May 1, 2010

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Highlights—May 1, 2010

Personnel Today: IBM crowd sourcing could see employed workforce shrink by three quarters. By Louisa Peacock. Excerpts: IT giant IBM told Personnel Today that the firm's global workforce of 399,000 permanent employees could reduce to 100,000 by 2017, the date by which the firm is due to complete its HR transformation programme. Tim Ringo, head of IBM Human Capital Management, the consultancy arm of the IT conglomerate, said the firm would re-hire the workers as contractors for specific projects as and when necessary, a concept dubbed 'crowd sourcing'.
"There would be no buildings costs, no pensions and no healthcare costs, making huge savings," he said. Outsourcing experts said employers from both the private and public sector were increasingly using the model as they looked to squeeze people costs post-recession.

When asked how many permanent people IBM could potentially employ in 2017, Gringo said: "100,000 people. I think crowd sourcing is really important, where you would have a core set of employees but the vast majority are sub-contracted out." He stressed the firm was only considering the move, and was not about to cut 299,000 jobs, as staff would be re-hired as contractors. ....

Ian Crinkle, associate director at the Work Foundation, said: "It's really important that companies don't just look at cost savings when considering [the IBM] model. They have got to be prepared to invest a lot of management time into handling relationships and networks and the long-term applications of it all." However, an IBM spokesman denied the firm was about to shrink its permanent workforce by three quarters in seven years. ...

Conrad, a retired IBMer himself, didn’t accept IBM’s denials at face value. “IBMers have seen this happening already but at a smaller scale: employees terminated only to be offered jobs back inside IBM as contractors at reduced pay,” he told Local Tech Wire and WRAL.com. “IBM workers worldwide need to join together and say to IBM that this is unacceptable. “Although an IBM spokesperson claims what an executive said is only speculation, just the fact that they are studying it shows what little regard the company has for its employees,” he added. “One also has to wonder whose comment is right, the IBM spokesperson or the IBM executive. Just who is running the company?”
Yahoo! IBM Employee Issues message board: "Re: Here comes the next step" by "flatsflyer". Full excerpt: Just think about how much more they could pay the 3,500 Greedy Bastards (Lettered Executives) if they didn't have employment expenses to deal with.
WRAL-TV (Raleigh): IBM denies report of planned 299,000 job cuts. Excerpts: IBM has gone into damage control mode following comments by a Big Blue executive who told a human resources publication that the company could cut 299,000 of its 399,000 jobs over the next seven years in moves to reduce costs. Tim Ringo was quoted in Personnel Today as saying the company could use “crowdsourcing” to slash headcount and costs. According to IBM's website, Ringo is the global leader of the company's Human Capital Management unit. ...
The company’s denials did not satisfy Alliance@IBM, the union seeking to represent IBM workers. “It appears that with IBM's so called ‘crowdsourcing employment,’ job security within IBM continues to be endangered,” said union spokesperson Lee Conrad. “It is clear IBM wants employees that are nothing more than temporary ‘hired hands’ with no benefits and no protection.”
Local TechWire (RTP, NC): Report that IBM could make huge job cuts triggers fears, denials. By Rick Smith. Excerpts: IBM (NYSE: IBM) has gone into damage control mode following comments by a Big Blue executive who told a human resources publication that the company could cut 299,000 of its 399,000 jobs over the next seven years in moves to reduce costs. Tim Ringo, who is the head if the IBM Human Capital Management consultant group, was quoted in Personnel Today as saying the company could use “crowdsourcing” to slash headcount and costs. IBM's Web site identifies Ringo as "Global Leader, Human Capital Management." A senior IBM media executive called Ringo’s comments “silly” and “ludicrous.” ...
The company’s denials did not satisfy Alliance@IBM, the union seeking to represent IBM workers. “It appears that with IBM's so called ‘crowdsourcing employment,’ job security within IBM continues to be endangered,” said union spokesperson Lee Conrad. “It is clear IBM wants employees that are nothing more than temporary ‘hired hands’ with no benefits and no protection.” ...

The story drew specific denials from Doug Shelton, head of corporate media relations for IBM. Asked about the story, Shelton took time out from IBM’s annual shareholders’ meeting in Milwaukee to call Local Tech Wire and WRAL.com. “You asked if these comments were authorized by IBM, and the answer is no,” Shelton said. “Frankly, the comments are ludicrous. “To say that we are even thinking about cutting three quarters of our work force is silly,” Shelton continued. “We need people all around the world to do the work.” Shelton pointed out that Ringo is not involved with IBM’s human resources group. “He is not part of our HR function,” Shelton said, noting that he is a consultant.
The Register (United Kingdom): IBM gooses dividend, share buybacks. Looking to split? By Timothy Prickett Morgan. Excerpts: "Our superior cash flow enables us to invest in the business and generate substantial returns to investors," explained Palmisano, IBM's president, chief executive officer, and chairman. (Or rather, someone in the investor relations department explained when they wrote the press release). "Since 2003, more than $80 billion was returned through dividends and share repurchase. Our commitment to delivering value to shareholders has never wavered."
The vast majority of that money went to share buybacks, which Big Blue uses to prop up EPS and also to award stock to employees as a form of compensation. But one could argue that shareholders would have been a lot happier if IBM just gave them the billions instead of just a little taste. But Wall Street likes a stock that is rocketing, not one that is steady, because you can get richer quicker.

