
Layoff Underway at IBM - ajarmst
http://spectrum.ieee.org/view-from-the-valley/at-work/tech-careers/massive-worldwide-layoff-underway-at-ibm
======
obtino
Before the IBM apologists start commenting: I was an IBM employee a few years
ago and I would never recommend it as a good place to work. You were
constantly worried about your job and there were cuts to basic resources all
the time. It's not at all surprising to see this happen. IBM only cares about
its shareholders and not its employees or customers.

~~~
AdamFernandez
It's so ironic to me that some large corporations only focus on shareholders.
Focusing on customer satisfaction, and product quality leads to greater sales
more than anything else. A byproduct of this is...wait for it...higher value
to shareholders!

~~~
TylerE
They are, in most cases, legally required to place shareholder value over all
else.

~~~
untog
No they aren't. Time to put that misconception to bed:

[http://www.washingtonpost.com/opinions/harold-meyerson-
the-m...](http://www.washingtonpost.com/opinions/harold-meyerson-the-myth-of-
maximizing-shareholder-
value/2014/02/11/00cdfb14-9336-11e3-84e1-27626c5ef5fb_story.html)

~~~
ashwinaj
True, they aren't obligated. Another thing to note is that most executives get
paid with equity more than cash. So it is in their self interest to have the
stock stay steady or go up and not take a nose dive.

~~~
gaius
_So it is in their self interest to have the stock stay steady or go up_

Until they are ready to cash out, which might be as soon as a year away. It
needs to be redesigned with long-term incentives in mind.

------
Jgrubb
> Of course, the appearance of the situation, in the eyes of employees and the
> public, is not being helped by the fact amid IBM’s actions comes the board’s
> announcement on Friday of a big raise for CEO Ginni Rometty.

~~~
jobu
The article linked in from that bit is pretty good too: "IBM redefines failure
as 'success,' gives underachieving CEO huge raise" \-
[http://www.latimes.com/business/hiltzik/la-fi-mh-ibm-
redefin...](http://www.latimes.com/business/hiltzik/la-fi-mh-ibm-
redefines-20150202-column.html)

 _" The company has posted lower revenue for 11 quarters in a row."_

She gets a raise for successfully shrinking the company?

~~~
sgt101
In an alien world a million billion miles away a general marshalling forces
after defeat after defeat offers it's sword (or other death dealing device) to
the star marshals and is told, "no, not now" but inconsolable the resignation
is re-tendered, so now the star marshals give it a medal, and a pay rise and a
nice pat on the heat, and it agrees to remain in charge.

If I could reduce and organisation to zarg-jelly by resigning I would extract
similar geld I guess..

~~~
rspeer
Your analogy is hard to follow.

~~~
TeMPOraL
Well, I guess the GP meant that if you could inflict significant harm on the
company by resigning, the shareholders won't let you do that, so you can just
start extorting them for money.

------
smackfu
Reminder that Cringeley's original claim from Jan 22nd was:

To fix its business problems and speed up its “transformation,” next week
about 26 percent of IBM’s employees will be getting phone calls from their
managers. A few hours later a package will appear on their doorsteps with all
the paperwork. Project Chrome will hit many of the worldwide services
operations. The USA will be hit hard, but so will other locations. IBM’s
contractors can expect regular furloughs in 2015. One in four IBMers reading
this column will probably start looking for a new job next week. Those
employees will all be gone by the end of February.

Now he's trying to spin that he never said "layoffs". Not sure why the IEEE is
still trusting him.

~~~
seanmcdirmid
Wait. I'm confused: was cringeley right or wrong?

~~~
x0x0
Well, here's what we know:

Cringely claims 100k people

IBM claims low thousands (at a cost of $0.6B, which seems quite high) [1]

ieee says Alliance@IBM, an ibm union, claims they know of 5k jobs eliminated;
they further say they're seeing a flood of backdoor layoffs, ie sudden bad
reviews

My guess is in 6 months, Cringely was more right than wrong. Or at least we
see an employment reduction of tens of thousands.

[1]
[http://mobile.reuters.com/article/idUSKBN0KZ1WF20150126?irpc...](http://mobile.reuters.com/article/idUSKBN0KZ1WF20150126?irpc=932)

~~~
smackfu
>IBM claims low thousands (at a cost of $0.6B, which seems quite high)

If you pay 6 months severance, it adds up quickly. A million dollars covers
only 20 $100k employees.

~~~
rgovind
What is the reason companies pay a severance? Most jobs are hire or fire
anytime right?

Is the reason only lawsuits and good will?

