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IBM says 'several thousand' layoffs on the way

182 points by oulipian 12y ago

pesenti 12y ago
So does that mean we can finally stop listening to Cringely altogether? I am an IBM employee and I can tell you a lot of my fellow IBMers had a really bad week-end because of his ridiculous claims. For context see previous discussion on the 110000 employee layoff that won't happen: https://news.ycombinator.com/item?id=8944637 https://news.ycombinator.com/item?id=8944637
- rjruizes 12y ago
  As another IBM employee, I second that. His rumor caused panic for a lot of people.
  - DannyBee 12y ago
    His rumor is probably a multi-year plan rather than a one-time event.
    - timf 12y ago
      He said "By the end of February all 26 percent will be gone"
      - DannyBee 12y ago
        Ooh, missed that. Well, i'd bet he's wrong then. They'll be gone, just not by end of february.
        jacquesm 12y ago
        Why are you so gleeful predicting doom for IBM?
        deleted 12y ago
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        DannyBee 12y ago
        I'm not predicting doom, i'm predicting that given their revenue is dropping for the past 11 quarters, and they can't they will cut the number of people to match the size of the market in most places, since they don't believe they can grow those markets. They don't need 400k people if their future is providing cloud and cloud services, and not tons and tons of services contracts in every walk of life etc Given they've taken restructuring charges between 600 million and 1.5 billion the past few years (which is about 7000-20000 people a year), why do you think they are going to magically reverse course?
        jacquesm 12y ago
        IBM has re-invented itself more times than you remember. They did it when mini computers came along, when the PC hit (an own goal if there ever was one), they did it when the Internet came of age (and when everybody else was still playing catch-up or even ignoring it) and I'm pretty sure they'll be able to survive the transition to the next phase of things (the cloud or whatever is fashionable). IBM is about as stable as they come, they do IT in whatever form it comes. When it was big iron they rolled their own hardware and software to go with it, now it is Linux, so they'll do Linux (on mainframes if you want it), if that changes, they'll change again. I'd write off a lot of companies long before I'd write off IBM and while they're laying off in one set of divisions they're hiring in others. So they're not 'magically' going to reverse course, they are gradually going to change course, like they've always done (and like every other supertanker does, move too fast and you'll break things for real, this is not a start-up). Each and every one of those changes was heralded as 'the end of IBM'. They definitely messed up during the OS wars, I'll give you that but for the most part they rode the waves better than just about any other tech company that has been around this long. Rumors of IBMs imminent demise are most likely vastly exaggerated and any prediction of lay-offs should be henceforth accompanied by some evidence or I'll simply not buy them any more, especially when they entail 100K+ lots of employees. How are Sperry, Control Data, Data General, Burroughs, SGI, Cray, DEC and a whole slew of others doing these days?
      - johnward 12y ago
        It's not the end of Feb yet so how do you know he isn't right? Also there is still a chance they plan to get rid of a large number but are avoiding the negative PR but staggering it.
        johnward 12y ago
        I agree that it's unlikely. Even if they would want to get rid of that number of people it would take years. Plus you would think they would try to sell off a part of the business instead of laying off so many people and paying out severance.
- Innistrad 12y ago
  I am suspect that IBM would layoff so many at once even if it were their intention to reorganize. The negative press involved with such a huge record breaking layoff would just add insult to injury. It would be much more likely to be 100,000+ over a length of time. Regardless I am sorry for the terror that this week must be based on this potentially unethical news article.
- lmg643 12y ago
  I wonder if IBM would change their plan based on this leaking. If he really had this totally and completely wrong, then of course that is very irresponsible of him to say. I don't see how you can stop listening to Cringely altogether though. They did abandon their $20/share EPS plan, which was a pretty epic change. The claims about global services having <50% college grads servicing IBM clients from india is also pretty damning for the company. I would like to see IBM do well, it makes me angry to see big companies squander their history and abuse their people.