And so, IBM executives, who are compensated largely in stock, are compelled by the system to do everything they can to pump the stock. That includes continual layoffs under the radar of regulators and the press; offshoring manufacturing, software development, and support operations; and shelling out billions each quarter to eat those shows to show EPS growth. Hence the additional $8bn in share buybacks that IBM's board also authorized today.

The other reason was to try to push IBM shares up, as the financial results for the first quarter, announced last week, did not. While IBM's earnings were up 13 per cent, to $2.6bn, in the quarter, revenues grew a more tepid 5 per cent, to $22.9bn, and both were against easy compares, given the economic meltdown was raging at the time last year. During his chat with Wall Street analysts discussing the quarter, Mark Loughridge, IBM's chief financial officer, did not paint a particularly rosy or bland picture of the IT market, and therefore, IBM's share price has been languishing in the $130 zone. The shares actually lost a half point on the announcement - go figure.
IT WIre (Australia): Union sets 5pm deadline for IBM - UPDATED. By Beverley Head. Excerpts: The Australian Services Union has given global computing giant IBM a deadline of 5pm today to comply with a decision handed down last week by Fair Work Australia which it says obliges the company to negotiate with the union in good faith, or it will seek further orders against the company from the Court. Sally McManus, secretary of the ASU in NSW, said that its dispute with IBM had been underway since 2007, and that the company had resisted all attempts to negotiate with the union. A group of 80 IBM employees working at IBM’s Baulkham Hills offices, North West of Sydney, who provide service and support to IBM clients including Westpac, St George, Qantas and the Federal Government had joined the union and asked the ASU to negotiate with the computer giant on their behalf.
With the introduction last year of the new industrial relations regime, the ASU had challenged IBM’s anti-union stance with Fair Work Australia, launching an action against the company last November. According to McManus FWA’s decision was delivered last week, and obliges IBM to negotiate with the ASU. It is understood this is the first time that the computer company will have been dragged to the negotiating table by a union anywhere in the world.
HR Zone (United Kingdom): Job cuts hit NHS and IBM. By Cathy Everett. Excerpt: Elsewhere, it came to light that IBM was considering cutting three quarters of its 399,000 permanent staff over the next seven years, although the IT vendor said it would rehire them as contractors to undertake projects on an ad hoc basis in a strategy dubbed ‘crowd-sourcing’. The move would form part of the firm’s HR transformation programme, which is due to be completed in 2017, and would see its permanent workforce reduced to 100,000. Tim Ringo, head of IBM Human Capital Management, the company’s consultancy arm, told Personnel Today: “There would be no buildings costs, no pensions and no healthcare costs, making huge savings.”
USA Today: Workers fight uphill battle on 401(k) retirement savings. By John Waggoner. Excerpts: When employers first rolled out 401(k) savings plans, the message was clear: Take control of your own retirement destiny. Invest your money as you see fit. Choose from among many different options. Now, more than a year after the worst bear market since the Depression, 401(k) accounts are close to being where they were at the peak of the market in 2007 — thanks in large part to workers' own contributions. But the bear market and recession have also realized some of the shortcomings of a 401(k) plan. The markets can slash even a conservative portfolio in half. Companies can stop or reduce their matches. And a plan with a low participation rate can put tough limits on how much you can save. ...
A 401(k) plan has an intrinsic problem. It tries to reach a specific goal — the amount you need to retire — by investing in stocks, bonds and money market funds, none of which offer specific returns. In essence, a 401(k) takes the task of a highly paid pension manager and gives it to each worker. Investors learned about the job's difficulties the hard way from 2007 to 2009, when the Standard & Poor's 500 index fell 57%, the biggest bear market since the Depression. About 60% of all mutual fund assets in retirement plans is invested in U.S. and international stocks, according to the Investment Company Institute, the funds' trade group. ...

