Thread regarding Kyndryl layoffs

A clone of Ginny's IBM

I had high hopes that the spinoff from IBM would include a business culture departure from Ginny's disastrous IBM strategy to save the company to prosperity. Her misguided approach produced $30B in annual revenue loss, including 27 out of 28 quarters of declining sales. IBM was the only large cap tech stock to lose market cap (-24%) during her 8 year reign. Accenture, probably GTS/Kyndryl's biggest IT services rival, quadrupled in value during the same period by adding customer value. Ginny soothed Wall Street by propping up the income statement with expense cuts tied primarily to massive layoffs and offshoring US jobs while her personal income increased every year.

Kyndryl would be wise to learn something from that. In a service business that is inexorably tied to trust, how does a company expect to earn new clients' confidence when the deck of customer-facing people is constantly reshuffled? When you miss your numbers, the IBM way is to restructure, reinvent, change, cut, rather than providing more value. Lather, rinse, repeat. That seems like a clone of Ginny's IBM. How'd that work out?

Couldn't agree more, @2nfy+1v0KWhHI .

by
| 1671 views | | 6 replies (last November 4, 2024) | Reply
Post ID: @OP+1v97l9nb

6 replies (most recent on top)

Like a lot of stuff on this forum, the OP contains both questions and answers in the same posting. Why does Accenture add value to its business year after year and IBM (and now Kyndryl) does not?

Answer: Accenture adds value to its offerings because it chooses to, and it represents itself to its customers as both business consultants and IT consultants at the same time. Accenture's peers (competitors) in the market are Deloitte, IBM (Consulting) and Capgemini, among others.

IBM (GTS) and now Kyndryl were structured as strictly IT and not business consultants. This is obviously an oversimplification, but the bottom line remains...Kyndryl is treated by the market as an IT body shop, because that's how the business is presented. It's competitors in the space are Wipro and Tata, among others.

Have you ever sat in on a client-side negotiation with Accenture and/or IBM and/or Kyndryl? I have. IBM GTS (and probably now Kyndryl) focuses the discussion on specific IT services (help desk, system admin, DBA, network, system builds, etc.), their HR requirements, and prices. The negotiators meet with the client, go back to their hotel rooms and play with spreadsheets, then go back and forth with the client until a deal is made. It's basically a matter of cost, profit and loss. How much will IBM (and now Kyndryl) spend on service delivery (which may in fact be totally erroneous, by the way), and what will the P+L be on this deal?

Contrast this with a discussion with Accenture. Sure, Accenture will do a negotiation like IBM/Kyndryl if that's what the customer wants. However, customers do not approach Accenture as just an IT body shop. They expect Accenture to be experts in both business and IT. Instead of a plain ole DBA, for example, they expect that DBA to give helpful assistance to the business that might help them work more efficiently or to save money. It's a level of service (and therefore value) that was never expected from IBM (at least on the GTS side of things).

Could IBM have worked differently by combining GTS and Consulting? I dunno...it could have happened I suppose, but it didn't work that way when I was there. Consulting and managed services were always handled separately. Maybe Kyndryl can change that approach...it would certainly help them add value to their offerings.

by
| | Reply
Post ID: @bdvw+1v97l9nb

Absolutely true. Just left Kyndryl along with some other US based talent.
Lousy way to "make money", glad my retirement is not glued to Kyndryl's fate.

by
| | Reply
Post ID: @7fqp+1v97l9nb

Kyndryl is Blackrock&Vanguad. It doesn't matter what Martin's role is. If it's not him, it will be someone else and nothing will change. Just stay away from businesses that are owned by Blackrock.

by
| | Reply
Post ID: @2ars+1v97l9nb

So damn true. It shames me whenever I see leadership posting about how we are “on the right track”. Like no we aren’t. And we are cutting people left and right to save face to the market.

by
| | Reply
Post ID: @1voz+1v97l9nb

Kyndryl is IBM 2.0. Martin was a bean counter in his previous role, cutting the flesh and bone to reduce cost has always been his forte.

by
| | Reply
Post ID: @fms+1v97l9nb

Yup more of the same. It will only change when Martin and the gang leave. That said I am reasonably sure you and I will leave before he does. We are the disposable workforce for sure.

by
| | Reply
Post ID: @swh+1v97l9nb

Post a reply

: