back to article Red Hat forced to hire cheaper, less senior engineers amid budget freeze

Next year, IBM's Red Hat plans to cut back on hiring senior engineers in an effort largely aimed at controlling costs. An internal email sent on Wednesday by Timothy Cramer, SVP of software engineering, to Red Hat managers directs hiring requisitions to be made at a lower level of seniority than usual. "All new plan reqs …

  1. Anonymous Coward
    Anonymous Coward

    What could possibly go wrong?

    *Sits back & munches popcorn to watch this shitshow*

  2. a_yank_lurker Silver badge

    Money

    I have no interest in taking a job with lower pay that a junior title implies. I would consider a lateral move for the same pay if I thought there was a much better upside for me even in my senile years (per the Ferals). I doubt anyone they would want to hire would consider a move to lower grade and pay.

  3. sanmigueelbeer Silver badge

    Next year IBM's Red Hat plans to cut back on hiring senior engineers in an effort largely to control costs.

    And now it starts.

    1. ayay

      I was going to post the exact same thing.

      Obviously, I was beaten.

      Who did not see that coming?

      Let us all witness "the great squeeze".

      1. TonyJ

        Yup next step: "All these senior engineers who've been with us for years are too old expensive. Now we have a bunch of cheaper junior engineers who can be pushed around more easily trained up as required, lets get rid of the senior engineers to save money."

        1. Fred Daggy Bronze badge
          Devil

          But the hiring of VPs will continue unabated. Until there are more VPs than Engineers.

    2. Doctor Syntax Silver badge

      I'm looking forward to seeing RHEL becoming a clone of Rocky or Alma Linux.

      1. keithpeter Silver badge
        Windows

        I'm sure that IBM would love to outsource all that tedious development of the OS to other organisations. That Big Red Logo company might actually have to invest a bit more perhaps?

        (Probably not a whole yacht's worth, just a mast and a couple of sails.)

  4. Anonymous Coward
    Anonymous Coward

    The fate of Little Red Riding Hat.

    It makes sense that IBM would take it's winning strategy and apply it to little Red Riding Hat. What's rep for if not as flammable material to fuel next quarters management bonus?

    1. Yet Another Anonymous coward Silver badge

      Re: The fate of Little Red Riding Hat.

      Some parable about a Golden Goose might also fit

      1. Anonymous Coward
        Anonymous Coward

        Re: The fate of Little Red Riding Hat.

        Duck hunting season. IBM likes to call experts and techincally minded as "wild ducks" .... Soon open season on duck hunting will happen

  5. Anonymous Coward
    Anonymous Coward

    Just another form of training your replacement

    That'll surely become tiresome to the older and more experienced employees who still want to and are fully capable of making contributions but are seen as a burden to IBM's bottom line goals.

    1. Amethyst

      Re: Just another form of training your replacement

      Are there even any older workers left at IBM? They've been laying them off for years now. AMHIK, Class of 2013 RA victim.

      1. DrXym Silver badge

        Re: Just another form of training your replacement

        I bet there are lifers who'll put up with any amount of bullshit to reach retirement whether that means they give a damn any more or not. The others will find employment elsewhere and take their skills with them. Either way, IBM has only hurt itself by treating its most experienced, knowledgeable staff like shit.

        1. fredesmite2
          Mushroom

          Re: Just another form of training your replacement

          Virginia M. Rometty.

          The only person at IBM over the age of 50 that actually reached the retirement age without getting laid off.

      2. fredesmite2

        Re: Just another form of training your replacement

        Virginia M. Rometty.

        The only person at IBM over the age of 50 that actually reached the retirement age without getting laid off.

        -------

        1. fredesmite2

          Re: Just another form of training your replacement

          Down voted for a fact. Are you Ginny's bottom catcher ?

  6. TM™

    In a knowledge economy a big part of your assets are your people.

    I was wondering about this approach less than a day ago and realised that it takes years to kill a company, but remuneration is typically based on short term metrics. If you can live like bandits for 4 years and leave the sinking ship before it goes south then I guess that constitutes success for these people.

  7. Ozan

    How IBM of them.

    1. Uncle Ron

      Joke

      Don't kid yourself. This is IBM speaking.

  8. Anonymous Coward
    Anonymous Coward

    Red Hat turns to running the company by spreadsheet

    I currently work somewhere like this, and it has been sad to see long time staff laid off, not slackers or wastes of space, but good people you like and respect, purely on the basis of "their salary was too high".

    All hiring now comes from low wage countries, ....and they are hiring low, we have had 3 people in a row get hired in the EMEA area, not turning up, citing the pay being too low as the reason.(technical jobs in a software provider)

    To run a business effectively you need people who can do the job and are happy, too many companies forget this and concentrate solely on the balance sheet.

