IBM to layoff 100,000?

[Tandalayo_Scheisskopf]

Last year I wrote a series of columns on management problems at IBM Global Services, explaining how the executive ranks from CEO Sam Palmisano on down were losing touch with reality, bidding contracts too low to make a profit then mismanaging them in an attempt to make a profit anyway, often to the detriment of IBM customers. Those columns and the reaction they created within the ranks at IBM showed just how bad things had become.

Well they just got worse.

This is according to my many friends at Big Blue, who believe they are about to undergo the biggest restructuring of IBM since the Gerstner days, only this time for all the wrong reasons.

The IBM project I am writing about is called LEAN and the first manifestation of LEAN was this week's 1,300 layoffs at Global Services, which generated almost no press. Thirteen hundred layoffs from a company with more than 350,000 workers is nothing, so the yawning press reaction is not unexpected. But this week's "job action," as they refer to it inside IBM management, was as much as anything a rehearsal for what I understand are another 100,000+ layoffs to follow, each dribbled out until some reporter (that would be me) notices the growing trend, then dumped en masse when the jig is up, but no later than the end of this year.

http://www.pbs.org/cringely/pulpit/2007/pulpit_20070504_002027.html

[Renew Deal]

1. I saw this a couple days ago.

The author is pretty well connected in the industry. He reports on Info Tech gossip. These numbers are outrageous, and probably credible.

[Ezlivin]

2. I guess that colleges will now be flooded with people getting new degrees

Isn't that what Bush always says—if you lose your job just go back to school and get a different degree?

Of course Mr. Blue Blood never provides the magic method of earning enough money to put oneself through college when freshly unemployed, nor what degree plan to choose to ensure career longevity in the new job.

One of these days the proletarians will revolt, I tell you....

[Tandalayo_Scheisskopf]

3. "One of these days the proletarians will revolt, I tell you...."

I expect it. I also think that is the intended effect.

[madokie]

5. that is what I am hoping for

if we all stood together we could make many changes in how our world is, all for the better too

[Aviation Pro]

4. Oh, he's got a money solution....

...borrow from his buddies banks. Yeah, that's the ticket. Ever wonder why the bankruptcy laws were changes? That's part of the reason.

[BearSquirrel2]

13. There are only so many ...

There are only so many math teaching jobs out there. And our job will become increasingly more difficult once the kids realize that there is no money in learning math anymore do to all the "knowledge jobs" being outsourced. Time to start teaching plumbing. You'll make more money.

[Blackhatjack]

6. Massive employee layoffs will affect wages the way the Housing Bubble bursting is affecting prices

Imagine for a moment that employers will have ten(10) times the number of applicants for each job they are looking to fill.

The debt-laden desperate unemployed will work for almost any wage, especially if their access to health insurance is involved.

And if you keep your job, you will definitely be affected. Your wage rate will remain stagnant if you are lucky, and be reduced if unlucky. More of the costs of benefits will be 'shifted' to those employed(ie. health insurance costs).

We are in for a rocky road as middle class jobs are being exported by the millions overseas.

And corporations will utilize 'low or no labor costs' to maintain profit margins that drive top level executive compensation and shareholder profits.

Just wait ... when China begins selling the no-frills, almost no labor cost, automobiles in the US within the next 2 years. Combine that with government supported car manufacturing of Japanese hybrid vehicles, and you will see Ford and GMC either merge with these overseas interests or go into bankruptcy --and the bleeding of jobs will be massive.

The OP is the canary in the mine shaft, and you can bet the top officials at IBM know exactly what is coming and the effects it will have on the economy.

[Tandalayo_Scheisskopf]

7. Job Security is National Security.

It should be treated as such.

[AlCzervik]

8. my sister works for IBM, she did work for Lotus until IBM bought them, she has dodged

the lay off bullet so far but if this story is true i'm afraid she'll be losing her job.

[blueworld]

9. I was globally serviced by IBM years ago

They bought my department at Prudential, relocated it & fired half of us. The other half slaved away until they could export the jobs overseas.

So will any of the pink slips be going to people residing on US soil? :sarcasm:

'Cause I bet there's a big IBM job fair hiring in India by 1st quarter next year.

[papau]

12. ? - How could overseas folks understand "Pru-COBOL"?- I agree as to the India hiring coming soon n/t

n/t

[CATagious]

10. I am one of the 1300...

I worked as a contractor in IBM's Global Services. Last week, we lost about a third of our group (data center) and I've heard that many of our technical support people were also let go. There are rumors that everyone at the Lexington data center will be gone by the end of the summer.

This is no surprise... they've started talking about LEAN months ago and have been implementing new web-based tools that are suppose to make our jobs easier and more efficient (i.e. fewer people/easier to outsource). The past couple of years, alot of our jobs have moved to Brazil and India. Even though there continue to be concerns about their performance, they continue to take our jobs. The support people complain about them, the customer, etc. but I guess they are cheap enough that quality is not expected. We have two floors of servers at our location and soon they will all be managed and monitored solely from overseas. I'm not concerned about myself, I had started taking classes a couple of years ago and will now go full-time and get a degree in accounting. But, IBM has been a family business for us. I have 4 cousins working there and my brother. My dad worked there and 2 of my uncles but they were there during the good old days. It's not like that any more. IBM should move completely to India and be done with it. Or there should be a law.

[BearSquirrel2]

Yes but ...

Yes, but those sales guys negotiated all those 10 year contracts. So there is really no recourse for the people being "serviced" by Ravi from the Curry Technical Institute of bubble gum diplomas.

[CrispyQ]

11. The company my husband worked for did this.

They laid off a few workers each week. A low level office worker here & there, maybe downsize a department or two now & then. In about 8 months they had quietly laid off over a quarter of their work force, most of them lower paying postitions. He got laid off a week after the shrub was reselected.

[BlooInBloo]

14. Yah - 1/3 of the company laid off - RIGHT.

[Paulie]

15. 100,000 AGAIN?

That's how they stocked Global Services when it was created. Laid off all the people, let them sign back up as contractors. sigh.

[DemReadingDU]

16. wow, what is happening to our middle class?

this is just terrible news