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6, 2000 April, 2000

Highlights—February 14, 2015

  • Los Angeles Times:

    IBM redefines failure as 'success,' gives underachieving CEO huge raise. By Michael Hiltzik. Excerpts: The IBM board of directors did a huge favor for mediocre CEOs the world over on Friday by announcing (quietly) that it has granted Chairman and Chief Executive Virginia Rometty a $3.6-million bonus for 2014 and a $13.3-million stock incentive award payable in 2018. She's also getting a 6.7% bump in her base salary, to $1.6 million from $1.5 million.

    Here's the record for 2014 the board thought was good enough to warrant a raise for Rometty: IBM's revenue declined by nearly 6%, and net income by 27%. IBM shares began 2014 at a dividend-adjusted $183.12 and ended the year at $160.44, a decline of 12.4%. During that period, the Standard & Poor's 500 index rose 12.4%. (As we write on Monday, IBM has fallen further to $152.12.) IBM has been the worst performing stock on the Dow Jones Industrial Average for two years running.

    If you're looking for an explanation of rising income inequality in America, Rometty's compensation is a good place to start. She's far from the most overpaid CEO in America — IBM is still hugely profitable, after all. But her record hasn't been sterling by any measure, and many investors remain on the fence about whether Big Blue is in the right hands. Under the circumstances, and considering the rut in which most working-class wages have been stuck for years, most IBM shareholders, employees and members of the general public are sure to consider her raise inexplicable. Apologists for rising income inequality in America often say it reflects the pay of "superstar" artists, sports figures and CEOs. What about soaring pay for non-super CEOs? ...

    In its corporate disclosure statement last week, IBM didn't go into any detail about why Rometty was due for a raise. During a conference call on Jan. 20, when the firm announced its dismal 2014 results, Chief Financial Officer Martin Schroeter made some noises about some company initiatives that will "generate some momentum." But the best he could project for other parts of the business was modest growth in some and "stabilization" elsewhere.

    When was the last time you heard of a rank-and-file American worker getting a 6.7% raise and a rich incentive bonus based on the "momentum" of his or her work? ...

    IBM's executive compensation process, which covers Rometty and her four top lieutenants, appears designed to stay divorced from the real world. First, at least on the surface, it's the product of logrolling. The four members of the board's executive compensation committee are themselves all current or former corporate CEOs -- Andrew Liveris, chairman and CEO of Dow Chemical; W. James McNerney, chairman and CEO of Boeing; Alain Belda, retired chairman and CEO of Alcoa; and Sidney Taurel, retired chairman and CEO of Eli Lilly. Corporate CEOs are, as a species, known for a sense of entitlement that could make $17 million in raises, bonuses and "incentive compensation" seem like punishment. The process by which CEOs help set the pay for their fellow CEOs is perhaps the biggest flaw in the American way of executive compensation.

    The compensation committee members all collect at least $250,000 a year for serving on the IBM board, but as of the company's last proxy statement in March 2014, only Taurel was an IBM shareholder (he owned 11,000 shares). ...

    We'll hear some explanation for Rometty's compensation when IBM releases its proxy statement this spring. The document will make interesting reading. One thing's for sure: It will take a corporate CEO to understand the rationale.

  • The VAR Guy:

    IBM: Employees React to Rometty, Exec Bonuses as Layoffs Reach 5K. By DH Kass. Excerpts: Could IBM’s (IBM) awarding chief executive Ginni Rometty a $3.6 million bonus for her performance in 2014—a year in which the vendor suffered its 11th straight quarter of declining revenue—possibly been more ill-timed, arriving amid a seemingly widescale layoff?

    In fact, IBM documents show Rometty actually has realized nearly $6 million in incentives and stock sales since last August.

    Two items may make Rometty’s haul feel like a sore thumb to newly-fired employees:

    First, IBM 8-K SEC filings on Aug. 28 show Rometty (or her proxies) executed 32 sales of IBM stock on Aug. 27, selling some 26,113 shares at an average value of $191.74 for a $5 million gain. On the same day, Rometty purchased 27,678 shares of IBM stock at an average cost of $96.73, making her net take on the day about $2.3 million. ...

    Second, amid reports that IBM so far has laid off about 5,000 employees, a sampling of worker posts at the watchdog Alliance@IBM forum leaves the immediate impression the vendor has its work cut out to shore up employee morale if it intends to do so. With the fur flying that IBM intentionally rated employee performances low to avoid paying full severance packages along with charges that it tagged older workers to cut from its rolls, it may be quite some time until it’s able to mollify what appears to be an unhappy workforce.

    Selected reader comments follow:

    • This raise for the IBM CEO is nothing less than an ABSOLUTE kick in the face and onto the ground for all the IBM employees, ex employees who have sacrificed SO MUCH and have seen their salaries cut, benefits cut, pensions cut, even tens of thousands of jobs cuts. Lord knows, God knows, what goes around comes around. When the business continues to fail as it has been, there will be big changes at the top...and VERY soon.
    • IBM should fire Ginni Rometty. It looks like airline corporation, when airline file a bankruptcy, CEO get a big bonus. Is that IBM is filing a bankruptcy? It is funny, Ginni bonus is comes from layoff employee.
    • Following the ill timed and insulting article Sam posted on Forbes, I am completely speechless. Shame on you Sam and shame on you Ginni. THINK!!! Respectfully, Deb Kelly.
    • The 5K is just the layoffs. Now come the performance-based firings of all of the Transition To Retirement (T2) folks that instead of being given what management promised in exchange for their identification as interested in leaving or retiring will now all be fired without any expense to the company, thanks to a hidden exception. Totally Machiavellian! A company that cannot be trusted.
    • 3.6 million dollar bonus for losing business, who paid it HP or Oracle? Surely IBM's board would not reward incompetence. Or Maybe she bribed Watson...
    • For years, dating back to Gerstner, the IBM Corporate HR plan was to move to an "average" 5 year employee. That means almost constant layoffs and rebalancing, while maintaining approximately the same number of world-wide employees. I was "in the room" when that plan was explained by the corporate HR exec during Gerstner's time. What has changed during that time is that Sam and Ginni brought back massive layers of management that Gerstner had flattened. That makes IBM totally dysfunctional because none of those VP's want to own or be responsible for anything. Decisions are chased up the management chain endlessly. No improvements in sight.
    • One of the worst CEOs ever, in the history of this planet, hell bent on destroying a century old company. And she receiving a bonus despite eleven quarters of straight loss is preposterous! In an organization where employees are penalized for disagreeing with their incompetent, nincompoop, spineless and brainless bosses, such an event is only to be expected! Shame!
    • Because it lost a previous age discrimination lawsuit, IBM is legally required to give current and future laid-off employees a list of the names and ages of all those subject to "resource actions" (i.e., layoffs). The most recent round of laid-off workers should have received such a list in the packets they got from the company the day after their managers called them to tell them they were being terminated. But the list of names/ages was not included in the packets. Looks like IBM may be headed for another age-discrimination lawsuit.

      And to add insult to injury, the managers who laid off admin assistants and others who had been with the company more than three decades wanted to send out "retirement announcements" on their behalf and hold a retirement lunch or dinner for them.

      Meanwhile, Ginni Rometty gets a $3.6M bonus and a 6.7% salary increase.

  • Channelnomics:

    IBM blasted again for job cuts. By Jessica Meek. Excerpts: IBM staff have blasted their employer in a statement surrounding the termination of 202 workers in Dubuque, Iowa.

    The IBM employees' union, which runs the website Alliance@IBM, described IBM's decision to fire the workers at the end of January as "outrageous".

    "The recent termination of 202 IBM Dubuque employees shows that IBM clearly does not value the experience and expertise of U.S. workers," Lee Conrad, national coordinator of the Alliance, said. "To have IBM U.S. employees help transfer work out of the country and then get terminated is outrageous and a threat to all jobs and our economy."

    The work to which Conrad refers relates to health insurer Kaiser Permanente's account, which Tom Midgley, president of the Alliance, said is having its workload shifted to India.

    "IBM employees and their communities continue to see IBM cut employee jobs while shifting the work off-shore," Midgley said. "This destruction of IBM jobs is unacceptable and must stop." ...

    In response to the statement an IBM representative told Channelnomics that the firm is "aggressively positioning itself" for continued leadership in cloud, analytics, mobile, security, social and cognitive computing, and that it is investing in and staffing these "priority" areas.

    "Transformation on this scale requires IBM to continually remix skills - our clients expect no less as they look to IBM to help them take advantage of these innovations and new technologies," he said.

  • The Four Hundred:

    IBM Layoffs Not As Dramatic As Rumored. By Timothy Prickett Morgan. Excerpts: It is the beginning of a new year and this is the traditional time for IBM, which reported its financial results for the fourth quarter a few weeks ago, to do what it calls "workload rebalancing" or initiate "resource actions." Those are euphemisms for employee layoffs, which have varying effects on IBM i shops. Some years, like last year, the Power Systems business takes some hits, in other years, different parts of Big Blue do. ...

    IBM does not publicly comment on where it is making its job cuts and does its best to keep the thresholds well below whatever numbers each state has that would trigger an official Worker Adjustment and Retraining Notification (WARN) reporting of those cuts to state agencies. You have to let go of 500 or more employees at a site or at least 33 percent of workers for smaller sites to trigger a WARN report. Because of these reporting requirements and the vast number of IBM facilities worldwide, IBM can get in below the radar and not have to tell anyone anything. That leaves the Alliance@IBM, the official site for the unionizing effort for IBM's employees in the United States, as the conduit through which IBMers who have been RA'd, as they say inside the company, tell their stories and we get some sort of count by country and division.

    Lee Conrad, who runs the Alliance@IBM effort as Local 1701 (yes, that is the number for the Starship Enterprise) of the Communications Workers of American union, gave me the heads up that layoffs were starting on January 28. IBM is no longer supplying the Older Workers Benefit Protection Act (OWBPA) reports to those laid off, which listed the job titles, business units, and number of people affected in each group of layoffs, and people used to turn them in to Conrad where he could compile them and build a picture of what was going on. Conrad could confirm that IBM had about 250 layoffs in its Boulder, Colorado facility, about 150 from its Columbia, Missouri, facility, and about 202 from its Dubuque, Iowa, facility.

  • InfoWorld:

    It's make-or-break time for IBM's cloud. Whether rumored massive layoffs take place, IBM is in serious trouble when it comes to the cloud. By David Linthicum. Excerpts: Whether or not a massive layoff is coming, IBM has a big problem to solve around the cloud: If the company succeeds in deploying public cloud services, it will cannibalize its existing business of on-premises services. Of course, IBM's on-premises services will be affected by the cloud regardless of what IBM does internally, as more clients use the cloud — from IBM or another provider.

    I'm very concerned about how IBM's leadership is handling this cloud transition. I see no fire in the belly or a drive into cloud computing. IBM innovates through acquisitions, such as SoftLayer, but that's a slow way to evolve, and there are signs that SoftLayer's not being easily digested into IBM.

    For example, the recent departure of SoftLayer executive Lance Crosby is troubling because he's being replaced not by an innovative thinker but by longtime IBM executive Robert LeBlanc. LeBlanc will lead IBM Cloud, a new division that will try to speed IBM's progress in selling cloud services. To me, that translates into the same old, same old.

    The shame of it all is that IBM has many smart people working for it, and I suspect more than few of them will be on the layoff list. Moreover, SoftLayer is a good public cloud offering.

    What's needed is a complete reboot of the company, including new leadership and a renewed focus on innovation. IBM won't accomplish that by purchasing other companies. It needs to change from the inside out.

