July 24, 2010

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Highlights—July 24, 2010

Computerworld UK: Texas, IBM argue over $1 billion IT contract. Texas on verge of killing contract, amid allegations of missed goals and high employee turnover. By Patrick Thibodeau. Excerpts: he state of Texas may be preparing to terminate a contract signed with IBM four years ago to consolidate the state government's IT operations because of missed goals and excessive employee attrition. Advertisement The contract, signed in late 2006 , called for IBM to consolidate the state's IT operations as well as reduce the number of data centres from 31 to two and provide specific services. At the time, the seven-year contract was valued at $863 million, a figure that was only "a snapshot of what it would take to consolidate on that exact day," said Thomas Johnson, a spokesman for the Texas Department of Information Resources (DIR) agency, today. The state had expected IT efficiencies to save $179 million over the seven-year period.
But late last week, the state sent IBM a lengthy "Notice to Cure" that gave the vendor a 30-day window to fix a long list of problems, little time for what seemed to include some complex problems. The notice didn't threaten an immediate termination of the pact. ...

Among the claims the state is making against IBM is a shortage of qualified personnel. In the notice to IBM, the state said the company has failed "to reduce the rate of turnover of assigned personnel below the contractual threshold of 15%." The annualized 12-month turnover rate has been 20% to 45% since the contract commencement, the state alleges.
Associated Press, courtesy of Forbes: Indiana: IBM welfare intake work flawed from start. By Ken Kusmer. Excerpts: Indiana's human services agency says it found problems with IBM Corp.'s takeover of welfare intake services early in the project and suggested delays, but yielded to the company's wishes to expand the project. IBM, meanwhile, claims the Family and Social Services Administration seized more than $9 million worth of its computers, servers and office furniture without paying for them after Gov. Mitch Daniels fired the technology giant last year.
The counter charges are included in filings rebutting and denying claims in the former partners' lawsuits against each other in Marion Superior Court in Indianapolis. The state agency is suing IBM for more than $1.3 billion, claiming the Armonk, N.Y.-based company breached one of the biggest outsourcing deals in state history. IBM wants the state to pay $52.8 million it says it's owed in deferred payments and equipment costs. The two sides sued each other May 13 over IBM's canceled $1.37 billion contract to automate intake for Medicaid, food stamps and other benefits received by more than a million Indiana children, seniors, elderly and disabled residents.
Wall Street Journal: American Eagle Blames IBM as Website Down For Third Day. By Elizabeth Holmes. Excerpts: American Eagle Outfitters Inc.'s website is down for a third straight day, depriving the teen retailer of an increasingly important sales channel at the start of the back-to-school shopping season. The Pittsburgh-based company blamed the problem on its external host, International Business Machines Corp. A spokesman for IBM said the company was working to restore service. He wouldn't comment on the source of the problem. "We apologize for the inconvenience to our customers and we are working 24/7 to get the site back up as soon as possible," an American Eagle spokeswoman said.
Wall Street Journal: IBM Management Changes Set Up Race for CEO. By Spencer E. Ante. Excerpts: International Business Machines Corp. reshuffled the ranks of its senior managers in a move that sets the stage for a race that could determine the successor to Chief Executive Samuel J. Palmisano. The reshuffle, which was disclosed Monday in an internal memo after IBM reported its second quarter earnings, elevated four executives, who all received expanded responsibilities. "It looks like this could set the stage for succession," said Frank Gens, chief analyst with research firm IDC. "It shortens the list of potential successors to Sam Palmisano." ...
In the executive changes, Senior Vice President Michael E. Daniels, who formerly ran half of IBM Global Services, has been promoted to run the entire group. Mr. Loughridge will keep his CFO job and add IBM's Global Financing business and "Enterprise Transformation" responsibilities, which include running IBM's internal technology systems. Steven A. Mills, who has run IBM's software business for many years, is now also responsible for IBM's Systems and Technology Group, which includes its computer server and chips business. And Virginia M. Rometty, a senior vice president who runs Global Sales and Distribution, is now also in charge of Marketing and Strategy. "All of them have had successful track records," Mr. Gens said.
Wall Street Journal: Sizing Up IBM Race. Two Executives Seem to Have Edge in Contest to Be Next CEO. By Spencer E. Ante. Excerpts: International Business Machines Corp. has put four senior managers into a horse race to succeed Chief Executive Samuel J. Palmisano, and two of them appear to have an edge at the starting line. Virginia M. Rometty, a senior vice president who has added oversight of marketing and strategy to her sales and distribution portfolio, is considered a front-runner. The 52-year-old Ms. Rometty, one of the four executives IBM promoted this week, was previously senior vice president of IBM Global Business Services. She led the integration of PricewaterhouseCoopers's consulting arm, a 2002 acquisition that was crucial to IBM's diversification away from the personal-computer business. IBM Virginia M. Rometty "While Ginny may not be ready for the job tomorrow, it is her job to lose," said Adam Prager, a partner with executive-recruiting firm CTPartners.
Michael E. Daniels, 56, who also ran part of IBM's big services business, is considered the other leading candidate for the top job. Promoted this week to run the entire Global Services Group, he is seen as an executive with a broad range of operating experience who has held top sales jobs. "He's very smart, and he's a street fighter," said Bill Hughes, a former IBM vice president and now senior vice president at software maker CA Technologies. ...

