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IBM to Lay Off Half of Global Services Division
Rolgar writes "Cringely says that IBM has begun massive layoffs in a quiet manner, starting with 1300 employees, but by the end of the year, the total will rise to at least 100,000 and probably closer to 150,000 employees, nearly 40% of their U.S. workforce. Some people will be temporarily retained as contractors at a fraction of their salary, and eventually, IBM will also dump many of the unprofitable customer contracts worked on by Global Services or outsource the work to Asia. If these people are looking for work, that could seriously drop wages for technical workers in the US since they will have to compete with these people for available jobs."
I'll wait until I hear it from a journalist.
How about from an IBM employee? As far as I can tell, it's true. They just cut nearly half our team Tuesday, wtihout even notifying the customer (Who is going apeshit). And 40% is indeed the workforce reduction I've heard bandied about.
And I think Cringely has it right - this is largely being driven by Palmasano panicing over the stock price. It's barely moved since he's been CEO.
So what (in a nutshell) is IBM Global Services? What do they do?
It's IBM's consulting division.
In a nutshell, it's all of IBM except the parts with which you're probably familiar from the Good Old Days; it's all the business consulting, management consulting, logistics, etc.
What it's not is the remaining parts of IBM hardware; the AS/400 division, the mainframe division, software division (Lotus) etc.
I think Cringlely is dead wrong on all this -- in the past few years it's been Global Services and software that are really hauling everything else along. I think Hardware would probably survive on its own, as long as they could keep the IBM marque, but the money is in the service crap.
"Ladies and gentlemen, my killbot features Lotus Notes and a machine gun. It is the finest available."
It's true. I'm soon to be out of my job at the end of the month, as well as the rest of my team (IBMers and (Perma-Temp) Contractors. My account was slated for transfer to Brazil in January and the talks started before that. We were expected to train our replacements who have basically been warm bodies. They're not even particularly talented. The rest of IBM Global Services is going the same way. So this is a VERY real thing. I was hoping to get hired on this year to IBM from being a contractor and that's shot. I'm just concerned given the massive offshoring that's occurring and how much this WILL impact IT. The displacement of this many workers is still going to have quite an impact on IT.
IBM has also implemented LEAN in effort to cut their IBM'er workforce in response to offshore outsourcing, which ironically is the very thing they're doing themselves. The survivors, although being survivors might mean they sorta wished they weren't. It's seriously bad. I'd suggest not touching IBM with a 10 foot pole. They're calling this the wave of the future... if they want to turn IT into something equated as fast food. That's the dream they're going for.
Check out http://www.ibmemployee.com/ . They have more news on the matter.
The sad part about the whole thing is that I enabled this to happen. I've spent my time there since day one migrating dying backup environments from Veritas Backup Exec and ArcServe IT to TSM and the resulting clean-up work. I am massively disappointed.
Anyone need a Arcserve / Veritas / Tivoli Storage Administrator ?
They do IT consulting, and make up one of the "Big Four", along with Accenture, BearingPoint (formerly KPMG Consulting) and Deloitte Consulting.
IBM Global Services is essentially the artist formerly known as PwC Consulting (which IBM purchased). PwC Consulting was formerly the consulting arm of PriceWaterhouse Coopers, and was spun off in 2002 in response to the Enron/WorldCom/Arthur Andersen messes & the introduction of the Sarbanes-Oxley Act (requiring auditor independence, separation of audit & consulting, yadda yadda).
Before IBM bought PwC Consulting, you may recall that it was on the verge of being renamed Monday.
Just once I'd like someone to call me 'Sir' without adding 'You're making a scene.'
IBM has been massively quiet on lay-offs for many years. It's just their style. It's bad for PR when it is that visible, let alone that it demoralizes the staff. IBM, through unofficial sources, has created ~70,000 jobs off seas while axeing a comparable amount (50,000) here in America. And that's before this latest round that we see today. The tracker is at http://www.techsunite.org/offshore/
150,000 would more-or-less be IBM's entire U.S. workforce, not 40% of it. If Cringely can't even get that right, I'd treat the rest of the article as extremely suspect.
SirWired
There are only 150k total IBM employees in the US. Cringely is talking out of his ass with that number.
I see you're a contractor systems administrator. I'm sorry you won't be able to come on as a full-timer, but your post seems to be a serious case of sour grapes. I mean...part of being a contractor is that your job is not guaranteed.
Blar.
IBM Global Services isn't just essentially PwC. Before they bought PwC there was IBM Global Services which was formerly ISM (Information Systems Management?). Back then it was mostly IT outsourcing. With the purchase of PwC it grew to be business consulting too.
I just wish people would do an absolute minimum amount of fact checking before they spread this kind of, quite frankly, garbage.
Firstly - I have no doubt IBM is laying off a lot of people, there is probably a need to in some areas. Layoffs are part of running any business. Some times a lot of layoffs will happen too. Trying just a little bit of basic maths first would be appropriate however. The numbers in this article are absurd.
As far as I know IBM has around 320 000 employees world wide and some 120 or so in the US. The layoffs this article are talking about are in the US, and they are only within the IGS part of IBM. IGS doesn't account for more than half of IBMs employees in the US, at an absolute maximum. That means that if you lay off the entire IGS division, you'd lay off some 50-60 thousand people. Where Bob gets the other 100 000 from is anyones guess. Perhaps they are laying off people in India and outsourcing those to China, and they are laying off people in China to outsource them to Poland.
Sadly sensationalism is more important than basic fact checking. The state of our current journalists is really, really sad. Cringely is at the very bottom of the heaping pile of dung that they call journalists today. Cringely is useful for little else than pirana food. Sadly I think that feeding Cringely to pirana would be cruel and unusual punishment, for the pirana.