  • Seeking Alpha:

    The Human Equation Every IBM Analyst Needs To Compute. By Peter E. Greulich. Excerpts: International Business Machines is under attack in 2015. It would seem that even Wall Street has decided it might be in trouble. I find a lot of irony in the latest round of articles attacking Ginni Rometty's reward for lackluster performance. Wall Street is only seeing the fruits of rewarding a fifteen year IBM shareholder — first and — only strategy. It would be nice if they admitted it.

    IBM's employee-owners gave up on IBM long ago. The best-of-the-best have been leaving for startups, business partners, the competition or retiring. When a corporation makes it difficult for the best and brightest to prosper, it is time to recognize that its culture is dead. The culture that enabled IBM to survive the 20th Century's 18 recessions, the Great Depression, 9 of the top 12 stock market declines, and even missteps by its CEOs, including Watson Sr., Watson Jr. and, yes, Louis V. Gerstner. ...

    IBM's own employees won't recommend IBM as a place to work anymore. It may be a place to build a resume or a place to do your time in a large corporation, but it is no longer a place in which an employee-owner invests their most precious commodity — their loyalty and dedication.

    Selected reader comments follow:

    • I've posted this recently in another thread but it is worth re-posting here in a shorter version when talking about the IBM employee base, past and present. I worked for other companies before I came to IBM for 2+ decades, therefore I know the view from the inside of the company much more than the average never-worked-at-IBM poster on this forum.

      Disclosure: I left on my own after seeing the handwriting on the wall.

      "With the latest charade of revenue declines, continually firing thousands of rank and file workers and then giving raises/bonuses to the senior execs, this may be the last nail in the morale coffin. I've posted elsewhere before, IMHO, they have lost the mindshare of their employee base.

      Bulls will point to 'IBM has transformed before' but that was when they had legions of true-blue IBMers who were willing to crawl through mud for the company. They no longer have that — instead they have scattered ranks of contractors and offshore techs who couldn't give a rat's azz about the company — they just want a check and punch the clock. Tough to transform with that type of employee base — no mud crawling here.

    • A disturbing article, especially for one who has just been RAed in the latest massive binge of 1/28/15...

      I don't know if SA readers will understand you, Peter. They will all come out with all their erudite numbers and analyses, and their appeals to history, how IBM will do it again...But the past is not prologue. I tried for a long time to fathom the IBM management mindset, and I am forced to the conclusion (however unwillingly) that basically they hate and detest the employees — we really are a lazy bunch of louts.

      Yes, Ginny is finished, even if she does not know it yet. In anticipation of defending her own bonus, she announced that employees would get their GDP (growth driven profit) this year — but why? There was no growth last year. I guess Ginny thinks it wouldn't look good to keep taking from the corporation without throwing out some kind of bone.

    • Ctobserer50, let me interject my thoughts on your comment about IBM executives detesting the worker bees. I think it goes much deeper than this in a sick and twisted narcissistic way. Just think of the documentary "Enron: the Smartest Guys in the Room".

      As I've stated prior, I was with IBM for over two decades and worked with many great I/T people. One in particular was a high ranking fellow, smart with really good insight. I trusted this person because he was a face-value kind of guy, he called it like he saw it. He once told me a story which occurred circa 1998-1999. It goes something like this:

      For those who remember the bricks the IBM CEs used to wear, they were glorified pagers which were essentially wireless computers that dispatched the CEs with work details, etc. My friend, who had access to 'higher' circles of authority, sat in a meeting once where a DE (distinguished engineer) said to a group of Band-C/D executives: "What if IBM were to take the brick to a new level, make it a cell phone with its wireless computing and maybe even one of these new digital cameras included in it. Then market it to the masses since cell phones seem to be all the new rage these days?"

      The highest ranking exec in the meeting said, without hesitation, "there's no market for that." And that, my friends, was the end of the conversation.

      This is but one example of what probably occurred thousands of times over the past 25 years at IBM. The Exec culture evolved into them being 'the smartest people in the room' and they were far too smart to listen to such malarkey coming from rank and file technician types — they wouldn't even entertain such ideas. It is this specific executive behaviour which has driven the company to where it is today.

      As mentioned in another SA thread, as recently as 2010, Palmisano was quoted as saying 'IBM customers are not really interested in the cloud paradigm.' And since, in his mind, Sam was the smartest person in the room, nobody within the company, no matter how smart or technologically visionary, could have convinced him otherwise. On the contrary, if this visionary had pushed the idea too hard, he would have simply landed on a resource action (layoff) list.

      Welcome to the new IBM executive culture. From what I hear, it is still alive and well within the Blue halls, even with the current state of affairs. They simply don't know that they don't know, it's a deeply flawed yet ingrained leadership culture — the higher you rank, the smarter you are. The lower you rank, well, you get the point.

      Maybe they will call the IBM documentary "IBM: The Smartest Maximizing Shareholder Value Executives on the Planet".

    • LitchfieldJeff: Peter, I guess I fail to see the purpose of putting this sort of thing in an investment blog. What's the point? I'm not of the school of thought that this sort of thing needs to impact a person's investment decisions. From my perspective, this type of pain that many of our associates have suffered is fairly typical of a giant corporation struggling mightily to turn itself around - and should best be left to your books. I also don't feel it is appropriate for you to use this blog to publicize your published works.
    • @LitchfieldJeff This article is informative. Employee morale and business culture matter. Especially in assessing the investing worth of a company in deep trouble.

      I also think you're missing the point. The pain of downsizing is obvious. But it's important to understand how and why this is occurring.

      In this case, it's self inflicted. IBM management transformed a positive technology culture with a negative financial engineering culture. It's structurally entrenched, as business managers routinely trump technologists.

      That was my experience at IBM after they acquired my company. I stayed for 2 years, not least to experience what it's like being an IBMer. I've posted about this before, so I won't repeat details that can be searched.

      But suffice it to say, I left of my own choice. It was simply too limiting and even oppressive, especially in light of how Google, Facebook, Oracle, Microsoft, & SAP treat their people. Lots of top IBMers leave for these companies...but the reverse is not happening, which is a HUGE statement.

      I've also posted how 100+ of IBM history was a positive statement about longevity and an ability to reinvent itself. Again, I consistently posted how employee morale was the chief threat in breaking this recycling of the company into a newer and stronger brand. Unfortunately, my fears are being realized.

      I'm holding my IBM shares. But no way would I advise anybody to put in serious money. Ginni isn't getting a grip on the employee morale issues. This can seriously diminish IBM in the years ahead.

      All the best.

    • Of all the articles I've read on SA, this is hands down the best one. Maybe it's because I've experienced the RA process personally (multiple times), but more than likely because there's no super optimistic financial analyst claiming the fundamentals of the business are sound and the great transformation underway will lead to a path of gold down the road.

      You can financially engineer results all you want IBM, but when all the people who made the company what it was the first 100 years are no longer around, it won't make a lick of difference. No good people = no good company = no good products = company circling the drain.

    • @techvet, If IBM were, as you say, restructuring and trimming employees that don't fit or were in business units that were on the decline this would seem like a prudent business adjustment. But that's not the case. That's not how RA's at IBM work. The current "major restructure" is primarily a shuffle of dozens of GM's, Sr VP's, VP's and giving existing business units new names aligned with current, popular marketing terms. Nothing has been reorganized below a Director level.

      The cuts in the RA's are arbitrary number targets across multiple business units, including groups performing well financially and in market growth segments. As an example, an area that provides core infrastructure services at the heart of IBM's cloud offerings. Several job openings remained unfilled in 2014 due to hiring freezes to meet "financial challenges". Critical work was impacted due to the staffing shortages. Yet about a dozen employees were notified in this area they were losing their jobs Feb 27th to "increase productivity". Even those in strategically critical roles were selected despite staffing of those positions is a key metric reported at executive levels globally in 2014 & 2015.

      I think the point the author was trying convey is investors both long and short should take into consideration how IBM is managing it's business and employees internally. The toll of these annual arbitrary firings aren't just impacting those losing their jobs. Those remaining are severely impacted as workloads double/triple with a fresh reminder that no matter how well you perform or critical your contributions, you may be next.

      If this discussion is too emotional for an investment blog maybe you should be reminded that human capital is the foundation of what made this company an attractive investment opportunity. As IBM continues to systematically erode that foundation from within, at what point should that practice be seriously considered in your portfolio risk analysis?

    • Peter thanks for this, Former IBMer here, 8 Years IBM customer engineer large systems, 12 years working for Steve Mills in Atlanta, 5 years managing global accounts. I have thanked God for IBM everyday of my life. If not for Big Blue giving a young kid from a small town a shot when he exited the military I may have been pumping gas for a living the past 25 years (not that there is anything wrong with pumping gas for a living — its an honest job) but I hope you understand my sentiment.

      That said, IBM is a toxic environment nowadays. IBMer morale is vapor.

      Analysts can play with all the spreadsheet analysis they like looking for "intrinsic value" etc. Less knowledgeable investors may even follow headline data or the drive by media commentaries of talking head pundits on cable financial news shows to aid their decision making — who knows.

      This I do know (and Buffet knows it also though in this case he didn't follow his own tenets on a companies management before taking the plunge).

      A true leader sets the tone, the vision, and leads ... Rometty manages (and not very well at that). She and top execs have lost the hearts of employees (This latest bonus fiasco ensured that). and without employees buy into a leaders vision of transition all the spreadsheet analysis in the world isn't going to save pale blue.

      Unfortunately, IBM is a toxic, toxic environment nowadays. IBMer morale is vapor.

      I wholeheartedly wish IBM well, but with Rometty, existing BOD and top execs at the helm the demoralized employees are gonna to have a hard row against strong headwinds trying to navigate this latest transformation in a rudderless ship.

      It truly saddens me to say this, but there are much much better companies out there today with strong leadership, clear vision, solid financials and a morale compass to boot with which to invest one's hard earned dollars nowadays.

      I'm not sure I would have said that a decade or so ago. Others mileage may vary.

    • I was rereading The IBM Way by Buck Rodgers. I think it was THE IBM WAY that I grew up in. I would love for it to rediscover this heritage. Here is his quote:
      "I can't stand to work in a world of yes-men. They create an atmosphere that can lull you to sleep. I like people who care enough about what's going on to speak up when they don't like what they see. Of course, there are critics and there are critics, but even the worst of them are more stimulating than the best of the yes-men...there's the kind of complainer every organization needs: the royal dissenter. He or she offers not only a well-thought-out criticism but also a considered approach to dealing with the problem."

      Treating humans as a relationship rather than a resource is really not that hard or expensive. It does demand accountability, though, which some folks don't like. Cheers, Pete.

    • I have a different experience. In the early '90's my company hired x IBMers and they were very capable people. Unfortunately, they behaved like they had been imprisoned in POW camps in Laos. Some were financially ruined, some certainly psychologically damaged and I feared they would never trust anyone again. I moved on but former colleagues said the IBMers never recovered from their IBM experience and it hurt their careers when trying to move on to new challenges. Not surprising no one recommends working for IBM.
    • For hi tech firms their most valuable asset is not IP or fab plants; it's brains. The average investor sees only metrics but those who have been part of one of these companies knows how important not only the quality of intellect but its morale is to allow an atmosphere of innovation to occur that is essence of any of them.

      This destruction of IBM culture that occurred by the execs of IBM is likely one of the most egregious since IBM was considered at one time a national asset like Bell labs, not just another investment option on Wall Street—just ask any IBM alum of the golden years.

      Because of the former brand name of IBM their execs have assumed they will always be able to replace any number of employees especially in a national good jobs deficit environment like now but they are wrong in terms of retention and even first interviews with such sites as GlassDoor.