Steven A. Mills, who picked up responsibility for IBM's hardware group in addition to its software division, is also being encouraged to broaden his experience through an outside board seat. However, most analysts say the 59-year-old Mr. Mills, while highly regarded, is probably too old to succeed Mr. Palmisano, who turns 59 this month.
Forbes: IBM May Finally Fire On All Cylinders. With the expected recovery of its services division, Big Blue may return to business as usual. By Andy Greenberg. Excerpts: IBM, like an enormous, $166 billion piece of furniture, sits most stably on three legs: hardware, software and services. And after a very wobbly year and a half Big Blue's third leg may be holding the company upright again. When the tech giant announces second-quarter financial results Monday, analysts expect the firm to report earnings of $2.58 a share on revenues of $24.22 billion. That would represent profit growth of 11% and sales growth of 4.2% over the year-ago quarter, only the second quarter since the recession that IBM has shown positive year-over-year sales growth.
One reason for those relatively healthy numbers may be the long-awaited--if still incomplete--recovery of IBM's services division. Because that division's revenue is based largely on long-term contracts and trails software and hardware sales, IBM's services division only experienced 2% growth last quarter even as other pieces of the business returned to double-digit gains.

But IBM's consulting and outsourcing may have finally caught up, says Forrester analyst Andrew Bartels. He predicts that services will grow 6% to 8% this quarter, and could generate $14 billion in sales--the low end of the $14 billion to $15 billion in revenue that the division was generating before the recession began. Bartels also expects the company to announce a 10% to 15% gain in new services contracts, a leading indicator of services revenue. "They're getting back there," says Bartels. "This is much more solid services growth than what we've been seeing."
Financial Times: IBM sales to businesses disappoint investors. By Richard Waters. Excerpts: However, IBM's revenues grew by only 2 per cent in the second quarter of the year, to $23.7bn, half the rate of growth that most analysts had been expecting. The company's shares fell 4 per cent in after-market trading. ...
Investors were unnerved partly by a 12 per cent decline in the value of new contract signings in IBM's services division, which accounts for nearly 60 per cent of its revenues. ...

Despite the unease over revenues, IBM more than matched profit expectations in the second quarter as it continued to hold down costs and improve profit margins.
Yahoo! IBM Employee Issues message board: "Re: Raises?" by "workforlife" . Full excerpt: A MIS trick I saw was a person with just over 29 years was told if he went the improvement route and failed there would be no possibility for a bridge to 30. With a wink and a nod he was more or less told that he would fail no matter how well he 'thought' he was doing. He took the bridge and is now doing the exact same job as a contracted employee and is making 30% more. Different bucket of money so the second line looks good while costing IBM more.
Yahoo! IBM Employee Issues message board: "Re: IBM earnings up 13%" by "celticht32". Full excerpt: Not sure how ISSW can loose more people... according to some reliable people inside still they can't fill 30% of their work because they don't have the people anymore... chris
Thompson: New Perk: Cash for Flying in Coach. Excerpts: Airlines may not want to hear this, but at least one company that sends thousands of employees on business trips, is successfully encouraging them to fly coach instead of business class. How? By paying them half the savings in air fare. The New York Times reported in a June 21 article that Energizer Battery Company, based in St. Louis, Mo., offers employees monetary incentives to fly in coach instead of business class. The flagging economy may be a reason for some employers' novel approaches to cutting travel costs, but Energizer began its program well before the recession began. Air transportation and lodging are common working condition fringe benefit. Such new twists in these traditional benefits deserve a closer look, especially in light of their tax implications. ...
Doris Lee Middleton, human resources and travel services manager at Energizer, told the Times that if an employee who would otherwise be eligible to fly business class chooses coach instead, the company will split the savings in airfare up to $2,000 for all parts of the globe except Asia. For flights to the Asia-Pacific region, she said, the reward cap is $3,000. Middleton confirmed to Thompson Publishing Group editors by phone that the company has reaped "substantial" savings on travel expenses from the incentive, which it calls the "rebate" program. She said that it is popular with the employees who travel, which comprise about two-thirds of the Energizer's 5,000 to 6,000 employees. "During 2009," she said, "nearly 60 percent of Energizer's international trips were booked in economy class resulting in rebates to its colleagues and savings to the company."

