Thread regarding IBM layoffs

Does IBM even have advisory for other cloud. If so how is it perceived. Who will recommend IBM services imeant Microsoft, Google or AwS and why they would want to work with IBM given each one of them have their own consulting and have strong partnership with Accenture and other consulting companies. How big is CAMS to move a needle.

CAMS NA here but can say the amount of work done in “other cloud” is really small as you need to justify why you shouldn’t use IBM or OpenShift during the bid cycle. Most leadership is too lazy to challenge it.

How is IBM CAMS Canada. One of my friend just got an offer to join. He asked me about it and I don't know any details. He mentioned that it is other cloud and not IBM as part of GBS in the advisory. Is it even worth considering it or pass it

I’m in GBS CAD and never had a client ask for OpenShift. I also haven’t done a project which uses Docker since 2016. All of my projects we have developed in serverless functions or PaaS services from cloud providers.

All groups (GTS, GBS, old SWG, Systems) are struggling with getting up to speed with Kubernetes and the all CloudOak stuff. It doesn’t help that these things changes every other months and that IBM can’t get behind a strategy and stick to it.

At this point, the only thing IBM can do is to manage costs (aka layoffs), keep on selling assets (software & hardware) and cut the R&D expenditures. This is called a slow death.... IBM will still be around another 10+ years on its own or may be they will get acquired or totally sell itself in pieces.

Pretty sad story!

What % of GBS people were doing anything related to OpenShift/K8s/Containers prior to the RH acquisition? I don't see GBS being all that effective in helping sell RH. Maybe in parts of the CAI business, but that's it.

As for the "move to Linux" this is typical IBM insularity and ignorance of the market. Most customers moved off proprietary Unix and on to Linux 10-15 years ago. This isn't some current green field opportunity.

2htj. You are making a pile of valid points. GBS was never allowed to make money. IBM mismanaged them from day one and until the purchase of Redhat, continued to do so. The purchase of Redhat is a double down on GBS. Redhat has the strategy for harvesting legacy, but not the experience. IBM has the experience, but not strategy. The purchase of Redhat for IBM is to buy a strategy. IBM has decimated it’s sales force, so they are counting on GBS to become their sales force. YES GBS only recommends, but that’s good enough to get the 1100 large enterprise reps into the door to do that rep dance. NOTE the new rep dance is move to LINUX where appropriate, and milk the legacy for all its worth. (YES legacy still does a lot of things quite well). Remember IBM gave up on 95% of the market place when they tossed Intel, and gave Power (except enterprise) to the channel. The only market place IBM has left is Z, enterprise Power, and a few MSP’s / hyperscalers who do volume. That means a sales/marketing force that’s 95% smaller. Combine that with the GBS recommenders and you can see where IBM is aiming. Established enterprise customers, with any LINUX adopters thrown in as “found” money. NOTE the go forward strategy will embrace cloud around the marketing message of “pay for what you use”. Amazon figures this out first, and captured share at an incredible speed. Microsoft had to change their CEO to realize this message and Azure took off when they did. IBM watched all of their Intel, and 75% of their UNIX market share fade away before they got the message, but when they finally realized it, they discovered they had sacrificed their sales force to balance the books. NOW they are trying to cobble together a go forward strategy with a skeleton “legacy” crew. Hybrid is the only card left to play, BUT it will have to embrace a GBS consulting Force to educate the customers about Cloud, LINUX, and pay for what you use. GTS (perform) on the other hand is mostly redundant. There are piles of perform skills out there who will always underbid IBM. IBM will need a skeleton crew of Legacy / cloud perform skills, but it will be much cheaper to form an Intel alliance with an established cloud player who wants to grow. Look for IBM to Dump most of GTS and some parts of GBS, as it’s where the bean counters see savings. REMEMBER the CFO saying we are withdrawing from OEM investments. IBM Hardware and Cognitive are just offerings to catalyze the enhancement of hybrid (think legacy combined with Intel) cloud. IBM is just harvesting what they have invested in over the last 40 years. Everything else (think mostly Intel) IBM has already let slip thru their fingers.

