What's Big and Blue – and makes its veteran staff sue? Yep, it's IBM IBM once again finds itself the target of age discrimination complaints from workers who claim they were unfairly laid off just because of their age. A lawsuit – filed in a US district court in southern New York, where Big Blue is based – accuses the tech titan of violating California and North Carolina age discrimination laws …
>>>generations X and Y are generally much more innovative and receptive to technology than baby boomers<<<
Boomers (& older) invented the computer age and most of the technology in use today working from first principles in Maths, Physics & Chemistry and without the help of advanced computers to do it!
As a Gen X I've always been amazed at what was achieved with slide rules and hard thinking.
Don't forget "And such transformations can yield substantial and permanent incremental capabilities and increases in productivity."
Curiously enough, despite this remarkable and valuable insight, IBM's shares have systematically underperformed the NASDAQ index for the last three decades since 1977. And more recently, over the last five years IBM shares lost 21% of their value (even before inflation), whereas the NASDAQ gained 109%.
Which would confirm that IBM consultants were talking out of their arses, which will come as no surprise to most round here. Why would anybody commission such a dreadfully run company to tell them how to do anything?
@Ledswinger, "Why would anybody commission such a dreadfully run company to tell them how to do anything?"
Oddly enough IBM seem pretty popular among dreadfully run companies, so there could be a link:
Lloyds finally inks mega 10-year cloudy outsourcing deal with IBM
Who will fix our Internal Banking Mess? TSB hires IBM amid online banking woes
Revealed: British Airways was in talks with IBM on outsourcing security just before hack
And more recently, over the last five years IBM shares lost 21% of their value (even before inflation), whereas the NASDAQ gained 109%.
May I point out that over those same 5 years IBM bought back almost 20% of their shares, too? Without their stock buyback plan, the stock would have performed even more abysmally.
I know that stock buyback plans are popular with investors, but they're also an admission by management that they really don't know how to use the money they have on hand to drum up new business. In IBM's case, that little bit of financial engineering has become their bread and butter since the corporate finance guys booted the tech guys out of the company leadership in the early 80s. Is it any wonder the company has gone downhill since then?
"Definitely. The bottom line rules the boardroom. It's not about "tech" as people who have worked on legacy systems were being let go in favor of younger workers to replace them. The IBM defense is BS and everyone knows it"
...and in which case, I sincerely hope that the courts see through that synthetic ruse and inflict punitive settlements on IBM not least to deter others from taking the same route.
>I expect this has plenty more to do with salary than age.
Quite probably. IBM's been all about the bottom line, the share price and the Board's stock options (not necessarily in that order) for the last 30 years. Unfortunately for IBM, that doesn't work as an excuse (or certainly not in the UK here, at least). It doesn't matter what your primary motivation was; if the effect is discriminatory, it's illegal.
Itsy Bitsy Morons is run some very dim PHBs. There is a serious, hidden problem when canning older workers: loss of institutional memory. New hires do not the back story of why something was 10 or more years ago. And a lot of tech is really based on 30+ year old designs. Having someone who knows why it was done that way can be great help in understanding. Another issue with trying to be 'hip' is the is very ephemeral as what is 'hip' today is passe tomorrow.
Yep. I remember when I first worked at IBM Hursley hearing a couple of old farts discussing an urgent customer issue with CICS. One of them was saying something like "I remember this same problem coming up about 30 years ago." I daresay they then went and fixed the problem.
Customer loyalty requires loyal staff. IBM seems to have forgotten that.
This is the principle of Chesterton's Fence:
In the matter of reforming things, as distinct from deforming them, there is one plain and simple principle; a principle which will probably be called a paradox. There exists in such a case a certain institution or law; let us say, for the sake of simplicity, a fence or gate erected across a road. The more modern type of reformer goes gaily up to it and says, “I don’t see the use of this; let us clear it away.” To which the more intelligent type of reformer will do well to answer: “If you don’t see the use of it, I certainly won’t let you clear it away. Go away and think. Then, when you can come back and tell me that you do see the use of it, I may allow you to destroy it.