Editor's note: IBM took a different approach than Energizer did to save costs on international travel. Instead of sharing the cost savings of flying economy with employees, IBM simply banned the use of business class for any travel, regardless of trip length. Even for 18 hour trips to India, economy class is the IBM standard. Furthermore, IBM forbids the purchase of higher-fare but upgradeable economy class tickets for employees who may wish to use their own frequent flyer miles to upgrade.
The Hindu Times (India): Tech-assisted 'inventory' approach to HR. Excerpts: An example discussed elaborately is that of IBM Global Services, in the context of workforce inventory and the on-demand workforce. The problem statement is simple: "To win contracts, IBM must guarantee that it can assemble a team having the necessary skills on time and on budget. It must balance people who may work on several projects with those working on one, and people who are needed long term versus those needed short term. IBM doesn't know until the contract is signed precisely what the needed workforce will do."
The solution is in the form of a system that can deliver talent on demand as contract needs arise, informs the author. He explains how, to enable this agile supply of talent, IBM leaders draw from workforce inventories that include not only employees but also contractors.

Expertise taxonomy: "To provide a common language allowing every business in the world to describe its talent supply and demand using the same language, IBM has developed an expertise taxonomy, essentially making every country and job a searchable talent inventory. 'Talent on demand' is a term IBM uses to capture the idea of reframing the question from filling vacancies to optimising talent availability."

Since the costs of talent shortages could be very high, perhaps even the loss of million-dollar contracts, IBM invested heavily in accurate predictions – and in a global workforce taxonomy that cost perhaps $100 million – to make its internal talent inventories as transparent and accessible as possible, reasons Boudreau.
Glassdoor IBM reviews. Selected reviews follow:
- IBM Senior Software Sales Representative in New York, NY: (Past Employee - 2009) "I'm happier as retired shareholder than an employee." Pros: I worked at IBM for more than 30 years where I made WONDERFUL lifelong friends. IBM was more than an employer, it created a family environment. IBM BBQ's, IBM Family Day, IBM Family Dinner...yep these used to exist, and they were GREAT for morale, and kept folks dedicated and proud. There used to be an IBM Country Club at Pt. Washington, Long Island, NY. I started selling Office Products, became a first line then a second line sales manager, and traveled extensively to exciting places around the world which I may have not enjoyed if it were on my own dime. Great healthcare and other benefits though many that existed for the first 10 years slowly evaporated after 1990. Minorities, women, and other diverse groups of individuals are well represented at IBM.
  Cons: You are only as good as your last quarter's performance. Having been a manager, I know that there are times when decisions are made purely on the basis of a quota, whether PBC rating, promotion, salary increases. What ever happened to career development? There isn't any anymore. Really BAD choices in promoting people to exec positions...I had to EARN my stripes.
  
  Advice to Senior Management: Honesty is really an excellent approach to people and clients. Way too many people get paid on a single dollar's worth of software sold. Go back to the three original basic beliefs - They worked for the Watson's. They'll work again. Stock ownership is a great way for employees to feel a deeper part of the company. 5% off isn't much of an incentive, especially when you can buy stock for $7 a trade in the US. Remember this work...? It used to be on everyone's desk. THINK
- IBM Anonymous: (Current Employee) "Poor Growth Options." Pros: Work life balance. Exposure to technology. Cons: Ocean - Swimming very difficult. Very difficult to move beyond middle management. US centric management. Very difficult to move to senior positions from India. Advice to Senior Management: None
- IBM Project Manager in Nottingham, England (United Kingdom): (Current Employee) "IBM - A challenge and a headache." Pros: There are lots of opportunities to further your skills and knowledge if you are willing to work the extra time and go the extra mile. Nothing is for free; you have to push and fight for everything but if you're lucky its a fantastic opportunity. Cons: Bad compensation, lack of any recognition when you do go the extra mile apart from thanks from the customer and colleges! Advice to Senior Management: Stop loosing the good people by taring everyone with the same brush. There needs to be flexibility to see those who can stand out and should be encouraged not lost to competitors.
- IBM Advisory IT Specialist in Cincinnati, OH: (Current Employee) "Not what it used to be, probably depends on your assignment." Pros: Solid Benefits, Stable Company, Professional Environment, Opportunity to Travel and relocate anywhere, most can work from home, we were once very well treated and rewarded for hard work really well, hopefully we get back to that some day. My customer site has a very strong group of people, gives me a chance to work with and learn from some great people.
  Cons: Benefits are solid but very expensive, Pay increases have dropped off and salaries lag behind competitors, over demanding on billable hours, Long time employees seem to be neglected, few rewards for hard work and effort. A lot depends on what assignment you are on, long term customer sites can be different than the greater IBM. My view of the greater IBM is a bunch of inexperienced or incompetent people, while our local site is full of underrated and undervalued people that are far better than those we work with outside the account. It seems every year they find a way to take something away from us. We're treated like interchangeable cogs that are lucky to just have a job. IBM doesn't feel like a special place to work anymore.
  
  Advice to Senior Management: Sam Palmisano has lead IBM through a much more difficult time, but he is not the leader that Lou Gerstner was. Quality programmers are hard to find, there are duds in the US, but over time they have been weeded out. Global resources are cheaper, but there are a lot more duds, weeding them out is expensive, and in the end, you will have to pay very similar amounts to keep the very best no matter what country they are from. IBM used to feel like a special place to work, but now it feels like a sweat shop. If you make people feel special, they will return the favor with loyalty and effort.
- IBM Anonymous in Markham, ON (Canada): (Current Employee) "Software Developer." Pros: Flex hours, collaboration with extended teams. Cons: Takes a while to adapt to changes. Very little innovation (company buys innovation instead.) Advice to Senior Management: let some internal innovation happen! starting to operate like a factory.
- IBM Anonymous in Pune (India): (Current Employee) "A Managerial Company." Pros: Huge learning base. Technical depth. Work Life Balance. Easy access to IBM softwares. Focus on innovation. Easy remote access to IBM network. Cons: Salary. Tough to move out from one client to another. Employees are taken granted by trying to just sell brand. Advice to Senior Management: Invest in your employees. Learn to keep employee first, share holders will automatically get happier. Look for long term gains and be what you were 10 years back.
- IBM Anonymous in Washington, DC: (Current Employee) "Decent pay, decent opportunities, decent work/life balance...boring work." Pros: Compensation, for some, is pretty good. Plenty of opportunity to gain new skills and develop your career. For some, flexibility and nice work/life balance. Cons: Lots of talented people end up on projects that just aren't interesting or challenging. Consultants that want to do consulting work end up as "staff augmentation" to a government agency. Advice to Senior Management: Let talented, aggressive people work on challenging, innovative projects. Even internal projects; anything to keep people engaged. Otherwise, the best and brightest will leave.
- IBM IT Specialist: (Current Employee) "It's us vs. them, executives vs. employees." Pros: Good for a college hire to get experience in the industry. Cons: Employees are treated like a commodity. Pay the least that you can get away with and don't invest anything in them. Exec's are too busy posturing for each other and don't seem to realize that its the employees that are delivering the results they keep crowing about. Advice to Senior Management: I've read most of the executive's summary of Q2 results. In none of these summaries did any of them thank the field for their hard work. Not even a mention. What does that say to us?
- IBM Systems Support Representative in Milwaukee, WI: (Past Employee - 2010) "Good first job but don't say long." Pros: Benefits are alright. Vacation - I had 4 weeks to start - that was great. Cons: IBM is all about the bottom line (Head count) / Profit. They don't care about their employees. Lack of raises and no bonuses. Outsourcing of jobs to other countries. Advice to Senior Management: Wake up and smell the coffee! - Keep hard working employees and support them - Don't be so damn greedy.
- IBM Senior Business Analyst in Dublin, OH: (Current Employee) "Nothing great a company to work with." Pros: The more you negotiate the better the position would be. The irony is person who do not have basics in your domain would interview and decide your growth in the organization. Cons: If the level of entry is good, your life is good. otherwise, it is really miserable. Advice to Senior Management: The PDF concept is a nonsense, why because, the SME panel who reviewed my work do not belong to my domain at all.
- IBM Senior Systems Engineer in Bangalore (India): (Current Employee) "High Brand Value amongst their Clients/Partners but a very average Employer in India -" Pros: On the brighter side IBM gives easy work culture - flexible, friendly and stress-free. IBM is a big brand. They hire a lot - even during recession.
  Cons: IBM is a big brand ONLY for its clients/partners. Based on its brand value it would be foolish to judge IBM as Best Employer. It is in fact a very average employer. Employees (I can speak of Indian counterparts) are poorly paid, no hikes, sham appraisals, minimal career growth, minimal career opportunities, poor onsites. Most of the Indian projects are maintenance based. Even though they hire a lot, they fire a lot too. Also the attrition is high. But their business model still works for them. Because their business doesn't get affected at all if an employee leaves the org - IBM replaces him with another "bakra". For IBM employee in a project just adds up to the headcount that can be billed to the client. His knowledge is never a critical factor for the project. However, there are few employees I know who have got lucky here and are getting good benefits. Overall, if you are NOT amongst the few lucky ones, you will end up in a big account with horrid time ahead!
  
