'20,000-plus staff' could face the chop in spin-off of IBM's IT outsourcing biz, says Wall Street analyst

IBM will push through a major restructure at the IT outsourcing business it's spinning off, with 20,000 or more staffers facing the chop, an analyst estimated. The Global Technology Services (GTS) division, minus a few elements, will be carved out into a separate public company. For now it's called NewCo, though IBM CEO Arvind …

[Anonymous Coward]

I'm not surprised they're dumping the division. Look how many lawsuits it has been involved in for failure to deliver on big contracts around the world. It is a liability for the main company if they lose those lawsuits.

Face it. IBM is definitely no longer "blue chip" stock, and people DO get fired for choosing IBM sometimes nowadays.

[Tony Gathercole ...]

Check your facts, please

It's been a while since I was an insider with IBM GTS, but I think that while there were some very troubled contracts within the GTS parts of IBM (I should know as I was part of the team that did performance reviews on SO and ITS contracts for ten years) - and indeed a few that went really sour and were terminated and / or ended up in court - they typically were not the deals that are occasionally reported here in El Reg.

In most cases these big contracts were systems integration, application development or managed process services contracts that would have been led by parts of the organisation that are being retained within what remains of IBM. Sometimes they would use GTS as internal subcontractors but my take is what mostly went wrong was at levels above the core infrastructure that GTS would have been involved in delivering.

And, for what it's worth, in my experiecene (and YMMV) there were many, many GTS contracts which were simply successful for both IBM and the customer. There are not many good Register headlines in deals that delivered what the customer wanted, at a cost that they were willing to pay and to acceptable levels of service.

[Anonymous Coward]

20,000 people?

What on earth did they all do? Ah yes, nothing.

[karlkarl]

Re: 20,000 people?

Heh agreed. There are two types of employee at IBM:

1) Those that are too busy tiptoeing around all the red tape so fail to get anything done.

2) Those that basically know very little and are a waste of space so fail to get anything done.

I honestly cannot think of *any* other category.

Big companies are interesting in that they either become an out of control, evil, blood sucking cancer. Or they become only slightly evil and glue their own feet to the floor. IBM is the latter. Again, I can only think of two categories that they all fit under.

[The Empress]

Re: 20,000 people?

There's a third category - the process drones. The dull dreary plodders who blindly and stupidly follow the process no matter what it says.

[Anonymous Coward]

Re: 20,000 people?

Isn't that covered under option 2?

The service delivery people focussed on ensuring targets are met by closing calls before SLA deadlines only for customers to promptly reopen the calls because they actually need a problem resolved.

[Youngone]

Re: 20,000 people?

The very big company I work for has developed into a sub-group of the second type.

A company that has consolidated its industry to the point where competition has become merely theoretical and so it can glue its feet to the floor, and still make huge profits.

[seven of five]

Re: 20,000 people?

While there are certainly -at least- 20k people doing nothing (or worse) at GTS, I very much doubt these are the ones to be fired.

[Anonymous Coward]

Re: 20,000 people?

Managers holding meetings and performance reviews. 20,000 seems a bit low tbh!

[FrozenShamrock]

Re: 20,000 people?

I worked for OIBM shortly after they took over a contract from the company I had been working for. They implemented new a change control process where we had to get all changes approved through IBM before going through the customers change control process. I was running the customers Exchange system and finally found a solution for an ongoing issue. I duly went through the IBM change control process and was approved. I then took it to the customers change control process and was approved and then actually implemented the change which resolved the issue. However, the IBM change control drone had not checked a box within the IBM process so technically I was not authorized to make the change even though the change control meeting approved it. I was reprimanded and told to immediately back out the change. The customer told me I would be walked out the door if I deliberately re-broke their email. I sent an email to various and sundry pointing out how stupid this process was and was then reprimanded again for questioning the IBM process and drone. I had to apologize to everyone and had to speak with a VP to prove how contrite I was.

It's the managers and process drones who screw things up at IBM, usually not the workers themselves. Most of the people working that particular contract stayed the same only the management changed. I left about a month later and IBM was tossed out half way through the contract.

[IGotOut]

10 more years...

