Thread regarding IBM layoffs

GBS is most definitely ghetto and has been for years. Aint nobody buying IBM software.

GBS could have been sold last year. Now it will never sell.

Why?

Because they saddled them with GTS. No serious buyer would ever take on that business.

Spinoff is far more likely.

This nets it out nicelyif you are in “old” IBm. One of the funniest movies ever

https://m.youtube.com/watch?v=fUDqcnSuKWc

Was on a call yesterday morning. The entire USA Power sales team was required to attend. Total head count on the call 94. Does this sound like a company dedicated to power sales??? Wave goodbye if you are on legacy. Dasd just nuked most of their heads who were associated with the industries. Again wave goodbye. Ibm gives lip service by saying “we are dedicated to XXX” but head count rules the roost, and they have gotten down to just the spread sheet bean counters. It’s over, IBM does not want to be in this business anymore

I’ve been doing systems integration consulting for about four years, so take my opinion with a grain of salt. I’ve worked three years for IBM and one year for Accenture. I am currently with Accenture. Overall, GBS is very comparable to Accenture’s SI consulting business however Accenture seems to have more projects and generally is better organized. Managers are very comparable from the skills perspective, Accenture folks seem to be driven and cut-throat a bit more. Accenture keeps hitting all numbers targets and there is an overall sense of optimism, when I was at GBS there was a sense of despair as we were going through a major RA at the time. With this being said, I think GBS is in trouble, IBM is in trouble but maybe they can fix things… Not sure if this helps but that’s my two cents.

There is one MAJOR over riding issue here and it’s “profit” margins. GBS has the worst profit margins out of the bunch of IBM divisions. Sometimes Hardware is lower, but it’s very seasonal depending on the product cycles. ALSO HW helps generate services far more than GBS does. So with that said, where does GBS reside. In the 25% profit margin business. FAR FAR below where IBM wants to run (Eg closer to 50%). As such what’s an executive to do???? Sell it, or spin it for the time value of money, and hope they license the IP that IBM owns going forward. KA CHING problem solved. So who buys GBS at 25% margins. Most of the outsourcers play in this arena with these margins, so most of the Indian players are most likely in the mix. (tata, Wipro, CSC, etc etc). Bain knows this, and has the inside track as to how they can “right size” the GBS operation for maximum profit, and re-issue of stock (3-5 years out) so most likely they can Tailor their bid to win. Will this happen??? Who knows, but certainly the street is pushing IBM, it’s board, and it’s exec management team in this direction. Question is timing. I would say it’s going to happen sooner rather than later. Most likely by end of Q1 2019

+1

They (GInni) do not want to be in this business any more...

GBS is hosed.

Give it back to PwC darn it...