  Advice to Senior Management Management: should also take care of the employee needs other than work flexibility. However, this would be the last thing on its list. The management is running the projects successfully and keeping the clients happy. It gets good revenue. For them an employee is just another headcount that can be billed to the client.
- IBM Team Leader in Austin, TX: (Current Employee) "Absorbed, overworked, undersupported." Pros: employee discounts, wide variety of coworker backgrounds. Cons: There is a axiom - "IBM stands for I'm By Myself" and they ain't kidding. We were absorbed and instead of getting IBM salaries, we kept our government salaries. Doing the same jobs as existing IBM people but at a 60% discount. Consistent reductions in staff/ requests for contractors to "take off" to improve quarterly bottom line which increases work for remaining people. Advice to Senior Management: do a better job of determining EVERYTHING that is required before offering a bid for a contract.
- IBM Account Manager in New York, NY: (Current Employee) "Could Be better." Pros: Steady Income, regular Job, Fun Working with the Customers, My direct manager is great to work with. Our Market is dog eat dog. Cons: The company is cutting costs. They want us to work virtual, but will not pay for the costs that come with that situation. Advice to Senior Management: The folks in the trenches are beating their heads into the wall trying to drum up business. All we need is respect, and compensation for our hard work.
- IBM Database Consultant: (Past Employee - 2010) "Pros and Cons of IBM," Pros: - Flexible work hours - Work at home opportunities - Ability to set own schedule. Cons: - Low employee morale - Remotely working employees are required to pay for their own broadband cost to do IBM business - Employees are treated as financial numbers and not people - Poor work life balance. Expected to work all hours of the day/night. Advice to Senior Management: Hold first line managers accountable for casting their department's vision and mission and establishing clear job roles and expectations.
- IBM Financial Analyst: (Past Employee - 2008) "Not many finance jobs left in Australia." Pros: Flexible working hours (work from home arrangement, job sharing, part-time, etc.) Paid parental leaves. Study assistance. Good brand, Cons: Focus too much on cost cutting. Pay is not competitive on the market. Keep moving finance jobs to overseas like Malaysia and India. Do not value resources as they used to. Advice to Senior Management: Value your employees.
- IBM Managing Consultant: (Current Employee) "Good for Experienced Hire." Pros: - The name looks great on your resume - Lots of intellectual capital. Cons: As you get promoted, your salary is not adjusted accordingly. The only way to get the salary you deserve is to say you're leaving or come in as an experience hire. Advice to Senior Management: Pay your employees better or they will continue to leave.
- IBM Software Engineer Manager in Atlanta, GA: (Current Employee) "IBM is a fantastic place for process driven individuals." Pros: Stability? Perhaps. If you can routinely beat out at least 25% of your peers in performance, you can stay on with IBM indefinitely. Cons: Process focus is extreme. This may be a lack of maturity on my part, but IBM spends what seem like inordinate amounts of effort in focusing on process instead of results. Advice to Senior Management: Get rid of the bell curve distribution on PBC ratings or explain to your leadership that its a suggestion rather than a top down requirement.
- IBM Systems Engineer in Bangalore (India): (Current Employee) "IBM is worst place for salary and career growth." Pros: Flexible timing and open work culture can make you happy for one or two years. You will be happiest person till the time your salary starts haunting your because of almost no hikes for years and years. Cons: No salary hike. No promotions. Every steps towards your growth in IBM is a big joke in terms of salary. To say the least, theoretically a person can become manager by the time his salary reaches 4.5 - 5 lacs (in case you are a campus hire or your have been hired at a low salary due to some reason). Every HR mail related to salary is a big Mathematical game to fool you. IBM gives no hike to average raters and they give 3-6% hike to top raters (only 10% of IBMer, that means on an average IBM gives a hike of 6/10=0.6%. You can easily understand how pathetic it is... Advice to Senior Management: They have nothing in their hand so I can not advise them. They will keep you encouraging and will keep you patting your shoulder for whole year and in the end they have no command on the hike which can be given to you so you get 3% if you are a top rater and 0% if you are average rater
- IBM Managing Consultant in London, England (United Kingdom): (Current Employee) "Low Pay, Low Morale." Pros: There are very good people that work at IBM who are passionate about what they do. IBM has a wide ranging client base which allows opportunities. Being part of IBM is CV enhancing. Access to IBM research. Cons: Pay is far behind the market rate and management rely on individuals to stay through loyalty rather than through competitive pay and benefits. There seems to be a feeling of low morale amongst a growing number of employees, this is all around lack of value of individual contributions by senior management. Advice to Senior Management: Start to value the individuals that work for you, if not then the good people will be leaving to take up opportunities that pay market rate.