      The destruction of the former IBM culture in combination with its decreased brand and lack of draw to the best brains is yet another headwind the next CEO (I assume Ginny's days are numbered) of IBM will have to correct and it might be one of the biggest. For now it's just another death by a thousand cuts faced by IBM and its unfortunate employees done by its rudderless execs.

    • Peter, I believe you observations and insights are well stated. I, as one of those Human Resources casualties can attest these exiting days are a horrific experience. Equally painful for those staying I might add. I believe the most telling statement in your article centers on very few, if any employees, telling folks what a great company IBM is to work for. Years ago going to work for IBM was like winning the lottery. Not today! As you state the failure of IBM to recognize that its greatest commodity is its human capital is sure sign that BIG Blue will go the way of all dinosaurs into extinction. Very sad, very sad.

  • IBM's Rometty To Partners: Change Is Hard, Not Pretty. By Tom Spring. Excerpts: IBM CEO Ginni Rometty expressed little regret reflecting on massive challenges that faced IBM over the past year, telling attendees at the PartnerWorld Leadership Conference during her keynote that the table is now set for success in the year ahead.

    "Transformations are only clear when they are retold in revisionist history, never when you are in the middle of them," Rometty said. "I thank you for being part of this transformation." ...

    "We made tremendous progress transforming the business," Rometty said in her keynote address to partners. "We completely transformed the hardware business and moved to a higher value solutions." ...

    "How does IBM differentiate its portfolio in cloud, mobile, and social?" Rometty asked. She said IBM was a leader in a highly competitive landscape, adding "make no mistake, we are not a me-too option. We serve clients and we know them well." ...

    She said that IBM’s cognitive approach to parsing big data — a la Watson — gave partners a competitive advantage in the marketplace. "Yes, big data is a natural resource. But it's not worth anything if you don't refine it," Rometty said.

  • Wall Street Journal:

    IBM Sues Priceline for Patent Infringement. Company Alleges That Priceline Owes It Royalties. By Maria Armental . Excerpts: International Business Machines Corp. is suing Priceline Group Inc., claiming the online travel company built its business on IBM’s inventions and owes it royalties on the billions of dollars in revenue allegedly made from IBM’s patents. ...

    The company behind punched cards, floppy disks and the Jeopardy-winning computer system known as Watson said it first notified Priceline in 2011 that it was infringing on several of its patents.

    “Priceline has refused to engage in any meaningful discussion on the merits, resorting instead to delay and non-responsive answers,” IBM alleges in its complaint.

    A selected reader comment follows:

    • Suing over patents? Is this the new road to growth IBM has been seeking? To borrow a phrase from the movie 'Trading Places', "sell, sell, sell..."
  • Seeking Alpha:

    Can IBM Possibly Go Even Lower? By Dana Blankenhorn. Excerpts: This week is IBM's PartnerWorld event. The company has been prepping for it with a stream of press releases.

    Marriott is buying into IBM's cloud. So is Opera, the browser company. SohoNet is taking IBM's cloud to the movies, ShopDirect is buying its hybrid cloud story, and its channel organization is being reorganized.

    Please don't take all this as an excuse to buy into IBM stock, however. These press releases are not proof of growth. They're proof of desperation. Don't believe me? Former IBM lawyer Marshall Phelps wrote in his book Burning the Ships that the purpose of patents is not to troll rivals for cash, but to force your way into new markets. Nope, now IBM wants the cash, from Priceline and subsidiaries Kayak and OpenTable, too. For patents that date from the late 1990s.

    This is not your father's IBM. More is the pity.

    If your father's IBM signed a reseller agreement with Apple you can be sure it would be driving the relationship. Nope. Apple is. IBM salesmen are going on calls with Macs preloaded, by Apple, with its presentations. IBM insists its layoffs aren't nearly as big as critics insist but we are talking about layoffs in growing markets, like India, where headcount has been cut by 50,000.

    The key IBM asset today is SoftLayer, acquired in 2013. SoftLayer brings IBM some key assets, but more important an entrepreneurial spirit and corporate culture. Which is now in the process of walking out the door.

    And for this performance Rometty is getting a bonus AND a raise? ...

    This is not a growing company. Rometty is being dramatically overpaid. She has no vision, no real growth plan, and she remains what she was trained by IBM to be, a salesman rather than an entrepreneur.

    Tech companies that fail to grow wither and die. IBM has been dying by degrees for years. The only news that could really turn around IBM shares, at this point, is Rometty's resignation. Or maybe its sale to Oracle, which at least knows how to milk a monopoly.

    Selected reader comments follow:

    • There is one thing different this time around. The relationship between executive management and employees has completely changed. I fear that now the incentives that are in place encourage the executives to look to short-term gain and the way that employees are treated has driven morale into the ground. I don't see how a successful business transformation is possible without addressing this first. Executive management need to be honest and open with employees. Yes, many will lose their jobs, but if a case for change is made by the executives, employees can be still be supportive. IBM needs great leadership right now.
    • IBM has not, in the past, sought to monetize 17 year old patents through the courts. That is what patent trolls do — they suck up real innovators under broad claims and thus put a tax on innovation. In this case, IBM is acting like a typical patent troll. If they really thought their case was so great they would have filed it in 1998.
    • Everything I've written about Rometty could have also been said of Palmisano. I was leery of this appointment when it was made, but became convinced later that it might work out. I'm no longer convinced. Rometty is Palmisano with better hair and a trimmer figure.
    • IBMs "cloud" is a terrible mash-up of products that include many "bolt-on third party" solutions bought via acquisition, not through their own innovation. Some of their acquisitions were third or fourth tier companies that they had to settle for after their competitors bought the good ones. Brand can only take a company so far, then it comes down to quality and ease of use of products sold. Try some of it yourself, then compare their products against the true innovators in the space and I'd say that the author has a point.
    • SoftLayer was a good buy, but I would argue they screwed it up by letting the top management walk, even though the IBM'ers who replaced them weren't as good. It would be like buying the Packers and firing Mike McCarthy.
  • ETF Daily News:

    International Business Machines Corp. (IBM) Falling Behind The Hottest Tech Trends. By Jim Bach. International Business Machines Corp. is no Apple. And it’s no Google.

    IBM is unexciting. It’s often described as a “dinosaur” for its history of falling behind the hottest tech trends.

    As the tech sector continues to unveil sleek new devices like smartphones and tablets, and begins making forays into wearable tech, IBM is nowhere to be found. ...

    Here’s the thing – IBM has a notorious record for spotting the trends, but forfeiting any dominance due to a slow bureaucracy and a lack of zeal. This pattern often relegates IBM to a lesser role in the tech market – as a servicer not an innovator – while an Apple or a Google steal the spotlight.

    And while Apple stock is up 61% in the past year, IBM stock has slipped 11% – with more losses likely ahead.

  • Glassdoor IBM reviews. Selected reviews follow:
    • “IBM Design in Austin — think twice”

      Current Employee — Senior Designer. I have been working at IBM full-time (more than 10 years).

      Pros: Good city, lots of young designers all together, nice work space. Charismatic leader. Decent pay and benefits, especially for visual designers compared to other opportunities.

      Cons: The new designers in Austin are organizationally and physically far away from the rest of the product teams. Decent designs are being done, but they are not getting into the products. The design management has VERY high opinions of themselves, but not clear it is deserved. IBM Design in Austin has absolutely no respect for the designers who have been in the company a long time and were not hired by IBM Design. The older designers who actually know how to get things done in the company and have worked with the product teams for years are being pushed out.

      Advice to Senior Management: IBM Design is a disaster in progress. Putting all the young designers together away from the product teams and the experienced designers was a really bad idea. Confusing visual design with interaction design was even worse. Also, take a look at the diversity in IBM Design — everyone is slim, young, white, and attractive (with very few exceptions). There is something funny going on in the hiring process.

    • “IBM Strategic Outsourcing”

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


      • Work from home.
      • Still some good people left at IBM although they are dwindling quickly due to resource actions and off-shoring.
      • I believe there's still come cachet to having IBM on your resume but that is rapidly dwindling as well.


      • No raises, no bonuses, no promotions to be had in the last several years. The Personal Business Commitments (PBCs) performance rating system is now used to get rid of people with little or no severance. It is also used to "justify" no raises, bonuses, or promotions. The rating you receive has little to no bearing on your actual performance regardless of what your first line manager tells you. It's just a complete joke and everyone inside IBM knows it.
      • Off-shoring of technical support and other functions has diluted the quality of service and the customer either suffers for it and/or if they're smart they leave.
      • Morale in IBM is as low as I've seen it in the 31 years I've been there. The focus in the recent past has been primarily on share holders with customers and employees a distant second and third.
      • IBM appears to be in denial and believes that the latest efforts in cloud computing, data analytics, mobile/social, and security are going to somehow save the company. However, without reestablishing a reasonable balance between the interests of share holders, customers, and employees, nothing good will happen.
      • I believe company revenues will continue to decline until either drastic changes are made or the company is split up and sold in pieces to the highest bidders.
    • “Good work life balance but lack of interest in employees.”

      Current Employee — Anonymous Employee in London, England (UK). I have been working at IBM full-time (more than 3 years).

      Pros: Mobile work arrangements; large company with numerous opportunities to move; great pension contributions.

      Cons: Lack of investment back into product. It's all about numbers for IBM to satisfy shareholders at the expense of reinvestment into product development. Continuous hiring restrictions on professional hires. Instead, straight out of school, inexperienced or outsourced developers are used because they are cheaper but require lengthy training before contributing towards productivity.

      Advice to Senior Management: Invest in employees; invest in products. Stop buying successful companies only because you are interested in 1/5 of the company and will neglect and destroy the rest of it.

      Advice to Senior Management:

      • Start treating your employees with the respect they deserve.
      • Be honest and conduct yourself with integrity in all business dealings, including dealings with your employees.
      • Don't be a shill for the company and just do what you're told when you can clearly see something is not right.
      • Stand up for yourselves and your fellow employees.
    • “IBM is going down the tubes”

      Current Employee — Network Technician in Los Angeles, CA. I have been working at IBM full-time (more than 5 years). Pros: NONE, this company is the worst one I have worked for in 30 years. Cons: They want you to work hard for very little money. Advice to Senior Management: You need to treat your people like adults not children and tell the truth about the company and jobs.
    • “IBM Armonk is filled with kleptocrats”

      Current Employee — Software Sales Leader in San Francisco, CA. I have been working at IBM full-time (more than 10 years).

      Pros: Still a lot of great people are trying to do good work for their customers, their employees, and for IBM. They're holding out for IBM to return to the type of leadership that made it great in the past. Some of the products are world-class and haven't been too damaged yet by the cycle of corner- and cost-cutting that's taken place since 2008.

      Cons: IBM HQ in Armonk continues to focus on EPS and shareholder value to the exclusion of all else. Annual resource actions are a torpedo to innovation and morale. The only people with confidence in the leadership in Armonk are the sycophants in Armonk.

      Advice to Senior Management: Change your focus to include your customers, employees, and other stakeholders when setting budget priorities. Instead of firing people annually, encourage internal mobility to address changing business needs. Dump the rank-stacking PBC system which hurts the morale of employees as well as the managers who are forced to administer a specific ratio of PBC 3's. Give anyone who changes jobs internally immunity from PBC 3 ratings for a year

    • “Smoke and mirrors”

      Former Employee — Applications Development Specialist in East Lansing, MI. I worked at IBM full-time (less than a year).

      Pros: I thought the people I worked along side were a diverse, eager to learn bunch of folks I was more than comfortable learning and working along side. I also thought the trainer was pretty great, learning tons about Java in a short time in their class.