Consider a worker who made $75,000 a year and invested 7% of his income a year in a 401(k) plan. He invested in a conservative mix of 40% bonds and 60% stocks. If he had started with $250,000 in September 2007 and retired in February 2009, his retirement nest egg would have dropped to $168,000. If he held on until March 31 of this year, he'd have $248,000. Of course, $13,000 of that increase would have come from his own contributions.
Glassdoor IBM reviews. Selected reviews follow:
- IBM Anonymous: (Current Employee) “IBM - a good company to work for if you want a job, bad if you want career growth and compensation.” Pros: Good Work-Life balance. Benefits. Nice people. Can usually work from home (at least 1 day per week.) Cons: Career Growth in US Shrinking US workforce Lower then average pay. Advice to Senior Management: Nurture your talent Pay fairly Don't assume management is good just because they succeeded in getting to that level (always question their ability and if necessary make room for new talent to take it's place).
- IBM Marketing Manager in Armonk, NY: (Past Employee - 2009.) “Get your experience and get out or else you will become a brainless robot.” Pros: Ability to work remote. Benefits: Too top heavy. Lack of worker-bees. Arrogance in the marketplace. Slow to market. Too political. Cons: Teleconference overload. No Work/Life Balance. GLOBALLY INTEGRATED ENTERPRISE. Hierarchical/ Poor Pay. Horrible review system. Incompetent executives never get "resourced." Advice to Senior Management: Parity in executive/non-exec rules. Nurture good talent. Trim executive FAT. Pay better, fix your PBC system. Stop SAMETIME 24/7!
- IBM Senior Software Architect in Atlanta, GA: (Past Employee - 2009) “Software Technical Sales Review.” Pros: Great people, Teamwork amongst co-workers was great. Access to technologies via research was great. Cons: Management was not in tune at all with technology , did not care about personal issues. They paid lip service to that. I saw some business practices by management that really bordered on bad ethics (they did not follow the Business Conduct Guidelines) when it came to personnel issues. Management was into the beat the employees until they improved (especially the Southeast Sales environment) they know morale is poor but just don't care. Advice to Senior Management: I've been around along time. The company I know is dying... the Management today is killing it. they should leave.. or just close the company.
- IBM Technical Support Engineer in Montreal, QC (Canada): (Current Employee) “Review.” Pros: Possibility to have access to the servers and applications and learn a lot. I hope for IBMer will be easy to find next job. Cons: 1 person in a team gets positive evaluation, the others are getting neutral or negative evaluations - that is the politics in IBM. Managers are not technical, often they get changed, as a result your new "manager" who for instance has no idea what the difference is between DB2 or Oracle and knows you mostly by phone (because he works remotely) only few months has to evaluate you...can you imagine which kind of evaluation you are getting ???? This is unbelievable... I came from scientific environment and for me it was big fun to see how all that "works" in IBM . Some people in the same team simply does not work enough since managers can not catch them, as a results the others are working more.... Advice to Senior Management" I read so many similar advices to CEOs - looks like all companies are similar. Technical people are working, middle level management are profiting, the only job that management is doing - is inventing "new" metrics to SHOW up to the upper management that they are very active...As a results of that "invention" technical personal has to work more only to satisfy management , that is not related at all to the customers support ....We all know about that but we can not do anything about it...
- IBM Senior IT Project Manager in Charlotte, NC: (Past Employee - 2008) “IBM, A Good Place To Work.” Pros: Access to the latest IT productivity tools. Good training/professional development resources. The opportunity to lead teams comprised of full-time, part-time, and contract employees. The compensation, medical benefits, 401K plan are 'on par' with other companies in the Global Business Services industry. Cons: You'll need to understand that there's an 'IBM way' of doing things, this can be an adjustment for recent graduates that haven't been previously employed in a corporate environment. There was a time when first and second level management worked together to lead employees; that has changed dramatically. During the last 4 years i was employed, there was a lot of reassignments of first level and second level managers. Advice to Senior Management: IBM was a good place to work for 20+ years. My advice would be to 'get back' to clear objectives and the third and second management levels so that the first level manager and employee can truly benefit from developing short term/long term performance plans. Continue to encourage professional development at all employment levels.
- IBM Managing Consultant in Rochester, MN: (Current Employee) “My 2c as an IBMer.” Pros: IBM is the world's largest IT company with opportunities for employees to grow their career in multiple technologies and locations. The company puts a lot of stock in mentoring relationships and networking which allows you to talk to (and work with) some very intelligent and world-changing people as an employee. Within many divisions of IBM, work is being done on the cutting edge of technology. Your work is often reasonably well defined and you have the benefit of working for a very large company when dealing with clients and business partners. Generally you are expected to work 40-50 hours per week, but my experience has also included times where more or less were required. Cons: The company is quite top-heavy (at least within product development) right now so there are often a large number of employees filling the limited number of jobs at the higher levels. Many of these people would not get to their current level under the promotion rules of today but IBM has not done many demotions over the last decade. A lot of information is not shared by HR or the leadership team to combat the fear, uncertainty, and doubt caused by recurring layoffs. There is a lot of effort by certain groups within the company to promote their own technology/projects, including forcing it into products and offerings where it does not belong, in order to justify its(their) existence. A lot of good ideas are ruined by the fact that so many people have a vested interest in having "their stuff" included in the next big thing. Even though the opportunity to move from job to job exists within IBM, it is often difficult to move because everyone is already overbooked and understaffed with no option to back-fill your position. A lot of services jobs within the company require very high billable-utilization rates which result in employees not even being able to take all of their vacation without missing their targets. Advice to Senior Management: Respect your employees. Don't consider managers to be higher-order beings than "perform resources" because without them, you wouldn't have a job either. Share information. Manage your employees as individuals, not a group - everyone is different and has different needs and expectations. Stop fudging the numbers on reviews for people who are your friends just because you know a bad review would result in their layoff, they probably deserve it more than someone else. Realize that cutting employees to increase earnings per share is only an option for the short term; pick some things to invest in, and go out and win with them. Take the company from being responsible only to investors to being responsible to investors, employees, and the planet.
- IBM Anonymous: (Past Employee - 2008) “Mediocre Band of Techies.” Pros: Best reasons are definitely the Benefits and the ex-PwC folks are extremely competent and stick out from the 'crowd' of legacy IBMers. Other than that, free cell phone plan. Cons: Legacy IBMers are not consultants. They are glorified techies who empty their pockets of products in front of customers and leave it to them for matching their needs to technical solutions. Ex-PwC are the true consultants who identify the challenges and needs of the customer and customize solutions to solve their business problems. Also, the travel is 100%. They move you around the country like a consultant but pay an industry salary. Advice to Senior Management: Remap your legacy IBM people against the bands. Legacy PwC are leagues ahead of legacy IBM staff and there was definitely a mismatch on the band grid when looking around at peers. It was fairly easy to identify who was legacy IBM and who was legacy PwC.
- IBM Anonymous: (Past Employee - 2008) “Big Blue.” Pros: Office position but IBM was fine with working from home when needed or desired. Good name recognition. Cons: You are a number no matter what they tell you when you're hired. If you're not meeting the numbers, you're out. Advice to Senior Management: Stop talking a good game about how well you treat employees, actually do something about growing employees.
- IBM Offering Manager: (Current Employee) “Competitive, challenging, not sure where the reward is though.” Pros: At the worker bee level people work extremely hard and take a lot of personal pride and responsibility in their work. In theory it's a big enough place to move around, find new and interesting areas to work, and make a rewarding career for themselves. Experienced, polished management who often know the details and see the big picture of the part of the business they manage.
  Cons This is the most quintessentially bureaucratic, hierarchical, corporation I have ever worked for (and I've worked in quite a few places). In the technology sector this model feels sorely outdated and full of needless hoops to jump through. Title and rank mean everything here, and execs who have played the game their entire careers have an interest in keeping things this way. There are absolutely no limits or boundaries that are respected. You have to assert your own work/life balance and stick to your guns, otherwise you will work yourself to death. 5am meetings, standing weekly meetings that go until midnight, you name it. Most of my time is spent on internal meetings instead of doing "real work." On an average day I spend 5-8 hours on conference calls, and the flow of emails, deadlines, and fire drills never stops, and must be managed on top of the endless meeting cycles.
  
