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6, 2000 April, 2000

Highlights—January 3, 2015

  • Bloomberg:

    Five Charts Show Why IBM Is Worst Dow Performer for Second Year. By Alex Barinka. For the second year in a row, IBM is on track to be the worst-performing stock in the Dow Jones Industrial Average.

    Since Ginni Rometty became chief executive officer in January of 2012, the shares have fallen 16 percent -- 14 percent of that this year alone. Investors have dumped the stock as Rometty struggles to re-imagine International Business Machines Corp. as a contender in cloud computing, data analytics and mobile technology. So far, those new areas haven’t made up for a decline in sales of legacy hardware and technology consulting services.

    The following five charts show that Rometty will struggle to turn IBM around because the company is generating less free cash flow than before, underspending peers on research and development and boosting debt to help pay for dividends and share buybacks. ...

    IBM spends about $6 billion a year on research and development, which has led to offerings like its Watson data-analytics supercomputer and has helped it churn out more patents than any other company for 21 straight years. Even so, IBM is spending only about 6 percent of its annual revenue on research and development — an investment that’s crucial for tech companies to develop the next wave of innovative products. That’s half the average that its S&P 500 Index information technology peers are spending. Competitors like Google Inc., Cisco Systems Inc. and Oracle Corp. typically spend about 13 percent.

    “Ultimately, the R&D underinvestment may be one of the fundamental flaws of the recent EPS roadmap and weakened the company’s positioning over the long term,” Kulbinder Garcha, an analyst at Credit Suisse Group AG, wrote in a Nov. 17 note.

  • New York Times DealBook:

    IBM Needs to Spend Cash, Not Return It. By Robert Cyran. Excerpts: IBM requires an atypical activist fix. The company’s strategy of cost cuts and debt-fueled buybacks is no longer working – even though the company keeps trying. A tarnished balance sheet, lean staffing and a history of disposals rule out typical activist wheezes. Encouraging Virginia M. Rometty, the chairwoman and chief executive, to invest in IBM’s core businesses could pay off.

    IBM has run the same playbook for two decades. It sells low-margin businesses, cuts expenses, buys some profitable software companies and returns a lot of cash to investors. Over the last four quarters, the $152 billion company has spent more than $23 billion on dividends and buybacks.

    The problem is that IBM is investing too little. It has spent only about $11 billion over the last four quarters in total on research and development, capital expenditure and acquisitions. That’s a problem in technology, where old products soon become obsolete. Google spends about 16 percent of its sales on R.&D., but IBM spends 6 percent.

    The effect is becoming clear on the top line. Revenue has shrunk for 10 consecutive quarters. Costs have been cut to the bone, sending customers fleeing to better service providers. In a good year for stocks, IBM’s shares have fallen more than 15 percent. That means IBM has overpaid on its last three years of buybacks. ...

    IBM’s focus on financial, rather than product, engineering has caused low employee morale, falling sales and shareholder dissatisfaction. It’s time to invest.

  • The Globe and Mail (Canada):

    The solution to IBM’s woes? Invest more in the business. By Robert Cyran. Editor's note: This is the same article as that published in the New York Times...see previous list item. Selected reader comments follow:
    • It's a lost cause; another great company ruined by bean counters and quarterly earnings pumping.
    • For over a decade the company has been focussed entirely on increasing share price each quarter. Customer and employee satisfaction have become a distant priority. IBM is unable to attract fresh talent, and the best and brightest are evacuating the company in droves. Everyone I know at IBM is still there because they are hoping for a layoff package.

      I don't see how IBM can survive without a complete reboot. They tout their cloud initiative as being the focus of their future, however, Amazon and Google are so far ahead of IBM, I can't understand why ANY company would choose IBM's cloud products.

      The other area IBM is investing heavily in is their Watson initiative. But IBM has not been able to generate revenue with it — and, should Google or Amazon decide to commoditize their cognitive computing efforts, Watson will quickly become irrelevant.

    • If you ever want to work for a company where no one seems to quite know what is going on, IBM would be a good choice.

