Probe: How IBM ousts older staff, replaces them with young blood IBM for the past five years has been pushing older employees out of the company and replacing them with younger staffers in the US or moving the jobs overseas, it is claimed. Reg readers may have had a sneaking suspicion this was the case. As we exclusively reported last year, about a third of Big Blue workers, some 130,000 …
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Or, for IBM this is definitely the case.
This file should go into the dept of labor and IBM lose USA government contracts.
While the Orange Baboon has tried to roll back some of Obama rules, most of them are still in place. If memory serves me right a company caught discriminating is disqualified from bidding for government contracts
Pretty much any company enters a death spiral, although the initially trajectory may be subtle, once it is run by MBA's. Apple the first time Jobs left is an example. Apple once again now that Jobs passed away is another, although still subtle at this point. As is General Electric. As is IBM. As have been many a US automaker. And countless other companies. (Just remember, the entire financial meltdown of 10 years ago was the product of MBA's.)
It's all due to the addiction all MBA's have to eating the seed corn for the short term appearance of gain.
In defence of MBA programmes (I know not a popular way to start here), they *can* provide a lot of valuable background and insight. Of course, I would say that having acquired one (as a techie). What I observed, however, was the tendency for 'group think' - the Harvard way if you like, which results in a monoculture, suppressing some of the brighter ideas and promoting dubious ones.
I should admit that I almost gave u when I sat through a lecture in which the imponderability of queues and demand management was discussed, not to mention the most appalling modelling ideas!
> I should admit that I almost gave u when I sat through a lecture in which the imponderability of queues and demand management was discussed
Indeed. MBAs (I haven't done one) seem OK as a way to quickly gain the financial, legal and accounting background that is required to have any amount of serious responsibility in an organisation.
When it comes to the actual management bits though, sleeping through them is probably the best course of action. Lots of seriously wacky ideas there.
As I said, I haven't done an MBA myself, this is just the impression I got when I entertained that possibility at one point.
@TMWFTE wrote: Pretty much any company enters a death spiral, although the initially trajectory may be subtle, once it is run by MBA's.
Or, to put it another way, beancounters. Once a company starts seeing everything and everyone as an only item in a ledger, sales fall flat because beancounters think marketing and tech support is voodoo magic that just mysteriously takes care of itself.
When experienced (older) people are missing from marketing and tech support, the competition notices and takes advantage of the lack.
Experience, experience, experience makes all the difference.
I joined IBM in 1989 as a experienced hire. I think I must have been one of the last UK people taken on under the 'old' IBM rules. We had the IBM culture rolled out to us as a major benefit of working for IBM. The next intake were taken on as FTC's, with different T&Cs and pension rights.
I decided to leave after 7 years, as I could not see a future for my role (support based in the UK), and since that time have spent a total of something like 11 years working on contract for IBM, doing one long stint in a role as an on-site customer support that really, really should have been done by an IBM permie. It's a good job I decided to represent IBM as if I was an IBM employee (there was no deception, the client was quite aware of my employment status).
I'm not sure how many other contractors would have done the same (most contractors, IMHO are a cynical, self-serving bunch).
But one way or another, it will bite IBM, because the number of ex-IBM contractors that work for IBM, providing the skills that no longer exist in IBM is huge. Once these people retire, there will not be the skills in IBM's own products, and no skilled ex-IBMers left because current employees are not trained enough.
The only saving grace (for IBM) is that they appear to be determined to sell or destroy almost all of their older technologies that have served the company over the years.
I was sponsored by IBM (UK).
Anyhow, I digress. As part of the 'meet the company' I travelled to numerous sites and met numerous people, more so than a typical IBM grunt would.
I heard all the tales and fables.
The 'not laying any one off' was mentioned a lot - this was pre 90s nearly going bust.
Its not hard whne a good ~30% of head count on a site were contractors.
Thats not a bad strategy.
Anyhow, I refused by job offer. Just did not fancy it.
The interview team, who Id worked with for a few summers, were shocked. Id have got less a suprised reaction if I stripped off naked. Seriously. Theyd never had anyone, ever, turn down a job offer.
About 6 years later the entire interview team were laid off.
A few years younger, but similar story. After graduation I applied for IBM, HP and Nokia as they had development centers close to my home town and were considered prime employers at the time.
I'm so happy none of them considered me good enough. Now working happily since 20 years at another company that may not pay top dollar but has a good working climate and our HR is populated by human beings (allegedly).
Can't say I dodged the bullet. It's more like I stumbled out of the way.
I'm also younger but think I'm one of the ones they were writing about... Or maybe not, since it isn't clear if I'd be filed in a different crease.
Hmm... Anyway I can find out if my forced retirement was special or just part of the policy? Maybe I just preferred not to take in personally?
100% correct. Now known as IBM Talent Management formerly Kenexa.
The example they give is an airline company. Who do you reward and retain? The pilots and safety engineers? No. They are 10 to the cent besides you already have the customers butts in a seat.
You retain and reward the low paid cabin and airport staff because they can sell profitable drinks to your captive customers.
Watson tells you that.