  IBM is cheap when it comes to spending money on its employees. Sharing hotel rooms, unrealistic meal allowances, limited reimbursements for essentials are all part of the game. Business class is out of the question even on long haul trips. You're expected to stay in cheap hotels and take the red-eye home and keep smiling.
  
  The notion of having a job for life is gone. The company treats lifers like barnacles at this point, scraping them off the side of the ship during the annual purge. That said, nearly everyone I meet has been around for 10-15 years or more with no plans to leave. This seems like an unsustainable situation - expecting die-hard commitment while regularly pulling the rug out from under employees. Feels like the company is following instead of leading in most segments.
  
  That kind of behavior can't satisfy Wall Street's insatiable demands for growth, and the pressure to deliver revenue growth (and not just profits) seems to be on. I joined the company through an acquisition and am relatively new, and I can't for the life of me figure out why people stay. I don't see any light at the end of the tunnel or pot of gold after all the hard work people regularly put in, even for those who have crossed the magical boundary into the executive ranks.
  
  Advice to Senior Management: Make some bets, commit to them, and encourage managers and employees to find new areas of growth. IBM's internal hurdles and processes are ridiculously elaborate and hinder time to market and innovation. The Smarter Planet campaign has resonated with the market. To make it a reality is going to take guts, and people are going to have to stick their necks out to make it happen. I see very little incentive for execs or managers to risk their precious careers at IBM given the current culture and reward structures.
- IBM Executive Partner/Associate Partner in Atlanta, GA: (Past Employee - 2009) “A company in flux.” Pros: Top technology name, great resources for technology smarts. Large consulting and software business. Well known name. Largest global outsourcer. Recognized worldwide. Have moved globally quickly with people and sales. Smarter planet seems to be working well as a marketing campaign. Cons: Short term focus on people. Moving jobs overseas at a rapid pace. Frequent downsizing. Changes in direction on the consulting side are frequent. Changes in middle level management frequently. They have never gotten all the parts of the business working effectively together; often work across purposes. Losing ground to MSFT and Oracle in enterprise software. Advice to Senior Management: Get all the pieces to work together. Ever since I joined the company the common refrain was, "If we can only get all the pieces working together effectively, we could be unbeatable.
- IBM IT Consultant in Toronto, ON (Canada): (Current Employee) “Ambivalent.” Pros: Sorry, I really can't think of any pros. It's simply a big company, and if you've worked in a big company I think you have a good idea what it's like at IBM. Cons: Far too much focus on the metrics - utilization, billables, etc., even when you have no control. Very lonely place to work as a remote employee. No effort made to create a team atmosphere. Advice to Senior Management Management: Treat IBM like a family, not a bank account. Are senior executives rally worth even a 10th of what they make?
- IBM Anonymous in Poughkeepsie, NY: (Current Employee) “IBM.” Pros: There are many opportunities to change career without changing company's. Cons: Senior management does not care about employees. The direction is to cut costs and move work off shore even as the company makes record profits. Advice to Senior Management: Make use of the experienced workforce in the US to keep the customers satisfied and keep IBM the value leader it once was.
- IBM IT Specialist in Alpharetta, GA: (Past Employee - 2009) “IBM for the most part is a good company to work for. Expect long hours and little job security.” Pros: Most of the people are really nice and hardworking. The company has a good reputation. Excellent with EEO. Often very flexible with work hours. Compensation is competitive and benefits are good. Cons: As a general rule, you will be expected to work at least 50 hours a week and do give back in addition to your normal work hours. This is to meet productivity goals and must be done even in slow times. (Giveback is good, it you had the time to do it) The job is not secure. Periodically IBM does massive layoffs. It doesn't matter if you are on the bench or have a revenue producing assignment, if you are in the wrong group at the wrong time, you will be laid off. Advice to Senior Management: Instead of doing mass layoffs, look for other ways to save money. It used to be that people were IBM's most valuable asset. Review productivity goals and the original purpose for them. Overtime is necessary from time to time to meet deadlines. It doesn't make sense to be putting in hours to meet productivity goals when hours are just being put in for the sake of putting in hours. Also, when employees are constantly putting in massive amounts of overtime, they are more prone to mistakes and "real" productivity goes down. Current productivity goals are determined by the number of hours put in and I can't believe that was the original purpose of the productivity goals.
