There appears to be a growing perception that IBM's long-term strategy involves gradually divesting parts of the company and returning capital to shareholders.
I think that Red Hat will remain as the primary entity, with senior executives seamlessly transitioning to positions within Red Hat.
There is speculation that even the IBM brand name might be sold off. Some of us have likened the acquisition of Red Hat to a "reverse takeover."
Not sure why folks are touting Z as they sacked a LOT of Z . For my (former) project we had to take over all Z testing and integration as all those folks were sacked and not replaced. I'd hazard that situation for any other internal product running on Z.
Ahhh Mr Downvote is back. You know you are pathetic! Oh well you can’t fix pathetic. Now on to IBM’s cost structure. IBM’s basic problem is they suffer from “legacy management practices” IBM since the 20’s has managed in a 10-1 structure. That came from Watson SR and his adoption of a 10-1 management to employee structure generally accepted because it worked for the army. This structure got reinforced during WW2, and IBM refused to change it until Gerstner took over. Gerstner changed the management structure to closer to 20-1, and it proved quite successful as “technology” changed the game. Gerstner’s biggest mistake was he allowed existing managers to backfill employee positions instead of running them off and embracing the technology solutions. As Gerstner faded from the scenes, those ex-managers creeped back into management positions, and IBM is yet again back to 10-1. Old habits die hard. Meta has demonstrated that being over managed is costly, and their latest round of layoffs targeted managers and spreadsheet jockeys. IBM would do well to learn the Meta lesson, and aim towards efficiency. Commoditization has two logical end points. You get more efficient by doing more with less, or you get out of the game. IBM has to decide which approach they want to pursue, as the status quo isn’t working. Go ahead Mr downvote Vote away
at approximately 8.30 am Eastern Time on June 2, I observed posts from each of @7esi+1mOxODEp and @7fxe+1mOxODEp be down voted from in one case +1 in the other case 0 to -12 in a matter of seconds. (Certainly within one minute.) The top article was short enough that I could check both vote counters without scrolling up or down. The vote count when down in sequence (0, -1, -2 ...) That is, it was not an instantaneous drop.
The odds of that happening because of actions of normal readers of The Layoff" are astronomically small. As we all know, votes on this board are being manipulated. Maybe IBM has a chron job running somewhere and it performs "sentiment analysis" (kind of like the "sentiment analysis" when providing feedback at HR time)? Others have speculated that the down voting could be done by a team in India. The down voting would have commenced at 6pm IST.
As near as I can tell, they didn't change the votes on older posts in this thread.
Anyway, I have now seen it happening in real time!
Maybe instead of accepting "IBM’s cost structure can’t support commodity pricing" as a given (and it's 100% true BTW) we should ask why is it the case and what can be done about it. There's no reason for IBM to have the overhead of General Motors circa 1980 and it's probably worse in reality.
4ynn It’s all about the SW. That’s where the profits are. 1 & 2 because they are SW make unbelievable profits. There is a reason IBM spent a small fortune on Redhat. It enhances 1 & 2’s profits via SW modernization and allows the legacy home grown SW to also be modernized. There is more home grown SW than IBM written SW. That’s a mighty big pool to be swimming in and Redhat only makes that pool bigger. Wall Street has estimated the potential for legacy SW modernization running on IBM HW at over 2 trillion dollars. That is the golden goose, and everyone knows it.
IBM's product line is still vast, even after many years of evolution. For what it's worth, here are my predictions:
The dieing taking over the dead
IBM is slowly restructuring itself into a mainframe company with “NICHE” mainframe offerings. Everything else is slowly being sold off or partnered off as those pieces of IBM doesn’t make any money and are shrinking by double digits. Mainframe is the cash cow, and profit driver. The Redhat strategy is nothing more than a stop the mainframe bleed/shrink by getting the consulting division to recommend SW modernization of legacy Mainframe code and implementation of LINUX front ends. IBM has restructured itself to where it was in the early 1990’s. Same amount of revenue, same amount of headcount, and same strategy (mainframe centric). Where was Aikers trying to take IBM in the early 1990’s? Yep breaking it apart. What’s old is new again. Think of the profitability if IBM was to just support mainframe and its niches and sell everything else off. There are a lot of Wall Street bean counters who are doing just that.
IBM is selling vacuous garbage plus Z. A lot of companies need Z. So they will create a "Z trust" (and buy Z outright and detach it from the mother corp.) They will use this until they can untangle themselves from this nightmare -- which will take years. Even governments might help out since this is vital to their economies. But, insanely broken as governments everywhere are, it will be obvious even to them that an exit strategy is essential. So there will be an investment in a new Pfizer and a new Moderna (warp speed II) to re-open our economies without being wedded to: the opposite of agile; the opposite of open; the opposite of modern Cloud; make up your own comment about AI because it is so far removed from the only non-garbage currently being sold.
All of the rest is dead. Their cloud and their AI is pure marketing with no technical value. Specifically to @DownVoteBot, how much organic demand is there for "Cloud Paks?" And how much are you just making up? The answers are: "not a lot" and "most of it." The next question (again to @DownVoteBot) is will watsonX (IBM's puny AI) be different from "hybrid cloud?" The answer, in this case is "No, it's basically the same story; find a trend on jump on it." You are not even eligible for a "Participant" ribbon (because your participation was utter fiction on the day of the big track meet.) But that should never stop you from following your dreams and down voting everything in sight.
Oh, and to @cjb+1mOxODEp , products are now made by something called "Designers" who have never written a line of code in their lives. But gosh are they excited. Design Thinking may (or may not) be the final nail in the coffin.
I don’t agree with that other roles are useless. The industry outside IBM has proven this that Engineers can only deliver Product Managers vision. I have seen multiple times Engineers defining product and how quickly it falls flat!
Now that US employees are losing jobs they are worried about third world country skills. This has been the case for the longest time. It’s only best if we accept the fact and work on our skills rather than complain about it.
IBM already returned more than its market capital in the form of dividend and share buyback.
As a reminder, the industry is made by talented
engineers and not by "product owners", "scrum
masters", "agile coaches" and third-country
underpaid labors.
Truth.
It doesn't matter. IBM and Red Hat are both dead companies that probably won't even exist in the next 10 years. Since the 2019 acquisition, Red Hat has let go of many talented engineers. All these engineers are happily employed somewhere else. None of them has any interest in making their current employer pay for Red Hat and/or IBM services.
Red Hat has turned evil, the industry care way less about them than before.
As a reminder, the industry is made by talented engineers and not by "product owners", "scrum masters", "agile coaches" and third-country underpaid labors.