  - krschultz 12y ago
    Something like laying off 25% of the company is as drastic a measure as you can ever take other than closing up shop. If they were thinking about it, they were not thinking about it lightly. They certainly wouldn't change their mind just because the news leaked.
    - DannyBee 12y ago
      ???? IBM is highly likely to have to lay off that many given the dryup of various markets. When HP splits, it's likely they'll do the same. This is just the way the services market is going. As for whether they'd change, uh, people like their current CEO definitely change their mind based on the way the wind is blowing, and how much crap will hit the fan.
      - krschultz 12y ago
        Have you ever thought about the logistics that go into planning a layoff of 25% of the workforce? In order to get the list of who stays and who goes there is a lot of work involved. Many of the people involved in that work end up on the list to get laid off. It's terrible for morale. Once you've gone down that road, you aren't turning back just because someone found out 2 weeks ahead of time.
- cones688 12y ago
  I feel lucky like yourself of being in one of the divisions with massive growth. I don't think people appreciate the size and breadth of IT IBM does, my "tiny" division of security if an independent company would be the 3rd biggest Security vendor in the market.
  - sharkweek 12y ago
    Saw the 100k number and thought "surely a typo" - only to learn that IBM has 400k+ employees I had completely failed to realize just how massive IBM truly is as a company.
- smackfu 12y ago
  My guess is that he turns "possible strategic plan for 110k layoffs over the next five years starting in January 2015" into "110k layoffs in January 2015."
- jacquesm 12y ago
  I think for an error of this magnitude some kind of apology would be in order. If he can't manage that he's lost a lot of credibility.
  - timf 12y ago
    I don't think he apologized the last two times he incorrectly made massive IBM layoff predictions: http://www.pbs.org/cringely/pulpit/2007/pulpit_20070504_002027.html http://www.pbs.org/cringely/pulpit/2007/pulpit_20070504_0020... http://www.cringely.com/2012/04/18/not-your-fathers-ibm/ http://www.cringely.com/2012/04/18/not-your-fathers-ibm/
  - hristov 12y ago
    An error of what magnitude? IBM has not said exactly how many people will be laid off so we do not know what the magnitude of the error will be. Furthermore, they can certainly perform a 110K layoff by splitting it into multiple layoffs of thousands.
    - jlukanta 12y ago
      Response from IBM (via its Hong Kong office’s blog): IBM does not comment on rumors or speculation. However, we’ll make an exception when the speculation is stupid. That’s the case here, where an industry gadfly is trying to make noise about how IBM is about to lay off 26 percent of its workforce. That’s over 100,000 people, which is totally ludicrous. The fact is that IBM already announced, after 3Q earnings report, that the company would take a $600 million charge for restructuring. That’s several thousand people. Not 10,000, or 100,000. Moreover, IBM currently has job postings for more than 10,000 professionals worldwide, with more than half of them in growth areas such as cloud, analytics, security and mobile technologies. IBM’s new cloud leader, Senior Vice President Robert LeBlanc, told Fortune this week that IBM has plans to hire 1,000 cloud professionals. A little perspective on IBM’s earnings is in order. The company still makes huge profit… $21 billion in operating pre-tax profit last year. And IBM’s “strategic imperatives” represent 27% ( and growing ) of the company’s total revenue… $25 billion in revenues, up 16 percent. We have high growth in a substantial portion of the portfolio, and those areas (CAMSS) have better-than-normal margins in areas that matter most to clients today — that’s the heart of the IBM transformation. https://ibmhkblog.wordpress.com/ https://ibmhkblog.wordpress.com/
- DannyBee 12y ago
  I don't think today's IBM ever planned to layoff 110k at once. Lay off 10k here, 10k there, call one a workforce restructuring, another "an innovation related rebalancing plan", blah blah blah. It seems highly unlikely to me that IBM would just up and lay off 110k workers. Ignoring any other issues, the political blowback and PR blowback they'd get from politicians would be huge right now. IBM doesn't want to get in the middle of the current job-related wranglings. When they laid off 60k in 1993, you can see it didn't really happen all at once then either. http://www.nytimes.com/1993/02/16/business/first-layoffs-seen-at-ibm.html http://www.nytimes.com/1993/02/16/business/first-layoffs-see... (February) and then http://query.nytimes.com/gst/fullpage.html?res=980CEEDF163EF93BA15754C0A965958260 http://query.nytimes.com/gst/fullpage.html?res=980CEEDF163EF... (July)