~~~
msumpter
It's a good time for the company to attach various nondisclosure, noncompete,
non disparagement clause(s) and they mark the severance pay as consideration.
These agreements typically only hold up if there is commensurate consideration
attached to them. This of course varies by state and local laws if they hold
up at all.

~~~
x0x0
IBM has been repeatedly sued, sometimes successfully, for age discrimination,
so you can bet that severance package requires agreeing not to sue for age
discrimination.

see, eg,
[http://www.cookbrown.com/docuserfiles/file/Spring%20Newslett...](http://www.cookbrown.com/docuserfiles/file/Spring%20Newsletter%20THE%20IMPORTANCE%20OF%20BEING%20EARNEST%E2%80%94WHY%20UNBIASED%20INVESTIGATIONS%20MATTER%20Debra%20Hinshaw%20Vierra%20Article.pdf)

------
anonbanker
Nobody ever got fired for choosing IBM.

Except as an employer.

------
orionblastar
IBM didn't take the microcomputer seriously, until it saw how well Apple did
and then made an IBM PC to compete with it.

They made a deal with Microsoft for DOS, but didn't make the deal exclusive so
Microsoft sold their own version of DOS to the PC Cloners.

IBM made the PS/2 series with Microchannel as Clone Killers. VGA was a better
video, and Creative Labs had the Sound Blaster for better audio. IBM's
Microchannel flopped because people wanted to still use their ISA cards. IBM
had OS/2 and Microsoft had their own version of OS/2 and Windows, and
Microsoft took their OS/2 NT 3.0 and made Windows NT 3.1 out of it and stabbed
IBM in the back for a second time.

IBM sold their printer line to Lexmark, and their PC X86/X64 line to Lenovo,
IBM didn't know how to turn a profit on them.

When IBM couldn't supply the PowerPC chips to Apple for their Macintosh line,
because IBM was making PowerPC chips for video game consoles as a priority,
Apple switched to Intel chips. Then later video game consoles switched to
Intel or AMD chips. IBM open sourced their PowerPC chips eventually.

IBM bought out Lotus and basically ran it into the ground and let Excel
replace Lotus 123, and Lotus Smartsuite was never updated to compete with
Microsoft Office and for modern Windows systems so it fell away and IBM forked
OpenOffice.Org to make Lotus Symphony. That also went nowhere.

IBM still earns money from mainframes and contract support. I think IBM got
into Linux and Java contracting as well.

But IBM has changed over the decades and it is not the same company it once
was. It fell into a trap of maximizing shareholder values rather than making
the customer experience a better one like Apple did. Microsoft also suffers
from the same sort of thing that IBM does which explains why Microsoft Surface
sales tanked.

IBM needs a big reboot, and to focus on making the customer experience better.
Mobile apps is an area they could focus on, make the IBM Cloud and then make
IBM Lotus Symphony for iOS and Android and store the documents on the IBM
Cloud and offer subscriptions for more storage. They should also make Lotus
Domino and Lotus Notes for mobile devices, and make a set of developer tools
to make Android and iOS apps easier to program.

------
Someone1234
But nobody will admit that there is a massive ageism problem in technology..?
It is nice that some countries have moved to protect against ageism, it is an
extremely common problem that few wish to address or take seriously.

~~~
oldmanjay
Do you feel like being old would entitle you to a job? And if so, why?

~~~
Crito
Being old of course does not entitle you to a job. However people being fired
_because_ they are old is something that should bother you. One day, you will
be old.

Walk into the office of an accounting firm, engineering firm, bank, architects
office, whatever. Count the number of employees that you see with gray hair.
Now walk around your (software company's) office and do the same. Chances are
( __particularly__ on the west coast in my experience), there is a big
discrepancy.

There are several possible explanations. Maybe the old people get fired. Maybe
old people get the hell out of the industry on their own terms. Maybe young
people are just hired at an absurd rate, which is suppressing the proportions
of old people.

Some people suggest that it is because this industry is young, but it isn't
_that_ young. Your standard 20-something dev might think he is entering an
exciting new industry, but the reality is that the industry is several decades
old already; more than enough time to accumulate lots of gray-headed
programmers.

~~~
morgante
> Maybe young people are just hired at an absurd rate, which is suppressing
> the proportions of old people.

Honestly, I think this accounts for most of the ageism in tech.

Way more people are entering the field now than in the 1970s, so even if
there's absolutely no ageism at play you'd still expect the majority of all
developers at a company to have graduated in the last decade.

~~~
tonyedgecombe
If you entered in the 1970's you would likely be at retirement age now.

------
mkozlows
"IBM said there would be thousands of layoffs. We believe there have been
5,000 layoffs. Clearly IBM was lying."

Um.

~~~
differentView
What are you quoting?

~~~
vacri
When Cringely wrote his clickbait 100k, IBM responded saying that the layoffs
would be more like 10K.

------
TeMPOraL
Wait what... does that mean that management at IBM suddenly realized they
don't need 1/4 of the company? Since they rather won't be hiring new people in
place of all laid off, I wonder what is going on there? Did they recently have
an extremely successful merger with a very similar company? Did 1/4 of the
company provide zero output? Or did Watson get so good it can actually replace
engineers and sales people?

