https://www.techzine.eu/news/infrastructure/124578/ibm-quietly-conducting-large-round-of-layoffs/
6 replies (most recent on top)
This layoff is most likely IBM approaching the right sizing that it’s after. Several changes in the marketplace have caused the right sizing
- The commoditization of labor
- IBM being quite late to the cloud game
- IBM exiting the Intel game
- IBM adopting a purchase of innovation and abandoning “invented here”
- IBM adopting an enterprise focus and abandoning everything else
- IBM adopting the Kyndryl services model (8% on shore)
What suppositions can we speculate from the above 6?
- Any repetitive non-highly specialized job will be off shored due to lower labor
- IBM will exit the public cloud and partner up instead
- IBM power did not back fill Intel and ISV’s doubled down on Intel LINUX
- IBM’s purchase innovation decision will shrink SW group dramatically
- Mainframe and large power are now IBM’s primary focus Everything else goes This will result in a 75-80% reduction in first world staffing but and increase in offshore staffing
- GTS proved 8% on shore services model works and IBM has embraced it
Quote @pqf+1uARCw3F's statement
Why IBM does not move headquarters to a cheaper country or region if the cost so important？
Obviously they're only thinking about their own interests rather than the company's.
IBM will never have a leader like Gerstner again, nor will it have a future.
It sure sounds like AK has taken the Kyndryl model to heart. 8% on shore for services. NOTE manufacturing wouldn’t be included in that number as plants and equipment are sunk costs. Everything else near or off shore. If true, that says he’s aiming for a USA headcount of 288 x .08 = 23k PLUS manufacturing (POK, RST, AUSTIN, Tucson, Albany, and perhaps the labs) so maybe 10-12k = 35k total
This seems to square with the layoffs this week 48k starting and 38k ending
AK IBM CEO was hired in the first place to clean up that IBM mess by replacing older Americans with Indians.
Makes sense: IBM dinosaurs cost too much
The article says: “AK wants to replace older (more expensive) Americans with younger (cheaper) Indian employees “