- IBM Technical Support Engineer: (Past Employee - 2010) “job out sourced to oversea or not qualifying individuals.” Pros: Work from home option if available. Cons: Poorly supported continuing educations taking away work from home options laying off good quality and hard working employees to replace them with oversea or not qualifying people consistently. Advice to Senior Management: laying off a few upper management people will save the company and more money than laying off workers whom really work daily
- IBM Anonymous: (Current Employee) “IBM no longer a great place to work.” Pros: The people...meaning the ones who are the workers who bear the burden of supporting the rest of the company. Cons: Finance is running the business with no discretion. There is no longer opportunity to make decent money. There is no respect for the individual left (one of IBM core values). Advice to Senior Management: There are few leaders left with any integrity. Those who still have a shred should leave while they still understand what that means.
- IBM Senior Managing Consultant in New York, NY: (Current Employee) “Great company, but consulting is once again a work in progress.” Pros: Bright, nice colleagues; not a cut-throat environment - Generally, a strong (and real) emphasis on work/life balance compared to other firms - Large company with opportunities to transfer to non-consulting roles - Reasonably good job security. Cons: Lack of an up and out policy limits upward mobility; executives find comfortable roles where all that is required of them is showing up to a few meetings each week - Management has never trusted current staff - almost all "Partners" are hired from the outside - Consulting services were hit hard by the down economy; some practices have dissolved from RIFs and departing staff and will take a few years to recover. Advice to Senior Management: If you're serious about providing advisory services, place a real emphasis on career development and progression.
- IBM Software Engineer in Tampa, FL: (Past Employee - 2010) “Leaving the USA/” Pros: The best part was the ability to work from home and have flexible hours, oh wait, then it turned into endless hours. Cons: Does not matter how hard you work, they are sending everything to China. Or Brazil. Or India. Advice to Senior Management: If you are not paying them enough to buy your services, then who will be your customers in 10-20 years? Do you expect to do much business in the US if you are leading the pack in sinking this economy by giving all our hard earned income to just your the top ten employees?
- IBM Consultant: (Current Employee) “Good or Bad? You decide.” Pros: Good on Resume. Work with professional and talented people. -Being a consultant can go from project to project to work with different client and gain different industry experiences. Cons: Performance evaluation is determined heavily by utilization. Even if you get good utilization does not mean you will have a good rating. Perform additional work doesn't mean you will get good rating. Again, utilization is king!! IBM said it will provide career coaching. However, I have never seen my coach or people are too busy to talk how to take your career to the next level. Hard to get in-class training or tuition reimbursement. They will ask you to read books or do free e-learning. Annual salary adjustment is like 1%, which is lower than inflation. Management do not have an idea where you are working. They only communicate to you when it's performance review time, remind you to get your admin work done, and when they're leaving IBM or moving to another part of the business!! Advice to Senior Management: Focus on employee - Utilization is not everything. Senior management have to look at other areas the employee has help your business.
Wall Street Journal: Bias Suit Advances Against Wal-Mart. By Ann Zimmerman and Nathan Koppel. Excerpt: A federal appeals court ruled Monday that a gender discrimination lawsuit against Wal-Mart Stores Inc. can go forward as a class-action case, in one of the biggest class-action lawsuits in history. The 9th Circuit Court of Appeals in San Francisco voted 6-5 to affirm a federal judge's decision to award class-action status to potentially one million women or more. The ruling increases the pressure on Wal-Mart to either settle claims of unfair pay brought by the women or risk going to trial. The decision represents a serious blow to Wal-Mart, the nation's largest corporate employer, as a denial of class-action status would have forced the women to pursue their cases individually. Fewer women would likely proceed in that event, due to high legal expenses.
Wired: Sony Announces the Death of the Floppy Disk. By Charlie Sorrel. Excerpt: Fully 12 years after the original G3 iMac dropped support for the 3.5-inch floppy disk, Sony has finally decided to stop making them. The reason is a lack of demand. The surprise is that it took so long. If you still rely on the massive 1.44MB of space to move files quickly around between far-flung computers, don’t worry: Sony will keep the production lines running until March 2011, giving you a year to stockpile the things. You won’t be alone. Apparently, “lack of demand” is somewhat relative, and Sony sold a jaw-dropping 12 million floppies in Japan during 2009.
US News & World Report: 6 Ways Couples Can Maximize Social Security Payouts. By Emily Bradon. Excerpts: Couples who are currently married, or who have stayed together at least 10 years, tie their working records—and the resulting Social Security checks—together as long as they both live. In the case of Social Security payments, the result is often better for the couple. Spouses have Social Security claiming options that single people don't. Here are a few ways couples can boost their Social Security benefits...

New on the Alliance@IBM Site

To Alliance@IBM supporters: The Alliance is the only organization that advocates and supports IBM employees and ex-employees. In fact, there are few like it in the Information Technology field. It is always difficult to keep an organization like this alive, but as a supporter you know how important it is that we exist. We are calling on you today to help keep us alive another year by joining as a member or associate member. See our online forms below. As our membership has dropped, it is imperative that we gain new members or this organization and web site will cease to exist. Help us keep our organizing and advocacy work alive!
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Job Cut Reports
- Comment 4/24/10: The rumour has it that there is going to be a huge hit in June. Quite frankly, I can't wait. I'm getting increasingly frustrated training my replacements. Does anyone know anything more concrete than the rumours we have here in GBS Canada. -P.O'ed in Canada-
- Comment 4/25/10: To: -RAed last Jan- Thank you for the information, it was very helpful. In regards to a June lay off, I've heard that too. I'm in GBS in the U.S. In the job role I'm in, I something get wind when HR/Senior Leadership are working on the latest cuts. So far, I haven't seen this activity, but who knows. I would say it takes about 2 -2.5 months to work through the process of picking names, etc. before an announcement is made. I heard about the of the March 1 layoff in January. -Florida Resident & Alliance Member-
- Comment 4/25/10: Changes in Global Administration (Secretaries). Only band C and above will get support from IBM secretaries. The rest will receive support from contractors. Global Admin is big on using U.S. contractors (Manpower) for low cost support of customers. Since the majority of regular employees DO NOT support Band C execs, how they'll achieve this is unknown (the rumor is the selling off of Global Admin) Most of the high level execs sit in NY and will NOT feel any pain or inconvenience from any changes. It's good to be King! *Join the Alliance* -anon-
- Comment 4/26/10: Contractors received email today that hours would be cut 15% this quarter -- Here we go again. From the contractor perspective, 1st quarter last year took 13% pay cut, next four quarter 10% of hours -- so basically working for 23% less. -Anonymous-
- Comment 4/27/10: Confirmed, 15% hours cut this quarter, after the 13% pay cut in 2008. -CDI_Drone-
- Comment 4/27/10: "To: All CDI ITD Resources From: Andy Morgan, Director Subject: 2010 Q2 Work Reduction Notification IBM recently notified CDI that from April 26th through July 2nd all CDI ITD resources are required to reduce normal work schedules by 15%. This action is not a reflection of any dissatisfaction over the services provided by you or CDI but rather an IBM business decision. Your IBM Manager will work directly with your CDI Account Executive to coordinate a reduced work schedule that minimizes any impact to IBM or its clients. You should receive the communication regarding your reduction schedule from your CDI Account Executive. When you begin working the reduced schedule and notifying CDI of these reduced work hours, please enter 0 hours into the CDI Web Based Time reporting tool and note the words “work reduction” in the comment section. A number of CDI resources may not be affected by this action at this time, due to critical IBM business requirements. IBM managers will communicate these exceptions to your CDI Account Executive. This decision and action is not to be discussed with any IBM clients. It is expected that normal work schedules will resume after this request is completed. You should understand that this action is being taken by IBM to retain as many CDI resources as possible for future work. Please address any questions to your CDI Account Executive." -Anon-
- Comment 4/28/10: Contractors hours and pay have been cut for years and years now. This is nothing new just like the cuts every quarter to IBM'ers. Everything on this site is old news reposted. The only way to stop the madness is to organize and unionize. Without a union contract in place, IBM can and will do whatever they please to any and everyone. The executives have their contracts and are padding their retirement while the grunts without a contract continue to be treated like dirt. If you don't have a union contract you are at the mercy of greedy executives. Join up and get every one of your coworkers to join up, or don't complain -Gone_in_07-
- Comment 4/28/10: If IBM cuts 90% of perms and rehires them as contractors, the customers will hire contractors directly and cut IBM out altogether.. no need for IBM. Why pay extra when you can cut out the middle man, especially with all of the horrible service provided by slave labor offshore employees? Perhaps they want to get out of the service industry altogether. -cut out the middle man-
- Comment 4/28/10: From: LKeyte@oaot.com. Sent: Tuesday, April 27, 2010, 4:27 PM. Subject: IBM DSS Q2 Work Reduction Announcement. Importance: High. Dear Employees, The following note is being sent to all employees presently on the IBM DSS contract. PLEASE NOTE: This does not affect all employees. You will be notified individually by your OAOT manager if you are to be subject to the reduced work schedule. In light of the current economic conditions, the ITD US Organization of IBM has determined subcontractors will operate on a reduced work schedule. Work schedules are to be reduced by 15% from April 26th through July 2nd. This action is not a reflection of any dissatisfaction over the service provided, but rather a business decision. Please DO NOT address this with IBM clients. It is expected that the normal schedules will be resumed after this program is complete. We regret any inconvenience this may cause and it's our hope it will not effect you. -RA'ed in 2010-

News and Opinion Concerning Health Savings Accounts, Medical Costs and Health Care Reform

News and Opinion Concerning the U.S. Financial Crisis

"It is a restatement of laissez-faire-let things take their natural course without government interference. If people manage to become prosperous, good. If they starve, or have no place to live, or no money to pay medical bills, they have only themselves to blame; it is not the responsibility of society. We mustn't make people dependent on government- it is bad for them, the argument goes. Better hunger than dependency, better sickness than dependency."

"But dependency on government has never been bad for the rich. The pretense of the laissez-faire people is that only the poor are dependent on government, while the rich take care of themselves. This argument manages to ignore all of modern history, which shows a consistent record of laissez-faire for the poor, but enormous government intervention for the rich." From Economic Justice: The American Class System, from the book Declarations of Independence by Howard Zinn.

New York Times: Goldman Cited ‘Serious’ Profit on Mortgages. By Louise Story and Sewell Chan. Excerpt: In late 2007, as the mortgage crisis gained momentum and many banks were suffering losses, Goldman Sachs executives traded e-mail messages saying that they would make “some serious money” betting against the housing markets. The messages, released Saturday by the Senate Permanent Subcommittee on Investigations, appear to contradict statements by Goldman that left the impression that the firm lost money on mortgage-related investments.
New York Times op-ed: Berating the Raters. By Paul Krugman. Excerpts: No, the e-mail messages you should be focusing on are the ones from employees at the credit rating agencies, which bestowed AAA ratings on hundreds of billions of dollars’ worth of dubious assets, nearly all of which have since turned out to be toxic waste. And no, that’s not hyperbole: of AAA-rated subprime-mortgage-backed securities issued in 2006, 93 percent — 93 percent! — have now been downgraded to junk status.
The rating agencies began as market researchers, selling assessments of corporate debt to people considering whether to buy that debt. Eventually, however, they morphed into something quite different: companies that were hired by the people selling debt to give that debt a seal of approval. Those seals of approval came to play a central role in our whole financial system, especially for institutional investors like pension funds, which would buy your bonds if and only if they received that coveted AAA rating.

It was a system that looked dignified and respectable on the surface. Yet it produced huge conflicts of interest. Issuers of debt — which increasingly meant Wall Street firms selling securities they created by slicing and dicing claims on things like subprime mortgages — could choose among several rating agencies. So they could direct their business to whichever agency was most likely to give a favorable verdict, and threaten to pull business from an agency that tried too hard to do its job. It’s all too obvious, in retrospect, how this could have corrupted the process.