      Cons: The opportunities were very limited, contrary to what some reviews have stated. During my time there, I was locked out of trying to apply for open projects on their marketplace. Then I was basically forced onto a project by the center management. One, where the project manager openly admitted I wouldn't have any billable work because my rate was too high compared to developers at other centers and he needed to make a case to the customer that I could add value to justify the rate. After hearing that, it was clear I had to leave immediately because staying at IBM was guaranteed career suicide. I found a new job within the week.

      Advice: IBM is waffling too much. It seems like if they're willing to bring someone like me in with no clear vision of where I could fit, the recent decisions to restructure the company will result in the same. The employees in the various segments will struggle to find where they fit and IBM will wind up delivering more sub-par products.

    • “27 years with ups and downs.”

      Current Employee — Sales Representative in Boston, MA. I have been working at IBM full-time (more than 10 years). Pros: Good benefits. Great people to work with. Cons: Too many layoffs and then hiring and then layoffs and then hiring. Everyone is always worried about getting laid off or getting a 2 performance rating — and at least half the company gets a 2 performance rating. So half the employees are unproductive for a month or so trying to get over the performance review. Too focused on quarterly performance and not enough on long term strategy. Advice to Senior Management: Get rid of PBC performance rating system. Appreciate your employees by making them feel better than average.
    • “Too conservative, not enough dynamic”

      Current Employee — IT Specialist in Warsaw (Poland.) I have been working at IBM full-time (more than a year).


      • Work from home, flexible working hours
      • Friendly team and nice atmosphere (depends on a team you're in)
      • Decent salary if you came from another company
      • Theoretically infinite possibilities to learn things and to work on anything you ever imagine in IT
      • You could work with people from around the world.


      • You're on your own from very start. They need some crucial things from you on the first day and no one could ever help you with them. No one knows what fresh employee should do to start successfully.
      • Thousands of processes, most of them completely useless and time consuming. Sometimes you can't do your core work because of papers (!)
      • Enormous number of people that don't know what they are doing and what are they for. They waste your and their time. Random people with random minds.
      • Old and outdated, slow, inefficient tools. Everything for online working (mail, VPN, group work, documents, etc.) is terribly slow. No decent and modern tools anywhere. It's like working in the 90s. Even modern tools are slow like running on oldest hardware possible.
      • No raises, no additional motivation, no promotions, no paid trainings, benefits are decent but could be better.
      • You're treated like an amateur and beginner no matter how much experience you have already. Company doesn't trust you and they treat you like a baby.
      • Free trainings are embarrassingly weak. They are mumblings instead of pure technical training.
      • Informational and organizational chaos. It's hard to move inside the company; it's really hard to work internationally.
      • Company is very inconsistent between countries/regions. Sometimes working with team from different city looks like work with external company.
      • Nearly nonexistent second-level management. They can do nothing.
      • Too many levels of management. You're a just an "Excel cell", not a person with some abilities/experiences.

      Advice to Senior Management:

      • Appreciate people
      • Start managing and start thinking about the future
      • Be modern not conservative
      • Reduce levels of management
    • “Senior Certified IT Architect in IBM when I quit”

      Former Employee — Senior IT Architect in Poughkeepsie, NY.

      Pros: IBM was a good place to work for. I was lucky enough to be in department where my first-line manager and second-like manager encouraged me to take informed risks. I was one of the few who always got opportunities to take classes and gain new skills. There were many opportunities if you worked hard, had 3 wonderful mentors who took interest in advancing my career.

      Cons: As the years went by the company culture changed drastically, the work-life balance was bad, lots of people worked many extra hours with little or no benefit. Training opportunities, career growth opportunities went away. Team was rated with the system called PBC. Non-existent raise and bonus made the environment stressful. There was always a danger of being let go in the next round of cuts.

      Advice to Senior Management: Empower FLM (first-line management) to help the team members working under them. Don't treat the people as resources/headcount which can be eliminated to make up some far-fetched number. Invest in the people. Don't make a counter offer after the person has found another job; if you really need a key member to stay, ensure that they are happy and well compensated.

    • “IBM’s Legacy and Culture is Diminishing Rapidly”

      Current Employee — Software Sales. I have been working at IBM full-time (more than 8 years).

      Pros: There are still good people that work at IBM and they have a lot of great offerings. IBM is big enough and has enough money to sustain some of the bad decisions and strategies for many years.

      Cons: Lack of vision from the leadership, rapidly diminishing culture, and more focused on short-term stock price has put the iconic company future at great risk. I have worked for IBM for ten years and it is sad to see how quickly this company has fallen. The erratic, illogical, and unfocused change that is deemed “transformational” has put IBM on the fast track of its demise.

      Under the current leadership the services business has been highly mismanaged and it has been a distraction that replaced the core competency of IBM’s, which is creating new innovative technologies that will change the world. Customers are being managed poorly, customer satisfaction is at an all-time low, and IBM Watson is the primary new innovation that has been rushed to market too early and many of the solutions in my opinion are not fully ready for market, organization is disjointed, and it is driven by marketing and false perceptions.

      The good news is that the company is so big, it has time to get things figured out, it is not like IBM is going to fall overnight, but big changes are needed as soon as possible to put this ship on the right path.

      Advice to Senior Management: Your focus on services has been a distraction from what makes IBM great. Although services lead the growth in IBM revenues in the past, but because it has no barriers of entry and new low cost competitors have greatly impacted future growth and picked off many of your existing contracts. We lost the focus on the customer, and lost the focus of your most important asset, your employees.

    • “Good starter job, afterwards it goes down the hill”

      Former Employee — Anonymous Employee.


      • Good environment if you land in the right department
      • Depending on the department, no need for overwork
      • Good location in Bratislava.


      • Lack of prevision
      • Tons of useless procedures and checks
      • Obsolete tools (MS-DOS programs and so)
      • Company in clear troubles
      • Starter salary great, but difficult to get promotion-raise after some time
    • “They have the IT market in their hands, but it keeps slipping through their fingers due to bad management”

      Former Employee — Citrix Engineer I worked at IBM full-time (more than a year).

      Pros: Enjoyed the remote office environment and easy hours.

      Cons: Execs over sell; managers over commit; PMs underestimate and you are left on an ever shrinking team because of layoffs and attrition to deliver a solution to a customer that is already upset by the time you get to them because of all of the fumbles and additional charges that have occurred, that once they find out that they will receive the most basic of implementations by way of licensing tiers on everything they need thus ending up with something similar to a "small office" type configuration for their company by way of licensing.

      Advice to Senior Management: After having seen behind the curtain of this huge circus, I would:

      • Stop overselling to the customer just to win the bid — this is killing you
      • Hire real experienced PMs for their respective technologies so you even have a glimpse of a chance to deliver what was promised to the customer.
      • Get rid of any dead weight; most of it seems to be with management and people that have been shuffled around from team to team but really have no depth in the technology they now implement (poorly).
      • Hire real experienced people that are real SMEs.
      • Stop delivering bottom tier software on every solution you implement for your customers. I am sure this is an overlooked detail in the contracts by the client, but for heaven sakes, your customers are expecting a "like for like" functionality when you take over and when they receive bottom tier software that is more limited that what they had, and are now forced to interface with the nightmare offshore team in India for support. You have now made yet another angry customer.
      • Speaking of the offshore team in India, they serve a great role and purpose, but you are misusing them to your disadvantage. In effort to save money, you fired more every year from your core support teams until you had none. All you have now on-shore is the implementation team but no real experienced sustain teams. You now have the team in India trying to do everything and they are not only unequipped they are inexperienced and if you think your customers don't know this, you are lying to yourself.
      • Read your customer satisfaction reports for the last 3 years again and again until you finally get it.
    • “Across many years, the whole gamut of emotion — from high elation to the depths of despair.”

      Former Employee — Business Management Outsourcing in Bristol, England (UK). Pros: Despite all the adverse media comment, I remain optimistic that there still are excellent people in IBM doing amazingly innovative things for their clients, and if you're lucky enough to pitch up in the right 'neighborhood' then you can have a bundle of fun. Cons: It was getting much harder year by year to find those neat neighborhoods. What was once a globally supportive team culture was dying on its feet. Advice to Senior Management: Simple, return to the IBM Principles.
    • “Actual Employee rating, not Watson generated”

      Current Employee — Anonymous Employee. Pros: Online education, personal growth—lots of exercise swimming in heavily executive shark-infested culture. Cons: Executive decision makers have little to zero relevant technical knowledge; no tangible corporate strategy. Advice to Senior Management: Board of Directors, it is time to get rid of GR and all of her direct reports. Bring back Lance to replace RL.
    • “Mixed”

      Current Employee — Anonymous Employee. Pros: Some great people, some not so good. Cons: Driven by greed and profit; no real loyalty to staff or clients. Advice to Senior Management: Look back to your heritage.
    • “Not what it once was”

      Current Employee — Client Relationship Representative in Atlanta, GA. I have been working at IBM full-time (more than 10 years). Pros: IBM offers great insurance and the ability to work from home in most cases. Unlimited sick leave. Great training depending on your dept. Great people to work with. Cons: Yearly layoffs are no longer surprising. There is no investment in employees. Sickening minimal increases are laughable. Many jobs moved out of the US...but not identified as outsourcing because IBM is a global company. Advice to Senior Management: Tell your employees the truth...when it's time to look somewhere else, let people know. Stop bragging about how much cash we have and how many acquisitions we make.
    • “Hit or miss depending on your project & management.”

      Current Employee — IT Specialist in Bedford, NS (Canada) I have been working at IBM full-time (more than a year).

      Pros: Great health benefits. Most projects are flexible for work hours and working from home if necessary. Many projects offer training and/or travel. Lots of exposure to clients and executives. Great employees to work with and great team work. Open to work life balance including working and going to school, different schedules. Certain projects are very interesting and well balanced.

      Cons: Lots of time spent doing basic IBM training before getting on a project. Can be placed on a project where you do no work from your field of work/study. Not easy to switch projects. Not competitive pay. Lots of expected unpaid overtime and very short notice weekend work; no time off in lieu. No explicit steps to advance your career and no knowledge given about possible promotions. Not open to employee suggestions to deal with these issues. Employees are considered and treated as "productive or unproductive resources" and not as human beings with lives, families, and obligations.

      Advice to Senior Management: Offer at least higher compensation or time off in lieu for unpaid overtime. Heed employee concerns instead of letting them get tired of being mistreated and leave.

    • “Not what it once was”

      Current Employee — Compliance Auditor in Raleigh, NC. I have been working at IBM full-time (more than 10 years).

      Pros: Global company. Work with great people from around the world. 100% work from home. Good vacation package with standard holidays and some floating holidays to accommodate everyone's needs. Decent work live balance.

      Good place to spend a few years to pick up some skills but don't plan to spend your career here


      • Always looking over your shoulder wondering if you will be part of the next blood letting.
      • Reducing costs by moving work offshore or to H1B visa workers even though skilled workers are plentiful via US citizens.
      • Resource actions are not a layoff as your job is gone and they will not be calling you back if there is need.
      • Force RA'd (fired) persons forced to train their offshore or H1B visa replacements to get severance package.
      • First line managers are puppets for upper management.
      • People do not share, in an attempt to keep a leg up on their peers.
      • All the old buzz words like "respect for the individual" are history.
      • You are a commodity and not a person.
      • Moving to another position could be a death sentence.
      • Raises are few and far between for all but those considered to be top contributors.
      • The salary range keeps moving down for all levels below the letter execs.
      • Ranking is certainly not dead here.

