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Highlights—August 28, 2010

• Washington Post: Obama administration targeting ineffective contracts in an effort to trim costs. By Kate Andersen Brower and Todd Shields. Excerpt: The Obama administration said Monday that it plans to review 26 government information-technology projects worth a total of $30 billion as part of an effort to trim back or cancel contracts that aren't meeting goals. ...

  IBM's portion of a $4.5 billion cargo-tracking system for the Department of Homeland Security was identified for review, as was Raytheon's $251 million contract for the patent-processing project. ...

  AT&T spokesman Michael Balmoris declined to comment. Lockheed Martin spokesman Jeffery Adams, Computer Sciences Corp. spokeswoman Marian Herbst Kelly, IBM spokesman Clint Roswell, and Raytheon spokesman Jon Kasle all said they couldn't immediately comment.

• ZD-Net Australia: IBM concludes union negotiations. By Luke Hopewell. Excerpts: IBM and the Australian Services Union (ASU) have concluded critical discussions, resulting in a number of formerly displeased IBM employees accepting common law contracts offered by the company. IBM confirmed that it had concluded negotiations and that the "interests of employees remained central throughout the negotiation process". ...

  The controversy centred around IBM's Baulkham Hills facility, after unionised staff demanded better working conditions and protested at the plans to offshore staff. Staff also expressed a desire to be represented by a union in employment negotiations. At one stage, the ASU proposed an indefinite strike if the demands of staff were not met.

• Yahoo! IBM Pension and Retirement Issues message board: "Life Insurance Issues for those looking to retire from IBM" by "Robert". Full excerpt: To whom it may concern: I am writing this note to help other IBMers avoid a serious mistake I made concerning life insurance. The IBM Group Life policy can be continued after you retire but the first fact to emerge immediately after you retire is that you are put into a new risk pool for retirees, no longer working with higher rates, regardless of your age.

  The policy was then managed by Marsh McLelland for several years with dramatic rate increases. The plan was taken over by Prudential who immediately lowered rates about 5 years ago but there are still some "gotchas" due to my own ignorance I was unaware of. My policy for $170,000 and has been in effect since 1999. Rates are now adjusted each August 1 and my current rate is going up about $70 per month per year. Also, there is zero cash equity build up in the account and the policy is automatically terminated at age 100.

  If I had it to do over again I would learn about other options like annuities etc and not be locked into a poor financial plan with no desirable options.

• Yahoo! IBM Pension and Retirement Issues message board: "Re: Sept 1st announce/non-announce (fair and balanced reporting -ha)"
  by "art_vandalay". Full excerpt: In one of my earlier posts I showed how the number is probably ranging from 3,000 to 4,000 who have not qualified for the 30 year target and are still not 55 years old. I also estimated that canceling those IBMers from the annuity bump could be worth $1B to IBM. I'm sure the accountants in IBM lick their chops on that type of dough.

  One manager also mentioned that health care is a factor in this move to get rid of older employees. I was told that every year IBM negotiates with the insurance companies and the higher percentage of older workers, then the higher rates they are charged.

  Too bad there are so many of us that are doing valuable work for this company, otherwise I am sure some accountants (taking their orders from the execs) would love to ship us out tomorrow, if possible.

• eWeek: H-1B Visa Fee Increase Unpopular Across the Board. By Don E. Sears. Excerpts: Supporters, detractors and reformers of the latest law that will place a $2,000 increase on H-1B visas is not expected to impact American jobs or curtail companies from seeking to use temporary, foreign workers. The measure is expected to sting U.S. and India trade relations.

  The measure to increase fees on H-1B visas that was attached to the $600 billion border security bill by Sen. Charles Schumer (D-NY) passed both houses of Congress was signed in to law by the president on Aug. 13. What proponents and advocates on all sides of the debate have to ask themselves is whether this measure will have any impact on American jobs and will close loopholes that allow companies to abuse wages for temporary technology workers .Critics and supporters of H-1B visas are finding the measure to be wholly inadequate and ineffective. “The actual impact [of the fee hike] will be negligible, since the amount of the fee is minuscule in comparison to the wage savings employers accrue by hiring H-1Bs,” said a leading H-1B visa reformer and computer scientist, Professor Norman Matloff of the University of California, Davis, in an interview with eWEEK. “Those savings are in the tens of thousands of dollars each year, multiplied by the (up to) six-year life of the visa.” ...

  “The mainstream U.S. firms abuse the H-1B visa just as much as the Indian firms do,” stated Matloff. “All of them use the visa for saving on wages. The mainstream firms tend to hire a higher class of worker than the body shops do, but still the mainstream employers pay the H-1Bs below-market wages. (And as I've said before, this is done in full compliance of the law, which is full of loopholes.)”

