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Lloyds To 'Offshore' 2,000 Jobs In IBM Data Center Outsourcing Deal (thestack.com)
In early January, IBM announced a roughly $1.6 billion outsourcing deal with Lloyds Banking Group. IBM would pay Lloyds for its data center assets and in return will charge the bank for ongoing management. Today, Lloyds plans to move almost 2,000 members of staff to U.S. tech giant IBM as part of the IT outsourcing deal. An anonymous Slashdot reader shares a report from The Stack: The seven-year deal hopes to save the bank close to $930 million in costs, streamline the business and make its IT services more agile. Lloyds Trade Union (LTU), which represents around 35,000 members of staff, now "derecognized" by the bank, claimed in a newsletter that once the deal is signed the jobs would be "offshored" over a four-year period. It added that most of the 1,961 positions would be cut. "1,961 staff will be transferred to IBM including permanent staff, contractors, 3rd parties and offshore suppliers. However after 4 years, only 193 of the staff transferred to IBM will still be working on the LBG contract," wrote LTU.
Nice try. IBM continues to cut US headcount like there is no tomorrow. I spent 11 years with them, this is their mode of operation. They sign a deal like this, agree to take the headcount and then rapidly move the work to low cost countries. Think about it - if the customer expects to see 40% savings, where do you think it comes from? Mark my word, IBM will transition the acquired employees as fast as they can in order to maximize profit. Lloyds has essentially traded their "known" for freshers in low cost countries and IBM is their hatchet man so they don't look bad to their customers/employees.