Lean and Mean: 150,000 U.S. layoffs for IBM?
I don't know what 150,000 lost IBM jobs means to the American economy, its workers and America but 150,000 is a breathtaking number and most certainly a staggering number. Other reports on the web place this number at 10,000 layoffs so PBS's integrity is on the line here!
so what's the future of America about?
we used to think that we could give away money to help those in poverty but now the means of doing that is being taken away from many Americans...
things are going to get different around here I think!
not only is the world getting flatter but paychecks will probably be getting flatter too and make us all brothers and sisters.
wow.
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While I'm rather shocked, given IBM culture, to see this, it seems rather a trend. I'd be very likely to throw my support to candidates, of whatever party, that have creative approaches to large corporation cutbacks, outsourcing, and offshoring.
Historically, some of the best highly-compensated job creation has been in small businesses. Some apparently core functions have been reduced in major companies, where a firm such as Cisco obtains a significant (but not all) amount of its new technology through acquisitions rather than internal research. To varying extents, some large companies use "intrapreneurial" strategies where they act as would an external startup incubator and venture capitalist, then spin off a subsidiary or even independent company from which they could get results.
Some of the obstacles to small business creation include healthcare costs with a small group, predatory capitalization (I don't mean to say there aren't VCs that play win-win), and competition from overseas firms that don't have to have the same work standards, or comply with US law. It's unnerving, for example, when a medical function goes overseas, and then the contractor threatens to publish personal data on the Internet, an act that would be a felony under HIPAA if it were in the US.
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Howard
*equal opportunity offense to both extremes*
"Those who cannot remember the past are condemned to repeat it" [George Santayana]
May 7, 2007 11:24 AM | Reply | Permalink
As a tech professional in a niche where a lot of work is offshored, it's not yet clear to me how inevitable the trend is.
On one hand, all you have to do is follow the news to hear stories like this. OTOH, there are plenty of countervailingn anecdotes about offshored projects that turned out so botched that the sponsoring companies saw the error of their ways. I think reality falls somewhere between the two extremes. Offshoring has already been through the fad phase, but it will be a slight but persistent drag on compensation of US-based knowledge workers.
In tech the interesting question for me is this: To what extent can lower-wage markets overcome their stereotyped perception as the home of low-creativity workers well-suited only to highly repetitive tasks that don't actually involve meaningful communication with the project's client? If the lower-wage countries can attack this "problem", then we're in a lot of trouble.
May 7, 2007 4:10 PM | Reply | Permalink
right. I agree with that because, as much as folks like Friedman lead you believe that culture is monolithic, it's not and, thus, one culture can't really replace another one.
however, IBM had quite a culture in the past and nobody I know enjoys the IBM of today.
To boldly go...
May 7, 2007 8:30 PM | Reply | Permalink
Don't sweat it!
Boeing is still hiring; so is Lockheed-Martin. The "Arsenal of the Democracies" soldiers on. And if it stumbles, Blackwater's there to pick up the slack.
May 7, 2007 5:03 PM | Reply | Permalink
I refuse to do military work since I don't like feeding off blood money... so those employers wouldn't hire me, or, I wouldn't stay there! as another poster mentioned, small business saved my ass.
To boldly go...
May 7, 2007 8:33 PM | Reply | Permalink
another interesting thing about IBM, when I was there, was that their scientists (phd's) didn't have enough things to do so they were going to work on letting outsiders hire them. I'm not sure how that effort paid off but big companies like the ones you talk about have a hard time competing because of their overhead.
these days, I think that IP companies can sell ideas to bigger companies who pay based on how the ROI works out.
the beauty of the big company is: "new employees can make a lot of money quickly."
To boldly go...
May 7, 2007 8:44 PM | Reply | Permalink
Nortel liked to spin things out of its research labs, into new small businesses that repaid investment, and my team tried to do that. Unfortunately, there were some internal politics tied to a much more expensive approach developed -- if that term applies to something that never worked -- by a team physically closer to the executive offices.
Nortel and Cisco were different in other ways. While I was there, a rumor propagated that Cisco and Nortel had had a rowing race, and Cisco won. Nortel executives were horribly embarrassed, and hired a consultant to tell them, within Nortel culture, how to win the next race.
"Fire two rowers, and replace them with two levels of middle management that will relay the coxswain's orders to the remaining rowers." Executive loved it.
--
Howard
*equal opportunity offense to both extremes*
"Those who cannot remember the past are condemned to repeat it" [George Santayana]
May 7, 2007 8:55 PM | Reply | Permalink
now, that's a good story! and most likely that boat slowed down! the main reason why I post stories like IBM is because, intuitively, they have so much potential but blow it.
The executives at the big 3 car companies didn't jump on green technologies; US steel companies didn't modernize; and IBM's management let it's soul die.
I once read something on TheStreet.com website that was pretty eye opening because it said that while workers should earn the right to make $50/hour, managers need to create opportunities that pay $50/hr!
so those middle managers really need to be working on the sort of synergies that create and promote enhanced performance.
IBM, I think, is moving towards "pay for performance" and we'll see if management is right that one highly skilled person can row the boat him/herself given the right incentives. but I think they'll rediscover that teamwork and trust isn't created that way and that meritocracy (absolute performance) has to be balanced with community (average performance).
To boldly go...
May 8, 2007 9:25 AM | Reply | Permalink
I wonder if IBM will remember some of its early and groundbreaking work in the "expert systems" subset of artificial intelligence. When many people hear of "expert systems", they think of cloning a PhD superspecialist.
Some of the early IBM work, for a business environment, recognized that an experienced receptionist or secretary had a deep knowledge of corporate organization and personalities. Optimally directing incoming calls was, in fact, an area that involved expert knowledge that was rarely recognized as such and valued as such.
--
Howard
*equal opportunity offense to both extremes*
"Those who cannot remember the past are condemned to repeat it" [George Santayana]
May 8, 2007 10:06 AM | Reply | Permalink