  - deleted 12y ago
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  - bring1 12y ago
    their stockprice would make a big jump if they could manage to lay off 110k people. I think it would be a good thing, to streamline their operation.
    - jacquesm 12y ago
      You do realize you're talking about 110k people losing their income? Including dependents (averaging 2.4 / wage earner) that means this would affect ~ 250K people plus those laid off so 350K people. Funny definition of a 'good thing', there is more to life than stocks.
      - stainednapkin 12y ago
        Yes, "good" can mean many things depending on what the person saying it believes.
      - stavrianos 12y ago
        I inferred a "for IBM" on the back of that sentence. Obviously, shitty for those laid off.
- jimbokun 12y ago
  Just read Cringely's article, and think IBM's response takes just the right tone: "IBM does not comment on rumors or speculation. However, we’ll make an exception when the speculation is stupid."
- wglb 12y ago
  I stopped decades ago. Note that his wikipedia article says he finally figured out "[A] new fact has now become painfully clear to me: you don't say you have the Ph.D. unless you really have the Ph.D." Rather cringeworthy, I would say.
- yabatopia 12y ago
  It would be naive to think IBM upper management didn't run simulations of letting go 100,000 employees in order to optimize profits or focus operations . Letting go not in the sense of actually firing people but also by selling divisions or splitting up the company. It doesn't mean they will do it (right away), but it's not as ridiculous as you would like it to be. One thing's for sure: more than 11 consecutive quarters revenue losses will have a drastic effect on the workforce of IBM.
mathattack 12y ago
Project Chrome? It's hard to fathom that a tech company would name their layoff program after a competitor's technology. That just strains credulity. If that part is true, it's a sign of bad things in the company.
- mynameisvlad 12y ago
  First off, it's just a name, not really a big deal nor would it really be a sign of anything. Secondly, if your requirement is "not a competitor's technology" then practically every single word would be excluded because it would have been used, at some point or another, by one of the hundreds of thousands of competitors IBM has and has had.
x0rg 12y ago
I think IBM should stop selling the ultra crap software that is selling right now like Websphere commerce and all the crappy enterprisey stuff. They really need something good to change and if layoffs are for the better, it's probably worth trying. If the plan is to keep this stuff going, it's gonna be bad.
- aragot 12y ago
  Yes the most interesting revelation in Cringely's rumor was that IBM made software. Let's be honest: An big IT product is about 25 programmers and 25 diverse people (incl marketers, designers, accountants) working for 3-10 years. With this you make a GitHub, a Word, an IE. IBM could be owning the planet today. But no, they're in the business of hotels, golf, and conferences.
  - AlisdairO 12y ago
    They do make many billions profit on software every single quarter. Who cares if the market is not very sexy? If you think there's only 25 people working on Word, I think you're off by an extremely large margin.
    - aragot 12y ago
      If you planned on making a competitor of Word, would you copy all its features and throw 5,000 people at it? Of course not. No, I don't think Word is 25 people. But a relationship of mine made an Excel in js with 3 people and sold enough copies. Before you say I'm wrong again, no this Excel-in-js isn't isofunctional. It's just what the customer needs. Point being: You can make great software with few people, and IBM could do it easily.
      - AlisdairO 12y ago
        > Before you say I'm wrong again, no this Excel-in-js isn't isofunctional. It's just what the customer needs. isofunctionality is implied by saying you could make 'a Word'. I wouldn't dream of disputing that you could make a word processor that offers some limited subset of Word's functionality with a small team - but that's not making a Word-class product, it's making a simple word processor.
pkaye 12y ago
How many employees does IBM even have in the US anyway? Except for a few research or sales divisions, I'm sure very little is left.
- huxley 12y ago
  IBM doesn't report its headcount in the US any longer, but in 2009 IBM had approximately 105,000 employees in the US, based on congressional testimony (via this article http://www.computerworld.com/article/2520399/it-outsourcing/ibm-stops-disclosing-u-s--headcount-data.html http://www.computerworld.com/article/2520399/it-outsourcing/... ). IBM has 431,212 employees worldwide (according to their 2013 annual report).
