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Highlights—March 12, 2011

• Wall Street Journal: IBM CEO's Total Compensation Grew 30% Last Year To $31.7M. By Shara Tibken. Excerpts: International Business Machines Corp. (IBM) Chairman and Chief Executive Samuel J. Palmisano saw the total value of his 2010 compensation rise 30% to $31.7 million, thanks mainly to an increase in an incentive plan for meeting the company's long-term roadmap. The Armonk, N.Y., company has benefited from its push toward higher-margin, complex businesses and away from crowded fields where companies can only compete on price. It has been making heavy investments in emerging markets and business analytics and has been posting record quarterly results. ...

  Along with the incentive-plan increase, Palmisano also saw a boost in the value of his pension and retention plans, with the pension more than doubling and the retention plan up 93%. Palmisano's salary has been flat at $1.8 million for the past three years.

• Forbes: IBM bumps CEO Palmisano's pay 19 pct in 2010. Excerpts: The pay package for IBM's chief executive, Sam Palmisano, rose 19 percent in 2010 from a year earlier to $25.2 million, thanks to a near-doubling of his performance-based bonus as the company surpassed a profit goal it set in 2007. That's according to an Associated Press review of a securities filing Monday.
• Yahoo! IBM Employee Issues message board: "Re: variable pay 2011" by "andymccarl". Full excerpt: Let's see:
  • Diluted earnings per share of $11.52, up 15 percent and $0.52 ahead of high end of 2010 roadmap; 8th consecutive year of double-digit EPS growth;
  • Revenue of $99.9 billion, up 4 percent, up 3 percent adjusting for currency; up 5 percent, 4 percent adjusting for currency, excluding PLM operations;
  • Record net income of $14.8 billion, up 10 percent;
  • Record free cash flow of $16.3 billion, up $1.2 billion;
  • Gross profit margin of 46.1 percent, 7th consecutive year of increase.

  "We completed an outstanding year, with record profit and free cash flow, and exceeded the high end of our 2010 earnings per share roadmap objective," said Samuel J. Palmisano, IBM chairman, president and chief executive officer.

  So...if we missed the objectives, what were the objectives? Maybe total global takeover and control?

• Yahoo! IBM Employee Issues message board: "Re: Age groups" by "bits_bytes_and_bugs". Full excerpt: We haven't had a new hire in my department for nearly ten years and of the three that were last hired before that, none are still around. I think the youngest in my department is age 40 or very close to it. The team averages around 25 years of service with the company.

  We have also lost half of our resource in the last ten years due to layoffs.

  Our overhead has doubled in the last ten years due to an ever increasing number of corporate mandates, heavy-handed processes and procedures, with tools that either doesn't work or are horribly unusable or overly bureaucratic, none of which help us do our jobs better or improve service to our customers. It is more important to mindlessly follow the procedures and leave the customer dissatisfied, then it is meet the customer's needs efficiently, effectively and on time. Process is more important than results.

  People are leaving us for better jobs and more reasonable employers that actually value and invest in their employees. More power to them. We have been so viciously downsized that we no longer have enough resource keep critical business processes running.

• Yahoo! IBM Employee Issues message board: "Re: Age groups" by Bob Rodriguez. Full excerpt: ITD (formerly Global Services) was especially bad about adding clumsy, unautomated process like the security checklists for new servers over the last few years. We had servers that took several months to make it through the approvals. The last 2 teams I was in had mostly people with 25+ years for the US and Canada, 5-10 year hires, or Indians and Brazilians. I enjoyed my 27-year stay for the most part, until getting laid off last March when the Linux team moved their support to Brazil, but I won't miss the PBC stuff, as they were forever changing the criteria for a 2+, What was worse is that recent PBC objectives included a goal that required you to support "global resourcing" so it seemed as if you could only do really well if you had a hand in moving more work off-shore.
• Yahoo! IBM Employee Issues message board: "Re: Age groups" by "alwaysontheroad4bigblue". Full excerpt: I work in Global Services doing custom application development (not the typical outsourcing work that makes up the bulk of IGS) and it's been interesting to watch our staffing model change. It used to be that projects would have a mix of young and old, and it was such a pleasure to work with the bright young folks that were new hires. Of the dozens of "kids" I once worked with, there are only two or three still in IBM.