      One fellow told me how someone came up to his desk and gave him an award. However he had no idea what the award was for and the fellow handing him the award couldn't say either.

      While I was there, I happened to work very briefly on an internal project they had going. It was to come up with a super-deluxe resume handling system where a consultant (among other things) could put in up to 50 different "skills" he/she was adept at.

      This was IBM's "solution" to the problem of staffing assignments or projects end up being staffed by "the wrong people" (i.e. Joe Blow is put on a project where he doesn't really have the necessary experience).

      The only problem with that solution was that consultants were more or less encouraged to exaggerate their qualifications in order to "jump onto the next project". (Not particularly unique to IBM, BTW)

      And was "creativity" rewarded at IBM? Well probably in some fashion or other in some part of the organization. But from what I saw, the thing that really counted was billable hours.

      And of course there was the abrupt change in strategy where someone from far above would decide an area was redundant. So a whole whack of people would suddenly be laid off.

      Try having a cohesive organization when everyone is looking over their shoulder and padding their resumes to avoid being laid off.

    • During my time at IBM I wasn't aware of this resume rigging. But I was painfully aware of IBM's stacked ranking system. Employees in each department are ranked on a bell curve; if employees get a low ranking for more than a couple periods, they are fired. Many managers I knew were frustrated with this practice because — even if it was a team of geniuses — some would have to be ranked poorly. This idiotic system is a fantastic way to kill morale and productivity. It becomes to your advantage to look out for yourself, and not necessarily supporting the success of the team as a whole.
    • They have let short term, bottom line fixation by the bean counters destroy the company. The core of longer term, skilled and dedicated staff have been gutted, with less-productive workforce with low cumulative skills but who are cheap retained. Same for management core.

      The IBM of yore has been changed into a cheap cardboard replica. What a shame.

      (BTW, I am not, not ever have been, an IBM employee).

    • Need to find a new leader that wants to grow the company instead of just watch the stock price.

      It's pretty sad that most employees there know what the company's priority is.

      In the services/consulting business, they ask employees to try to bill an extra day sometimes in a quarter just because they want the extra revenue. It's not because the client needs an extra day of work, or because the project is behind, it's just so that they can get 8 more hours at $xxx/hr to pad their bottom line. It's ridiculous. Why would an employee be motivated to work an extra day just for that?

    • Worked at IBM for 15 years. The first 5-6 years it was truly a great company to work for, but it changed during my tenure to an internally focused, drive sales for the quarter without much thought about the future or what was right long term for the client or IBM.

      Middle managers like myself would be under such pressure to make their quarterly objectives they would discount to bring in revenue and set a new price point in the market that was unprofitable.

      The company has such a great legacy and so many assets and client relationships it can be turned around but they need to do a reset and invest as the author of this article suggests.

  • Forbes:

    IBM: Why Big Blue Is Still A Big Bruise. By Steve Denning. Excerpts: “IBM is now hours away from Dow infamy,” said Andrew Ross Sorkin on NBC Squawk Box this morning. “IBM is on track for the second consecutive year as the very worst performer in the Dow Jones Industrial Index for the second year in a row. That’s the first time that has happened since 1995.” In 2014, IBM lost 15 percent of its market cap. Despite having the largest stock of patents in a booming IT sector, IBM lost even more value than ExxonMobil which is having to cope with collapsing oil prices.

    The news on IBM is hardly surprising. As one might expect from a firm that has the most explicit long-term commitment to maximizing shareholder value as reflected in the stock price, IBM has destroyed more shareholder value than any other company in the Dow. ...

    Dispirited staff: After years of relentless cost-cutting, driven by the goal of boosting EPS, workers complain that the cuts now affect IBM’s muscle bone and vital organs. IBM has also shifted technical expertise from high-paid US staff to low-salaried staff overseas, while cutting back on staff in the US. The automatic culling of staff has also taken a toll, as 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, was telling. 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.

