Where is IBM Going?

So take one more step in the thread we are chatting about, and you pretty much can see where IBM is going. This next step makes an assumption, but I believe it’s a rather good assumption

New IBM is Strategic and Fortune 250 worldwide. (needs 25% of the existing marketing, sales, and technical experts). IBM considers the 75% either IP (legacy investment that it needs to recover, or services that it needs to milk)
GTS and GBS have been combined and SCON’ed into India. (again an 75/25% split on the in India vs the outside of India equation). What can be outsourced to India has, or will be outsourced to India as quickly as possible. The 25% head count outside of India gets absorbed into new IBM, and the India component of GTS/GBS gets spun off into a new venture that gets called a new name and issues new stock. (sounds like HPE and CSC doesn’t it)
The Legacy portion of IBM will continue to get spun off via IP deals. This has been going on for several years (rational, Lotus, Tivoli, PC’s, PC servers, etc etc etc). The remaining portion of “legacy” will get absorbed into either the existing channel, or via an outright sale to a legacy HW vendor much like EMC/Dell

So let’s do the math. 80 billion today with approx 350k headcount. 130k in India gets spun off. That results in 220k and 55 billion. IBM lays off 30k of existing heads. = 55 billion and 190k of heads. Spin off the channel via IP = 20k more heads go, but revenue remains. Thus 170k and 55 billion for “new IBM”. That results in 323k per head left in IBM. Right where IBM has always targeted and right where most of IBM’s competitors live.

So one last assumption. Is 55 billion and 170k worth of heads viable. YEP. In fact it would be a target considering the redundancies and IBM exec overhead. Redundancies if acquired would dump 10-15k worth of heads and dumping executives would relieve another 10k worth of heads. Now you are at 145k and 55 billion. That’s 380k per head. Right where Google and Apple live

Comment! It's anonymous!

8 replies (most recent on top)

Good thread

I was an IBM employee when they were making all the money and building the reputation that Ginni is now destroying. The successes of the past are gone and there are no new ones.

All IBM has done for the past many years is measure cost. They can't increase revenue so they cut costs to make the numbers look good. Problem is, they cut cost by throwing away talent. No pay raises, no incentives, hire only the cheapest possible people from the cheapest possible country, and nickel and dime the people who are left. Add in punitive programs like colocation and you see a company at war with its own employees. That's why IBM hasn't invented anything in decades. Any advances IBM claims are actually smart companies that IBM has bought and pillaged.

Pay attention to the math. It’s IBM managements grading system. Ibm hires consultants to tell them what to do. It’s what you do when you have run out of ideas. Consultants can’t quantify “innovation, or ahead of the curve skills”. So what do they do??? They measure revenue per employee, expense per employee, and compare you to your competitors. Hit their measurements and you are a hero. Miss their measurements and you are a goat. Ever wonder why there seems to be no rhyme or reason as to who gets picked or why for the RA’s. It’s all about the math, and consultants inability to quantify needed skills or future technology. Rather it’s comparing yourself to your competitors, and the consultants have decided how to present measureable results in a light that favors them as the presenters of the math. As I said, this is what happens when you run out of ideas. Hire folks who invent meaningless measurements to make you look good. May I say Ginni you look marvelous

I was told there would be no math...

i reposted - it was a good reply and i felt it deserved a thread of it's own... feel free to ignore if it's redundant.

why repost?

Great - thank you

Thread regarding IBM layoffs

Where is IBM Going?

8 replies (most recent on top)

Post a reply