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Massive Layoff Underway At IBM

Posted by Soulskill on from the hope-you-land-on-your-feet dept.

Tekla Perry writes: Project Chrome, a massive layoff that IBM is pretending is not a massive layoff, is underway. At more than 100,000 people, it is projected to be the largest mass layoff by any U.S. corporation in at least 20 years. Alliance@IBM, the IBM employees' union, says it has so far collected reports of 5000 jobs eliminated, but those are just numbers of those getting official layoff notices. According to anecdotal reports, IBM appears to be abusing the performance appraisal system to cut additional employees without officially laying them off.

11 of 331 comments (clear)

  1. Re:Tsk. And they wonder where employee loyalty wen by Kwelstr · · Score: 4, Informative

    It is disgusting really, and it's all about satisfying Wall Street. Read Cringely for more info, he's being blogging about this IBM situation for a couple of years. :-/

    --


    ~~~Please pass the salt, I hate unsalted MD5s :-/
  2. Meanwhile Lenovo is doing well by Anonymous Coward · · Score: 4, Informative

    Meanwhile Lenovo, the PC business they sold off that moved into tablets and smartphones is doing really well. All of the same chinese factories and technologies are available to IBM that were available to Lenovo, only the management was different. One decided it couldn't make money on making actual computer stuff, the other went ahead and made actual computer stuff.

    One went a route of selling vague data mining services at high prices, a bit of patent trolling, and slow expensive lock-in mainframes. The other made stuff people want without the hard selling to dumb middle managers.

  3. Speculated at for over a year by rahvin112 · · Score: 4, Informative

    The speculation is that IBM is trying to push the dividend to a record level. In the process they may very well destroy the company. Because the only way to get the dividend to that level is to basically wipe out long term profits for a short term boost.

    That's probably the goal, the new MBA generation from the baby boomers is taking the point of view of taking every dime out of the company and giving it to the insiders even if it guts a major American corporation and hundreds of thousands of jobs will be lost to China.

    It's funny but the CEO from the Movie Dick and Jane reminds me so much of these CEO's that are only out for themselves, yet he was supposed to be fictional.

    1. Re:Speculated at for over a year by Anonymous Coward · · Score: 2, Informative

      Not insiders per se, but a (the?) primary compensation for senior executives is stock options, and there is a significant benefit for them if the stock prices does well, even at the expense of the company over the long term. Over the past few years IBM has been spending one billion dollars a month buying back shares. It would be interesting to see if the number of outstanding shares was reduced, or just redistributed as stock options (when I checked in 2012 it certainly appeared as if that was what was happening). This past year IBM has spent almost $2 billion/month propping up the stock price. They have borrowed money to do so, and fired good people. Internally, teams have been stretched beyond reason. I was an IBM employee for almost 20 years (I recently quit). The cuts to our teams started in 2008 and every year the belt was pulled ever tighter, accelerating around 2011. I can assure you there was absolutely no fat at all from 2010. The teams (at least in the area I was in) were high performers very talented--our area typically produced the majority of patents for IBM Canada. I think that is also reflected in many of IBM reviews in GlassDoor.com--I was generally impressed by the high standards of my colleagues, and it was the main reason for sticking around even when things started getting grim.
      Our area started having problems just maintaining the software due to staff shortages, and yet the cuts continued. Some software releases were pushed from yearly to every two years because we couldn't keep up. This was all before AWS won the CIA account and IBM realized they needed to transition to something a bit more cloudy.

      The 2015 road map was the focus of IBM for many years, which basically was all about improving the Earnings Per Share. I believe that focus was a distraction, and the cause of many short-sighted policies. IBM might have moved a bit earlier on the cloud without this EPS obsession (but then again, maybe not).

  4. Re:Tsk. And they wonder where employee loyalty wen by ZipK · · Score: 4, Informative

    I know a company has to be profitable to keep people employed...

    IBM's net profit in FY2014 was $15.75B (down from $16.48B in FY2013).

  5. Re:You are the 1% by kelemvor4 · · Score: 4, Informative

    If you have a 401(k) or any kind of mutual fund investment, you are part of Wall Street. That's how the system works, it's not spinning in a vacuum. That 6% return you got last year did not fall from the sky, it ended up in your pockets because institutional shareholders put pressure on companies like IBM to help the stock price and/or pay more dividends.

    Clearly you doesn't understand what "the 1%" refers to. Here's the information you need. http://en.wikipedia.org/wiki/W...

  6. Re:Tsk. And they wonder where employee loyalty wen by ShanghaiBill · · Score: 4, Informative

    They didn't need to do this to stay profitable.

    Companies exist to produce profits, not to provide employment. If an employee is not providing net value, then it is better for the company, and the overall economy, for that employee to go somewhere else. In the long run, it is better for the employee as well.

  7. IBM execs are Dems, gave Obama ~million dollars by raymorris · · Score: 2, Informative

    These cocksuckers are actually Democrats who gave Obama almost a million dollars to help him get reelected.

    http://influenceexplorer.com/o...

    How has six or seven years of Obama worked out for the workers at IBM?

  8. Re:Odd blog post by Dahamma · · Score: 3, Informative

    On the topic of not commenting on rumors, this one was even more fun:

    When reached, IBM sent the following response: “We do not comment on rumors, even ridiculous or baseless ones. If anyone had checked information readily available from our public earnings statements, or had simply asked us, they would know that IBM has already announced the company has just taken a $600 million charge for workforce rebalancing. This equates to several thousand people, a mere fraction of what’s been reported. Last year, IBM hired 45,000 people, and the company currently has about 15,000 job openings around the world for new skills in growth areas such as cloud, analytics, security, and social and mobile technologies. This is evidence that IBM continues to remix its skills to match where we see the best opportunities in the marketplace.”

    Wow, 5 sentences of non comments. I'm thinking IBM PR doesn't understand what "no comment" really means.

  9. Re:Tsk. And they wonder where employee loyalty wen by Anonymous Coward · · Score: 2, Informative

    Having worked for IBM as a contractor in the past - this.

    The way they treat contractors is crap: forced time off at very short notice (so they can hit the numbers they "need" to hit); forced rate reductions at contract renewal time (take it or leave it); maximum hours per week (but I'm on call, but I'm not allowed to take time off during business hours); ...

    Short version: if somebody were to offer me another contract at IBM, I would consider it. I would take it, if and only if the rate on offer was at "if they're fool enough to pay it, I'm fool enough to take it" levels. Somewhere around $5,000 an hour would probably be sufficiently enticing on a twelve month contract. It would be a similar story for a permanent full time position.

  10. Re:You are the 1% by Anonymous Coward · · Score: 2, Informative

    $4.83 / hr.

    That is what they pay the typical offshore worker (Contracted, not full-time IBMer).

    They can replace One american programmer (80k / yr) with 8 offshore workers (10k / yr) for that price difference.

    Bring your "A" game to compete. /Not all BRICS countries. //Just the one that I deal with.