM full-time for more than 10 years.

    Pros: Strong technical talent. You can find a person in IBM that is an expert on anything. This makes it a wonderful place to learn and grow.

    Cons: Very large and bureaucratic. Not very nimble. Lots of people in middle management just looking for a way not to be blamed if things go wrong. The appraisals are more based on quotas and financials than on performance.

    Advice to Senior Management: The current narrow view on financials is slowly killing the value of the company. In a down economy one should be reinvesting in R&D. I think the focus on services and software is short sighted.

  • “Project Manager”

    Advisory IT Specialist (Former Employee). I worked at IBM full-time for more than 10 years.

    Pros: I had the opportunity to meet a lot of smart people.

    Cons: Work/life balance is non-existent. All work, no life. IBM culture is only earnings per share based so employees are now working out of fear of layoffs. Pay is average but bonus and raises are not keeping up with inflation or cost of living. The new IBM is now utilization based which makes it impossible to have work-life balance since your performance reviews are based on 120% utilization rates. The more vacation you get, the more overtime you have to work to make up for it. Should be criminal but there must be a loophole around it.

    Advice to Senior Management: Listen and implement more employee centric approaches to the overall productivity of the company. You are losing good people by overworking them and not appreciating their work.

  • “Enjoyable IT jobs for foreign language speakers”

    Anonymous Employee (Current Employee). I have been working at IBM full-time for more than 5 years.

    Pros: No hierarchical structures; we're all a big family. So many different roles to choose from, don't like one, move to another. You're encouraged to develop your skills. Free education available.

    Cons: Family with all it's dysfunctions; matrix organisations creating new matrices for organising activities; nobody thought of a 'rollback' process for the stuff that went wrong. Excel sheet/dashboard managers.

    Advice to Senior Management: Middle managers need to stop staring at the RAG table and the dashboards, and start looking ahead — this should be self-evident. You can't navigate by staring down at the chart; you have to keep your eye on the traffic and the horizon.

  • “Mixed Emotions”

    Client Representative (Current Employee), New York, NY. I have been working at IBM full-time for more than 3 years. Pros: Great place to get started in technology. Gained global perspective and business processes both internal and external. Enjoyed working with a bunch of talented and dedicated colleagues. Cons: Career at IBM really depends on who your "executive sponsor" or "godfather" is; a lot people get lost in the corporate black hole. Advice to Senior Management: Good luck.

  • “Big Blue”

    Anonymous Employee (Current Employee), San Jose (Costa Rica). I have been working at IBM full-time for more than a year.

    Pros: Learning: a company as big as this one provides big opportunities for learning. Depending on your luck, you may end up with a flexible job. Has the potential to move to different roles inside the company.

    Cons: Its size: everything is big and slow. Strategy of company doesn't include all areas, so some are unrelated and left in the cold. If you don't have a clear personal career focus, the company will eat you. Not really a technology company locally. Barely setting up their technical operation, so that part is still small and disorganized. Salary: not the best, and can only grow by moving up.

    Advice to Senior Management: Lower and middle management are poor; need more focus on people skills and real leadership. Focus more on the people and less on processes and personal visibility.

  • “A tough business to work for long term”

    Global Program Manager (Current Employee), Denver, CO. I have been working at IBM full-time for more than 10 years.

    Pros: Large company with many areas to move around in. Hiring salaries are somewhat competitive. Working from home really allows people to focus on families.

    Cons: It is simply impossible to move your salary yearly at IBM. Even when you're a top 10 percent contributor each year, you often max at at 3 percent raises. I have moved 4 levels in 10 years and am an enterprise level manager, and make less then new professional hires. Life at IBM is always travel freezes, and resource actions. IBM is just not a place you can be a top performer and care about your career long term anymore.

    Advice to Senior Management: Pay your top people, give them raises, make sure when RA's come, they are based on performance.

  • “Working place only for people who are starting their career”

    Project Manager (Current Employee), Brno (Czech Republic). I have been working at IBM full-time for more than 3 years.