Get rid of all your longer-serving staff and you've lost all knowledge as to why the fence was originally built.
Customer loyalty requires loyal staff. IBM seems to have forgotten that.
No longer matters. IBM are merely a middle of the road commodity outsourcer attached to a historic brand. So cost cutting and low-ball quotes are all that matter up front, then the outsourcing game is to provide a crap service, ream out the clients if they make ANY changes because they're locked in for several years, and accept that a lot of clients churn out.
Because other outsourcers do the same, there's always people churning out from competitors, who haven't used IBM before, and delude themselves that the experience will be different. Pillaging the customers is more important than providing a good service and building loyalty.
> low-ball quotes are all that matter up front, then the outsourcing game is to provide a crap service, ream out the clients if they make ANY changes because they're locked in for several years
Been there. A former employer brought IBM in take over all the data center operations--migrating nearly everything into Blue data centers--and then canning everyone involved with those data centers and the servers. Well, except for a few clusters that IBM couldn't find anyone in-house to manage so I was contracted to do that. Because of the brain drain that the outsourcing caused, migrating all the applications that been hosted locally to work in IBM's environment along with the ones I was contracted to manage took nearly four years--of a seven year contract--to complete. None of the few that IBM chose to hire as contractors were allowed to do anything related to the migration process despite having years of experience with the systems, applications, and end-users within the company. Gawd forbid we might do something without IBM being able to bill separately for it. Everything about the existing systems and applications being migrated was being learned from square one by the IBM people assigned to the tasks. Even before the four years had passed, the people in management that championed the outsourcing were gone--including the CIO. All were escorted from the building by security. There were a significant number of people that weren't let go as a direct result of the outsourcing who left the company in frustration because of the effect that this move had on the rest of the company. And, years later, everything's coming back in-house.
There is a serious, hidden problem when canning older workers
Having worked for companies that were pulling IT systems back in-house from IBM after ten years, most the passed over knowledge was long-gone, and this was before the IBM lay-off-palooza.
The handed-over documentation had been shelved and not kept up-to-date, the outgoing staff had checked out or bogged off (though I can't blame them) and the business side had only a magical thinking interpretation of what went on.
The tech may be current, but the problems are the same.
Older workers have solved the same problems before, using different tech. You pay them not to make the same mistakes again. The younger worker wil implement a sort routine with bubble sort; the older worker will know to use something more efficient.
canning older workers: loss of institutional memory
But IBM's income all comes from surfing the next techno-innovation wave of cyber goodness.
It's not like they have any business in legacy government mainframe projects.
I definitely want a 21year old Ruby bootcamp rockstar in charge of the air traffic control system - after all they grew up with an iPad so are digital natives.
I got downsized at 55 in 2001 along with a number of other similarly aged employees, only to see my former employer advertising open positions a few months later at lower salaries.
Skills? I picked up relational database and a couple new languages in my last couple years with that employer in my usual way - by picking up the manuals and getting on with the job.
Plus I had just delivered a project on time and budget. But it conflicted with a corporate fantasy that took several years and tens of millions more to deliver.
Seriously, these oldies have a considerable amount of collective knowledge and IBM by getting ride of them will just lose that knowledge. Ha Ha.
I'm in a mixed team of oldies and young ones, the number of times I've seen a problem come up that completely stumps the youngsters that I've been there are got the scars from first time around.
Latest little stuff up a couple of the youngsters needed to know when records were deleted. No problem they added a table to track these. Went into production a year later this tracking table has nearly tripled the size of the database. Youngsters didn't think to add any cleanup code. It turns out that tracking data was only needed for less than a month. Doh!
...if IBM youngins are "more innovative and receptive to technology than baby boomers", it might have something to do with the IBM of yore, that your older minions persevered through, having had somewhat of a reputation for not exactly encouraging thinking outside the box, blue or otherwise.
You know, back when young-and-hip Microsoft (how times have changed) were having your lunch.