~~~
johnward
From what I understand; They are getting rid of employees in low performing
areas and hiring in growth areas like CAMMS (cloud, analytics, mobile, social,
and security) and Watson.

~~~
runT1ME
Why would anyone in the top (let's say, 5%) of tech be interested in working
for IBM when it seems this is how it treats its employees?

~~~
TheCondor
fwiw, they did a great job taking care of me and some other heavy hitters
while I was there. Regular bonuses, very very nice salaries, and it was
predictable. I worked on products though, not services, and our product made
money.

honestly, I don't know what 400,000 IBMers work on. Every company of a certain
size and age does layoffs. You could ask the same question of Apple or
Microsoft and at some point Google too.

~~~
iends
How long ago were you there? Things seemed to start to dive 2-3 years ago.

~~~
johnward
I don't think I've seen a bonus since being acquired. This had to be years
ago.

------
sciurus
Ouch. I lived in Columbia, Missouri for a couple years starting in 2012. The
IBM office had just opened in 2010 and was a big deal. The city and state gave
them large tax incentives to open it there. If IBM really laid of 150 people
in it, that's a huge cut.

[http://www.columbiatribune.com/news/local/ibm-layoffs-hit-
co...](http://www.columbiatribune.com/news/local/ibm-layoffs-hit-columbia-
service-center/)

[http://www.columbiatribune.com/news/local/department-of-
econ...](http://www.columbiatribune.com/news/local/department-of-economic-
development-to-review-ibm-incentives-after-columbia/)

~~~
eevo
Native Iowan, same goes for Dubuque Iowa.

------
aceperry
It would be nice to hear from honest IBM managers, who are doing the firing
and downgrading of employees, what is really going on. Though I'm pretty sure
most people know what the score is.

------
bronson
Why is the tone of the comments on this story so different from those of just
last week?

[https://news.ycombinator.com/item?id=8948778](https://news.ycombinator.com/item?id=8948778)

One hypothesis... some of the IBM managers who were commenting on that story
now realize Cringely was at least partly right?

~~~
brymaster
This is a tech board where anyone can post anonymously, so sockpuppeting and
astroturfing are quite common, especially as employees of these companies post
here. In every thread about Apple/Amazon/Google/Facebook/IBM/Microsoft/etc
you'll always have to wonder who's behind that post or who clicked the upvote
and downvote arrows.

------
bhouston
Still no real confirmation of figures but I guess there is purposeful
obfuscation here.

~~~
AlisdairO
Even so, if IBM loses 100,000 employees in the course of a month it's going to
be pretty damn obvious. I'm still betting that the numbers are wildly
exaggerated.

~~~
bsder
I'm not. If it were just a couple thousand, they wouldn't be doing all the
shenanigans with review numbers.

This is a test to see what they can get away with before class action lawsuits
start flying. If they dumped all 100,000 at once, they'd get smashed with
lawsuits.

So,they're going to try to pull it off with 10,000 and see how many lawyers
appear.

------
rodgerd
So maybe not uncritically accepting IBM's press releases would be a good idea?

------
e0m
What a remarkable collapse from the "Big Blue" of the 1960s. Is there really
anything sexier then then thought of brand new IBM 360 getting loading into a
PanAm jet-powered aircraft.

------
Elrac
A goodly chunk of the company I work at was recently sold to IBM. Not my
chunk, but still - color me deeply un-reassured!

------
akurilin
Does this impact SoftLayer in any way?

------
kjs3
Cringly said in his article that a quarter of the IBM workforce would "get
their paperwork" to be laid off in the last week of January or so. He was very
specific and he's not even close. At some point, the layoffs may total a
quarter of the workforce, but that's not what his histrionic diatribe said. If
he now gets to backpedal and "restate" what he said and be right in his
predictions, then so were the forecasters who said New York was going to be
buried in snow and yet only got dusted.

People have been predicting the imminent death of IBM, with detailed litanies
of the myriad of ways it's unrecoverable failures, pretty much every day of
the 30 years I've been in IT. The thing about predicting the end of the world,
is that if you do it long enough and lack the humility to be ashamed of all
the times you were wrong, you'll eventually get to be right.

------
drawkbox
IBM seems like it would be a terrifying place to work, Initech level. With the
1,2,3 system there is also probably tons of project protectionism going on,
and you probably have to wear a tie.

~~~
kjs3
We don't wear ties.

------
q2
Recently, Apple announced highest quarterly income in corporate history and
now, IBM is going through biggest layoffs in corporate history. It seems to be
the season of superlatives in corporate history.

But what a contrast between Apple and IBM!!!

~~~
dredmorbius
Tech has a very powerful tendency to winner-takes-all dynamics. IBM's had an
unbelievably long run (formed in 1911 though through the merger of two
existing firms), and has taken on and disposed of other competitors (most
recent Sun, though there were the Seven Dwarfs in the 1960s / 1970s).

Which is to say, the shifts are likely not unrelated, though Apple doesn't
directly compete significantly in business.

