This, I believe, is what makes IBM's "pay-to-play" training decision so unsettling.
IBM recently sent a memo to select employees in Global Technology Services that some of them "have not kept pace with acquiring the skills and expertise needed to address changing client needs, technology, and market requirements," according to a memo to select employees obtained by Computerworld. What's more, they were told they must attend required training one day a week for 23 weeks, during which time — wait for it — their pay would be cut by 10 percent.
Exactly why is this disturbing? IBM has every right to make such a decision, yet something about it feels wrong. For one thing, this action seems to violate an implicit pact between employers and employees regarding skill development.
Simply stated, companies are generally expected to provide the training required to keep basic competencies up-to-date. Nurses will be taught to use electronic records. Lawyers will attend annual seminars on legal changes. Auto repair techs will learn to service heavily computerized cars.
But not in the GTS division, where a technician making $60,000 a year will now be required to sacrifice about $3,000 for training "to address changing client needs, technology, and market requirements." Since this helps IBM compete, shouldn't the company foot the bill? ...
How about executives? And the board? The GTS group is being retrained in CAMSS — cloud, analytics, mobile, security, and social — IBM spokeswoman Trink Guarino is quoted as saying in the Computerworld article. Given that many IBMer's have been with the company for decades, odds are that other folks have also lacked expertise in these areas.
For example, those technologies certainly weren't around when CEO Ginni Rometty joined IBM 33 years ago. So, did she give up 10 percent of her salary while going through that learning curve? And how about the board? With an average age of 64, they surely required some technical updating – but did they pay for it with a cut to their $250,000 annual fee?
What does this say about IBM's values? IBM has historically claimed to be guided by core values, one of which is "trust and personal responsibility in all relationships." So, just how is employee trust being affected by this decision? To be informed via email that your skills are outdated and your pay is being arbitrarily reduced by 10 percent would certainly erode trust for most of us.
Is IBM misleading their customers? In advertising materials, IBM describes GTS as having "highly skilled technical consultants" who "deliver the combination of deep technological expertise and rich industry insight." Really? According to the pay-cut email, many employees "have not kept pace with acquiring the skills and expertise needed to address changing client needs, technology, and market requirements." So, be careful, GTS customers.
Is IBM misleading job applicants? IBM entices potential recruits with invitations to "deepen your expertise" and "re-invent yourself without ever leaving the company," stating that "few places offer as many opportunities as IBM to gain knowledge in your field". The pitch fails to mention, however, that you could be required to subsidize your training with a surprise pay cut. Anyone receiving an offer from IBM might want to ask about that. ...
All in all, it's hard to determine the broader implications of this decision. Nevertheless, here are a few suggestions for the IBM executive team: 1) Develop and enforce training policies consistent with IBM values, 2) Do not make employees pay for education required by the company, 3) never tell people about pay cuts or performance problems in an email, and 4) Don't be jerks.
Selected reader comments follow:
Let's be blunt. It's downright evil. No way to spin it otherwise.
At companies like Google, you get 1 day to work on side projects or study new skills. In most tech companies, you teach yourself new skills as projects demand. You aren't fleeced of your salary under the pretext of being skill deficient...which isn't a good way to rectify the situation if even this were true.
Again, pure evil. WTF IBM! Yeah, I'm keeping my stock. But this one definitely is making me feel dirty right now.
Employees in GTS must be billable 95-97% of the time, no exceptions. You get sick, tough, work overtime when you're better. You take a weeks vacation, tough, work overtime when you get back.
As a manager, I was put in the position of beating employees to make their billable utilization. Those that didn't make it, would often get laid off and replaced with a much less expensive H1B worker. I finally quit 5 years ago out of disgust.
Sad that a once great and innovative company has become another slave to the investors on Wall St.
n any case, the lacking skills as provided to us are high level, vague, and generally do not apply to current roles. This is a cost cutting exercise disguised as an employee skills deficiency. Employees will leave, so IBM won't have to pay severance. Employees will cut back on 401k contributions in order to make ends meet, so IBM won't have to match contributions.
I wonder how our Strategic Outsourcing customers feel about this information.
No company in Silicon Valley or on Wall Street takes certifications seriously. They mean nothing. For that matter, nobody takes any such things from IBM seriously. Google or Facebook will not care what your personal profile at IBM looked like or your band classification.
Like with all good companies, they will assess you as a software engineer. You will need to demonstrate data structures, algorithms, and programming expertise. You will need to talk competently, using appropriate domain expertise idiom. Nothing more. Nothing else.