    Flawed implementation of acquisitions: IBM has tried to plug these holes with acquisitions. But “IBM taints an acquisition’s successful product with its own goals and strategic direction,” suggests analyst and author, Peter Greulich. “It acquires a product that was usually easily priced, inexpensive, sometimes fit on a thumb drive, had a time-to-customer-value measured in hours, and outstanding installation and ease-of-use characteristics; it then exchanges that for a product that is more secure, hard to price, costly, and blue-washed. Blue washing—an internal IBM process—brings an acquired product up to IBM standards: hard to install because of the supporting product infrastructures required, impossible to even download easily from the Internet, and installation, usability and time-to-value characteristics that are hard to describe until experienced. It takes IBM’s best product managers to retain a startup’s customers, and IBM’s best product managers have their hands tied by IBM finance and development teams spread out across the globe.”

    Unusual accounting: A goodwill impairment is admitting that an acquisition that was once a great deal has failed to produce the expected value. Most firms that are active in taking goodwill impairments, since not all acquisitions work out. “Since goodwill impairments came into being in 2001 – covering more than 142 acquisitions – IBM has never taken a goodwill impairment,” writes Peter Gruelich. “IBM, by not taking impairments, has failed to hold its middle and upper management accountable for negative customer impacts arising from the poor execution and long-term negative results of an acquisition.” ...

    Analysts noted how sad and even painful it is to see how far this once-preeminent IT company in the world has fallen. “Big Blue” is not so big any more. For instance, IBM’s market cap is now a fraction of other firms in IT.

    • Apple $660 billion
    • Google $362 billion
    • Microsoft $387 billion
    • Facebook $222 billion
    • IBM $158 billion
    • HP $ 74 billion

    “It’s like watching Eastman Kodak in slow motion almost,” suggested Joe Kernan on CNBC. ...

    IBM’s case isn’t hopeless, if it builds on its strengths. Yet it’s hard to see how it can accomplish this with an obsolete management philosophy of maximizing shareholder value as reflected in the stock price. It has been evident for some time that IBM has been heading down the wrong path. According to Nick Summers at Bloomberg BusinessWeek, IBM’s leadership has been “like a driver obeying the commands of a GPS system even as passengers shout that the car is clearly headed toward a ditch.”

    Selected reader comments follow:

    • Saving IBM is easier said than done. IBM has way too many problems. First, IBM treated human resources as a commodity like it treated operating systems. Remembered IBM outsourced it’s DOS to Microsoft and created a giant now that’s bigger than IBM? IBM cut its U.S. talents and shipped its development to India. Instead of developing first class code, it now develops shoddy code. When customer saw IBM’s code quality dropped, they lost confidence in the company and jumped ship. Walmart was one example. When your big customers leave one by one, you eventually lose money. Now IBM’s only hope might be someone to turn it around like Steve Jobs did to Apple. The current management will definitely run it to the ground.
    • Vanity, greed and pride often wear the cloak of self-sufficiency – and people can believe for decades that everything is fine. But comes that day…
  • Glassdoor IBM reviews. Selected reviews follow:
    • “Partner”

      Current Employee — Anonymous Employee. I have been working at IBM full-time (more than 10 years). Pros: Collegial organization with cutting edge innovations in cloud, analytics, mobile, security, social computing. Excellent consulting engagements in these areas. Innovation focused. Cons: Air travel policy is a challenge. Focus is on economy travel even for extremely long distance travel. Performance measurement system does not consider extenuating circumstances. Can be too short-term focused.
    • “A big, stodgy, mismanaged ship that's sinking”

      Current Employee — Anonymous Employee in Washington, DC. I have been working at IBM full-time (more than 5 years).

      Pros:

      • Flexible work schedules and locations, work from home options, offices everywhere
      • A big name company
      • So big and poorly managed that you can coast while you look for a new job.

      Cons:

      • Everything about IBM's software group is so backwards, behind the times, and inefficient — the leaders, the technology, how they work, etc.
      • They only people who speak well about IBM are those who have been with the company since they were 22 and have pension plans waiting for them.
      • The positive reviews here on Glassdoor are all fake and from their HR department.

      Advice to Senior Management: Nearly all the managers and leaders should quit. Nothing will change unless they bring in new leadership and management.