    I spent some time going to events about start-ups and new businesses and the overriding message was that companies that are enthusiastic about their products and believe in the company are the ones that do well, companies started with the idea to become rich normally don't do so well, I believe the same happens with larger established companies too, once they focus on cost to the detriment of everything else they will not do well.

    I hope Red Hat re-thinks this policy, they were a good company, and I like their products.

    The staff are what makes a company a success, smart companies look after their staff and reward them for their work

    1. Pascal Monett Silver badge

      Re: Red Hat turns to running the company by spreadsheet

      Indeed, smart companies do. That rules out IBM.

      The problem, as always, is management. When the company starts out, they have the world to conquer. It's thrilling to progress upwards, to build a solid team and see competence and experience flourish while making oodles of money.

      Two decades later, the management team has changed. The people who built the company are gone, the employees who still like it there are now only "assets". The new management knows all about managing assets : they compute cost and returns on their little spreadsheet line by line. That ensures that they don't have the foggiest idea why Martin is costing so much per month and yet brings in next to nothing.

      That's because they don't know that Martin is the living, breathing encyclopeadia on Product X, and spends most of his working day answering pointed questions from his colleagues on the finer points of debugging this or that problem.

      So management decides to get rid of Martin, and the whole house of cards starts its trek towards ending up on the floor.

      1. Plest Silver badge

        Re: Red Hat turns to running the company by spreadsheet

        "That's because they don't know that Martin is the living, breathing encyclopeadia on Product X, and spends most of his working day answering pointed questions from his colleagues on the finer points of debugging this or that problem."

        So long as Martin didn't engineer that for himself. I utterly dispise people who make themselves invaluable, it's selfish to hold a company to ransome like that. However if Martin fell into that position, which is actually closer to reality most of the time in my experience 'cos no one else wants the job, then that's the company's fault if they shoot themselves in the foot. They cut the workforce, people have to become the centre of all knowledge on things, then they decide to come after those people and then they realise too late they've created a monster. They try to shaft poor Martin but Martin often has the last laugh, Martin often gets snapped up by another company who sees Martin's potential as a valuable asset.

        It's just life in the modern workforce, I've seen and been a Martin at various times.

        1. lotus123

          Re: Red Hat turns to running the company by spreadsheet

          >"I utterly dispise people who make themselves invaluable, it's selfish to hold a company to ransome like that."

          The company that allows employee to be in such position definitely deserves it. It is their responsibility to organize process in such a way that it can not be held hostage by a single person's "engineering". If owner lets all vital knowledge stay in single person that owner deserves Darwin's award

        2. Doctor Syntax Silver badge

          Re: Red Hat turns to running the company by spreadsheet

          Martin is probably the only last survivor of his team.

          1. W.S.Gosset Silver badge

            Re: Red Hat turns to running the company by spreadsheet

            CHRIST I've seen a lot of that in the big corporates.

        3. martinusher Silver badge

          Re: Red Hat turns to running the company by spreadsheet

          Nobody ion their right mind would make themselves indispensable on a single product. Some might try but they're invariably the useless ones. The reality is that this process happens because of a "last man standing" effect. Management will ignore warnings while the system seems to keep working.

          (...and, yes, my name is Martin and I've found myself in this position but never contrived it. But I'm not 'that' Martin, just 'another' Martin.)

          1. Denarius Silver badge

            Re: Red Hat turns to running the company by spreadsheet

            Documenting quirks and details is also futile. Nobody reads it and it gets lost quickly, especially if some document managing indexing and storage program is used. So the last person clued becomes a Martin. The few self styled indispensables I have run across are usually next to useless and mere sociopaths who only fool manglement.

        4. Anonymous Coward
          Anonymous Coward

          Re: Red Hat turns to running the company by spreadsheet

          I once worked for a large company with a very complex software ecosystem built upon 10-20 year old internals. They were very compartmentalized, with explicit management approval needed for each component of the massive software repository.

          I needed to find info on an internal EEPROM format. The active x86 product only used a few fields, mixed with knowledge built into the Windows drivers. The ARM and ARM/Linux uses would need to use more of the info.

          I spent a bunch of time trying to find someone to tell me about it or where the documentation was, or least give a hint where to start asking and looking. No one would acknowledge ever having worked on it, even when their name was on the check-in for related code, at most hinting that someone else had and giving me another place to look. It took me several weeks longer than it should have to write guessed-at documentation and my guessed-at code.

          In the years since I figured out what led to that situation. No one wanted to be the expert on legacy knowledge. You would spend your days being valuable to the company by answering questions, but useless to your immediate boss. You wouldn't be 'productive enough' to work on the important new projects that would lead to respect and promotion. The successful people "forgot" everything except when it was needed for their current or future project.