New on the Alliance@IBM Site

Pushing for Living Wages and Jobs for All. Labor Fights Back. By Shamus Cooke. Excerpts: If the U.S. economy eventually recovers and current trends continue, U.S. workers won't be celebrating in the streets. The corporate establishment has made it clear that a "strong recovery" depends on U.S. workers making "great sacrifices" in the areas of wages, health care, pensions, and more ominously, reductions in so-called "entitlement programs" — Social Security, Medicare, and other social services. These plans have been discussed at length in corporate think tanks for years, and only recently has the mainstream media begun a coordinated attack to convince American workers of the "necessity" of adopting these policies. The New York Times speaks for the corporate establishment as a whole when it writes: "American workers are overpaid, relative to equally productive employees elsewhere doing the same work [China for example]. If the global economy is to get into balance, that gap must close." ...
Ultimately, years of Wall Street gambling and corporate greed in general have destroyed the U.S. economy, sending jobs overseas to exploit slave wages with the inevitable result of slave wages coming to the U.S. Decades of tax-cuts for the rich combined with overseas wars for profit have undermined the foundation of economic stability — and U.S. workers are being asked to foot the bill. In the long-term, the U.S. economy will need to be re-structured, meaning that giant corporations cannot continue to dominate the economy for their personal profits. In the short term, U.S. workers will need to organize themselves to fight back. Alliances with Democratic politicians are no longer an option to stave off attacks from corporations, since the attacks are now coming from both sides of the two-party system.
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!
General Visitor Comments: Due to a lack of membership growth the comment sections will be closed until we see sufficient growth in full membership, associate membership or donations. Many of you that visit our site have not yet joined, but seem to value its existence. The only comment section that will remain open will be Job Cuts Reports. If you have information that you want the Alliance to know about please send to ibmunionalliance@gmail.com. Information of importance will be put on the front page of this web site. To join go here: Join The Alliance! or here: Join The Alliance!
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Job Cut Reports
- Comment 7/18/10: To -not_a_butt_kisser- I was a first line who had to do a RA and I can tell you I didn't choose would go. For me and others we were all called into a meeting where we we're told we have employees who would be RA'd and that we'd receive an email later in the day saying who it was. I don't believe the 2nd lines knew either as in the information packages only we to the 1st's and 3rd's. To even show you how stupid this whole thing was. We as 1st lines had to claim it was all our choice and IBM had nothing to do with it. As well HR crafted up reasons why each employee was being RA'd (i.e. poor performance, skills mismatch, etc). In my case I had to tell my employee it was due to a skills mismatch, however they were the only one with that skill on a new technology that the whole product was moving to. -Bob-
- Comment 7/18/10: IDT SDMs are being evaluated for possible move to GDF. It's a 19 week process which conveniently ends the first of December, just in time to RA those who don't move before year end. Timing is everything! -anon-
- Comment 7/21/10: RE: "IBM Failed Us Big Time, Says Texas" This is just the beginning of much more of this to come. Most good people are gone from this company and too much is left up to India, and we know how their service is. It's just going to keep on catching up with IBM. One thing for sure, if big blow ever realizes they need to restaff US workers to make it a good company again, a Union must be in place so the years of abuse are not repeated with hard working US employees. -Gone_in_07-
- Comment 7/22/10: It was confirmed to me that not only did I lose almost 1/2 of my retirement-eligible pension when I was RA'd, but my entire online Future Health Account was wiped out - 10's of thousands of dollars that was to be used for retirement medical insurance - gone, with less than 1/2-year to go to lock it in, along with full retirement benefits. This is after close to 3 decades of service with this company.
  It's also after the company raked in about $100 Billion in annual revenue. They called it 'forfeiture' in the system; I call it theft. What level of greed, incompetence, and ethical bankruptcy can explain this? It's a crooked system that will shaft any older worker after a full career, approaching what they've worked some of the best years of their lives for. It's now so rigged that they block virtually any chance of an extension once you're on the 'list.' It's almost beyond belief that a company that was once the epitome of ethical behavior could line its coffers on the backs of its long-time workers like this. There needs to be a full investigation into this type of practice. This is what companies like IBM once took the lead in, but with this serious vacuum in ethics, ad infinitum, what the government is now trying to do to ensure people are covered from a health insurance standpoint.
  
  You can't depend on or trust a company like IBM, anymore. The Alliance is the only hope to restore any kind of fairness, ethical integrity, equality, and job security here through a bona fide, undisputed employment contract, but each employee must act to take the initiative and join to make this happen. PLEASE JOIN. -Former True Blue-
- Comment 7/25/10: To -irRational- - I have 25+ years in the company. In the past I would have agreed with your statement regarding workings NOT leaving IBM. In the past 2 years, I have seen MULTIPLE employees (with 10+ years of service) in my group leave the company for other opportunities in the I/T field. They were smart. Mgmt told them eventually their jobs were moving to Dubuque or Boulder. They didn't stick around to wait for the axe to fall. They just gave IBM the finger and left on their own terms. I keep hearing talk that others are looking, but haven't found anything yet, so I do believe that once the job market loosens, and jobs are more plentiful, you'll see more workers leave this sinking ship. -dun-4-

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

New York Times: Insurers Push Plans That Limit Choice of Doctor. By Reed Abelson. Excerpt: As the Obama administration begins to enact the new national health care law, the country's biggest insurers are promoting affordable plans with reduced premiums that require participants to use a narrower selection of doctors or hospitals. The plans, being tested in places like San Diego, New York and Chicago, are likely to appeal especially to small businesses that already provide insurance to their employees, but are concerned about the ever-spiraling cost of coverage.
But large employers, as well, are starting to show some interest, and insurers and consultants expect that, over time, businesses of all sizes will gravitate toward these plans in an effort to cut costs. The trade off, they say, is that more Americans will be asked to pay higher prices for the privilege of choosing or keeping their own doctors if they are outside the new networks.
Kaiser Health News: Wal-Mart Sued For Limiting Employee Medical Care. Excerpt: Wal-Mart Stores Inc. is facing a class-action lawsuit in Colorado accusing the company "of conspiring to limit medical care for injured employees in a bid to save money," The Wall Street Journal reports. "The lawsuit alleges that Wal-Mart broke state and federal laws by using a subsidiary to control the treatment for employees with workplace injuries. Wal-Mart sent the injured workers to clinics run by Concentra Inc., which operates 300 medical centers and 250 workplace clinics in 40 states." The suit was filed last year on behalf of roughly 7,000 current and former Wal-Mart employees in Colorado. It charges Wal-Mart, Concentra and insurer American Home Assurance Co., part of American International Group Inc., "of conspiring to violate a Colorado worker's compensation law that bars companies from dictating medical care for workers hurt on the job." Court records show that Wal-Mart gave subsidiary Concentra "protocol notes" before appointments with employees.