...and IBM will be little more than patent troll.

[MiguelC]

Re: 10 more years...

Their reasoning seems to be that they'll be profitable when they manage to finally shed the very last employee

[Mike 137]

Is this what the customer wants?

"maniacally focused on being the best hybrid cloud platform and AI company ..."

I'd rather not have my cloud service run by maniacs. Cloud is already proving unreliable enough without that.

[poohbear]

"Linux is the de facto operating system standard and market share leader. "

Can't we give Linus a Nobel Prize for something now?

[FrankAlphaXII]

I vote for literature, hear me out.

His statements wishing death to Nvidia's engineers in multiple ways, that OpenBSD developers are a bunch of masturbating monkeys, that userspace was written by other monkeys smoking crack rock, and that a certain compiler's behavior is similar to a sloth that was a victim of a drop on its head as an infant are true classics, and need recognition as such.

[Anonymous Coward]

There are those that hope this new venture will rid them of the shackles imposed by IBM. The feeling is that, once no longer having to point customers at sub-standard solutions 'just because its IBM and they want the revenue', the new business can focus on what is best for the customer and not what lines the IBM C-Suite's pockets. Only time will tell.

[vtcodger]

In the long run

IBM seems to be evolving toward a glorious future where the entire company consists of a CEO, a board of directors, three janitors, a patent portfolio, and the 8000 lawyers required to monetize the patents.

[Anonymous Coward]

Re: In the long run

Don't forget the helicopter pilot....

[Anonymous Coward]

Re: In the long run

He'll be outsourced. Along with the janitors. And the lawyers.

[FrankAlphaXII]

Re: In the long run

I'm sure Infosys, Collabera or Capgemini will be happy to hire him, with no benefits and a significant pay cut naturally.

[sanmigueelbeer]

Re: In the long run

You forgot the army of sales people who will be paid by commission -- oh, wait.

[The Empress]

So basically they're creating IndiaCo. Another Indian outsourcing company. And half the 20,0000 will come back as contractors at 3/4ths pay

[Anonymous Coward]

Leverage is not a verb.

[Michael Hoffmann]

Mirriam Webster

leverage verb

leveraged; leveraging

Definition of leverage (Entry 2 of 2)

transitive verb

1 : to provide (something, such as a corporation) or supplement (something, such as money) with leverage also : to enhance as if by supplying with financial leverage

2 : to use for gain : exploit shamelessly leverage the system to their advantage— Alexander Wolff

[steamdesk_ross]

Re: Mirriam Webster

Webster isn't English!

[PassingStrange]

Meh

Dictionaries be damned. Leverage is a verb if enough people use it that way. That's how language evolves.

[Anonymous Coward]

Verbing weirds language.

[Anonymous Coward]

So by the end of 2021, "IBM" will consist of an operating system called RedHat branded as "cloud" and renamed to IBM, and some old decrepit Watson software that IBM will never learn is totally useless, but still being spruiked as "AI".

In other words, only stuff they can just "make" money by selling a license, and not have to actually produce anything. No doubt they will also demand you download the software/license etc so they don't have to create media or hardcopy documentation either

[sanmigueelbeer]

In other words, only stuff they can just "make" money by selling a license, and not have to actually produce anything.

You forgot "subscription".

[Richard Pennington 1]

Red Hat ...

... will be rebranded as Big Cloudy Blue Hat.

[Anonymous Coward]

How is there anyone left

IBM have been firing 10s of 1000s of people yearly it seems for over a decade!

Literally how is there anyone left working for the firm? In fact how are they still getting business? Any CIO worth their morning rice krispies would see how the firm is run and should have run a mile (Lloyds Bank, I'm looking at you).

It's genuinely mind boggling that anyone looks at an outsourcing firm and says "this'll be cheaper" and then looks at IBM, etc and go, "you know whats better than well motivated internal IT teams....staff that literally don't know one day to the next if they'll have a job"

[Anonymous Coward]

Outsourcing nightmares

When a company outsources work IT better be sure those that lose their jobs are not the people they expect to sell services to

no job no money, Lloyds Bank is an example

[EnviableOne]

I wonder ....

How long before DXC snap this one up