    • “Everyday practicals”

      Current Employee — Systems Administrator in Bangalore (India). I have been working at IBM full-time (more than an year). Pros: The freedom of expression and speaking to the management is good. Cons: IBM is not employee environment friendly. Dirty pantries with rats running around. Advice to Senior Management: Do not see many new ideas coming up. A clear communication on yearly reviews and help employees to improve and grow instead of just analyzing and providing a score card.
    • “A once-great company has stumbled under poor leadership”

      Former Employee — Anonymous Employee. I worked at IBM (more than 10 years).

      Pros: Flexible on working at home. Great opportunities to volunteer. Lots of online training. Amazing global community of exceptional people.

      Cons: Poor morale. Ridiculous workload. Volunteering discouraged and not rewarded. Aging admin processes and systems. PBC process demoralising and opaque. No payrises or bonuses for year after year. Concerns about where growth is coming from. Expense constraints strangling business. Employee payment on growth-driven profit totally out of line with senior executive remuneration from cost-cutting. The overwhelming feeling that you are not valued.

      Advice to Senior Management: Start investing in people again. They need payrises, promotions, expenses to travel, time to think. They can then focus on customers again, and start growing revenue. Start seeing share price as result of doing good business rather than as an end in itself

    • “It was a great company to work for...not now.”

      Former Employee — Manager in Rochester, MN. Pros: 20 years ago, great company. Cons: Not employee focused, all about the financial results, this week. Advice to Senior Management: Get back to basics, respect for the individual and recognize accomplishments.
    • “Very sad state of things”

      Current Employee — ITS Client Representative. Pros: Amazing people and technology. Cons: Poor pay, impossible, constantly changing quotas, managers take away deals, no awards money, constant fear of losing job. You try to get a better job and they block you. Antiquated systems take weeks to quote anything. Approvals take forever. Advice to Senior Management: Focus on making employees happy. Invest in operations. Make us a leader again.
    • “Stable. You will retire at the job level you came in with (with a slightly higher salary).”

      Current Employee — Anonymous Employee. Pros: It is possible top have long term employment. Cons: Salary and compensation is not competitive. Advice to Senior Management: Provide a compensation program.
    • “Used to be a world class company, just another company now.”

      Current Employee — Anonymous Employee. Pros: Fair pay and benefits. Good work life balance. Has a tendency of being a 'good ole boys' culture. Cons: The company used to be the best company in the world. Great values of treating employees fairly with respect for the individual. Now very short sighted and it is causing problems. Advice to Senior Management: Try to go back to IBM's core beliefs. Check the Watson history and realize when you create loyalty it pays back huge dividends.
    • “Rough 5 years”

      Current Employee — Advisory Software Engineer in Toronto, ON (Canada). I have been working at IBM full-time (more than 5 years).

      Pros: Work from home. It wants more then 20 words, but currently beyond having a pay check, and hunkering down, hoping the nightmare will end, there is very little else.

      Cons:

      • Long hours with no overtime pay, shifts can last 20-70 hours at a time. 15 minute couch naps are considered okay
      • Bonuses are a rarity.
      • Staff Moral, resembles that of a WW1 soldier in the trenches after a bombing. With such high turn over, everyone is wondering who is next.
      • No training. Although asked at the start of each year, training is a rarity. Think 40 is expected to be done on your own time.
      • Serious worker shortage often leads to canceled holidays. Christmas Bonus? Party? Gifts? Non-existent. Past 5 years building owners have thrown a Christmas luncheon for all building occupants. IBM is invited and this appears to be IBM's idea of Christmas.
      • Last New Years Day, employees called in for unexpected work. When complaints launched manager proclaimed this will provide good motivation not to drink on New Years Eve.
      • Complaints to management on work conditions are often buried and never answered.
      • Work/life balance is nonexistent, as you're often called in even when on holidays.
      • Benefits changed this past year and added as taxable benefit, then deducted as expense.
      • Employee awards become taxable income; that $20 mouse pad as an award for good work will turn into $150 taxable income.
      • Most staff is waiting for an exit package; just biding time waiting for the offer to come.