And it did. The Senate subcommittee has focused its investigations on the two biggest credit rating agencies, Moody’s and Standard & Poor’s; what it has found confirms our worst suspicions. In one e-mail message, an S.& P. employee explains that a meeting is necessary to “discuss adjusting criteria” for assessing housing-backed securities “because of the ongoing threat of losing deals.” Another message complains of having to use resources “to massage the sub-prime and alt-A numbers to preserve market share.” Clearly, the rating agencies skewed their assessments to please their clients.
New York Times op-ed: The Goldman Drama. By David Brooks. Excerpts: This spectacle presents Goldman with an interesting public relations choice. The firm can claim to be dumb but decent, like the rest of the establishment, and emphasize the times it lost money. Or it can present itself as smart and sleazy, and emphasize the times it made money at the expense of its clients. Goldman seems to have chosen dumb but decent, which is probably the smart narrative to get back in the establishment’s good graces, even if it is less accurate. ...
If this were a movie, everybody would learn the obvious lessons. The folks in the big investment banks would learn that it’s valuable to have an ethical culture, in which traders’ behavior is restricted by something other than the desire to find the next sucker. The folks in Washington would learn that centralized decision-making is often unimaginative decision-making, and that decentralized markets are often better at anticipating the future. But, again, this is not a Hollywood movie. Those lessons are not being learned. I can’t wait for the sequel.
The Huffington Post: Not All Jobs Are Created Equal: Why Wall Street's Gain Has Been America's Loss. By Arianna Huffington. Excerpts: Jobs -- everybody is in such total agreement that we need more of them that the word is in danger of becoming meaningless, of going from tangible policy to talking point. In Washington, saying you're for jobs has become just another obligatory, perfunctory throat-clearing preamble. At a fundraiser last week, Joe Biden pledged, "Some time in the next couple of months we're going to be creating between 250,000 jobs a month and 500,000 jobs a month." That sounds great, if it's true -- a very big "if." But, even if it is true, the vice president didn't say what kind of jobs these are. And make no mistake: not all jobs are created equal. ...
In other words, in the absence of manufacturing, the only way to compete with Third World nations is to become a Third World nation, which is exactly what will happen if we allow our middle class to disappear.

What's more, it's not just manufacturing and lower skilled service jobs that are disappearing. According to the Hackett Group, companies with revenues of $5 billion and over are expected to take an estimated 350,000 jobs offshore in the next two years alone -- nearly half in IT, and the rest in finance, procurement and human resources. ...

And Booz Allen Hamilton, in a 2006 study, found that white-collar outsourcing is no longer just about call center and credit card transactions. Now "companies are offshoring high-end work that has traditionally been considered 'core' to the business, including chip design, financial and legal research, clinical trials management, and book editing." Do you hear that? It's Ross Perot's giant sucking sound being cranked up to a deafening roar -- and it's about a lot more than NAFTA.

Accenture now employs more people in India than in America. And IBM is headed in the same direction. ...

We are continuing to feel the sting of our lack of investment in our people -- particularly when it comes to education, the other primary pillar (along with a good job) of a healthy middle class. This is what happens when a country is willing to spend trillions of dollars fighting unnecessary wars while allowing college tuition to rise out of the reach of so many of its citizens. And it's what happens when a country turns its economy over to the casino of Wall Street.
New York Times: Panel’s Blunt Questions Put Goldman on Defensive. By Louise Story. Excerpts: In an atmosphere charged by public animosity toward Wall Street, the senators compared the bankers to bookies and asked why Goldman had sold investments that its own sales team had disparaged with a vulgarity. “The idea that Wall Street came out of this thing just fine, thank you, is just something that just grates on people,” said Senator Edward E. Kaufman Jr., a Democrat from Delaware. “They think you didn’t just come out fine because it was luck. They think you guys just really gamed this thing real well.” ...
In what almost added up to a light moment, Senator Mark L. Pryor, Democrat of Arkansas, said the public wanted to know what went wrong and “how we can fix it,” adding that Americans feel that Wall Street contributed to the financial crisis. “People feel like you are betting with other people’s money and other people’s future,” he said. “Instead of Wall Street, it looks like Las Vegas.”

Senator Ensign said he took offense at the comparison, saying that in Las Vegas the casinos do not manipulate the odds while you are playing the game. The better analogy, he said, would be to someone playing a slot machine while the “guys on Wall Street” were “tweaking the odds in their favor.”
Washington Post: Goldman Sachs adds to its ranks of lobbyists. By Tomoeh Murakami Tse. Excerpts: Until a few years ago, Goldman Sachs operated a sleepy lobby shop in the nation's capital. But now, faced with fraud charges, investigations, a firestorm of criticism and a regulatory overhaul bill that could seriously damage its profitability, the venerable Wall Street firm is assembling a team of veteran lobbyists, well-connected former Hill staffers and top public relations strategists to confront what is arguably the most traumatic moment in its 140-year history. Over the past two years, as it emerged from the financial crisis with a reinforced image as Wall Street's top bank but also the No. 1 target of public ire, Goldman has built up a 12-person government affairs office in Washington to help the firm get its message to legislators and regulators.

If you hire good people and treat them well, they will try to do a good job. They will stimulate one another by their vigor and example. They will set a fast pace for themselves. Then if they are well led and occasionally inspired, if they understand what the company is trying to do and know they will share in its sucess, they will contribute in a major way. The customer will get the superior service he is looking for. The result is profit to customers, employees, and to stcckholders. —Thomas J. Watson, Jr., from A Business and Its Beliefs: The Ideas That Helped Build IBM.

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News and Opinion Concerning Health Savings Accounts, Medical Costs and Health Care Reform

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