      Advice to Senior Management:

      • Pay more attention to the company and less to the stock holders.
      • Stop spouting that there are no skilled people in the US to fill positions. There are plenty and you fired way to many good people already.
      • When you don't make your numbers...don't pat yourselves in the back and give yourselves rises and bonuses.
    • “Worst Company Ever Worked For”

      Current Employee — Principal Consultant in London, England (UK).

      Complete disjoint between senior US management and the rest of the company, pure short term-ism in their approach to satisfying their customer (the shareholder, not the true client). They erode any value from companies they buy.

      They do not care about the employee or the client, only the shareholder, and who are the biggest shareholders...the board.

      They constantly restrict your ability to do your job yet expect you to support the sales guys in selling as much as possible, even if that means giving ridiculous discounts just to get anything even if it means undermining any future market value.

      They say IBM is a great place to have lots of careers and move jobs; that's because it's full of people constantly moving and hiding when they mess things up! What about those who want to do one thing really well!

      Advice to Senior Management: Break the company up into smaller units and let them have control over their future. IBM is too big in this day and age to try and do everything for every market in the same way. You buy companies for the success they have had; let them continue that by not instilling IBM processes and controls on them!

    • “Wasn't all I hoped it would be”

      Current Employee — Software Developer in Austin, TX.


      • Great people.
      • Decent benefits (though not what they once were)
      • Reliable employer (the company isn't going to go away any time soon)
      • Good work/life balance (you go to your kids' soccer games)

      Cons: I came to IBM through an acquisition. When we were acquired, we were told about all of the great opportunities that IBM had to offer, there were sessions about advancing your career, about moving into new job roles, about becoming master inventors or senior scientists. In the end, it was all bull.

      The opportunities to move up or move into new domains are few and far between, and really come down to patronage and who you know. Most people are pigeon holed, working the same job, keeping their heads down, and hoping their product or team remain intact until they retire.

      Business decisions are arbitrary and based completely on short term results. Unless you work on a few blessed products, there is little to no innovation. And when you do innovate, opportunists step in and take over the product, driving out the people who did the original work (example...Watson).

      Advice to Senior Management: IBM used to have a reputation as a great place to work...make that the focus again.

    • “Not a stable environment.”

      Former Employee — Delivery Quality Testing Manager in Minneapolis, MN. I worked at IBM full-time (less than a year). Pros: IBM has the best talent, and the pay and benefits are quite good. Cons: Management does not make decisions based on taking care of their people or future business planning. The strategy is all about making the most profit now, and disregard what comes next.
    • “Frustrating experience, mostly Excel management”

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

      Pros: Interesting technology view and on the forefront of some of the technologies, does its best to adapt to changed environment. Work-life balance is preached, but then putting in extra time outside working hours is expected.

      Cons: The review process is very frustrating, almost no feedback during projects. Manager constantly changes which provides you with no solid person to act as a reference or provide the possibility to bond with such a manager.

      Advice to Senior Management: Get out of your office and understand what is really happening inside the company

    • “Senior SQL Architect”

      Current Employee — SQL Architect in Tarpon Springs, FL. I have been working at IBM full-time (more than 10 years). Pros: Working remotely from the home office. Cons: Forget about bonuses or raises. Advice to Senior Management: Share the wealth please. Additional you have to turn this ship around.
    • “Good people, bad company climate and bad feedback form”

      Current Employee — Anonymous Employee. I have been working at IBM full-time (more than 10 years).


      • Great people Great opportunities Global interaction with people from different background Able to work with state-of-the-art tech Learning incentive


      • PBC (annual review) is complete utter bullsh*t
      • The organizational climate can be very bad
      • Endless online trainings that do not really help
      • Too much politics involved in any career interaction — lack of meritocracy

      Advice to Senior Management: Scrap PBC; start evaluating on things people did not on the people who are good at a** kissing.

    • “No Longer Part of ISC Lansing”

      Former Employee — Applications Consultant.

      Pros: IBM Name on resume. People, projects, experience with IBM. Travel benefits.

      Cons: Salary is a joke; $42K for four years of experience with IBM. I know someone that transferred to another sector within IBM and was given the exact same salary even for transferring! You are continued to be haunted by ISC Lansing when you're no longer associated with it. Pay employees what they're worth and stop utilizing the words "low cost center" if you want to keep good hard working employees. All they care about is utilization for the center no matter what project they get you on, even if it is not in your skill set.

      Advice to Senior Management: Pay us market value, not what you call your "low cost center" pay scales. Let your employees that live on the west side of the state of Michigan have the same convenience of not having to drive to Lansing and work from home/Grand Rapids like you choose to give the employees that live in the Detroit area at the office in Southfield. Fair is fair. Everyone should adhere to same location if you're going to require them to work from Lansing at least 3 days a week.

    • “IBM was a good company”

      Former Employee — Project Manager in Phoenix, AZ. I worked at IBM full-time (more than 10 years). Pros: Good benefits, salary and internal job opportunities. Cons: Culture moving away from a teamwork environment. Constant threat of outsourcing and layoffs each year. No pay raises. Advice to Senior Management: Get back to basics and place value on the employee as it is the employees that make a company successful, not accountants.
    • “Back in the days...When we used to...”

      Current Employee — Anonymous Employee. I have been working at IBM full-time (more than 3 years). Pros: Great technology, great services proposition. Cons: Too many managers who have never actually done the work that the teams they manage have to do. Result: inadequate management that is oblivious. Advice to Senior Management: Get in the experts. At every level, for every role and function. Do not promote those that have been with IBM for too long; hire and promote those that really make a difference!
    • “Incredible place to be a Designer!”

      Current Employee — Anonymous Employee. I have been working at IBM full-time (more than a year). Pros: Horizontal leadership; you can approach the studio director and other management directly. Not typical at a company like this. You get to use the best tools available and the studio is cutting edge. Cons: Working with corporate IBM is awful — politics and bureaucracy is suffocating. Inside the studio though it is totally different.
    • “Company in Transition”

      Current Employee — Project Manager in Atlanta, GA. I have been working at IBM full-time (more than 10 years). Pros: Good work/life balance and ability to work from home. Cons: Promotion requires a lot of red tape. PDFA or promotion process is difficult. They need to streamline it. Advice to Senior Management: Need determine future of Cloud and outsourcing businesses .
    • “Great Company”

      Former Employee — Software/Systems Test Engineer in Austin, TX. Pros: If you are starting your career this is the best place to start. Cons: Didn't see any cons in my time. Advice to Senior Management: Keep up the good work.
    • “Once a Great Company”

      Former Employee — Market Management. I worked at IBM full-time (more than 10 years).

      Pros: Smart, talented employees; Flexible (remote) work environment; Intellectually stimulating projects; Global reach.

      Cons: Constant financial engineering, layoffs, cost-cutting, low-ball performance appraisals, offshoring, use of landed resources...all destroying the culture of a once-great technology company

      Advice to Senior Management: Value customers and employees above shareholders. Apply the same age and seniority criteria used to lay off experienced employees to the senior executives.

    • “IBM Brno”

      Current Employee — IT Specialist in Brno (Czech Republic). I have been working at IBM full-time (more than 3 years).


      • access to the latest technologies
      • if you want, you can learn almost everything (and switch the team)
      • lot of smart guys around
      • home office possibility


      • no education budget, no internal/external technical education
      • no benefits at all, no meal vouchers
      • hiring freezes, (if somebody left from your team...well, you have to do work instead of him)
      • first-line managers just bringing bad news from higher management
      • almost no salary raise (even if you are promoted)
      • stupid PBC system
      • no retention policy in place (they can always hire somebody from countries like Bulgaria or Romania)
      • noisy, crowded open space
      • really huge amount of bureaucracy
      • obsolete and slow IBM tools
      • no team-building, no budget for anything, no bonuses in last years, cutting costs everywhere.

      Advice to Senior Management: Please, keep in mind that people are not just numbers behind computers, but your most valuable "asset". You can't make customer "happy and first" if your own employees are unmotivated and living from salary to salary. Recognize the top guns; say "thank you" after successful project implementation. And, mainly start investing to your own people, their training and career development, and motivate them.

    • “Not what it once was”

      Former Employee — Executive Project Manager.


      • Overall benefits were good; compensation was decent but not keeping pace with market for last many years
      • Lots of talented colleagues.


      • Poor morale
      • Endless hours — on call 7 x 24 — no down time
      • Meaningful performance bonuses and salary increases were non-existent
      • Customers not seeing the value from IBM that once was industry leading.

      Advice to Senior Management: Treat employees like the valuable assets they were once considered to be not like consumables. Continuous focus on cost reductions has had a detrimental effect on both employee morale and customer service.

    • “Innovative, market focused and global competitor.”

      Former Employee — Business Unit Executive in New York, NY. I worked at IBM full-time (more than 10 years).

      Pros: IBM respects the individual and provides excellent career opportunities. Personal development and work-life balance are primary elements every IBM people manager is expected to work with employees on. IBM has great career growth opportunities and a broad range of career paths.

      Cons: Over time the benefits have been reduced but frankly the global market drives compensation so blame the economy not the company.

    • “Challenging, lot to learn, no work life balance”

      Current Employee — Anonymous Employee. Pros: many opportunities to learn and get exposure to various technologies and industries, fair pay. Good health care plan. Cons: You can get lost in the ocean. No direct transparency between manager and employees. Expected to work more than 45 hours a week; no work/life balance. Taking vacation affects the utilization which directly affects salary.
    • “Sinking ship”

      Former Employee — Sale Manager in Singapore (Singapore). Pros: Its name, International Business Machines that everyone knows. No need to explain the company. Cons: Almost everything except its name. Advice to Senior Management: Stop doing make-work. Do real work. IBM should not be run in the interest of shareholders.
    • “A wonderful company hamstrung by layers of clueless, bumbling middle management.”

      Current Employee — Cyber Security Engineer in New York, NY. I have been working at IBM full-time (more than 10 years).


      • Good, but not great, salary.
      • Above average job security. Many job opportunities.
      • Generally good, if somewhat thread-worn, working conditions, and work from home opportunities.
      • Company is starting to understand that moving work to China and India is a disaster.
      • Flexibility in work hours and time off
    • Cons:

      • Company is not committed to employee training; no rotations, online training is just window dressing.
      • Bad management, especially unnecessary layer upon layer of ignorant middle management, permeates much of the business.
      • Constant, slow decline in employee benefits.
      • Only a 401K retirement plan. Company match is not credited to employee until December.
      • Management's constant nit picking, over-reporting to each other, and distraction from job assignments.
      • The PBC annual evaluation is ineffective window dressing; it is simply a compensation management tool.
      • Silly budget constraints on travel: forced to fly at inconvenient times, stay in sub-par hotels, and rent undersize cars.
      • Constraints on conference attendance impede ability to stay current and maintain network.

      Advice to Senior Management: Get rid of unnecessary middle management layers that impede progress. Commit to training employees to expert level in their job areas. Get rid of silly expense constraints, and let employees find the best travel bargains to suit their needs.

    • “Software developer”

      Current Employee — Software Engineer in Bangalore (India). I have been working at IBM full-time (more than a year).

      Pros: Good work environment. Bad management. Should learn from Google and Microsoft on how to treat a employee. Very old technology is still in use. Compensation is bad.

      Cons: Benefits: not much as expected. Perks: do not remember any of them. Company values: I haven't seen any value as such.

      Advice to Senior Management: Please stop the company.

    • “Treated as an expendable 'resource' — no longer enjoyable to work”

      Current Employee — Senior Program Manager in Perth, Western Australia (Australia). I have been working at IBM full-time (more than 8 years).

      Pros: Name recognition on CV is perhaps one of the few advantages for having worked at IBM. Personal network of professionals.