• The Register: Moshe Yanai has left IBM. By Chris Mellor. Excerpt: Moshe Yanai, the founder of EMC's Symmetrix product, storage company XIV and co-founder of Diligent, has left IBM. An IBM spokeswoman said: "Moshe Yanai left IBM to pursue other interests. IBM appreciates Moshe's contributions to the company. XIV is an important part of IBM's storage portfolio. In fact, XIV added more than 130 new customers to the platform in the second quarter, and revenue more than doubled year to year."
• Wall Street Journal SmartMoney: 6 Expenses to Ditch in Retirement. By Catey Hill. Excerpt: Nearly half of all baby boomers will face a cash crunch in retirement, according to a recent study by the Employee Benefit Research Institute. Boomers’ net household assets – 401(k)s, pensions, homes and other investments, minus their total debt – have lost 18% of their value since 2007 and today average roughly $171,000 a person, the EBRI study found. The upshot of these losses is that boomers between the ages of 56 and 62 now have a 47% chance of falling short on funds to pay for basic retirement costs, according to the EBRI study. Boomers between the ages of 46 and 55 have a 45% chance. ...

  Here are six more expenses retirees should consider ditching to help close the gap...

• Glassdoor IBM reviews. Selected reviews follow:
  • IBM Systems Engineer in Seattle, WA: (Past Employee - 2010) “Not what it used to be.” Pros: Looks good on a resume. Often get to work on new technologies. There are still many, many great folks there.

    Cons: Full disclosure: I was laid off. However, I am not a bitter and angry ex-IBMer. I was elated to get my layoff package (very reasonable) and found a new, much better paying job before my severance ran out. IBM was very good to me for many, many years (and my tenure started long after the golden years before the early 1990's) and I'm too young to have been personally affected by the pension shenanigans. My review comes from working in the Server group.

    It is no secret that IBM's "strategy" has been to reduce its US workforce. They're achieving this by two methods: small but continuous layoffs spread throughout the company and by making it more unpleasant to work there to encourage attrition. The unpleasantness ranges from big things (most people haven't had a raise in years) to the petty (no coffee, no soap in the kitchens, etc.). Meanwhile, the senior executives are making millions upon millions. Consequently morale throughout the entire company is extremely poor.

    Training? Only if it's free and local (no travel expenses).

    Raises? Small and non-existent. IBM redefined their salary ranges a few years ago. We used to hear you've got lots of growth left in your salary range. Now you hear, "well, you're near the mid-point of your range, so you're paid what you should be paid. It's like jumping halfway to a wall - you'll never reach it.

    Salaries? When I worked there, I thought it wasn't bad, but three of us have left my team in the past two years and we've each received pay increases at our new companies in excess of 30% and that's been in this terrible economy.

    Working Conditions? Varies widely throughout the company depending on your local mgmt and location. It was generally pretty good where I was in the Pacific NW.

    Career? At the big sites, there's plenty of places to transfer or try new jobs. Smaller remote sites are more limited. And there's no way IBM's paying for anybody's relocation.

    Promotions? Still possible if you're on the right projects or working with the right customers. Pay raises are minimal with a promotion, but at least the halfway point in your salary range is a little further away after a promotion.

    IBM's always been beauracratic, but local management always had flexibility to take care of their people. That's gone now, First and Second line managers are now probably the worst jobs in IBM. They're reduced to just implementing the new and often petty people policies dreamed up by the execs.

    Advice to Senior Management: A company can't thrive by continually driving costs towards zero. Eventually you reach diminishing returns. Ultimately top line revenue has to grow to increase profits. It is the executives' jobs to come up with strategies to grow. Since IBM's top line revenues haven't grown in the better part of a decade, the failures are yours.