      Advice to Senior Management:

      • The company needs to stop focusing on the stock growth and focus on company growth. Current direction is to grow stock value, through cannibalization.
      • Company needs to look to inter relations between departments to understand the relations in value. The selling of the hardware divisions have led to the destruction of the lucrative Services Market, has also lost the companies public Brand Value.
      • Ask anyone under 30 who IBM is and they either don't know or ask if the company still exists. This is a major issue, as these people move up through companies to decision makers.
      • A prime example selling of US based plants which made hardware components for IBM assembly. After the sale, component costs rose, driving down profit on assembled items. Resulting in the sale of the second division, which then resulted in the services attached to maintenance to lose traction. Which also results in software and software support services to lose traction.
      • And, after-sales competitors now have access to patent portfolios which allowed the company to have a market edge.
      • Stop concentrating on breaking down smaller and smaller cost centers.
      • Stop thinking about revenue generation, and concentrate on revenue retention.
      • Stop projects where one department rushes the work to look good, knowing the other department that takes over has a mess to clean up. But the cost of the mess shifts to the other department.
    • “Back then was a good place to work”

      Former Employee — Anonymous Employee. Pros: Recognize hard work and reward it. Quick promotions. Good benefits. Time off is good. Cons: Benefits have decreased and overall treatment of employees have lessoned. Advice to Senior Management: Go back to the old IBM and you will be back on top. My dad also worked for IBM for 30 years and you showed that you valued your employees. Since he retired 20 years ago IBM has gone downhill; especially for the past 10 years.
    • “One of the last great fortune 500 companies”

      Former Employee — Executive Program Manager in San Francisco, CA. Pros: If you are looking to differentiate yourself and perform at a high level, you will enjoy working at IBM. Cons: Depending on your position, travel requirements may be high. Advice to Senior Management: Listen to your subject matter experts on how to improve the services business and client delivery
    • “IBM is the worst company I have ever worked for.”

      Current Employee — Senior IT Specialist in Rochester, MN. I have been working at IBM full-time (more than 10 years).

      Pros: There used to be Pro's. Management removed them one by one until there was nothing left.

      Cons: Management and executives are absolute idiots. They treat employees like we are garbage. No raises, no promotions, no education, no pension, no affordable healthcare after retirement. Hopeless.

      If you object management tells you that there are a thousand Indians who would love to take your job, so be thankful you still have it. IBM is rapidly replacing all of their US employees with Indians, Brazilians, and even Africans. They do everything they can to get the CHEAPEST labor possible and as soon as they do they kick their US employees out the door.

      Executives try to fool investors into thinking they are making money by buying back stock at a horrendous rate while all the time IBM's revenues are drying up. This is not a technology company, it is a farce.

      Advice to Senior Management: QUIT. You guys are nothing but politically correct idiots. Rometty is a fool and so was Palmisano. Look what you have done to the stock value. There is more downside to come as the world sees more and more clearly that IBM is nothing but a farce.

    • “IBM the Big Blue Titan”

      Current Employee — Business Analyst.

      Pros: People are IBM's greatest asset and part of what keeps people around. The commitment that management has to developing their employees and ensuring their success (if they want it) is unparalleled. That is how you cultivate relationships/talent and build loyalties in your organizations. There is a familial sense in some of these organizations that really drive a sense of belonging.

      Considerable amount of flexibility in your work, the group will cause this to vary a bit. My experience has been that you do not have to be in your seat all day in order for your work to be seen. They are very much focused on what you are delivering and the timeliness of those deliverables.

      Management in my group has been very adamant about taking the time you need for you, and your family. They are cognizant of the fact that people have obligations outside of their traditional working hours and make an effort to accommodate those reasonably. In addition to that, there is considerable time off given for vacation and holidays. Nearly 4 weeks of vacation when you first start and that progresses upward after a given number of years.