Again, no solid technology company cares about formal certifications. Either you have a good computer science background and can apply it or you simply can't. Once in, you're expected to do what is necessary to be productive...and given time and space to do so.
I left IBM in 2013 bewildered and disappointed that a company such as this could change so much. It became less of a place where one not only enjoyed work, but was also extremely productive, to one where management looked upon its employees as sweat-shop-workers and liabilities. This news report just strengthens my opinion that I did the right thing, and I have never regretted leaving. Good luck existing IBM employees, and good luck IBM trying to keep valuable employees.
Ginni's claim to fame is leading the costs cutting/job cutting efforts that began back in the late 90's. Too bad she has not developed her skills enough to do anything other then that. Like maybe position the company for growth. Like maybe keeping top talent. Or how aobut training and broadening the technical bench with the talented, client focused people they laid off.
IBM has nothing to offer to draw top talent—they are no longer the best at anything!
Unfortunately many talented employees with up to date skills, who delivered results to both the company and their customers were laid off. IBM should be embarrassed by such a bird brain ridiculous move.
They have denied training for years. Heck a certified project manager at IBM couldn't get a current copy of Microsoft Project—had to use the 2003 version. What does that tell you?
Shame on IBM management—sunk to a new low. A huge 'Fall from Grace'
From my history isn't this one of the groups that is charged with delivering innovation and "cutting edge" technology to high end clients? If so wouldn't you want these people to be at their best when going into a client? I know that the argument can be made that many of these people work so much that they don't have time for formal training, or that they have the knowledge and skills but just haven't filled out HR's paperwork and dotted the I's and crossed the T's.
Hey, the bright side is that IBM is saying, from what we can see you need to update your skill sets and we don't want to loss you so we will work together to fix the problem. Actually this is kind of a reverse RA where IBM is saying you are needed and important so we want to get you to where you need to be.
The layoffs in the early 90s were a sad time but IBM needed to wake the work force up. The people who stayed remained loyal. Today IBM isn't carrying the same kind of baggage but they have also systematically destroyed any sense of loyalty. Don Dieter's comment is on the money...it is a two way street and IBM has failed to maintain their side. Every 6 months lately it seems like IBM comes out with something new to further depress morale. There was that thing with the 401K plan, kicking the retirees to the curb, and now this.
"As you know we're a growing company, we've been doing a lot of recruiting around the country," GlobalFoundries Spokesman Travis Bullard said on Monday. "In order to support our investments in the business and meet our recruiting activity we have opened a small office in Williston at 64 Knight Lane." ...
The new Williston office follows GlobalFoundries mid-July placement of a full-page ad in the Burlington Free Press, advertising for technicians and maintenance workers at its semiconductor plant in Malta.
Later in the month, the company announced it had hired three high-level IBM executives for Fab 8, as the Malta plant is known, and in early August, GlobalFoundries held a job fair at the Sheraton Burlington's Conference Center.
GlobalFoundries has been rumored to be taking over IBM's semiconductor business, including the plant in Essex Junction. Bloomberg News reported on July 25, citing "people familiar with the process," that IBM rejected as too low an offer from GlobalFoundries to buy IBM's chip business. ...
Bloomberg reported on Aug. 4 that IBM had actually offered to pay GlobalFoundries $1 billion to take the semiconductor business off its hands, an offer GlobalFoundries rejected as too low. GlobalFoundries was said to have demanded at least $2 billion to take the business, in order to offset the division's losses.
The latest anonymously sourced report on Sept. 17, from tech blogger Daniel Nenni at SemiWiki.com, says IBM and GlobalFoundries have reached a deal that will be officially announced in early October. Nenni reported on "pretty good authority" that IBM will pay GlobalFoundries more than $2 billion to take over its semiconductor business.
Pros: Medical benefits are good or if you get sick and go on disability; IBM is very supportive. IBM on your resume looks good. Work/life balance is good. Recommend if you need a job but not for a long-term carrier growth unless you have Excecutive in your title. You've reached a position where you can sit on the confi chair and ride it to retirement.
Cons: Many layers of middle management, each trying to show their value by mandating unnecessary certifications to acquire. This also creates lots of red tape, unnecessary work and you can't move progress very quickly. When revenue numbers are low all at the bottom of the food chain are held accountable except for sales which are in control. Layoffs are common at the beginning of every year. You just can't settle down because great performance will not save you.
Lack of training to get your job done. It's learn it on your own or land in the fire.