@2htj maybe the strategy with Red Hat is to get new clients too. i cannot for the life of me think of any other reason that they would have bought it. The products reek.

IBM got what it wanted out of the PWC deal- pillaging their legacy clients to sell huge dollar value (but largely unprofitable) GTS deals and peddle software and systems. They also thought they had acquired a new sales force in the process. This strategy is flawed for many reasons. First of all, management consultants do not sell, they recommend. Second of all, GBS was still held to revenue targets that could not be achieved by passing the business to GTS, SWG, or Systems. We’ve seen this repeat itself many times, with Bluemix/Soft Layer and the latest now with the push to sell Red Hat. The result is a workforce held to metrics that are impossible to achieve within a dwindling pool of clients (ever worked in an account with GTS SO contracts? I’ve worked on several and they are unpleasant and soul s—ing). The decision to combine GBS and GTS, two completely incompatible businesses, is a death sentence for GBS. We all saw the sign that meant they were finally done with us. Yet instead of searching for a buyer, we still are held to revenue metrics and squeezed to sell Red Hat (with zero incentive, of course, as with IBM Cloud and the rest). So you get splinter groups working in AWS and Azure because that’s the only way to make revenue, let alone keep the workforce engaged.
I’m sick of working for a company with such misaligned leadership. Or maybe Services management is so thick they cannot see the strategy play out. At any rate, it is time to align and either dwindle the business naturally or cut the cord and do it fast.

IBM hopes since they own the legacy and skilled work force to run that

But didn't they lay off all those legacy people?

I absolutely agree there are ugly pieces of GBS too. IBM has pushed all of their chips into the middle of the table on the cloud/Linux bet. We as investors have to accept that. That bet is working it’s way thru IBM right now (call it blue washing if you wish). While you are blue washing, take the results of 3rd Q and streamline “services”. GTS has far more stream lining to do, BUT there is a significant part of GBS that needs to go too. The remaining LINUX/CLOUD services piece is something that definitely has value, and something that definitely compliments “hybrid cloud”. NOTE hybrid cloud is just a fancy way of saying we are going to take your legacy on prem work and move it to a pay for what you use type of service, whether it’s on prem, or in IBM’s datacenter. IBM hopes since they own the legacy and skilled work force to run that, that the 1100 enterprise customers will give them a shot at the Intel workload that is close to the legacy too. (this could be new front ends, Linux workloads, rewrites, and just running stuff that isn’t worth the effort to convert). Most enterprise customers will see great value in that, and most likely do it. The remaining non-legacy workloads and their infrastructure need to go. That means perform work, consulting, etc etc that don’t command any profit margin because they are body shop types of work. SELL that to the highest bidder with terms that favor the legacy (Eg we’ll give you first bidding rights for any work that we find in our 1100 customers that we would recommend outsourcing to a body shop). There you have it. The go forward strategy. Just get it done. It can’t take 5 years to accomplish. More like 18 months. Just concede Amazon and Microsoft own the Intel space. All of the remaining cloud players are potential partners. Pick one and ride the horse. The Potential partner environment and the resulting relationship, will never be stronger politically or economically It’s time. Perform or leave.

Is it time to admit that it was a mistake to change IBM from a hardware/software producer to a consulting firm? To change "customers" to "clients"? To stop researching new technologies and start buying them?

GBS itself is a dog too and now GTS/GBS are conjoined twins so if you dump one you need to dump the other so be careful for what you wish for.

GTS is shrinking faster than Cognitive is growing. Hell of a job Ginni. Hell of a job. I guess we’ll make it up in volume GTS is IBM’s problem child. It is shrinking at warp speed and shows no indication of turning around. Face the music and dump it. Once you strip cloud out of it since that’s the go forward strategy, you should have a viable 55-60 billion dollar company remaining that overlays quite well with where you have publicly announced you want to take IBM. Everyone knows GTS is the weak sister. Just s— it up and get it over with. The remaining viable company should easily expand the PE to make up for the drag of GTS. The revenue generated from the sale of GTS should be able to retire most of the debt taken on to acquire Redhat. Wipe the slate clean and move on. Being a viable company in the streets eye should expand the margins, and produce something the street is willing to speculate in again.