      Cons: The macro environment is probably as bad as it could be. On an annual basis there is at least one layoff, with people leaving intermittently as a result of constant churn. The macro culture as a result of all this is suffering and there is a sense that people do not care nearly as much as they used to. Additionally, pay is mediocre and raises are often joked about as things of the past.

      Advice to Senior Management: Flatten the organization, there is no need for a technology company to be as hierarchical as this one is. The structure stifles innovative thought and reduces individual contribution. Domestically there is a sense that the executive management is completely detached from the work required to drive their initiatives. A lot of the transformation that needs to happen in order to align this company with current market conditions would work much more efficiently if they eliminated some of the layers of management and better aligned themselves with the people that are driving the actions.

    • “Old folks trying hard to modernize.”

      Former Employee — Software Developer Intern in Austin, TX I worked at IBM as an intern (less than an year).

      Pros: The culture around IBM is definitely one of change. It's obvious that the company knows that it currently thinks/operates like a dinosaur and is trying to modernize both its operations and its software development styles.

      Cons: Still a dinosaur. In my experience they used old tools, old methods of software development, etc. I even saw developers email code to each other while I was there!

      Advice to Senior Management: Give your interns cooler stuff and more fun events that are paid for by the company. While it is certainly a little dumb for us young folks (and coincidentally better engineers/designers) to be swayed by a company flying us out to Seattle for a Macklemore concert, it does, so take note.

    • “Good”

      Current Employee — Enterprise Sales in London, England (UK). Pros: Good work life balance, lots of opportunities for career development across software group, GBS and all the business units. Cons: Decision making authority is way too diluted and convoluted. The company is wrong by a lot of long-term IBMers who have lost touch with their customers. It can be painful trying to do deals as an IBM sales person with all the various requirements IBM places on the customer — very few of which provide any additional value. Advice to Senior Management: Where do I start?
    • “Overall pretty good”

      Current Employee — Software Support Engineer in Cairo (Egypt). Pros: Depending on your manager, department and line of work, you might be able to work from home which makes a huge difference in Egypt. Cons: I don't personally feel like there are many opportunities to move up unless you work in sales which I hear is a horrible department to work for. A lot of managers are dinosaurs and really old school. I've been in the company for almost 4 years and only got a raise once, even though I'm a positive contributor. Software support is a dead end job.
    • “Company has been declining over the past decade”

      Current Employee — Anonymous Employee. Pros: Work at home program is good. Cons: Benefits declining. Morale is down. Lack of good management.
    • “A lot of bureaucracy but still innovative guys inside the company with corporative spirit and ability to grow.”

      Current Employee — Sales Leader in Moscow (Russia). I have been working at IBM full-time (more than 3 years). Pros: Travel. Develop. Get a lot of experience. Cons: Bureaucracy. Slow process of decision making and a lot of restrictions. Advice to Senior Management: Spend more on people.
    • “IBM is broken”

      Current Employee — Senior Sales Manager. I have been working at IBM full-time (more than 10 years). Pros: Flexible working, opportunities to move within the company yearly, lots of free education. Cons: IBM does not care about their employees; no pay rises or travel expenses; poor buildings that leak and are held together by sellotape (North Harbour); mixed messages, e.g. moving offices one month and not moving the next month. Voluntary redundancy offered at least yearly. Crazy policies and the business is so fragmented all departments compete and argue with each other. Some decisions are immoral. Advice to Senior Management: Practice what you preach "the most important asset is the staff".
    • “Good workers, very bad executive management.”

      Former Employee — Software Engineer in San Jose, CA I worked at IBM full-time (more than 10 years).

      Pros: A lot of good, helpful workers. Decent salary. Flexible work schedule.

      Cons: Working 60+ hours a week not uncommon, including weekends, just to keep up with the work. Performance ratings are given out on a curve. So, even if you are in an area with a lot of high performers, only a small percentage are allowed to get high ratings and good performers will get low ratings. Those that get the lower ratings are candidates for being laid off.

      Executives are focused on EPS and stock prices — likely due to the fact that a lot of their salary is in stock bonuses. Instead of focusing on delivering high-quality products and satisfying their customers to increase revenue, they rely on cutting expenses, including lay-offs.