      • Too many levels of management; slow to respond to customer requests for support, new deals
      • We've lost the plot in making our client #1; instead, we're more focused, too focused on shareholder earnings per share
      • Our Leadership has forgotten a basic tenet — if we don't have satisfied clients, our EPS will soon follow (downward spiral)
      • Out-of-balance compensation adjustments; our CIO, leadership should NOT be getting a bonus, salary increase while telling the actual work force that we had a "bad year", and thus won't be able to reward/compensate you as much as we had hoped in 2014.

      Advice to Senior Management:

      • Enable your front line team (PMs, architects, BAs) to make decisions quickly for the client rather than falling victim to Risk Management/QRM/SDM GPE enforced QAs, pricing checks
      • Shakeup/challenge existing processes, driving for more efficiency and quicker, client focused results
      • Basically, "eat our own dog food" and practice what we sell/deliver to our clients (an efficient, productive, solution)
      • If we can't manage ourselves efficiently (and fairly - to our fellow team members) then I would have zero to little faith that you could deliver the results you've promised me as a client.
New on the Alliance@IBM Site

Job Cut Reports

  • Comment 02/07/15:

    There needs to be a class action by IBM employees to force out into the open the mechanism IBM is using to separate employees. It's certainly unethical and borders on illegality and misleading business conduct. A class action would force exposure of the real process and email between the senior executive and the HR 'advisors' that collude in the using PBC to force uncompensated and unwarranted dismissal sham. It would also provide the basis for IBM to be forced to compensate billions back to all the ex employees that were unfairly dismissed or denied fair and transparent measures and payment for contribution.

    How the PBC mechanism works and what its intent is: The PBC (personal business contribution) ranking is quota driven — heavily masked by very senior management to be a committee and ground-up appraisal and comparative ranking. What happens is a PBC quota for 1, 2+ is set from USA and then AP HQ for Australia. This is done in October then refined in November, months before any employee or first-line manager interaction. The quota is 1 (5%) and 2+ (20%) Then the rest of the 75% staff have to 'fit' into what was the remaining 2 (60%) and 3 (15%) quota ranking. A person that is 2 is able to claim to be made redundant. A 3 is basically getting readied to be sacked for non performance and save IBM money.

    In the last two years IBM reduced the quota of 2's from 50% to 35% and increased the 3's from 15% to 30% to save money on redundancies. Basically, it's set up so nearly on- third of staff can be fired without compensation or cost to IBM. The PBC process is like something out of a Monty Python movie. The PBC Quota is imposed top down. The manager already has submitted their rankings to the top-down quota edict long before the employee even submits their view on performance. The PBC discussions are a sham cover and then the first-line manager (and second-line and third-line, etc.) are told to assign PBC rankings to the top down quota edict. -PBC Class Action?-

    Alliance reply: Class action lawsuits against companies that are "at will" employers are rarely actionable in terms of a company that "breaks its own rules". This is the case in IBM U.S. (We are not completely aware of "class action" legal specifics in countries outside the U.S.). The PBC process, while seriously flawed and in IBM management's complete control, is still part of the at will employee's process.

    IBM can operate the PBC any way they choose, without violating U.S. federal and state labor laws to the extent that a class action would be an option.

    Please take a few minutes to read through our Job Cuts Reports current comments (this page) as well as our archives, using the search or 'find' with the key words 'class action': Job Cuts Archive most recent *Job Cuts Archive #2 *Job Cuts Archive oldest.

    You will find several examples and several comments that suggest what you are suggesting, and you will also see responses from Alliance@IBM that explain why class action lawsuits require extensive effort and cost, as well as attorneys willing to take the case. Filing class action lawsuits against IBM has been tried before. The success rate is dismal and is not the best option for IBM employees seeking damages from IBM for their termination for cause or layoff (firing, RA).

    There are always exceptions; but historically, most class action lawsuits against IBM, fail.

  • Comment 02/0715:

    Replying to Sacrificial Lamb: In United States v. Quality Stores (2014) the U.S. Supreme Court unanimously held that severance payments are "wages" and subject to FICA (Social Security and Medicare) tax. Oddly enough that's mostly good news for workers. Notably it means that IBM must kick in the employer's share (6.2% for Social Security and 1.45% for Medicare) above the "advertised" severance amount, just as with a regular salary paycheck.

    Since most of these current firings are occurring early in the calendar year, that also means calendar year 2015 should go into your Social Security earnings history at least as a decent year, depending on your severance amount. That boosts your future Social Security retirement benefits, and it also helps workers who haven't vested yet in Social Security and Medicare to make sure 2015 is a full 4 credit year. And it pushes out expiration of your Social Security disability coverage if you face long-term unemployment after IBM. [Or if you start another job your severance payment counts as income toward your annual Social Security earnings cap, so if you're lucky enough to reach $118,500 (2015) in earnings including your severance payment you won't pay the Social Security contributions on earnings above that amount for the rest of the year.

    Some people might be lucky that the severance pushes them over the cap for the first time in their careers.] The major disadvantage, of course, is that your net severance payment is reduced by your share of FICA contributions. -FICA Answer-

  • Comment 02/07/15:

    It seems odd to be talking about Medicaid in this discussion. But it's well worth mentioning since a lot of people don't know about recent changes. Among the many improvements in the Patient Protection and Affordable Care Act ("Obamacare") there are no longer asset tests to enroll in Medicaid.

    Medicaid eligibility just depends on your income now (and obviously IBM isn't helping). You can be a multi-millionaire but have low income and thus qualify. You're much better off in states that have expanded their Medicaid programs. In those states you can have earnings up to 133% of the federal poverty line and qualify for Medicaid. (Even higher than that for children and pregnant women.)

    So take a look at Medicaid in your state (or in another state) to see if that works for you and your household. As for any stigma, please don't worry about it. Everybody deserves medical care, even if they're out of a job. You paid for this benefit, just as you paid for Social Security and Medicare. Don't hesitate to take care of yourself and your family. -Medical Advice-

  • Comment 02/08/15:

    IBM will save a lot of money by using these landed workers. Besides the salary, there is much hidden cost. I used to work a project at a client location. In that IBM group, about 1/3 were landed workers. IBM only needs to pay the apartment rental for these foreign co-workers, but for US employees, IBM needs to pay flight, hotel, meals ($35-55/day), car rental and maybe mobile. From a technical perspective, as a technical worker, in general the technical skills (in same band) of the US employees were much better than these landed workers. As an example, I spent a lot of my time to help a person from India. I just checked this person's data in BluePages. It seems like his department mates are landed workers. I don't think these people will be RAd as so many US employees were asked to leave. -Anonymous-
  • Comment 02/08/15:

    -To needToKnow- I am not a legal person but I can tell you what happened to me regarding short-term disability. I was out for 5 months on STD from December 2007 until June of 2008. I came back and was working from home from June of 2008 until I got the call in April of 2009 that I was selected for an RA. At the time I had 28 years and 9 months. I was 3 months shy of being able to bridge for retirement.

    An old second-line manager of mine who was then a VP in another group told me to re-apply for STD. I had enough STD time left to cover the 3 months I was short. I had my doctor fill out the form that my condition made it impossible for me to travel or work in an office. I was re-approved for STD after my case was reviewed by the IBM Medical Director. I remained on STD until; then I came back to finish my 30-day RA period for one week in August of 2009. Then I was within my one year for a retirement bride.

    My RA date was reset to the date after my return from STD. I was able to take the RA package, go on an 11-month bridge to my full retirement in 2010. I got to keep the FHA and am collecting my pension. Everyone says I beat the system. Truth is I should have not come back after my first 5 months. I should have gone on Long Term Disability, but I wanted to work. Now I am getting Social Security Disability along with my Pension. -Gone In 2010-

  • Comment 02/08/15:

    The odds are poor that you will find a internal job after being RA'd. I would suggest using the 30 days to search for a new job. Updating your resume, prepping for interviews, expanding your network, etc. are all better usage of your time, as well as taking advantage of your remaining benefits (use all HCRA funds, take out a HELOC/refinance, etc.)

    Also stop doing all IBM work when RA'd, or at least just doing the minimum. Your job is now to find a job, 100% of the time. While internal jobs look attractive, what happens if your 30 days are up and you have not focused on finding an external job? Time is your most precious commodity.

    Personally I gave myself 2 days, scouring the IBM jobs database. Found several jobs that I could do but never applied. My rationale was "If I get an internal job, what's to prevent them from laying me off again?" It was hard — sleepless nights — but in hindsight I definitely made the right decision. Best of luck to you. -Anonymous-

  • Comment 02/08/15:

    Another major problem with IBM is that employees can't debate or argue with their direct managers. Managers don't want to hear the reality or the truth. Managers want you to have the same opinion as they do which of course kills any real innovative thinking! Also, don't ever try to go above your manager...I learned a hard lesson. As much as IBM states they are fair, they are NOT FAIR! Managers want 'YES' people and they want to look good to their managers even when they steal your ideas to make it their own! I believe IBM will transform itself yet again but will hurt and damage many employees. That is how they play the game! -Glad to be Gone!-
  • Comment 02/09/15:

    To Anon2: Why would your son even consider working for IBM when he had a degree from Oxford, especially when you already knew what a crummy place IBM really is? If it's about H-1B, there are plenty of other companies to work for than IBM. The very reason so many of us are still here kicking and screaming is because most of our skills acquired at IBM are not marketable elsewhere or we would have left in a heartbeat, and IBM knows that. So, don't let your son grow up to be an IBMer. There is no education in the second kick of a donkey. -Mike-
  • Comment 02/09/15:

    If I join CWA 1701 as a full, dues-paying member, am I protected in _any_ way against IBM's unjust practices? If I go public with my membership does that help (or perhaps hurt.?) my chances of staying employed? I need to understand clearly what benefit or harm I can create. Thank you for everything. -want_better-

    Alliance reply: The Alliance president, the vice president, and secretary are current employees and have been public members of the Alliance since 1999. Other members have also been public. As a member of the Alliance you are under the jurisdiction of US labor law which gives you the right to help organize your co-workers. Of course there are rules and regulations you must follow and all new members that choose to go public must contact Lee Conrad national coordinator before they make that move.

    Can IBM fire you for work related offenses? Of course. You are still an "at will employee". But if they harass, intimidate you or take other actions because of your organizing activities then the Alliance will put you in contact with our legal team. They only work on issues related to the National Labor Relations Act. Staying employed inside IBM is something no one can guarantee anymore. But isn't it better to go out fighting?

  • Comment 02/09/15:

    To -needToKnow- Short-term Disability (STD) Benefits and the US federal law known as FMLA (Family and Medical Leave Act) are two different things. Under FMLA, you are allowed 12 weeks of UNPAID leave to deal with your or your family's medical issues. Note that the law simply ensures that you will have a job when you return from leave but the law does not force the employer to pay you anything while you are on leave. Further, an employer is allowed to fire you even after you go on FMLA if the firing is part of a larger reduction-in-force driven by business imperatives.

    In your particular case, you have two problems. First, you aren't even on FMLA yet and you have already been given a notice that you will be fired on Feb 27. Second, your firing is part of a larger reduction-in-force anyway. So, FMLA will not protect you from getting fired on Feb 27.