  - FranOntanaya 12y ago
    Trying to wrap my mind around the number -- 6 employees per 100,000 people worldwide is equal or higher than the number of physicians per 100,000 in Benin, Ethiopia, Niger, Burkina Faso, Central Africa Republic, Chad, Malawi, Mozambique, Papua New Guinea, Rwanda, Senegal, Sierra Leone, Somalia, Tanzania, Togo and Zimbabwe.
    - empthought 12y ago
      Very surprising given how easy it is to become a doctor, relative to getting hired by IBM. Combined with how appealing it is to live in those places, I too share your mind-wrapping-around-difficulty.
- johnward 12y ago
  There are still quite a few of US.
TD-Linux 12y ago
>"IBM does not comment on rumours, even ridiculous or baseless ones," the company said in an email to Reuters. ... isn't that exactly what it is doing?
- jimbokun 12y ago
  "IBM does not comment on rumors or speculation. However, we’ll make an exception when the speculation is stupid." https://ibmhkblog.wordpress.com/ https://ibmhkblog.wordpress.com/
trhway 12y ago
The correction is coming, and companies are starting to lay off people (like EBay doing "restructuring"). Some companies do global office "optimization" - i.e. completely closing offices in some countries/locations. Given that IBM commented on such a "baseless and ridiculous" claim puts a lot of foundation under it. Obviously not all the 100K at once. After all laying off people in Germany is completely different process than in CA. The fact that they point to open listings just shows that a lot of it will be sold under the sauce of "rebalancing" - lets layoff 10K there and hire the "best" 1K of them here. I've seen that an another legendary SV company (some of its former offices are occupied nowadays by a very "Like"-able company) I think IBM has big plan to close some regional offices, downsize/close some projects and to spin off some pieces with resulting IBM headcount expected being 100K less than today.
- jacquesm 12y ago
  Spin-offs and spin-outs are not normally accounted as lay-offs.
- Gustomaximus 12y ago
  > The correction is coming, and companies are starting to lay off people. In the last 3 companies I have worked for over 10 years this seems to happen every 6 to 12 months. Restructuring or right-sizing as HR love to call it is a fairly standard thing these days as companies search for optimal profitability. Every company I have worked for preaches employee loyalty in their mantra but I've never really seen it.
xienze 12y ago
Cringely definitely tends to... exaggerate but I have to say, getting IBM to even ballpark the number of people they're cutting is quite a feat. Remember this is the company that doesn't break down its head count for "competitive reasons" and prefers to stagger cuts so they don't trigger WARN in various jurisdictions.
- jimbokun 12y ago
  Not sure of the original source, but a meme I've been seeing around the Internets lately goes something like "The best way to get an answer to a question on the Internet, is not to ask the question, but to give a wrong answer and wait for people to correct you." I'm not sure whether this was is what Cringely was up to, but if it was, well played indeed.
dangerboysteve 12y ago
Anything with Cringely on it should be suppressed on this site.
- ryanmarsh 12y ago
  He's been wrong about a lot of things for a long time. I'm surprised people still listen to him.
johnward 12y ago
As an IBMer I still cannot understand how the "IBM Alliance" can have a website from '95.
calcsam 12y ago
TechCrunch has a source saying 43,000 over the next year -- ie, 11,000 per quarter (scroll to bottom): http://techcrunch.com/2015/01/26/sources-say-ibm-planning-on-laying-off-12000-over-next-year/ http://techcrunch.com/2015/01/26/sources-say-ibm-planning-on...
mfringel 12y ago
So Cringely guessed incorrectly, but forced IBM's hand in announcing more accurate information. Well played, I say.
jmspring 12y ago
I've known more than a few IBMers over the years associated with IBM Almaden and other places. Many of those on contract/part time/etc, kept their heads down. Many full timers, the same thing. Cringley may or may not be right on the magnitude of the numbers, but the one thing he is right about is IBM is purely governed by pleasing Wall Street above all else. The IBM that existed when I was growing up and seeded more than a couple of the early founding staff of the UC Santa Cruz Computer Engineering staff (Patrick Mantey and Glen Langdon -- my advisor to name two), is WAY different than the IBM of today. IBM is a shadow of itself, there are still interesting groups, but even the research arms are being hit hard by genuflecting to wall street.