    Pros: Trainings. Home office. +5 days of vacation. (The tool is pushing me for more words, but I cannot find any other pros).

    Cons: Zero benefits. Zero skilled people. Really bad leadership. Hard, impossible to get a salary raise due to band system, cost freeze, management rotation (you make a deal with your manager that in 3-6 months you are getting a promotion—he changes position, next manager doesn't care).

    Advice to Senior Management: They are responsible for losing all senior and skilled people from the company.

  • “An organization with too many moving parts.”

    Marketing Manager (Current Employee). I have been working at IBM full-time for more than 5 years.

    Pros: Work/life balance. Exceptionally brilliant people within Engineering, Project Management, Consulting and Marketing. Tremendous resources to global knowledge and best practices. International assignments. Education and training.

    Cons: Good managers can make work fun, meaningful, and all those warm, fuzzy things. Good managers can make work feel like a home away from home. They can make your team feel like a family. Not within IBM.

    Mid-manager leadership in sales and some areas of marketing are segregated to relationships, personal goals and bias.

    IBM Canada Management for example behave like school yard cliques. You're either in or you are out. Pedigree and social status also factor in on who receives coveted sales territories, and leadership positions. Diversity of people in prominent executive level positions in IBM Canada are near to non-existent.

    Acquired companies such as Cognos have an internalized culture that at times does not embrace the spirit of IBM's values to develop and grow one's career from within. Career progression is select and bias.

    Innovation is stagnant in some divisions.

  • “Can't compete with modern competitors”

    Software Engineer (Current Employee), New York, NY. I have been working at IBM full-time for more than 3 years.

    Pros: -People are generally very friendly; -hours/work location is flexible; -not much need to travel.

    Cons: -Way too executive driven, not engineering driven; -older, slow-moving culture; -few growth opportunities; -relatively low salaries.

    Advice to Senior Management: Try to make engineers happy, rather than shareholders. Shed several executive layers. Promote engineers. Pay engineers on a level competitive with Google and Facebook and Wal-Mart(!). The $20 EPS target is overly restrictive. Get rid of it. Try to make a company that Google and Facebook employees might want to switch to.

  • “Has degraded extensively over the years, as a company to work for”

    Engineering Technician (Current Employee), East Fishkill, NY. I have been working at IBM full-time for more than 10 years.

    Pros: Good technical environment (semiconductor business) to expand knowledge base. Empowered to do experiments, as needed, to find answers to ongoing problems.

    Cons: Penny pinching. CEO and executives are focused ONLY on "EPS" (Earnings Per Share), and the price of common stock. After all, this how they grow their personal wealth...through stock options. Living in constant fear of being sold off or outsourced. No conferences allowed. Very little new equipment purchased for our lab. Seem to be "cooking the books", for years now, to make the division more attractive to potential suitors. Forget about meaningful salary increases. Many, many years since I saw one of those.

    Advice to Senior Management: Drop your allegiance to the company, as the company no longer has any allegiance to you, personally. You are as expendable as a paper towel. Do not hide information from your employees. Tell them everything you know.

  • “IBM is good company for entry levels but not company which can retain valuable resource for long”

    Anonymous Employee (Former Employee). I worked at IBM full-time for more than 10 years.

    Pros: It offers market comparable rate and good benefits to new hires. It gives good training to entry levels. You have access to many resources and technical information.

    Cons: The career framework puts unnecessary pressure and overhead on senior technical oriented people. Salary and benefit increases are slower than expected. The company tends to get rid of senior people when there is financial trouble. Internal transfer among accounts are not very easy. Most time, you don't get chance to apply the knowledge learned from training to real work assignment.

  • “Four wasted years of my professional life.”

    Senior Managing Consultant (Former Employee), New York, NY. I worked at IBM full-time for more than 3 years. Pros: I can't think of one. Cons: 100% travel. No work/life balance. Minimum of 60 hours a week traveling Monday - Friday.

  • “It's an OK place to work but like all places has its issues.”

    Managing Consultant — Strategy (Former Employee), Washington, DC. I worked at IBM full-time for more than 5 years.

