Bob Cringley has written aseriesof fivearticlesconcerning IBM. The last time he did that, in 2007, he revealed that IBM was ready to offshore and outsource thousands of IBM jobs, impacting employees and customers alike. He was rigth. Now, he returns, predicting, well, here it is in his own words (emphasis, Bob Cringely).
The direct impetus for this column is IBMâs internal plan to grow earnings-per-share (EPS) to $20 by 2015. The primary method for accomplishing this feat, according to the plan, will be by reducing US employee head count by 78 percent in that time frame.
Reducing employees by more than three quarters in three years is a bold and difficult task. What will it leave behind?Â Who, under this plan, will still be a US IBM employee in 2015? Top management will remain, the sales organization will endure, as will employees working on US government contracts that require workers to be US citizens. Everyone else will be gone. Everyone.
Let's continue on to his second article.
Global Services is a mature business that has been around for about 20 years.Â In IBMâs 2015 business plan big income is expected from newer businesses like Business Analytics, Cloud and Smarter Computing, and Smarter Planet.Â Can these businesses be grown in three to five years to the multi-billion dollar level of gross profit coming from Global Services? Â Most of these businesses are tiny. Â A few of them are not even well conceived as businesses.Â It takes special skills and commitment to grow a business from nothing to the $1 billion range.Â Does IBM have what it takes?
Do you remember eBusiness?Â Do you remember On-Demand?Â These are recent examples of businesses IBM planned to grow to billions in sales, businesses that no longer exist today.Â Some claim that Blue Gene is shortly to be shuttered, too.
Actually, I see "eBusiness" nearly every day. It appears on my Linux server after I start WebSphere, ". . . ready for e-business . . . " Thanks, IBM, for that little advertisement.
Hereâs a simple thought experiment. When it comes to these new software and Internet services, IBMâs competition comes from a variety of companies including Amazon, Apple, Dell, Google, Hewlett Packard, Oracle and others. Does IBM have an inherent advantage at this point against anyÂ of those companies? No. Is IBM in any wayÂ superior to all of them and thence in a position to claim dominance? No.
If IBM is planning a 78 percent staff reduction, then that will of necessity involve all USA operations, not just Global Services.Â Hardware, systems, software, storage, consulting, etc. will all see serious staff cuts.Â This means IBM could be moving a lot of its manufacturing and product support offshore.Â Raleigh, Lexington, Rochester, and several other IBM communities are about to lose a lot of jobs.
That does not bode well for anyone, especially those organizations that pay IBM a lot of money for support, expecting a certain level of competence and knowledge from the support technicians.
IBMâs goal appears to be to have as few employees in the US as possible, maximizing profit. Â But doing so clearly hurts customer satisfaction.
Major IBM customers such as Amgen, The State of Texas, and most recently the Walt Disney Company have cut ties with IBM in favor of other providers. Many other customers are scaling back the services theyâre buying from IBM as the perceived value continues to drop. Customers are starting to realize that they can directly hire offshore companies such as TCS, Wipro, HCL and Satayam and book the savings directly instead of paying IBM top dollar for support and then seeing that support fulfilled from BRIC [Brazil, Russia, India, China] countries.
When IBM first started its big push to offshore technical work, the account teams were asked to make a list of reasons why customersâ work couldnât be offshored, but were not allowed to use skills as a reason. That makes no sense in a rational organization but it makes perfect sense to IBM.
Everything You Know About Black Friday is Wrong
Wed, Dec 4th 2013 1:50p Gregg Eldred Last week, we, here in the US, experienced that most wonderful of all days, “Black Friday.” On TV news reports, in daily newspapers, readers and viewers were treated to pictures of people standing in lines, waiting for Big Box retailers to open their doors on Thanksgiving Day. These people camp out (I literally mean “camp out.” Like, in tents, with generators and heaters), days and weeks in advance, in order to be first in line for electronics, televisions, and so on.
And [read] Keywords: wiki
“We should just call it #lame”
Tue, Nov 26th 2013 4:10p Gregg Eldred Hashtags. Twitter started the craze, then other sites followed. What has happened in the meantime is that they have become overused. To the point of comedy. Just look at a few tweets these days, hashtag orgasms are what some people are enjoying.
Alas, however, when companies or candidates use hashtags for the sake of using hashtags, the results are, at best, ineffective. At worst, they can backfire embarrassingly.
This month, JPMorgan Chase scrapped an attempt to engage Twitter users with the ha [read] Keywords: blackberry
InformationWeek: Amazon Again Beats IBM For CIA Cloud Contract
Wed, Nov 13th 2013 5:40a Gregg Eldred “As a threshold matter, IBM lacked any chance of winning a competition with AWS for this C2S contract,” the ruling said, and therefore it lacked standing to claim prejudice in the way the contract had been awarded. The GAO failed to assess whether IBM had the standing to file the protest that it did, said the ruling.
The court also objected to GAO failing to spot maneuvering by IBM’s lawyers. “The GAO failed to address the way in which IBM manipulated its pricing to creat [read] Keywords: ibm
Tue, Nov 12th 2013 7:10p Gregg Eldred No, this isn’t “one of those posts.”
In a men’s room, in the building in which I work, there is a reproduction of a Winslow Homer painting. I believe that this restroom is the only one with any sort of wall decoration.
Here is the picture:
So, what is so special about this picture? It’s in the details.
Damn, that’s funny. [read] Keywords: wiki
Chris Marvin: For today’s veterans, service isn’t over when the uniform is put away
Mon, Nov 11th 2013 4:10p Gregg Eldred I fought in Afghanistan. When people learn of my military service, I get a variety of comments — none more common than “Thank you for your service.” My response sometimes surprises people. I look them in the eye and say, “You’re welcome.”
. . . When I began to respond with “You’re welcome,” I was concerned that it shocked people. I wondered if I was being too flippant or prideful. Then I realized that their reaction said something about what “Thank you for your service” now [read] Keywords: wiki