182 points by oulipian 12y ago

So does that mean we can finally stop listening to Cringely altogether? I am an IBM employee and I can tell you a lot of my fellow IBMers had a really bad week-end because of his ridiculous claims. For context see previous discussion on the 110000 employee layoff that won't happen: https://news.ycombinator.com/item?id=8944637 https://news.ycombinator.com/item?id=8944637

rjruizes 12y ago
As another IBM employee, I second that. His rumor caused panic for a lot of people.
- DannyBee 12y ago
  His rumor is probably a multi-year plan rather than a one-time event.
  - timf 12y ago
    He said "By the end of February all 26 percent will be gone"
    - DannyBee 12y ago
      Ooh, missed that. Well, i'd bet he's wrong then. They'll be gone, just not by end of february.
      - jacquesm 12y ago
        Why are you so gleeful predicting doom for IBM?
        deleted 12y ago
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        DannyBee 12y ago
        I'm not predicting doom, i'm predicting that given their revenue is dropping for the past 11 quarters, and they can't they will cut the number of people to match the size of the market in most places, since they don't believe they can grow those markets. They don't need 400k people if their future is providing cloud and cloud services, and not tons and tons of services contracts in every walk of life etc Given they've taken restructuring charges between 600 million and 1.5 billion the past few years (which is about 7000-20000 people a year), why do you think they are going to magically reverse course?
        jacquesm 12y ago
        IBM has re-invented itself more times than you remember. They did it when mini computers came along, when the PC hit (an own goal if there ever was one), they did it when the Internet came of age (and when everybody else was still playing catch-up or even ignoring it) and I'm pretty sure they'll be able to survive the transition to the next phase of things (the cloud or whatever is fashionable). IBM is about as stable as they come, they do IT in whatever form it comes. When it was big iron they rolled their own hardware and software to go with it, now it is Linux, so they'll do Linux (on mainframes if you want it), if that changes, they'll change again. I'd write off a lot of companies long before I'd write off IBM and while they're laying off in one set of divisions they're hiring in others. So they're not 'magically' going to reverse course, they are gradually going to change course, like they've always done (and like every other supertanker does, move too fast and you'll break things for real, this is not a start-up). Each and every one of those changes was heralded as 'the end of IBM'. They definitely messed up during the OS wars, I'll give you that but for the most part they rode the waves better than just about any other tech company that has been around this long. Rumors of IBMs imminent demise are most likely vastly exaggerated and any prediction of lay-offs should be henceforth accompanied by some evidence or I'll simply not buy them any more, especially when they entail 100K+ lots of employees. How are Sperry, Control Data, Data General, Burroughs, SGI, Cray, DEC and a whole slew of others doing these days?
    - johnward 12y ago
      It's not the end of Feb yet so how do you know he isn't right? Also there is still a chance they plan to get rid of a large number but are avoiding the negative PR but staggering it.
      - johnward 12y ago
        I agree that it's unlikely. Even if they would want to get rid of that number of people it would take years. Plus you would think they would try to sell off a part of the business instead of laying off so many people and paying out severance.
Innistrad 12y ago
I am suspect that IBM would layoff so many at once even if it were their intention to reorganize. The negative press involved with such a huge record breaking layoff would just add insult to injury. It would be much more likely to be 100,000+ over a length of time. Regardless I am sorry for the terror that this week must be based on this potentially unethical news article.
lmg643 12y ago
I wonder if IBM would change their plan based on this leaking. If he really had this totally and completely wrong, then of course that is very irresponsible of him to say. I don't see how you can stop listening to Cringely altogether though. They did abandon their $20/share EPS plan, which was a pretty epic change. The claims about global services having <50% college grads servicing IBM clients from india is also pretty damning for the company. I would like to see IBM do well, it makes me angry to see big companies squander their history and abuse their people.
- krschultz 12y ago
  Something like laying off 25% of the company is as drastic a measure as you can ever take other than closing up shop. If they were thinking about it, they were not thinking about it lightly. They certainly wouldn't change their mind just because the news leaked.
  - DannyBee 12y ago
    ???? IBM is highly likely to have to lay off that many given the dryup of various markets. When HP splits, it's likely they'll do the same. This is just the way the services market is going. As for whether they'd change, uh, people like their current CEO definitely change their mind based on the way the wind is blowing, and how much crap will hit the fan.
    - krschultz 12y ago
      Have you ever thought about the logistics that go into planning a layoff of 25% of the workforce? In order to get the list of who stays and who goes there is a lot of work involved. Many of the people involved in that work end up on the list to get laid off. It's terrible for morale. Once you've gone down that road, you aren't turning back just because someone found out 2 weeks ahead of time.