  • IBM Manager: (Current Employee) “True Janta Company... Worst HR.” Pros: Flexibility - very flexible... Women friendly - I conduct PDM interviews... I keep hearing women want to join because IBM is very women friendly. This is absolutely true. If you give a poor rating to a woman employee she can report to diversity commission. If you appraise the employee can't stay and fulfill her delivery commitments...the manager is most likely to get fired. Good work culture. Scope for professional development for technical stream. Cons: Newer services contracts are bordering slave labor. A truly horrible HR. Everyone thinks the manager is responsible for everything. However, the truth is a manager is empowered to give hike of min of X and max of y percent. Too much of bongs have filled the top management and it is becoming regional. Senior management up to directorial level are just cutting time till retirement...making matters worse. I think IBM as an organization wants move on from India given the challenges...but there are no alternatives yet...they are looking at Philippines. Advice to Senior Management: Conduct serious performance appraisal from band 8 on...fire the low performers at band 8 to D to instill vigor. Look in to the gap in salary between the person newly hired vs person staying more than 5 years.
  • IBM IT Specialist: (Past Employee - 2010) “Great benefits, but frustrating administration.” Pros: IBM pays well and has great flexibility when it comes to work location and schedule. Cons: Large amounts of unpaid overtime are expected. Far too often, jobs are sent overseas to save money, but at great detriment to the existing project. Advice to Senior Management: Remember that IBM was built on its people.
  • IBM IT Specialist: (Past Employee - 2008) “When Good Goes Bad.” Pros: The severance package that I got when I was laid off. Cons: No to very little raises and a large pay cut. Management that was out to make themselves look good at all cost including their employees. 1st line managers are not monitored in behavior and action. People don't leave companies; they leave managers. No clear direction for Senior Management. No focus on customer satisfaction. Advice to Senior Management: Don't lie to customers to land contracts and then expect employees to deliver on unrealistic expectations.
  • IBM Software Brand Specialist: (Current Employee) “Meh” Pros: Perks, IBM Brand, Resources to get the jobs done and marketing support. Cons: Negotiate hard in regards to salary, or it will NOT go up. Maybe 2% to 4% per year and that is a maybe. Do not go in with an attitude, "do it and if I am wrong, I will get my hand slapped later," because people will get fired for that. Extremely rigid. Very high pressured and very management top heavy. Huge Websphere presents in the management chain, so they push transactional sales and not solution selling. As a result, no room for developing territory. They continually change and move territory every year. Commission plan, you will not get paid until you hit 55% of your target and the draw you get if you choose to get it is very low. Advice to Senior Management: Look outside the box. You will continue to lose people to the point you will wash down the value of the software brands except Websphere because none of the quality software reps will be employed by IBM...unless, you buy the company where they all went.
  • IBM Senior Software Engineer in Pleasanton, CA: (Current Employee) “If you are in a good group or active project it's a great place to be. Otherwise, it's a grind.” Pros: IBM is committed to making alternative work situations available to employees: work at home, work in the nearest office, etc. When your company is worldwide, this makes sense. -- I work with some very intelligent people who are genuinely interested in what they do. -- Depending on your product/project, you get to work on what interests you (within reason, of course). I'm going to work on some new technology that I've been wanting to work on for a while now. -- My pay is better than any other place I have worked. -- They take the annual review process very seriously, from the writing of goals to regular review of your progress towards your goals. I haven't been here long enough to know what the annual review itself is like. -- The people I have direct contact with are very helpful and a pleasure to be around every day. People have a lot of respect for their coworkers and immediate management, but there seems to be a general contempt for the bigger company and its processes and policies, however.

    Cons: This is an enormous company. There's a lot of stuff going on, and it's very easy to tune out the rest of your division. As a result, personal and career growth tools and advice are about as generic and non-specific as possible, and therefore not all that useful. -- Size makes finding useful information on the company intranet almost impossible. Pages are frequently out of date, and you seem to be redirected to 2-3 other pages before you find anything of use. -- No two groups seem to use the same technology for source control, access management, requirements management, or just about anything else. -- For some, it's such a good place to work that it's impossible for anyone else to advance into a technical leadership role, so you end up leaving or creating something new and esoteric to make your mark, which makes it even harder for someone new to figure out what's going on. -- Benefits (primarily health care) are not as good as other places I've worked. -- Can be very hard to figure out who your customer really is, or who is using what you work on.

    Bottom line: It's almost impossible to describe the 'good and bad of IBM', because it's such a huge company. IBM has acquired so many other companies in the past few years that you can't really describe the culture of IBM anymore. There are a few unifying pieces, like benefits and the review process, but if you want to work at IBM you will want to talk to a lot of people during your interview to find out more about the specific site you want to work at.

    Advice to Senior Management: There seems to be a huge disconnect between the big 'making a smarter planet' mantra and what we do on a daily basis. The attitude seems to be "someone else does that. We work on what we work on, big corporation be damned." Every purchase of a company just reinforces that feeling further, and leads to cynicism in the ranks. Short of breaking up the company into more cohesive groups, I don't know how you would go about fixing that. Change HR/training/etc. to stop assuming we're all sales people that meet with 'customers' on a regular basis, or that advancing up the bureaucracy is the only form of success.