    STD is a benefit that pays you a monetary amount while you are on leave due to short-term disability. When people go on FMLA, it is the STD benefit that pays them money while the FMLA protects their job. Note that STD benefits stop when your employment is terminated. In your particular case, as explained above, your employment cannot be protected and will terminate on Feb 27. If your last day is Feb 27, you may still apply for STD and your claim may still be approved. However, your STD benefits will end when your job terminates on Feb 27. -Legal Exporter-

  • Comment 02/09/15:

    RA'd Feb 2015 (2014 PBC: 2+). Past PBCs: 1, 2+, 2. 36 years with IBM PhD/Patents .Age: 60. Div 1G. NY: Somers. Retiring now. -Anonymous-
  • Comment 02/09/15:

    -needToKnow- FMLA is 12 weeks eligibility on a rolling calendar base meaning once you start it, say on Jan 15, 2015, it gives you 12 weeks eligibility until Jan 15, 2016. In small (less than 50 employees) or large companies (IBM) you have to be employed for a particular minimum period of time, 20 weeks I believe. If you are on IBM STD you can be RA'd while still on it. When you return to active work status back from STD then you are typically, summarily RA'd same day, sometimes before you get your morning coffee.

    If you are on STD when RA'd and apply and get IBM LTD (to see if you can keep your job and beat the RA) you basically are off the IBM payroll since it becomes a disability insurance case. So IBM basically says you're too disabled to work for them. So you can't beat the RA that way.

    New York State has its own State Disability Insurance (NYSDI) that pays you a portion of your working wages when out of work for a medical condition. But it too does not protect you from an IBM RA. -FMLAvsIBMdisability-

  • Comment 02/09/15:

    So if companies routinely blatantly and brazenly break the H1B visa laws, why aren't they losing lawsuits left and right over it? BTW, I have a friend who worked for nearly 2 decades at a large company that laid off/outsourced major departments. There was a class-action age discrimination suit brought against the company - and won. She received a check for $6.80 when all was said and done. -IBM = Idiots Become Managers-
  • Comment 02/09/15:

    I too was given a 3 PBC which was completely made up of lies, such as "not focused", etc. I am soooo happy to be gone from India Business Machines. Remember that you were not "laid off"! Layoff refers that your job isn't needed at this time and you will have a chance to come back later...you were "FIRED". IBM doesn't treat humans as assets, like the military and other companies. No, they treat you as a resource, a disposable resource like an empty roll of toilet paper. Be happy that your nightmare is over. Get a new job and try never to give IBM a second thought. They aren't worth the effort. -Firedin2014-
  • Comment 02/09/15:

    H-1B visas, illegal immigration,offshoring of jobs will ruin the middle class in this country. Without a union in this company, this will continue. The face of IBM will completely different in 10 years than what it is today. The kids in the future are going to find it very difficult to find well paying jobs. Without a union, greed and corruption will continue to ruin IBM. -ANA-
  • Comment 02/09/15:

    For those folks that are part of the recent RA and also were part of the GTS SO US skills measure announced last fall which reduced our salary by 10% to allow for up to 1 day to focus on learning and improve skills — Is there any suggestion on how to submit a formal complaint? Why are we being penalized twice — losing our jobs and at the same time having our salary reduced by 10%? We weren't even given a chance. We were forced into a layoff. Why do we need to pay IBM 10% of our salary? -doublewhammy-
  • Comment 02/09/15:

    17+ years, always a 2. Never got a 3 until now. On my last day, 17+ years of experience is going with me. -Anonymous
  • Comment 02/10/15:

    I am not an American (citizen of an OECD country) but graduated (Masters in CS) from one of the top schools in the US and pretty quickly realized, that the whole H1B game was stacked against American workers and smart foreign workers who graduated from good (top 10 CS) US schools. I moved out of the US pretty quickly and have not looked back since. Cheap labor imported by way of H1B visas is killing US middle class IT workers. Not to mention that it is having a negative impact on the quality of IT workers employed in organizations such as IBM US. -Anonymous-
  • Comment 02/10/15:

    Based on the new IEEE Spectrum article by Tekla Perry, it seems that IBM's plans to stretch that $580M fund into a much more massive layoff by only providing 4 weeks severance were thwarted because legal was worried about some aspect of that. Makes sense that that's what they were up to now. I guess because that plan went out the window, they got desperate and devised the 'plan b' to get rid of folks by downgrading performance rankings and other devious means.

    It all seems clear now. They are in trouble-now going after other companies for patent infringement, and reportedly the big upcoming conference Feb 22 has abysmal registration from customers, who are busy talking to competitors. The only salvation for this company is radical change - at the top, and gain back the hearts and minds of it's employees. I think we are all willing to act now, even if it means 'outing' ourselves, we just need guidance from the Alliance, and please folks, keep signing up here. Strength in numbers! -LowMorale-

    Alliance reply: Anyone willing to help organize in IBM please contact ibmunionalliance@gmail.com so we can discuss.

    The thermometer was started before the job cuts. It is a membership drive to support the Alliance. We also encourage employees to join as subscribers/supporters, which is free. The people who sign up in all 3 categories shows us the level of support for a union. Majority support at a given IBM location or division will trigger the process for a union election.

  • Comment 02/10/15:

    Re whether it's worth it to look for a job within IBM after you've been identified for the RA: I think it depends on how much you want to stay in the hell hole that is IBM. I think there are valid reasons, especially financial ones. If you want to stay, then you have only a very short time to try to secure another job within IBM. Personally I would take advantage of this time. If nothing comes of it, then at least you'll know for the rest of your life that you tried. -Anonymous-
  • Comment 02/10/15:

    One important thing — make sure you call IBM Service Center and activate your COBRA heath insurance. I found out the hard way. I broke my ankle on March 29th; RA date was March 31st. Had surgery on April 3rd. Papers came back that I did not have coverage. Called IBM Serv and a very nice gentleman told me that they do not tell us that in the package nor our managers. He reinstated me since it was not past the 30 days. If you do not reinstate after 30 days you can not activate COBRA. If I would not have broken my ankle and needed the coverage I would have probably not thought about it and would have fell into IBM's hope we will not do it. Pretty dirty I say. The HR guy agreed with me. I have the paper trail and documentation to back this up. -Gina M-

    Alliance reply: Thank you for sharing this information. Apparently, no behavior is beneath IBM HR or executive management. This is why the IBM workers need a collectively bargained contract, so they are protected from this skulduggery.

  • Comment 02/10/15:

    For those who will be encouraged by brokerage firms to switch 401K to IRA, please make sure you do good research. IBM 401K has been ranked very highly by Brightscope and from my experience in 2009, brokerage firms (in my case Fidelity) will encourage you to switch to an IRA and higher fees. Here is the link: http://www.brightscope.com/401k-rating/43285/Ibm-International-Business-Machines/43863/Ibm-401K-Plus-Plan/ Good luck -Anonymous-
  • Comment 02/10/15:

    IBM attempting to generate "billions in revenue" by becoming a patent troll. http://www.wsj.com/articles/ibm-sues-priceline-for-patent-infringement-1423529125. IBM is suing Priceline Group Inc., claiming the online travel company built its business on IBM’s inventions and owes it royalties on the billions of dollars in revenue allegedly made from IBM’s patents. -Anon-

    Alliance reply: This is not surprising to some of us that worked for IBM 30-40 years ago. While working in development engineering, there were several engineers that applied for patents at least 5 times a year, depending on what technology or program they were developing. Many of these patents went nowhere but "on the shelf" in IBM. And, those IBMers did not retain sole ownership with IBM...they had to share ownership, as it were. It's not surprising that IBM would search its patent archives to find out if any of them can be used to make IBM revenue, instead of actually making a product or a service that IBM can sell and make a profit. Sad.

  • Comment 02/11/15:

    Left IBM on my own after 15 years and have several friends still there. I've heard 2 separate suggestions from a first and second line manager there that the RA's are being spread out to avoid the "mass layoff reports" rumoured earlier. IBM's Federal group is scheduled for Feb 24. -Anonymous-
  • Comment 02/11/15:

    Helpful tip: It's too late for those being RA's this round, but if you think you may be RA'ed later this year, consider increasing your exemptions and 401K contributions now. Increasing your exemptions gives you extra cash now in case you need it. Otherwise you have to wait until next year for a refund when you file your tax return. -CPAguy-
  • Comment 02/11/15:

    Why doesn't the City of Dubuque and the State of Iowa go vigorously at IBM for breaking their employment agreement? Sounds like Tulsa, OK all over again. Watch out Columbia, MO; you're next. IBM makes more promises it never intends to keep. -MakeBluePAY-
  • Comment 02/11/15:

    To "LowMorale". I was under the impression that the "original plan" was to do the RA, then to supplement with assignment of abnormally high numbers of "3" PBCs that immediately translate into 30-day PIPs that are impossible to satisfy. Management would offer the 4 weeks severance to those who get the "3" PBCs so that there was another option instead of being fired for performance reasons. Not all PBCs have been completed yet. -Sad-
  • Comment 02/11/15:

    Never been a 3 in my career. Not happy with my 2 last year, but after being moved to a new group and being the low man on the totem pole, as an ex manager, I remember the ratios etc. So I thought that a 2 would be safe...nope.

    So after almost 29 years with the company and almost 54, I was given my walking papers a few days back. In discussion with others, I was advised that in your benefits portfolio in NetBenefits is a "Future Health Account" that IBM puts $$ into every year and when you retire you can use it for medical payments. I looked at my portfolio and there is over $30,000 in it for me at retirement. Wow maybe some sunshine in all this.

    OK, here's the kicker. You must retire to get this money. In my case, with the 1-year bridge, I will fall 45 days short of being able to retire and will not get that $$ or any other retirement benefits. 45 DAYS. I asked my manager about it and to see if he could ask for a 45-day extension. His answer was that he could not justify it. Nice! So after almost 30 years (more than half my life) with the company, this is the send off. -Kicked While Down-

  • Comment 02/11/15:

    To those RA's and whose jobs at IBM will soon be over, DO NOT GO QUIETLY! Raise a little hell before you go. On your next to last day send emails to your co-workers and urge them to join the Alliance. Wear black and blue to signify the mugging of IBM workers. Other suggestions anyone? -anon-
  • Comment 02/11/15:

    There may be something to the post that said there will be staggered layoffs each month, including Federal in a few weeks (although that date is right in the middle of the big conference). Something is amiss, because I and others do not have their PBC rating yet, and it's well past the due date and nobody is making a fuss in the management ranks like they usually do.

    I don't have my PBC goals for 2015 either, and we're almost two months in. So it's being held back for a reason, probably to assign more 3's and the door soon. It seems like folks are still being notified, but the posts here are a little vague as to whether these are new notifications or the poster is just getting around to putting something here.

    Can everyone please indicate the exact date you were notified so we can figure out what IBM is up to? In the meantime, keep the thermometer moving and please continue to join our ranks! -WaitingForACallFromMyManager-

  • Comment 02/11/15:

    The U.S. economy is broken and the issue isn't just IBM. Executives no longer get paid based on the true value they deliver to society. They can ruin a once great company in a year and still get a raise so long as they meet very short-sighted margin expansion goals at the expense of the company's future. It's time for everyone to write their congressmen and tell them that its time to reign in on executive pay. -Anonymous-
  • Comment 02/11/15:

    I too believe the RAs and other firing activities are going to be spread out. Heard more notifications coming in March. Don't wait; get started with your own Plan B folks. -Anonymous-
  • Comment 02/11/15:

    -anonymous- Yes, managers can and do get 3's. I know of more than a few that did over the past few years. Now, that said, none were above 2nd line that i knew of. But it does happen. -managerscanbe3-
  • Comment 02/12/15:

    Kicked while Down. I believe you also must be 55 to get the FHA. Even if you had 30 years you would not have qualified since you are only 54. There does seem to be a trend to RA people under 55 to save the FHA payments. -recentretired-
  • Comment 02/12/15:

    New IBM Systems group in the UK announce 30 consultation period — almost certainly around redundancies. -Anonymous-
  • Comment 02/12/15:

    I agree that these must be 'rolling' layoffs overs several months, for all the reasons noted already. I too have not gotten my 2014 PBC back (nor my 2015 goals) and my manager said that my PBC assessment hasn't been approved yet. Not sure if that means by 2nd line manager or HR? So...I'm expecting the worst. -Anonymous-
  • Comment 02/12/15:

    The Apple comments are interesting, given they declined to participate in IBM's biggest conference of the year, which is just over a week from now. With all the ballyhoo about this 'partnership', wouldn't you think they'd be front and center? With attendance way below expectations, and moving it to February rather than in spring when it usually is, what a fiasco it would be if there was another big storm in the midwest and northeast and the few that did sign up couldn't get there.