    2. jason_derp Silver badge

      Re: Red Hat turns to running the company by spreadsheet

      I very much doubt you need people happy to run a company properly. I very much doubt you even need to provide a meaningful service or produce anything. You're living with a pre-1970s mentatility.

  9. simpfeld

    All too common

    This is the sort of behaviour that buys you cost saving and better profitability in the short to medium term. But sows the seeds of your long term undoing. No problem though, the MBA who thought of it got a big bonus and will by then have moved on to the next business triumph (cost savings and long term business failure).

    Worse still this kind of crap is rewarded by the stock market, make a pile of people redundant and your share price goes up. Doesn't matter that there are less people to do the work and a pile of skills will have walked out the door (so some work maybe impossible to do now), so will maybe reduce future profitability.

    1. Yet Another Anonymous coward Silver badge

      Re: All too common

      But firing 10% of your workforce saves 10% of the budget and that's nearly the same as making 10% more money and if you keep doing it you eventually get profitable once all the people are gone

  10. trevorde Silver badge

    What IBM did next ...

    Resource Actions and a brand, spanking new helicopter for Ginny

  11. Anonymous Coward
    Anonymous Coward

    A plan for Red Hat...

    They could always fire Poettering, get in a dozen grads to start undoing systemd, save money and do the Linux world a favour.

    1. Doctor Syntax Silver badge

      Re: A plan for Red Hat...

      Really good things never happen. However a more feasible possibility is that RH's agenda no longer dominates and we get back to something more Unix-like.

      1. Short Fat Bald Hairy Man

        Re: A plan for Red Hat...

        If that happens happy days will be here again!

      2. LDS Silver badge
        Facepalm

        "something more Unix-like"

        Yes, if there is a company that could bring IT back to the 1970s that's IBM.

  12. AndrueC Silver badge
    Joke

    If you need internal mobility, eat a strong curry.

  13. Daniel B.
    Facepalm

    Oh no

    This is how Red Hat dies.

    You'd think companies, especially IBM, have learned their lesson but nope, they're still pulling off this kind of crap.

    1. itsborken

      Re: Oh no

      Wall Street rewards mergers of market leaders handsomely and continues to reward the squeezing out of costs over the years due to the merger. The union of the companies becomes stolid, so they pick a fresh target to restart the cycle and gain notice and future rewards. The fish rots from the head.

  14. Anonymous Coward
    Anonymous Coward

    This cr*p started almost immediately IBM took over

    I got squeezed out by Red Hat in 2019. Strangely I was the only team member (the only 50+ year old on the team) "encouraged" to leave at the time. Other senior staff were already leaving in droves in 2019 too.

    1. fredesmite2

      Re: This cr*p started almost immediately IBM took over

      Virginia M. Rometty.

      --

      The only person at IBM over the age of 50 that actually reached the retirement age without getting laid off.

      1. fredesmite2

        Re: This cr*p started almost immediately IBM took over

        Down voted for a fact. Are you Ginny's bottom catcher ?

        .....

  15. Doctor Syntax Silver badge

    /. picked up this. One comment there was along the lines of there being nothing as expensive as cheap engineers. There is; MBAs at any price.

  16. Lorribot

    Seems like the IBM "fuck the world how do we make a profit and who can we sack" is starting to bite.

  17. Roger Kynaston Silver badge
    Meh

    time to re-skill

    I observed that RH9 seems less bad than it might be but I feel that I may need to get up to speed with a Debian type distro now so may not get to find what RHEL9 is like.

    I'm getting too old for this shit!

  18. Anonymous Coward
    Anonymous Coward

    You're all such pessimists. Look at the strength and market dominance of Lotus, Tivoli, XIV, Storwize, Transitive.....

    Oh.

  19. Morten Bjoernsvik

    We all saw this comming

    $32bill borrowed and Mrs Romettys fallouts take their tolls. Rometty reigns in declining market cap. IBM used to have money in the bank, but now it is all debt. Stock buybacks to keep the value bloated emptied the coffers. Those interest rates could have payrolled the seniors.

  20. Ken Smith

    Just like the car industry

    Make a good product, the MBA's/Spreadsheet monkeys arrive, cost cut and the demise of a good brand is inevitable.

  21. kneedragon

    Have we heard this story somewhere before, not that long ago ... ?

    That's worrying ~

    What went wrong at Intel?