  • IBM Anonymous in Somers, NY: (Past Employee - 2009) “Don't stay too long (<7y) - it's a short cycle to attain skills, contacts and move on to brighter career futures.” Pros: Great and reliable research sources, very intelligent workforce. Excellent IT resources - no end to what you can have to enable a data deluge A place to make a few great friends outside of the corp culture. Diverse enough so you're not always talking to "the man." Cons: In an effort to bring operation costs down, down, down (and show profits)- employment in the US is almost non-existent. Too much management (un-actionable.) Too much cross functional decision-making, makes projects and success long and protracted still too siloed, GBS vs. S&D vs. SWG - no single face to the customer; groups work against each other, and there is no hesitance to throw folks under the bus with lots of blame-gaming. Advice to Senior Management: Flatten hierarchy, stop outsourcing.
  • IBM Senior Security Specialist/Lead in Denver, CO: (Past Employee - 2008) “Use IBM as a last choice if you cannot find work anywhere else.” Pros: All of the best reasons to work at IBM are gone. They used to have great benefits. Management used to care (somewhat) about their employees. I have heard the stories from IBM-ers who worked for IBM starting in the 1960s. All of them say that it's not IBM any more. It is an empty shell of what it used to be. Outsourcing has turned a once-great computer manufacturer into a services-only based business.

    Cons: Education is why I left IBM. I was set to take a Masters Degree, and asked my manager if there would be any time considerations for my education. The manager said 'no.' Now mind you, I had given IBM hours of free overtime to the tune of 18 hour workdays very often in order to fulfill client needs and meet deadlines. The manager was adamant, he absolutely would give me NO TIME CONSIDERATION for a Masters Degree. IBM *used* to brag about how they supported employees' educational pursuits by paying for schooling. PSHAW.

    They stopped paying for low-class employees' educations in 2001, after 9-11-2001. Then, they stopped paying for Team Leads' education in 2003-2004. They might still pay if you are a manager or Sr. Manager, but now their former boast rings hollow.

    Anyhow, I quit IBM in order to take my degree and finished in the top of the class. I will only go back to IBM if all other opportunities dry up for me. IBM is like one of the Pyramids in Egypt. There was once greatness there, but all that is left are archaeological ruins. And, the ruins are not great wonders of the world, they are just ruins of a once-great business that had values.

    Advice to Senior Management: Bring back the greatness. Care for your dedicated employees and they, in turn, will care for you. Loyalty works BOTH ways.

  • IBM Anonymous: (Past Employee - 2008) “No longer US focused.” Pros: Some of the most exceptional co-workers around. Cons: No respect for work/life balance. Advice to Senior Management: You seem to have forgotten who made it possible for you to make your multi-million dollar salaries/bonuses/perks.
  • IBM Sales Specialist: (Current Employee) “IBM is great.” Pros: respect for the individual is truly an IBM value. Makes working there worthwhile. Cons: If you are not 6 feet tall and spend $$$$$$ on clothes you won't go that far. Advice to Senior Management: value performance
  • IBM Advisory Consultant in Gurgaon, Haryana (India): (Current Employee) “OK place but reward and recognition is poor.” Pros: Global Opportunities. Wealth of Knowledge. Diverse Experience. Excellent work life balance. Cons: Internal Politics. Poor Pay. No reward for hard work. Pathetic hikes No Distinction between high and low performer. Too much power with the people manager. Non existent HR. Advice to Senior Management: Work to Reduce Office Politics. Reduce overheads, let employees focus on work. Better hikes and reward recognition. HR should be available to personally interact with the employees
  • IBM Sales Representative: (Past Employee - 2010) “Sales.” Pros: Flexible working hours. Training and personal development opportunities Innovative solutions and highly competent people advancement opportunities if you are willing to wait. Skilled top management. Cons: beaurocratic low compensation organisation and positions shuffled around too often before you get on a management track it takes forever (6-8+ years) to get promoted. Not much pay raises (if any except the ones legislation and such mandates) internal politics lot of incompetent mid management (and 1st level managers). No real leadership just number reporting low scores in employee satisfaction. Advice to Senior Management: read the book "the leadership pipeline" and start growing real leaders from the bottom up.
  • IBM Consulting IT Specialist in Cincinnati, OH: (Current Employee) “IBM is OK place to work.” Pros: Manager doesn't bother our team or get involved with day to day activities - we are all professionals doing our jobs and supporting each other. Team work is pretty good at IBM. Cons: Lots of long hours. Expected to do whatever it takes to keep customer happy. Expected to know everything! Advice to Senior Management: Stop laying off people with "resource adjustments" - we can't afford to loose anyone else. Hire more people so we can take our vacation and not have to be on calls and checking emails while trying to relax with family! Put some $$$ into giving folks at top pay range at least a small raise. What happened to stock options - haven't seen any of those in years!
  • IBM Anonymous in Beaverton, OR: (Current Employee) “Empower people to do their jobs: short term gain --> long term pain.” Pros: Huge opportunities to try a wide variety of tasks and technology. Cons: Like working for government or a big union. Advice to Senior Management: Start recognizing those who go above and beyond. If a developer needs tools/technology to be effective/work efficiently there should be no resistance to providing these.