    Fight the PR machine that they are attempting to use to humanize Rometty and provide cover for these actions they are undertaking, and sign up for the Alliance. We are building momentum, don't let it die. It feels good to be wanted, it feels good to belong, and it really feels good to fight back against these greedy, non-caring individuals. Fight to organize, fight for your jobs, fight for those who have been cut.

    If you have been RA'd, make a call to MoneySmart to get financial advice. Talked to them yesterday, and they have been inundated with calls from IBMers getting RA'd. The person I talked to told me one woman was a month from FHA eligibility. Evil. -HelpYourself-

  • Comment 02/12/15:

    To -RAed2015- regarding coming back as a contractor, read the portion of the RA packet dealing with severance and repayment. In 2013 the packet mentioned the conditions under which repayment was required: if you returned to IBM within the number of weeks covered by your severance payment, you would be required to repay an amount reflecting the remaining weeks. Thus, if you were paid 20 weeks and returned after 15 weeks, you would have to repay 5 weeks.

    It also stated that the repayment was required if you were returned to IBM by being hired directly by IBM or through a third-party agency. This is very unfair — why should you have to repay any amount? The payment was part of you leaving IBM. When you sign your separation papers and are given the checks, you are no longer an IBM employee. If you are rehired by IBM, your service date is reset as there is no credit for your prior years of service. You do not lose any defined benefits you left IBM with (pension, etc.) but as far as vacation and the number of years of service that you have it is as if you never worked for IBM before.

    So, you will need to work at least 15 years in order to qualify for FHA (assuming you are 55 at that time) no matter how many years you had already worked for IBM. If you get RA'ed again, your years of service would be based on your rehire date. -OutIn2013-

  • Comment 02/13/15:

    -managerscanbe3- Sure one knows IBM managers do get PBC 3s but the vast majority are first-line managers, no doubt. How many IBM directors and above get or ever got a PBC 3? That is the real rub. Well if you know this and are an IBM manager you broke Section 7 of labor law by replying here with this fact! -Anonymous-

    Alliance reply: The key thing to remember about IBM executives is that they are bound by an "employment contract" that stipulates THEIR responsibilities and performance. It's a rigged game, because the executives are able to "massage" their performance results with excuses that are never challenged by the BoD; especially because some of those executives have 'friends' on the BoD. The PBC system is for the "little workers" in IBM that don't have a voice or a choice in how the IBM rules are applied and executed. It's a rigged game. IBM employees need a contract.

  • Comment 02/13/15:

    -RAed2015-: Usually after six months you can come back as an IBM contractor after being RA'd and not pay back severance if IBM is willing to take you back and you are willing to put up with more of the BS of working from the outside in IBM. -BeenThere-
  • Comment 02/13/15:

    -LookingForATransfer- This is the story. The position I will be RAd from used to belong to GBS and it was moved to SO/GTS at the end of last July. In other words, I only knew my current first-line manager for a few months. I even never even saw his face at all. Before I applied to these two positions in last Nov, I told my FLM about that I would like to look for other opportunities in order to help my career grow. He made some very nice promises and encouraged me to do it.

    The main reason for me to turn down my first offer was that I had more interests in the Cloud. I was also confident about my technical skills and performance. Until now, I still do not know what my FLM really told that hiring manager that made the hiring manager change his mind in two days. I once asked my FLM’s thoughts about my performance, he replied that “you are very good…etc” . He also told me that he would help me by talking to the hiring manager for that position.

    After a few days, then, he told me that “the position is frozen due to the end of year"; “they will consider you next year…” The biggest mistake I made was that I should have recognized my FLM falsehoods and left him earlier. My personality is very trusting of other people. It is why I am so hurt right now. -Anonymous-

  • Comment 02/13/15:

    I was with IBM since the late 60's. I was very loyal, dedicated, and gave lots of overtime, when it was required. Seeing what has become of IBM today, is like having a death in the family. It is just so sad. The lack of morals, integrity, competent management (remember this one?), respect for the individual is simply tragic. -Another Anon-
  • Comment 02/13/15:

    Yeah you can work for IBM after you get a severance package but it's now a year and a half from the date your package ends so if you get 6 months pay then your year and a half starts after the 6 months, so 2 years. -whatever-
  • Comment 02/13/15:

    I'll never forget when Ginni sent an SVP/DE from Austin out to 'win' us over, after they purchased my company about 19/20 months ago. I asked where he thought IBM would be in 5 years, his reply was "At about $320."

    I knew then I was talking with someone that was more concerned about his retirement in the next five years, then the technological position of the company.

    Twenty months into that 60 months, and well, Scott, I think you're off on your prediction. As it went from $212, to what, $156? Must be nice being part of the 'good ol boy' network. Eight years at SoftLayer; was considering 30, but this is not the company I want to grow old with anymore. You're pushing your old talent out the door, and making the new talent want to leave. -Anonymous-

  • Comment 02/13/15:

    As I read these blog posts I am watching my IBM inbox and listening to my new FLM (6th in 10 years) in our weekly phone meeting. The emails coming in are all the same-old-same-old propaganda about how we have to work smarter, faster, better. My FLM is telling us the same thing over the phone. What is not said is how we the IBM technical specialists can overcome the massive road blocks to our success.

    The road blocks are NOT our demanding customers, the changing IT landscape being ushered in by the new "Cloud" technologies or our being lazy and unmotivated. The road blocks are caused by 10 years of giving all the profits to the stock holders and senior management and NOT putting any money back into improving products, support and people. So, both employee and customer morale and approval of IBM is zero or close to zero.

    As I read the emails and listen to my manager, I see how badly they understand the huge crater they made of this company and they continue blindly (see no evil, hear none, speak none). As I recall it, as the Titanic was sinking, the captain and crew were rearranging the deck chairs while ordering the band to play "Nearer My God to thee". Sound familiar? -Stop_making_Sense-

  • Comment 02/13/15:

    If I was 45 days away from locking in any kind of bridge or benefits or whatever, I would find a way to go on short term leave, i.e., nervous breakdown—I have feelings of ending my life. I know it sounds horrible but you have to do what you need to do. I know at least two previous managers that did this. It's a game; stay ahead of it. -Anonymous-
  • Comment 02/13/15:

    Re: Comment 02/13/15: To the person who posted this: "New IBM Systems group in the UK announce 30 consultation period - almost certainly around redundancies -Anonymous-" What does this mean? Can you explain in more detail? -SC-

    In the UK a company has to launch a consultation if it intends to lay off more that 19 people in a single location. For 20-99 employees, this must be 30 days before the first lay-off. For more that 99 people the consultation needs to start 45 days in advance. The consultation is a process for officially selecting who gets cut. I didn't make the original post, but I thought I'd explain the law here. UK-Happily Ex IBMer. -Anonymous-

  • Comment 02/13/15:

    I have a question. I got 2 and was RA'd. Told that my skills are no more in demand. Does this mean all the 2s got the same feedback or only a select few? I have a medical condition and submitted a workplace modification request last year but it was not addressed. I now got RA'd. Not sure if my medical condition played a role in my RA, but HR pretends that they don't even know about my modification request. -Anon-
  • Comment 02/13/15:

    Just a couple of points here based on my past experience. Once RA'd (fired) the FLM will mark your package whether to let you come back or not. This also depends on the relationship you had with your FLM and if you are considered hostile. As for finding another job while waiting for your last day of work, this is far and few between. You would be surprised and disappointed if you heard the conversation between your FLM and the other FLM. If you had a godfather in the VP ranks maybe you could get another internal job but if not you are labeled and not considered. Also an MIS 3 won't be allowed back even as a S/C. -lastdino1-
  • Comment 02/13/15:

    Hi. I'm an IBMer in Ontario. I've been worried about IBM sneaking their way out of giving severance packages by forcing PBC 3's on employees and giving short notices. So I did some research and found some useful information. The information gives me some relief and I want to pass it on to other IBMers in Ontario who want to know more, or may be affected:
  • Comment 02/13/15:

    Systems for Sale / SC IBM Systems is the new world-wide business unit created by the amalgamation of Storage, Systems and SWG Middleware. A 30-day consultation period is a requirement of UK law when redundancies are to be announced. Usually it involves a company and a trade union, but as IBM UK does not recognise trade unions, it is nothing more than a sham. Some employees will be nominated and voted onto an Employee Council. They will attend a few meetings, they will say very little as an non-disclosure agreement will be in place, and the company will go ahead and implement what they have already decided to do anyway. -Anonymous-
  • Comment 02/13/15:

    They get RA'ed (or outright dismissed) like everybody else. Being a first-line manager isn't like donning some magic cloak, trust me on this. I've been there. FLMs are the Staff Programmers of the management chain. They're the only ones doing any real management work; they have little to no authority and virtually no say over budget and yes, they get PBC'ed just like anyone else. My old department lost 2 FLMs and a SLM in one of the RA's in 2010. It does happen, even if you don't want to believe it. -managerscanbea3-
  • Comment 02/14/15:

    Although IBM UK does not recognise trade unions because, ahem, we are treated so well and there is respect for the individual, you are still able to join a union (I am in Unite) and they can advise you of what to do should you be put on a PIP. It is not as easy as it is to put you on a PIP in the UK despite the spread of 3s, nor is it impossible to get off. There is a set process that has to be followed and if they miss any step then they are in breach of UK employment law. And this is where Unite will step in and provide you with the best advice. I think I pay £12 or so per month for that security. And know of a few others that do too.

    People are under the misapprehension that IBM's word is law; well it has been proved in the UK High Court that it isn't. I would not be in the least bit frightened to take IBM UK on with or without Unite as I will never give into the corporate bullying they employ. And people can and do get off PIPs. I am not saying it is easy and you have to be prepared to meet IBM head to head and not be intimidated. -UK IBMer-

  • Comment 02/14/15:

    I was a top performer who left IBM voluntarily (although under significant duress) a couple years back. I ran across this brief "Why Good Leaders Make You Feel Safe" TED talk video at https://www.ted.com/talks/simon_sinek_why_good_leaders_make_you_feel_safe and thought of my former colleagues. I'm posting it here mostly for the management types that monitor this site :-) -gone_and_so_glad-
  • Comment 02/14/15:

    @Anonymous — Of course the next step is the sale of IBM Systems...this is the reason for the reorganization that is happening right now. They have put everything IBM feels they don't need in IBM Systems. That includes the ISSW ORG that I am part of, middleware, etc. IBM Systems will get canned in the next 18 months. Go luck to everyone. Let's organize NOW! -ISSW guy-
  • Comment 02/15/15:

    "Does this mean all the 2s got the same feedback or only a select few?" I was given 2+, but was working on an account that did not renew with IBM for 2015. I was told that I was caught between accounts. I had been put on that -10% education garbage in Oct. Finished the year with nearly 150 hours on Think40. I'm also over age 50. I was also told I was "eligible for rehire", but I have not tried to apply for any more IBM jobs. I feel fortunate that I was able to escape with a standard severance package. My heart goes out to all of you getting raped with low-ball PBC's and reduced severance. -Anon-
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