cones688 12y ago
I feel lucky like yourself of being in one of the divisions with massive growth. I don't think people appreciate the size and breadth of IT IBM does, my "tiny" division of security if an independent company would be the 3rd biggest Security vendor in the market.
- sharkweek 12y ago
  Saw the 100k number and thought "surely a typo" - only to learn that IBM has 400k+ employees I had completely failed to realize just how massive IBM truly is as a company.
smackfu 12y ago
My guess is that he turns "possible strategic plan for 110k layoffs over the next five years starting in January 2015" into "110k layoffs in January 2015."
jacquesm 12y ago
I think for an error of this magnitude some kind of apology would be in order. If he can't manage that he's lost a lot of credibility.
- timf 12y ago
  I don't think he apologized the last two times he incorrectly made massive IBM layoff predictions: http://www.pbs.org/cringely/pulpit/2007/pulpit_20070504_002027.html http://www.pbs.org/cringely/pulpit/2007/pulpit_20070504_0020... http://www.cringely.com/2012/04/18/not-your-fathers-ibm/ http://www.cringely.com/2012/04/18/not-your-fathers-ibm/
- hristov 12y ago
  An error of what magnitude? IBM has not said exactly how many people will be laid off so we do not know what the magnitude of the error will be. Furthermore, they can certainly perform a 110K layoff by splitting it into multiple layoffs of thousands.
  - jlukanta 12y ago
    Response from IBM (via its Hong Kong office’s blog): IBM does not comment on rumors or speculation. However, we’ll make an exception when the speculation is stupid. That’s the case here, where an industry gadfly is trying to make noise about how IBM is about to lay off 26 percent of its workforce. That’s over 100,000 people, which is totally ludicrous. The fact is that IBM already announced, after 3Q earnings report, that the company would take a $600 million charge for restructuring. That’s several thousand people. Not 10,000, or 100,000. Moreover, IBM currently has job postings for more than 10,000 professionals worldwide, with more than half of them in growth areas such as cloud, analytics, security and mobile technologies. IBM’s new cloud leader, Senior Vice President Robert LeBlanc, told Fortune this week that IBM has plans to hire 1,000 cloud professionals. A little perspective on IBM’s earnings is in order. The company still makes huge profit… $21 billion in operating pre-tax profit last year. And IBM’s “strategic imperatives” represent 27% ( and growing ) of the company’s total revenue… $25 billion in revenues, up 16 percent. We have high growth in a substantial portion of the portfolio, and those areas (CAMSS) have better-than-normal margins in areas that matter most to clients today — that’s the heart of the IBM transformation. https://ibmhkblog.wordpress.com/ https://ibmhkblog.wordpress.com/
DannyBee 12y ago
I don't think today's IBM ever planned to layoff 110k at once. Lay off 10k here, 10k there, call one a workforce restructuring, another "an innovation related rebalancing plan", blah blah blah. It seems highly unlikely to me that IBM would just up and lay off 110k workers. Ignoring any other issues, the political blowback and PR blowback they'd get from politicians would be huge right now. IBM doesn't want to get in the middle of the current job-related wranglings. When they laid off 60k in 1993, you can see it didn't really happen all at once then either. http://www.nytimes.com/1993/02/16/business/first-layoffs-seen-at-ibm.html http://www.nytimes.com/1993/02/16/business/first-layoffs-see... (February) and then http://query.nytimes.com/gst/fullpage.html?res=980CEEDF163EF93BA15754C0A965958260 http://query.nytimes.com/gst/fullpage.html?res=980CEEDF163EF... (July)
- deleted 12y ago
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- bring1 12y ago
  their stockprice would make a big jump if they could manage to lay off 110k people. I think it would be a good thing, to streamline their operation.
  - jacquesm 12y ago
    You do realize you're talking about 110k people losing their income? Including dependents (averaging 2.4 / wage earner) that means this would affect ~ 250K people plus those laid off so 350K people. Funny definition of a 'good thing', there is more to life than stocks.
    - stainednapkin 12y ago
      Yes, "good" can mean many things depending on what the person saying it believes.
    - stavrianos 12y ago
      I inferred a "for IBM" on the back of that sentence. Obviously, shitty for those laid off.
jimbokun 12y ago
Just read Cringely's article, and think IBM's response takes just the right tone: "IBM does not comment on rumors or speculation. However, we’ll make an exception when the speculation is stupid."
wglb 12y ago
I stopped decades ago. Note that his wikipedia article says he finally figured out "[A] new fact has now become painfully clear to me: you don't say you have the Ph.D. unless you really have the Ph.D." Rather cringeworthy, I would say.
yabatopia 12y ago
It would be naive to think IBM upper management didn't run simulations of letting go 100,000 employees in order to optimize profits or focus operations . Letting go not in the sense of actually firing people but also by selling divisions or splitting up the company. It doesn't mean they will do it (right away), but it's not as ridiculous as you would like it to be. One thing's for sure: more than 11 consecutive quarters revenue losses will have a drastic effect on the workforce of IBM.