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: More of the Rich Run as Populist Outsiders. By Damien Cave and Michael Luo. Excerpts: When Jeff Greene, a k a the Meltdown Mogul, recently brought his Democratic campaign for the United States Senate to a poor Miami neighborhood rife with the kinds of subprime mortgages that he became a billionaire betting against, did he: A) Arrive in a Cadillac Escalade S.U.V., before stumping for energy conservation; B) Tell the crowd that he was "fed up and frustrated" with Washington while suggesting job-creation ideas previously proposed by Washington politicians; C) Receive a raucous welcome as an outsider who could turn Florida around.
The answer? All of the above, of course.

Call it the Great Recession paradox. Even as voters express outrage at the insider culture of big bailouts and bonuses, their search for political saviors has led them to this: a growing crowd of über-rich candidates, comfortable in boardrooms and country clubs, spending a fortune to remake themselves into populist insurgents. ...
New York Times: The New Poor. After Training, Still Scrambling for Employment. By Peter S Goodman. Excerpt: In what was beginning to feel like a previous life, Israel Valle had earned $18 an hour as an executive assistant to a designer at a prominent fashion label. Now, he was jobless and struggling to find work. He decided to invest in upgrading his skills. It was February 2009, and the city work force center in Downtown Brooklyn was jammed with hundreds of people hungry for paychecks. His caseworker urged him to take advantage of classes financed by the federal government, which had increased money for job training. Upgrade your skills, she counseled. Then she could arrange job interviews.
For six weeks, Mr. Valle, 49, absorbed instruction in spreadsheets and word processing. He tinkered with his résumé. But the interviews his caseworker eventually arranged were for low-wage jobs, and they were mobbed by desperate applicants. More than a year later, Mr. Valle remains among the record 6.8 million Americans who have been officially jobless for six months or longer. He recently applied for welfare benefits.

"Training was fruitless," he said. "I'm not seeing the benefits. Training for what? No one's hiring." Hundreds of thousands of Americans have enrolled in federally financed training programs in recent years, only to remain out of work. That has intensified skepticism about training as a cure for unemployment.
Huffington Post: When Do I Prosper? By Gary Hart. Excerpt: We Americans may be entering (or have already entered) a period of national re-evalution. It was fashionable a few years back for "values" to be a political buzzword, meaning if you believed in "values" (undefined) you voted in a certain way. But now, we may actually be forced to define what our true values are. In the past three decades or more we have all become consumers. Bigger houses, bigger cars, more things. At the same time we were producing less, importing more, and basing our economy on manipulating money to make money. The results were predictable. Huge trade deficits. Selling US bonds to finance the deficits and to buy more things.
It's pretty obvious we can't keep doing this forever. This pattern has brought us to the mess we are in today. The question is whether we'll find a way to pick up where consumption, money manipulation, and unproductivity left off, or whether we will restore a national economy that produces, saves, invests, makes things, and pays its way.
Jim Hightower: Wimpy Leaders Ignore a Strong People. Full excerpt: Right-wing Republicans and corporate Democrats have become a pathetic bunch of "No-can-do Nancys." Faced with an economy reeling from the plutocratic policies that these same lawmakers pushed down upon us, they are now whimpering that America is too weak to meet the obvious needs of its own people. "We must surrender to the Gods of Economic Despair," they cry. At a time when history calls for our leaders to step forth with a bit of FDR boldness and rally grassroots people to rebuild our economy, they trumpet for retreat, giving up on America's historic ideal of the common good.
A jobs program? "Everyone for themselves," they shout. Health care for all? "Go to the emergency room," they scream. Social Security? "Socialism," they screech, "run away from it!" Public education? "Can't afford it," they tell us, as they turn their backs on hundreds of thousands of teachers soon to be fired. Repair America's rotting infrastructure? "Too big for us, " they wail, "leave it to the next generation."

Wagging teabags rather than picking up the tools of real recovery, the woeful voices of American failure insist that they speak for the People. Hogwash. Americans are a strong, community-minded, democratic-spirited, can-do people. Indeed, the latest Gallop poll shows that 60 percent of the public favors "additional government spending to create jobs and stimulate the economy."

"But we must balance the budget," whine the naysayers. Of course we should, and big majorities say we should do that by putting people to work, taxing the superrich to pay their fair share of Social Security and other public needs, as well as by slashing the $12 billion a month we're spending for the wars in Iraq and Afghanistan. It's time for our "leaders" to stop whining – and catch up to the people.
Jim Hightower: Averting America's "Long Depression." Full excerpt: The most moronic oxymoron I've ever heard is the one being cheerfully bandied about by economists as they tell us that the Great Recession of 2008-2009 is over, exulting that we're presently experiencing a "jobless recovery."
I don't see how their minds can put those two words together without having their heads explode! Excuse me, Einsteins, but there's no such thing. You can spin your data 'til the cows come home, but an economy that has nearly 20 percent of the workforce either unemployed or underemployed, that has no plan for replacing the 8 million jobs we lost in the last two years, that is now proceeding with mass layoffs of such essential workers as teachers and firefighters, and that is willing to accept poverty pay as the new American normal is not by any stretch of the imagination a recovery.