    Pros: Reputation, opportunities, great colleagues from which to learn. Clear how to get promotions. You own your destiny.

    Cons: Not a lot of opportunities for training or other growth opportunities. Making all employees be sales people. As a managing consultant had to always try to sell things that weren't needed and had to find our own jobs or sit on the bench and risk getting laid off.

    Advice to Senior Management: Don't make everyone be a sales person and look at the required utilization rates.

  • “SSR”

    SSR — Support Services Representative (Current Employee), Taipei (Taiwan). I have been working at IBM full-time for more than a year. Pros: Talent colleague multi challenge and ever task business anywhere keep yourself thinking value creation. Cons: lack of training short term goal instead of long term goal profit drive everything. Advice to Senior Management: Consider about real value than just number Talent need feed
• Glassdoor IBM Canada reviews

• Associated Press, courtesy of ABC News:

  The CEO Got a Huge Raise. You Didn't. Here's Why. By Josh Boak. Excerpts: While pay for the typical CEO of a company in the Standard & Poor's 500 stock index surged 8.8 percent last year to $10.5 million, it rose a scant 1.3 percent for U.S. workers as a whole. That CEO now earns 257 times the national average, up from a multiple of 181 in 2009, according to an analysis by The Associated Press and Equilar.

  Those figures help reveal a widening gap between the ultra-wealthy and ordinary workers around the world. That gap has fed concerns about economic security — everywhere from large cities where rents are high to small towns where jobs are scarce.

• TechRepublic:

  H1-B visas: Would lifting the cap really attract the 'brightest and best' to the US? By Nick Heath. Excerpts: Former US Secretary of State Condoleezza Rice is baffled: perplexed at why people oppose lifting restrictions on the number of skilled foreign workers employed in the US.

  Speaking at the 2014 VentureScape conference last week she said: "Forty percent of the startups in this area have one foreign founder. That says something about the power of attracting the best and brightest. And, I just don't get it when people want to make immigrants, somehow, the enemy."

  Rice was discussing H1-B worker visas, which are used by companies to employ foreign workers in the US for up to six years. The visas are reserved for "specialized" roles - requiring a Bachelor's degree or higher - and while they are used to recruit for professions from biotechnology to medicine, are most commonly used by IT services firms. The base cap limits the number of workers approved for these visas to 65,000 each financial year, with a further 20,000 granted to those who have earned a master's degree of higher.

  Rice believes this cap should be loosened. But her reduction of anti-H1-B sentiment to a desire to make immigrants "the enemy" flies in the face of genuine concern about how these visas are used by large companies. ...

  The figures show the median wage paid by offshoring firms to H1-B workers between the financial years 2010 and 2012 was between $54,000 and $69,000. In contrast wages for Computer Systems Analysts stood at around $82,000, he said. ...

  And if foreign workers are truly filling a skills gap that can't be met domestically then, as Hira pointed out in his written testimony to a hearing at the US Senate, these non-US nationals should be paid more, not less, than their American counterparts.

  "H-1B advocates have claimed H-1B workers they seek possess superior skills. If this is the case, then those workers should be paid at least the average wage," he wrote. ...

  But if Rice wants to encourage more foreign self-starters to the states there is scant evidence that lifting the cap on H1-B's will do so, said Hira.

  "Foreign workers cannot self-sponsor - they require an employer to sponsor them. The work permit is controlled by the employer. This means that H-1Bs cannot start their own business and self-employ. The people who wish to see more foreigners become entrepreneurs in the US should be pushing for more green cards, not H-1Bs. "

• Alliance for Retired Americans Friday Alert. This week's topics include:
  • The Alliance Releases Annual Voting Record Rating Congress
  • Early Social Security Claims Linked to Job Demands and Life Expectancy
  • Skyrocketing Median CEO Pay Tops $10 Million
  • Social Security Administration Considering Closing Most Field Offices
  • Fiesta Joins Sinema at Tele-Town Hall Call Regarding Seniors and Veterans
  • Voting Restrictions Threaten to Disenfranchise Voters Across South