    They got taken over by boardroom pirates and management types, accountants and salesmen, not engineers. They ended up with a bloke in charge who did have an engineering degree, but all he's ever done was management. And he presided over the change in the company to reduce R&D budgets and hire junior people and slash the R&D spending ... now maybe he had a point, because Intel did have a stratospheric R&D budget, but while maybe it needed a bit of a trim, you don't let fkn accountants decide what needs trimming, you get the engineers to decide. So after they got rid of all the senior and talented engineers, they decided to make 10nm using less of that super-new-fangled extreme UV and rely on good old Intel engineering and resourcefulness to make 10nm work on older machinery, and let the damn engineers figure out the problems because that's what we pay them for. So for 6 years or something, the remains of engineering (the good ones having left or been sacked) tried to make 10nm work on a production system that struggles with 14nm .... and when things don't work, you blame the engineers because theyr'e not doing their job. Let's sack a few and hire fresh graduates... Now ~ How's your corporate bonus looking?

    Now, who would like to pull a figure out of their arse and tell me how much the corporate and management and sales focus at Intel for 6 or 7 years co$t them?

    I would suggest (I don't know and nor does anybody else) it cost then in the ballpark of a hundred billion dollar$ ...

    So what's happening at RedHat? Now that IBM own them body & soul? Well, it's not exactly the same thing, not quite, but there are some obvious parallels...

  22. DrXym Silver badge

    Welcome to IBM

    All the long termers will be subject to waves of petty bullshit designed to make them leave so IBM doesn't have to pay their wages or give them expensive severance packages.

  23. james7byrne

    Typical

    I knew when IBM bought RedHat it would not be a good thing. Big companies buy successful ones for the revenue stream. They kill R&D and layoff expensive employees. Customer service be damned. They will suck the revenue for until many customers leave. I remember when Symantec bought Veritas software in the 90s and the same thing happened. Netbackup R&D slowed and customer service went down the tubes.

  24. elregidente

    Microsoft and Nokia redux

    We knew when Microsoft bought Nokia, Nokia was doomed.

    We knew when IBM bought Red Hat, Red Hat was doomed.

    "...it also helps us balance the organization as we have many engineers with senior titles."

    This is madness; the difficulty of the position determines the seniority of the staff you hire.

    If you cannot afford all the people you want to hire, you hire *less*; you do not hire the *same number of people* but ensure they are *all* underqualified for their position.

    1. Kernel

      Re: Microsoft and Nokia redux

      "We knew when Microsoft bought Nokia, Nokia was doomed."

      Having worked for Nokia up until two years ago (when I retired) and knowing a number of people who still work for Nokia, I can assure you that Microsoft never bought Nokia.

      Nokia's mobile phone division (which Microsoft did kill) was only a part of Nokia.

      1. pavel.petrman Silver badge

        Re: Microsoft and Nokia redux

        I believe I read something about a Nokia 4G system being rigged up for the experimental moon base. I sincerely hope it works out, otherwise they would need to hire Alcatel for the job and we would not want that now would we.

    2. Anonymous Coward
      Anonymous Coward

      Re: Microsoft and Nokia redux

      But this is the failure of many large companies. They feel a need to hire 100 people to build a team because the problem sounds complex (to those without any technical understanding of whatever it is) rather than hiring 10 or 20 *amazing* engineers who will get the work actually done, and in less time, with fewer bugs. There isn’t a need to empire build and bloat ranks, there is a need to maintain quality of hiring. That doesn’t mean not hiring entry level roles, it means not *only* hiring entry level roles.

  25. Unicornpiss
    Meh

    Let me be..

    ..the 19th person to say it, but "You get what you pay for."

    Once in a while you'll find some gifted, naive person that lives and breathes IT, and is willing to work for less than they're worth. But mostly you get idiots that padded their resume and their only skills are sucking up and making everyone else's life difficult.

  26. fredesmite2
    Mushroom

    RH is a big India employer

    Like big-brother .... India Business Machines .. the majority of RH postings for the past decade has been offshore where they get 4 or 5 warm bodies for the price of one American.

  27. fredesmite2
    Flame

    Virginia M. Rometty.

    The only person at IBM over the age of 50 that actually reached the retirement age without getting laid off.

  28. Anonymous Coward
    Anonymous Coward

    Nothing new - it's IBM's Finance team at work...

    I worked at IBM for 30 years, 20 years as a manager. This is nothing new. For last 25 years, the company has been firmly and completely run by the Finance department. It's a finance company that happens to do technology.

  29. Stites

    IBM has a 25 year history of management by MBA. They manipulate the books to provide the maximum possible earnings in their next quarterly report and such things as long range sales strategy and product innovation are irrelevant. Now that IBM management has pushed the former head of Red Hat, Jim Whitehurst, out the door through internal politics they can apply their management techniques to their Red Hat subsidiary.

    Red Hat will join the rest of IBM in dying a slow lingering death by mismanagement. About 2 or 3 years from now IBM will sell or spin off the by then floundering Red Hat in order to spruce up the upcoming quarterly report.

    RIP IBM

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