It's not a customer comes first type of company. It's sell them something and move on to the next leaving the customer to sink or swim. A lot of cost cutting measures have been put in place so much so that employees are buying their own laptops. Rejections for needed supplies are happening so you have to raid office supply shelves.
It's a place where you always need to cover your behind and all are in to get credit for others work. The folks that have been around for many years are there because they are master of the game and it reminds me of high school popularity clicques with some bullying that goes around. Provides no sense of accomplishment. Disatisfying place to work at.
Advice to Senior Management: Eliminate the unnecessary multiple layers of middle management. Hold sales accountable for revenue. Stop creating blanket mandatory certifications on topics that are not applicable to job being performed. Stop being so cheap on supplies needed to get our work done.
Pros: Smart people, remote office, work/life flexibility, many educational opportunities, good pay, reasonable benefits, possibility to influence a global corporation that is in transition.
Cons: So little value is placed on the employees that drive the business that success is no longer based on performance but, rather, on politics and your budget owner's ability control and/or cut spending. This will likely evolve in to something better and more modern as the old guard continue to retire/be laid off and the company competes with up and coming technology startups that refuse to be acquired (but not before the end of 2015).
Advice to Senior Management: Centralize, centralize, centralize where your legacy back end systems and behemoth business units are concerned. Demand that your managers actually manage and develop the people who report to them. Influence the industry by valuing and retaining your experienced employees.
Pros: IBM offered good career growth with very good work-life balance practices. Compensation was among the best in this area and the site received several environmental awards from the local and state governments.
Cons: The current climate at the local IBM site is poor and declining. Corporate leadership has made it clear they no longer want to be in the semiconductor business and the employees know their employment time is limited.
Advice to Senior Management: The talent of the workforce is amazing. Allow the site leadership to optimize the product mix and improve the infrastructure and the site will deliver revenue as it did in the past.
Pros: Flexible work location as full-time home-office—but then again, they no longer pay for home-office connectivity and require the family budget to bail out the billion dollar corporate budget.
Cons: GBS is a repressive culture devoid of innovation as a body shop focused solely on the next quarter's wall street financials who will toss you aside once they're done with you, regardless of employee's dedication.
Advice to Senior Management: Invest in your people and actually do it—rather than just say it.
Pros: IBM offers a great deal of opportunity to move to several different areas within the company, which helps keep things interesting and advance the knowledge of the company. There is also the opportunity to work in different countries. Flexibility to work from home is also a plus in most cases.
Cons: Current environment is extremely challenging and our senior leaders appear lost, with no clear direction on where the company is going. The employee is no longer viewed as an important part of the company and there is very little interest for personal career development. Morale is at an all time low. Work/life balance is basically nonexistent.
Alliance Reply: You need to ask the corporate "Main Stream Media" that question. In the mean time, one suggestion would be to start organizing. Don't sit around waiting for the MSM to get "curious'. They never will, unless a large group of US IBMers decide to publicly make noise and take some action.
FYI...Alliance has its own Facebook account and Twitter account. We use them both to connect with IBMers in the USA AND the rest of the IBM world. Our web site has nearly 10 million hits and gets about 100,000 per month on average.
The not-so-big media outlets run our press releases without any hesitation. Yet, the MSM will not "bite", as in the past. What we have said over and over and over and over for the past 15 years is still true: The IBMers must rise up and organize in large numbers and stop sitting around waiting for someone else to do it. YOU are the union, if you choose to be.
And we can help you. If you choose not, then no one else will really care; most especially the Media.
"IBM software and mainframe business is already in steep decline. New applications are invariably being put on low cost IaaS cloud, or specialized PaaS or DB engineered systems. Lotus has been a basket case for years, Tivoli is being eaten by the likes of ServiceNow, IM and Cognos suffering from lack of investment and Oracle/SQL Server superiority, Rational long ago lost to HP, services losing out to far cheaper Indian companies and in-sourcing to internalise profit margin. Nowhere for IBM to go from here, particularly with an unmotivated/uncompensated workforce."
Sounds like you need a 10% pay cut Ginni or maybe a PBC 3 improvement plan?! -Anonymous-
Alliance reply: Yes IBM is testing the waters. They have been taking actions like this for years. Why? Because employees keep letting them get away with it. We offer the alternative if people are willing to take it. Organizing and unifying IBM US workers makes it extremely difficult to "twist your arm" when there are so many arms for IBM management to twist at once, when they are together. Organize.
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