I've been with big blue many years in the UK and not seen this happening much here yet. I've lost a number of colleagues to redundancy but across all age groups and generally just because they had much worse contractual terms not the bullshit JRSS saturation they were sold on. Anyway more recently I've heard they're replacing around a third of UK GTS staff with thousands of IT people outsourced as part of a massive deal with Lloyds bank. Surely that's a bigger story?
“Anyway more recently I've heard they're replacing around a third of UK GTS staff with thousands of IT people outsourced as part of a massive deal with Lloyds bank. Surely that's a bigger story?”
The age discrimination is potentially illegal - the Lloyds outsourcing was an expected part of the transition to outsourcing so the job losses were effectively
To clarify, if your company is moving to IBM outsourcing, approximately 90% of existing staff will leave within three years. Either voluntarily or via resource actions. There is a reason that no ones particularly helpful with the new and “interesting” platforms you are expected to use for day-to-day tasks - you’re not expected to be around long enough to benefit from training. Lack of handover or offshore replacements is not seen as grounds for delaying headcount reductions unless the customer complains a lot...
"I've been with big blue many years in the UK and not seen this happening much here yet."
Perhaps not in your location. I retired in 2000 and throughout the late 90's Function managers talked openly about "reprofiling our demographics". Meaning you're over 50 and it's time to accept voluntary separation. Which I very happily did. Some time later I bumped into my Function manager who looked somewhat stressed and confessed that he had not realised just what was involved in my role.
Keep looking over your shoulder.
In the first round of layoffs when IBM GSA lost the Telstra account. The oldies were given the bullet first and despite the fact that IBM Thailand put out a call for experienced AS400 hands, and 2 of us had all the skills & experience required(which included what was then an obscure lang Aspect Computing's LANSA (I was an ex "Aspect'er" to boot !) ) we were not allowed to even put in EOI . Youngsters who had heard of the AS400 were sent instead
Same thing here in the states. Our high-performance computing group was at the end of a particular product/project release, and anticipating the upcoming work on a MAJOR government project. So did they keep critical talent on-hand for something they KNEW was coming, perhaps giving a chance for engineers to get a head-start on what they knew would be a major effort? NOPE! Don't need them this week, so let's lay-off the folks who *know* the technology, we can always hire some cheap college grad who has NEVER seen a high-end system before. What could possibly go wrong?
The only way TCS will pick up IBMs GTS is if the cost is so low that they can get some value. I.e somewhere between free and IBM paying a lot.
Currently, GTS is a loss leader for other IBM systems and services, with huge overheads in staffing, so taking it as is just gives you the unhappy customers desperate for a way of leaving expensive, underperforming contracts.
TCS can compete more easily in re-tenders where the customer will swallow more on boarding costs and avoid bringing over the staff even IBM couldn’t shift.
I'm a us chap. In the states IBM hired my company to do in house repair of laptops,desktops and printers. They fired the in house staff to bring my company . After a year they fired us saying it just did no work out. They paid us 3/4 of the what the old staff was paid. When they brought it back in house they paid the new crew 3/5 .
.... those that remained IBM are getting the tap on the shoulder and being informed of their redundancy this week. I had a couple of messages via LinkedIn, and two former colleagues down at Warwick have had said tap. One was a bit older than me, so 50+ and the other a tad younger, with nearly two decades service under his belt. Not that two decades makes much difference when the statutory minimum offering is in place.
At the other end of the spectrum in the UK, IBM have 'Client Innovation Centres' and hire recent graduates, on 23 month contracts, so this will skew the age demographics, as these hires will expire and be replaced with more fresh faced meat.
Looking around at the IBMers I've seen, any redundancies are bound to affect older people. IBM is either the grey-beard lifers, or fresh out of college. Median age must be about 50. There's a missing generation at IBM, from about 30-45.
I guess that's because IBM have been such a bad employer over the last 8 years (ish) that the aspiring folk left for greener pastures, leaving the oldies & the graduate program.
Just for the youngsters amongst us: discrimination doesn't only have to be applied on race (which is the most obvious thing people think off) but can just as easily apply to other areas such as gender and age. And correct me if I'm wrong but discrimination is against the law I think ;)
Of course companies should be free to hire who they want, it's their paycheck afterall. But even so the whole thing is utterly stupid because by doing this you're also throwing away years worth of expertise. It doesn't matter if someone has documented all their work, even the best documentation out there is in no way comparable to pure hands on experience.
I wouldn't be surprised if that all that money they may be able to save on the payroll will get burned up anyway because people are now busy re-inventing the wheel. It's inevitable, that's just the way things work.
Other companies are doing exactly the same thing.
A more recent practice is to bundle all the unwanted or nearing retirement workers into a spin-off, sell it and then 4 months later the new company goes busts and bobs your uncle you're without a job.
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Must have been a slow news day
To think most of the week they've been hosting the inaugural Think 2018 conference and the only thing El Reg has to show for it is this, LOL!
My only real question is how this ended up in the Data Centre section???
Good luck on getting IBM to respond to this garbage and welcome to the Cognitive Era!