      The employees are fearful of the next round of lay-offs, which occur more and more frequently. There is no longer respect for the employees by the executives like there used to be.

      Advice to Senior Management: IBM's #1 business principle used to be respect for the individual. This is no longer the case. Currently employees feel like they could be laid off at any time just to make the bottom line look better. This had lead to very low morale in departments.

    • “It was great...now there is nothing”

      Current Employee — Managing Consultant in Melbourne (Australia). Pros: It is massive, great amount of IP and opportunity to move into a company that defies national culture! Cons: There is nothing; left eduction and training has been removed; massive redundancies in the last two years have resulted in the remaining survivors competitively looking to get out. No opportunity to grow or learn in this organisation. Advice to Senior Management: Need to either look after who is left or give them the redundancies!
    • “Excellent company with deep resources and a willingness to stay current.”

      Current Employee — Writer in New York, NY. I have been working at IBM full-time (more than 5 years).

      Pros: They encourage telecommuting; they keep the focus on up and coming technologies; the people, in general, are cordial and professional. If you enjoy the global enterprise, high tech B-to-B environment—and you have technical skills—you'll probably like it. They company values integrity and high quality. CEO Ginni Rometty is sharp.

      Cons: The company is very, very, big. It can take quite a while to understand how things are organized and who is who. You may feel like a cog in a wheel. The stakes are high and as in any organization, you need to watch out for a few sharks.

      Advice to Senior Management: Keep moving forward with the changes that top management is pushing. Let go of the low margin stuff more quickly. Capitalize more on the deep vault of patents and inventions that never see the light.

    • “Great springboard to launch a career in IT or Business Consulting”

      Current Employee — Senior Consultant in Melbourne (Australia). I have been working at IBM full-time (more than 3 years). Pros: Well respected and known brand, great learning opportunities, lots of travel opportunities. Cons: Unprofessional compared to other consulting firms and big 4, high average age, not a great social culture. Advice to Senior Management: Need to be less conservative as an organization.
    • “Not a good company for freshers”

      Former Employee — Applications Developer in Pune (India). I worked at IBM full-time (more than 3 years). Pros: It has good flexibility in time. If you are somebody looking to do something then it's not a place for you. Cons: There is no opportunity for hard workers. Advice to Senior Management: Don't give all authority to people managers.
    • “Twenty plus years”

      Current Employee — Anonymous Employee in Dallas, TX.

      Pros:

      • The people — Most IBMers rank as the "best of the best." Very exciting to encounter and work with the most extraordinary people in the business.
      • Depending on division and management chain, projects can be challenging, exciting, with a great deal of relevance to current and future technological impact on business and society.
      • A wealth of available online education.

      Cons:

      • Unfortunately, in recent years an alarming number of what I believe to be the most dedicated workforce in the world are quite literally dropping dead from causes related to overwork and excessive stress. (My statement is based on personal knowledge — not hearsay.)
      • In many areas, work/life balance is nonexistent.
      • Personnel review system is a numbers game with no relationship to actual performance. Final decisions are often made by managers who have no personal knowledge of the person under review.
      • Raises are all but nonexistent.
      • Benefits erode every year.

      Advice to Senior Management: Reorder priorities — Clients first, employees second, stockholders third.

    • “Toxic”

      Current Employee — Anonymous Employee. I have been working at IBM full-time (more than 10 years). Pros: There are still some good, hard working people. Cons: Exclusively focused on EPS, while destroying services business. Advice to Senior Management: Stop focusing exclusive on EPS.
    • “Good company, interesting work, too many concerns about layoffs.”