mathattack 12y ago

Project Chrome? It's hard to fathom that a tech company would name their layoff program after a competitor's technology. That just strains credulity. If that part is true, it's a sign of bad things in the company.

mynameisvlad 12y ago
First off, it's just a name, not really a big deal nor would it really be a sign of anything. Secondly, if your requirement is "not a competitor's technology" then practically every single word would be excluded because it would have been used, at some point or another, by one of the hundreds of thousands of competitors IBM has and has had.

x0rg 12y ago

I think IBM should stop selling the ultra crap software that is selling right now like Websphere commerce and all the crappy enterprisey stuff. They really need something good to change and if layoffs are for the better, it's probably worth trying. If the plan is to keep this stuff going, it's gonna be bad.

aragot 12y ago
Yes the most interesting revelation in Cringely's rumor was that IBM made software. Let's be honest: An big IT product is about 25 programmers and 25 diverse people (incl marketers, designers, accountants) working for 3-10 years. With this you make a GitHub, a Word, an IE. IBM could be owning the planet today. But no, they're in the business of hotels, golf, and conferences.
- AlisdairO 12y ago
  They do make many billions profit on software every single quarter. Who cares if the market is not very sexy? If you think there's only 25 people working on Word, I think you're off by an extremely large margin.
  - aragot 12y ago
    If you planned on making a competitor of Word, would you copy all its features and throw 5,000 people at it? Of course not. No, I don't think Word is 25 people. But a relationship of mine made an Excel in js with 3 people and sold enough copies. Before you say I'm wrong again, no this Excel-in-js isn't isofunctional. It's just what the customer needs. Point being: You can make great software with few people, and IBM could do it easily.
    - AlisdairO 12y ago
      > Before you say I'm wrong again, no this Excel-in-js isn't isofunctional. It's just what the customer needs. isofunctionality is implied by saying you could make 'a Word'. I wouldn't dream of disputing that you could make a word processor that offers some limited subset of Word's functionality with a small team - but that's not making a Word-class product, it's making a simple word processor.

pkaye 12y ago

How many employees does IBM even have in the US anyway? Except for a few research or sales divisions, I'm sure very little is left.

huxley 12y ago
IBM doesn't report its headcount in the US any longer, but in 2009 IBM had approximately 105,000 employees in the US, based on congressional testimony (via this article http://www.computerworld.com/article/2520399/it-outsourcing/ibm-stops-disclosing-u-s--headcount-data.html http://www.computerworld.com/article/2520399/it-outsourcing/... ). IBM has 431,212 employees worldwide (according to their 2013 annual report).
- FranOntanaya 12y ago
  Trying to wrap my mind around the number -- 6 employees per 100,000 people worldwide is equal or higher than the number of physicians per 100,000 in Benin, Ethiopia, Niger, Burkina Faso, Central Africa Republic, Chad, Malawi, Mozambique, Papua New Guinea, Rwanda, Senegal, Sierra Leone, Somalia, Tanzania, Togo and Zimbabwe.
  - empthought 12y ago
    Very surprising given how easy it is to become a doctor, relative to getting hired by IBM. Combined with how appealing it is to live in those places, I too share your mind-wrapping-around-difficulty.
johnward 12y ago
There are still quite a few of US.