HPE has been on the exact same road for the last year or so...with many of the older and most experienced people being cut. What I see matches the article's description of IBM's behavior nearly perfectly. HPE and IBM must have outsourced the layoff decisions to the same vendor. (That's a serious comment; I have second hand information suggesting exactly that was done.)
I got my notice late last year, as well as quite a large number of my older peers, most of them technical experts with an enormous amount of experience.
I figure it will take about two years before HPE really has to pay the piper and their products come crashing down around them. At that point they will only be capable of acquiring, reselling, and outsourcing.
It's a race to the bottom, and we're winning!
Apparently, playing the long game is no longer fashionable. Get what you can, then get out? The company that builds knowledge, and manages to retain their experts could make a killing. Wonder who will figure it out first.
// I'm 64, EE employed by a consulting company.
Mine too. Ultimate folly. Within the next 6 months they lost every contract they had and went bust. They made the most elementary mistake - they forgot to consider how the clients might feel about this. Every IT company needs to remember the basics, starting with "At 5 o'clock the entire intellectual base of the company gets up from their desks and goes home."
Policing age discrimination isn't that hard - effectively the median age should be half the retirement age in any given country. Granted that wouldn't stop IBM in it's current unpublished practices, but would eventually even out as the excessively young companies would need to start doing the opposite.
>Policing age discrimination isn't that hard - effectively the median age should be half the retirement age in any given country.
The median age should be somewhere around the early-mid 40s - effectively nobody under 18 is working full-time, and retirement is mid-late 60s. This could skew depending on the age demographics of the country and the role.
>> "...retirement is mid-late 60s."
>LoL! Someone's in for a shock.
Official retirement age for someone my age (40s) is 67, which will probably go up in the next 20 years. Even then, I doubt my pension would be enough to support myself alone in this country.
The plan is to flog everything and move to the cheapest, safest country I can find. Unfortunately, the best values of cheap usually mean the worst values of safe...
The plan is to flog everything and move to the cheapest, safest country I can find. Unfortunately, the best values of cheap usually mean the worst values of safe...
Unfortunately Japan isn't cheap, otherwise I'd retire there. OTOH they *do* have a dwindling population, so at least there will be plenty of room (outside of Tokyo).
And on it goes... IBM UK has just started a consultation for getting rid of 110 people in it's legacy, er, Cloud software division. That's 110 out of just under 500 staff, on top of all the previous rounds. There is a voluntary programme this time around, where those who stick their hands up get the great incentive of a statutory minimum payment, as opposed to just the statutory minimum payment otherwise.
Seriously? They just handed out the cardboard boxes to those departing after the 'consultancy period' from the previous round this week. So they are overlapping, effectively. It used to be one every 18months - 2 years, it appears now it's an exponential circle of shite.
Seriously. I assume that there are people whose full time job is essentially firing people. If the process didn't keep rolling on, they would presumably have nothing to do, and then where would we be?
I'm not sure "handed out the cardboard boxes" is a good phrase as it implies they are free. I imagine that IBM deducts the cost of cardboard boxes from the generous redundancy payment.
I'm not sure "handed out the cardboard boxes" is a good phrase as it implies they are free. I imagine that IBM deducts the cost of cardboard boxes from the generous redundancy payment.
Nah, last time I got laid-off from an on-site IBM job, I just used a couple of printer paper boxes. Never mind that there were still a few reams of paper in the bottom...
Reminds me of the old IBM salesman's manual giving all the 'ethical' rules that were to be used during sales projects. Of course, the rule book could be interpreted and then used in exactly the opposite way to the claimed 'ethical' intention. No wonder we relatively gentlemanly chaps in UK firms lost out all the time...
Do they still use that manual I wonder?
I've noticed as I've aged that I get technical tested far harder by people half my age than they test people their own age. I've been part of my current employers hiring regime for 7 years now, and over that time I've regularly interviewed in a pair with each of the younger guys that interviewed me, and they definitly go easier on the younger staff.
There's no point expecting us to work to 70 if nobody wants to give us a job after 50. Why is age discrimination not policed and called out where deficient? Everyone is going to get older - there's nothing we can do about it.
IBM went down hill when Sam Palmisano took the helm, it was all about financial engineering and innovation slowed down. Indeed the biggest scam was the 2015 roadmap that was never hit. Things only got worse and more incompetent under Ginni Rometty. They are now trying to innovate again, but it's not clear if this is real or just blowing marketing smoke.
100% correct. Now known as IBM Talent Management formerly Kenexa.
The example they give is an airline company. Who do you reward and retain? The pilots and safety engineers? No. They are 10 to the cent besides you already have the customers butts in a seat.
You retain and reward the low paid cabin and airport staff because they can sell profitable drinks to your captive customers.
Watson tells you that.
FFS The Oldies? 40+ ~It's not like we are all just doing the 'three score and 10' innings these days.
<<Over the past five years, Big Blue has axed over 20,000 American employees who were 40 years old or more, it is estimated, amounting to roughly 60 per cent of its US job cuts...>>>
...with (old) folk regularly living well into their late 80s, what will they do for the other half of their lives?
Hopefully they will steer any investment pots away from companies that use such ageist practices.
sigh.
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