      Former Employee — Anonymous Employee. I worked at IBM full-time (more than an year). Pros: Working with smart people is always interesting. The company benefits for employees are very impressive. There are many areas to work in and the culture allows transferring to other areas. Cons: My experience with the people who work on the corporate systems was one of concern. It appeared that everyone was looking over their shoulders for someone to replace them. While the benefits are great for employees, it is not as good if you want to include your family.
New on the Alliance@IBM Site

Job Cut Reports

  • Comment 12/31/14:

    There are a lot of people asking if they can volunteer for a "package". Why is a package considered the only way to leave? I ran the numbers on my own situation and determined I was better off to leave without a package. I took a 25% pay increase and got a 3% raise after one year...plus a real bonus that I get if I do the work. Or, I could have kept waiting for a package. You need to stop thinking of it as being IBM's job to take care of you, and take matters into your own hands. The real rub was I announced I was retiring right after an RA was announced. One of my coworkers had almost exactly the same experience I did, was on the RA list, and my leaving didn't save his position. IBM HR and Finance don't care about employees at all...just their numbers. -GoneIn2013-
  • Comment 12/31/14:

    I left of my own volition to take a position with another company but IBM considers me to be 'retired'. I'm not sure where they got that idea from, it wasn't me. Maybe it makes them look better in that jumble of numbers if we 'retire' instead of 'leave' -Glad To Be Gone-
  • Comment 01/01/15:

    Two product groups from Rational were divested and sold to Unicom Global, effective January 1: Focal Point and PurifyPlus. Unicom offered everyone more or less the same salary they had at IBM. Some of us aren't sure whether they mean to keep us for long. Whoever did not accept the offer is out with no severance pay after only ten days of notice. There was an NDA that ordered everyone not to tell their spouses or anybody else until January 1. Happy New Year, honey, I lost my job. Thanks IBM. -Good Bye Blue-
  • Comment 01/01/15:

    I firmly believe a lot of IBM's management problem lies in the Board of Directors that allows these top players to remain in the positions they are in. The Board is also interested in their own interests instead of what is best for the company. They are the ones with the power to hire and fire management. Why are these top management people being kept on when the company is failing. It seems to me that the owners of sports teams are much smarter than the Board members of IBM. They will fire a coach for not putting a winning team on the field. I know some board members read this forum. How long are you going to let this dismal management team stay? -Gone in '98-
  • Comment 01/01/15:

    To "-Gone in '98-" — You are absolutely right about not just waiting for a package if you still want to continue working after leaving IBM. My previous advice about hiding your desire to leave IBM applies only to those who want to retire. Why retire without the buyout unless staying with the company is making you ill? From -CAT STILL IN THE BAG-
  • Comment 01/04/15:

    Another long term problem afflicting IBM is called 'three-year-itis". Typically afflicting low to mid level execs to pad their resumes with goal to get VP or director level positions. They spend three years maximum in a position before moving onto another one. When they move on they leave a mess for the next person to address. Some positions (e.g. being a division CIO or Corporate CIO) inherently facilitate this behavior. One year is spent learning the job, the second trying to do it, the third is spent looking for the next one. Their skills look good on paper, their ability to deliver leaves much to be desired. -Gone-
  • Comment 01/05/15:

    @-trexibmer-. As a band 10 STSM I got to see a lot of how IBM worked; my job was to fix things. As the amount of things that required addressing increased, so did the push back and denial that there was something wrong. No time to test, no time to fix, push it out the door, if a customer found a problem only fix it then, priority was generating revenue at all costs.

    A health scare that the doctor said was work stress caused made me re-evaluate priorities. I sat down with Fidelity folks, looked at finances, discussed with family and after over 30 years gave two weeks notice.

    Words are cheap. I had been called a critical resource, yet when I said I was leaving there was only a nod towards the door. My health has improved, family life is better - one brings stress home. I enjoy my work now, adjusted to waking up looking forward to going to work — not worrying about RAs, PBCs, exhortations to do more with less.

    Six colleagues over the years had heart attacks directly linked to work, five died. I had no desire to make my wife another IBM widow. -Anonymous-

  • Comment 01/05/15:

    -Gone- Quite true about "three year-itis". Another thing that is related to "three year-itis" that affects managers and non-managers alike is that three years is the time an IBMer is 100% vested in their 401k plan. So if IBM RAs people before their three year service anniversary they lose vested value of their 401k account balance. More rancid food for thought. -anonymous-
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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