The irony is that all the so called senior execs taking these life changing decisions for other lowly employees are themselves old. Why arent these senior execs sacked then? How old is Giny Rometty? The point is people in delivery and technical jobs are the ones selected for retrenchment. It is unfortunate but true. It seems seeing youngster around gives a feeling of change and newness in tech, not sure how it is on the ground. If salaries are the issue, they should cut the salaries and let the employees know their wont be any raises going forward. See if the employee wants to continue or not? At least give a chance.
Why arent these senior execs sacked then? How old is Giny Rometty?
II'm not quite sure, but she's looking her age these days
I've always wanted to know where the crossover point is between "we have to make these people redundant and employ cheaper ones for the company/make these people take a salary cut for efficiency" and "we have to pay these people more to get the best people"?
Does it vary between companies, or is it a set point?
It is sad to see a company, that was the technical benchmark in IT from the baby-boomer age up to the early 2000's, slowly became irrelevant. IBM lost its technical aura, the great company building the 360/370 architecture, setting standards and making the fastest CPU's now is becoming what Unisys is now. I am sure the day they will start emulating z-Series on Intel will be near.
Their path into technical irrelevance indeed implies it can afford to replace technical competence by millenials fingering their smart phones.
>>>
IBM's consulting branch about aging workforces that appears to suggest older workers were less valuable.
<<<
If the IBM Consulting conclusion is that it makes sense to blow your corporate brains out then I won't be hiring those consultants anytime soon - I guess that business line has already completed firing all the older experienced consultants and replacing them with cheaper ones with no experience. And I thought the point about using consultants was to tap into their extensive experience.
[Won't someone think of the children - because those are the consultants you will be hiring]
I joyfully took voluntary separation in 2000 and it was always about the money for IBM. It was openly stated by Functional Managers, time you over 50's took the money and went. The irony is some years later I met one of those FMs who had been forced out and boy was he bitter. I laughed about it for days afterwards.
Quote: "Yet, one of the long-running allegations against IBM, though, is that it does not always offer retraining and new positions to older staff to fit them into roles that require new tech skills. Instead it prefers to simply lay them off, and lure in young talent otherwise applying for jobs at Microsoft, Amazon, and Google, it is claimed."
CSC/DXC seem to be doing the exact same thing, and no doubt other large corps as well.
So difficult to get relevant training via the company, no budget etc. and now an insistence to do work related training in your own time! (It's a formal goal!). Then they turn round and tell you, you don't have the right skill set!
For myself, I've got my escape kit on, just waiting for the paperwork to come through! Hopefully to greener pastures, or at least not as dark as these!
I am truly shocked to hear that IBM of all companies is trying to get rid of people on the flimsiest and potentially illegal of circumstances.
Let's hope we don't learn that IBM has been making life intolerable and shitty for its workforce in a cynical ploy to force as many of them leave as possible so they can avoid the cost of laying them off.
Let's hope we don't learn that IBM has been making life intolerable and shitty for its workforce in a cynical ploy to force as many of them leave as possible so they can avoid the cost of laying them off.
I think that was step 1 and performed some years ago. Now they have to pay money. But it could go full circle and back to intolerable and shitty.
"In fact, since 2010 there is no difference in the age of our US workforce"
Hmmm... context? Could this rather ambiguous statement mean that they purged older workers around 2010 and are now (8 years later) finding themselves with a new crop of old people?
Regarding older workers being more expensive, this might be true.
However, when was the last time you heard a Millennial or Snowflake complain about lack of planning, documentation, diagrams, standardization, best practices, proper security, and the like?
Just make sure they have their foosball tables, beanbags, and munchies. Much easier to deal with than demands for the aforementioned roadblocks.
IBM, meanwhile, denies the charges it is discriminating against older employees. Rather, it claims the moves are the result of shifting its focus from legacy tech to emerging fields.
I guess the problem when you want to hire emerging fields is that you have to fire a few legacy technologies first.
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