back to article Kyndryl's consulting business may be less than it seems

Kyndryl has bet on becoming a consulting-led business, but among those who recently left the IT biz there's skepticism about the corporation's claims. Following our report last month about the managed infrastructure services firm's ability to win new clients, we were contacted by a source familiar with the company's consulting …

  1. Doctor Syntax Silver badge

    Would I be correct in thinking that by setting up Kyndryl IBM was trying to hive off the drain it was circling?

  2. David 132 Silver badge
    Facepalm

    Hmm

    “Many of these multi-year contracts cost more to service than they generate in revenue…”

    “…but we’ll make it up in volume!”

    1. JoeCool Silver badge

      Re: Hmm

      Or maybe you'll mke it up by having an account through which you can try to sell the entire range of IBM's products and services.

      Unless of course you're no longer IBM and don't have that avenue to gerenate sales revenue.

  3. The man with a spanner

    Its perfectly rational

    If you have a festering bunch of contracts that will never turn a profit it is perfectly rational (if a little unethical) to shove them onto the plague boat and cast them adrift on the ocean.

    More fool those that invested in the boat.

    1. Anonymous Coward
      Anonymous Coward

      Re: Its perfectly rational

      The University of Cumbria was created from the unwanted bits which the universities of Northumbria and Central Lancashire couldn't make pay. That has worked out about as well as you might expect.

  4. deevee

    Too much competition in the consulting arena for Kyndryl to be able to make any inroads...

    They should stick to services, like they were spun out to do.

  5. Denarius Silver badge

    Anything IBM touches

    dies, slowly, expensively IMHO. Including IBM. Just like Boeing and for similar reasons. I predict the next 3 years political uncertainty outside USA will encourage a move to inhouse everything except maybe, the hardware. However, given the appalling state of IT education. perhaps not

  6. The Oncoming Scorn Silver badge
    FAIL

    Short Version

    They snatched a MSP contract from my employer, cherry picked who they wanted to remain (Under worse compensation\no benefits as third party contracted staff) & or replaced with cheaper contract employees.

    Now they wonder why SLA's targets are lower than whale shit, as they got rid of all the staff with site specific & local knowledge to keep things working.

    Apparently they have been told, engage permanent higher quality staff, pay market rates\benefits & improve performance or they will be gone...

  7. Groo The Wanderer

    Well, this is one mismanaged company, isn't it? How long do you think it'll be before they declare bankruptcy? I'm going to peg it at a pregnant 9 months...

    1. Bebu sa Ware
      Windows

      In the genes...

      《declare bankruptcy? I'm going to peg it at a pregnant 9 months...》

      "you can't take the IBM out of the Kyndryl."

      Any ideas as to the paternity?

      I was wondering the origin of the word kyndryl - according to IBM is their neologism from kin and tendril presumably with the y for i replacement for trademark etc purposes but in old english it would have been cynn. Apparently the correct pronounciation is kin + drill but looking at the word I would have guessed cund + rule.

  8. Anonymous Coward
    Anonymous Coward

    Promising

    Kyndryl is going hard on AI-ops and is doing what it needs to to survive in a highly competitive environment. For the most part, to my knowledge, employees are not just being laid off when their jobs are offshored. Internal positions are offered where available. K is trying to do right by its employees, speaking as somebody within K who was part of IBM for a few years before the spin-off. The larger issues are societal/cultural ones where growth and (large) profit by any means is the rule. It is a bit concerning to see so many folks with no knowledge of the real situation at K sh*t posting based on their ignorance.

    1. James Anderson Silver badge

      Re: Promising

      I am assuming that kindly operates the same way as it's old parent IBM which has a long history of fiddling the accounts to match the stories they tell investors. They also have a history of shafting ordinary employees to enhance C suite bonuses. So the article seems enemently plausible.

      1. Martin Gregorie

        Re: Promising

        This is consistent with what an ex-IBMer told me when I was working in NYC back in 1976-77, when small non-IBM business machnes with capabilities like Bib Blue's System/3 first appeared, so its evidently not a newly invented behavior that only appeared as Kyndryl was launched.

    2. David 132 Silver badge
      Happy

      Re: Promising

      Ha. Found the Kyndryl employee and - likely - downvoter on this page. It's OK. You don't have to be so defensive. You're among friends. If you're unable to speak freely, blink twice...

  9. Anonymous Coward
    Anonymous Coward

    fake accounting

    "The Register was told previously that Kyndryl has been classifying work done on managed service accounts (its outsourcing accounts) as consulting work."

    How is it even a surprise ? Atos has been doing this for years, hugely faking its capital value, now look at the share price ! And it is not over.

    Here, they are faking their potential value, which is a bit the same.

    In K's case, we have:

    - managed services = legacy of IBM, will die soon. The part investors are writing off already in their purchasing decisions

    - consulting = the future, the part ensuring a bigger share price later

    Once this hits the proverbial fan (à la ATOS), people should go full class action if they've been ruined by fake accounting.

    At least in the US, it is still illegal, while in Macron's France, you basically risk less than crossing the road outside of zebras ...

    1. Doctor Syntax Silver badge

      Re: fake accounting

      "people should go full class action if they've been ruined by fake accounting"

      Why? As share holders they own a share of the business. The clue's in the name. The only source of money to pay out is the company which, if you want a fuller description, is the company of shareholders. So what happens in a class action by shareholders? They pay lawyers to sue themselves and pay lawyers to defend themselves against themselves and, whatever the outcome, get what's left after lawyers fees of what was left before the class action.

      Are you, by any chance, a lawyer?

      1. JoeCool Silver badge

        Re: fake accounting

        So, no share holder ever has benefitted from a shareholder lawsuit ?

        Obviously your analysis is missing some relevant detail or two.

        1. graemep
          Unhappy

          Re: fake accounting

          A shareholder suing a company they part own can only benefit at the cost of other shareholders.

          The people who actually to blame as insulated from the consequences.

  10. g-ibm

    In reality, they're not hiring in the US

    Would love see the employee breakdown by country. I'd guess less than 10,000 of the 80,000 in the US.

  11. SeasonedTechGuy

    A slightly different yet informed view

    Worked at IBM/Kyndryl for 40 years (last 2 at K). I'd have to disagree with Dakota.. there were very many talented people during my tenure and after (I left earlier this year) and we did indeed beef up consulting skills as well as solidify existing managed outsourcing contracts. Layoffs/resource actions are nothing new, we started doing those in IBM in the 1990s to balance our skill needs. Kyndryl has definitely gone through transformation to NOT be like IBM. I saw them hiring from the outside with competitive salaries and continue to financially reward employees after; something that we didn't do a lot of in IBM.

    I think Kyndryl will be alright. The insight gained from doing the type of work we did for 40+ years while learning new skills along the way will definitely not just keep Kyndryl afloat, but see it prosper as well.

    1. James Anderson Silver badge

      Except "Managed Services" or "outsourcing you mainframe ops" to the rest of us is pretty much a dying business in the Cloudy modern world.

    2. Groo The Wanderer

      Their market share suggests otherwise.

POST COMMENT House rules

Not a member of The Register? Create a new account here.

  • Enter your comment

  • Add an icon

Anonymous cowards cannot choose their icon

Other stories you might like