TD-Linux 12y ago

>"IBM does not comment on rumours, even ridiculous or baseless ones," the company said in an email to Reuters. ... isn't that exactly what it is doing?

jimbokun 12y ago
"IBM does not comment on rumors or speculation. However, we’ll make an exception when the speculation is stupid." https://ibmhkblog.wordpress.com/ https://ibmhkblog.wordpress.com/

trhway 12y ago

The correction is coming, and companies are starting to lay off people (like EBay doing "restructuring"). Some companies do global office "optimization" - i.e. completely closing offices in some countries/locations. Given that IBM commented on such a "baseless and ridiculous" claim puts a lot of foundation under it. Obviously not all the 100K at once. After all laying off people in Germany is completely different process than in CA. The fact that they point to open listings just shows that a lot of it will be sold under the sauce of "rebalancing" - lets layoff 10K there and hire the "best" 1K of them here. I've seen that an another legendary SV company (some of its former offices are occupied nowadays by a very "Like"-able company) I think IBM has big plan to close some regional offices, downsize/close some projects and to spin off some pieces with resulting IBM headcount expected being 100K less than today.

jacquesm 12y ago
Spin-offs and spin-outs are not normally accounted as lay-offs.
Gustomaximus 12y ago
> The correction is coming, and companies are starting to lay off people. In the last 3 companies I have worked for over 10 years this seems to happen every 6 to 12 months. Restructuring or right-sizing as HR love to call it is a fairly standard thing these days as companies search for optimal profitability. Every company I have worked for preaches employee loyalty in their mantra but I've never really seen it.

xienze 12y ago

Cringely definitely tends to... exaggerate but I have to say, getting IBM to even ballpark the number of people they're cutting is quite a feat. Remember this is the company that doesn't break down its head count for "competitive reasons" and prefers to stagger cuts so they don't trigger WARN in various jurisdictions.

jimbokun 12y ago
Not sure of the original source, but a meme I've been seeing around the Internets lately goes something like "The best way to get an answer to a question on the Internet, is not to ask the question, but to give a wrong answer and wait for people to correct you." I'm not sure whether this was is what Cringely was up to, but if it was, well played indeed.

dangerboysteve 12y ago

Anything with Cringely on it should be suppressed on this site.

ryanmarsh 12y ago
He's been wrong about a lot of things for a long time. I'm surprised people still listen to him.

johnward 12y ago

As an IBMer I still cannot understand how the "IBM Alliance" can have a website from '95.

calcsam 12y ago

TechCrunch has a source saying 43,000 over the next year -- ie, 11,000 per quarter (scroll to bottom): http://techcrunch.com/2015/01/26/sources-say-ibm-planning-on-laying-off-12000-over-next-year/ http://techcrunch.com/2015/01/26/sources-say-ibm-planning-on...

mfringel 12y ago

So Cringely guessed incorrectly, but forced IBM's hand in announcing more accurate information. Well played, I say.

jmspring 12y ago

I've known more than a few IBMers over the years associated with IBM Almaden and other places. Many of those on contract/part time/etc, kept their heads down. Many full timers, the same thing. Cringley may or may not be right on the magnitude of the numbers, but the one thing he is right about is IBM is purely governed by pleasing Wall Street above all else. The IBM that existed when I was growing up and seeded more than a couple of the early founding staff of the UC Santa Cruz Computer Engineering staff (Patrick Mantey and Glen Langdon -- my advisor to name two), is WAY different than the IBM of today. IBM is a shadow of itself, there are still interesting groups, but even the research arms are being hit hard by genuflecting to wall street.