Au contraire, buckaroos, the reality we face is the darkening shadow of what economist Paul Krugman is frankly calling a "Long Depression." As happened in a similar decline in the 1870s, those at the top will prosper and take an even larger share of the wealth we all produce, while the majority see declining income and rising poverty.

There is, of course, a way to avert this. It's called leadership. The way out is to enlist our grassroots people in an all-out "Rebuild America" campaign. Stop talking about a green economy and put Americans to work building it. Also, let's lead the world in putting high-speed internet in every home and school. And our crucial national infrastructure, from bridges to parks, is in a sorry state – let's go to work to repair and improve these public resources.

Destiny calls, but our leaders are either self-absorbed, clueless, or cowardly. So, we must lead. One place to start is Blue Green Alliance: www.bluegreenalliance.org.
Yahoo! Finance: The Middle Class in America Is Radically Shrinking. Here Are the Stats to Prove it. By Michael Snyder. Excerpts: The 22 statistics detailed here prove beyond a shadow of a doubt that the middle class is being systematically wiped out of existence in America. The rich are getting richer and the poor are getting poorer at a staggering rate. Once upon a time, the United States had the largest and most prosperous middle class in the history of the world, but now that is changing at a blinding pace.
So why are we witnessing such fundamental changes? Well, the globalism and "free trade" that our politicians and business leaders insisted would be so good for us have had some rather nasty side effects. It turns out that they didn't tell us that the "global economy" would mean that middle class American workers would eventually have to directly compete for jobs with people on the other side of the world where there is no minimum wage and very few regulations. The big global corporations have greatly benefited by exploiting third world labor pools over the last several decades, but middle class American workers have increasingly found things to be very tough. Here are the statistics to prove it:
- 83 percent of all U.S. stocks are in the hands of 1 percent of the people.
- 61 percent of Americans "always or usually" live paycheck to paycheck, which was up from 49 percent in 2008 and 43 percent in 2007.
- 66 percent of the income growth between 2001 and 2007 went to the top 1% of all Americans.
- 36 percent of Americans say that they don't contribute anything to retirement savings.
- A staggering 43 percent of Americans have less than $10,000 saved up for retirement.
- 24 percent of American workers say that they have postponed their planned retirement age in the past year.
- Over 1.4 million Americans filed for personal bankruptcy in 2009, which represented a 32 percent increase over 2008.
- Only the top 5 percent of U.S. households have earned enough additional income to match the rise in housing costs since 1975.
- For the first time in U.S. history, banks own a greater share of residential housing net worth in the United States than all individual Americans put together.
- In 1950, the ratio of the average executive's paycheck to the average worker's paycheck was about 30 to 1. Since the year 2000, that ratio has exploded to between 300 to 500 to one.
- As of 2007, the bottom 80 percent of American households held about 7% of the liquid financial assets.
- The bottom 50 percent of income earners in the United States now collectively own less than 1 percent of the nation's wealth.
- Average Wall Street bonuses for 2009 were up 17 percent when compared with 2008.
- In the United States, the average federal worker now earns 60% MORE than the average worker in the private sector.
- The top 1 percent of U.S. households own nearly twice as much of America's corporate wealth as they did just 15 years ago.
- In America today, the average time needed to find a job has risen to a record 35.2 weeks.
- More than 40 percent of Americans who actually are employed are now working in service jobs, which are often very low paying.
- or the first time in U.S. history, more than 40 million Americans are on food stamps, and the U.S. Department of Agriculture projects that number will go up to 43 million Americans in 2011.
- This is what American workers now must compete against: in China a garment worker makes approximately 86 cents an hour and in Cambodia a garment worker makes approximately 22 cents an hour.
- Approximately 21 percent of all children in the United States are living below the poverty line in 2010 - the highest rate in 20 years.
- Despite the financial crisis, the number of millionaires in the United States rose a whopping 16 percent to 7.8 million in 2009.
- The top 10 percent of Americans now earn around 50 percent of our national income.

What has developed is a situation where the people at the top are doing quite well, while most Americans are finding it increasingly difficult to make it. There are now about six unemployed Americans for every new job opening in the United States, and the number of "chronically unemployed" is absolutely soaring. There simply are not nearly enough jobs for everyone. Many of those who are able to get jobs are finding that they are making less money than they used to. In fact, an increasingly large percentage of Americans are working at low wage retail and service jobs. But you can't raise a family on what you make flipping burgers at McDonald's or on what you bring in from greeting customers down at the local Wal-Mart. The truth is that the middle class in America is dying -- and once it is gone it will be incredibly difficult to rebuild.

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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