  In later years instead of a mix of young and old, the young were replaced by Indians (often contractors) on H1-B visas. Project managers, delivery managers and senior technical staff were still U.S. based.

  Now, the projects that I'm on have a token number of U.S.-based employees. The project managers, delivery managers, and most technical staff are from IBM India, here on L1 visas. (Unlike H1-B visas, there are no limitations on the number of L1 visas a company can bring in.) There are no fresh U.S.-based faces to be seen. Before joining a project, you will almost always be interviewed from someone from IBM India. While on the project, you will be managed by a person from IBM India, and he (and rarely she) will complete your PA.

  I hang on because I still enjoy the work I do. But, it's clear that the bright youngsters coming out of college today are going to Google, Microsoft, or small companies...not to Big Blue.

  When I hired on (in the late 70's) IBM hired the best and the brightest. Now we import our workers from India.

• Yahoo! IBM Employee Issues message board: "Re: Age groups" by "Debbie". Full excerpt: Didn't I read somewhere in the last couple years that over 50% of IBMers had less than 5 years with the company? In my former department we were all oldies. Our department "baby" was 50 years old. We all worked on an outsourcing contract for a large health insurance company, providing all their systems and application development software support. Most people had been there for years, very few young folks around. They didn't want to go into "mainframe" technology.

  But the Indians were happy to do it. When we were all RA'ed last year and replaced by Indians the Indians were mostly all kids. We had to train our own replacements or we would not have gotten our 6-months-pay severance packages. But as my work partner told me, "I have to train him? Sure. I'll answer faithfully any question he asks me. But I'm not going to volunteer one single thing!"

  And the Indians all had very little time with the company. One of the two guys my partner and I were training had *three months* with IBM at the time he was sent over for training. The other had about 18 months. That was typical for most of the Indians.

  I suspect people in the middle ranks don't stay as they find the environment poisonous, and know their odds of hanging in long enough for pension and full benefits are slim. And yes, older employees want to hang on to try for their 30 years, or 15 and 55. Younger post-2005 employees know there is no pension for them anyway so can't imagine staying for the long haul. So yeah, stay for a few years and have it look nice on your resume. I guess if I were starting out I'd want to try to stay at least long enough for the IBM match to my 401k account to vest, but would have no incentive to stay a day longer than that.

• Yahoo! IBM Employee Issues message board: "IBM Medical & COLA Promises" by "larryrgeorge". Full excerpt: I have been reading through the many notes regarding the promises made to those who retired on the VTPP in June 1991. I am one of those who took this plan. In fact I was the manager who pitched the plan to my office at the time.

  I attended a management session on the VTPP to get training on presenting the plan to potential retirees. We were told that if we took this plan, we would be "grandfathered" into our present medical plan at the time and that we would receive COLA's on our retirement annuity.

  The medical plan remained without a monthly contribution for a number of years, but now the employee costs are escalating significantly each year. And there has been no COLA's for the 1991 retirees.

  I am not only angry that I was lied to, but I presented these falsehoods to other employees.

  I have written several letters to both IBM CEO's and Randy MacDonald, HR V.P. regarding the most recent medical plan increases. All I got back is the usual tap dancing, telling me how fortunate I am for even having both retirement and medical plans.

  Does anyone here know of any legal action being taken against IBM for this? I would be interested in finding this out.

• Yahoo! IBM Employee Issues message board: "Re: IBM Medical & COLA Promises" by Kathi Cooper. Full excerpt: Corporate promises are not protected by federal law. Medical benefits are not protected by federal law. I was a manager spewing the same foils to my team at the same time you did. After the Kool Aid wore off, I came to terms with the situation we are in. All of us have a medical problem.
• Yahoo! IBM Employee Issues message board: "Re: IBM Medical & COLA Promises" by "orsonbear". Full excerpt: You said you would be "grandfathered into your current medical plan". No lie there. Even for current IBM employees, plans change over time. IBMers pay for their medical coverage and so do retirees. For current employees, the IBM PPO is still free for the employee only (you pay for each additional family member). And the same free option, as the IBM High Deductible PPO, exists for retirees. I am retired and am on that plan. Free for me, but I have to pay for my spouse. I still have free medical for myself, just like when I was an employee. The plan is less generous, but I am not complaining a bit.
• Yahoo! IBM Employee Issues message board: "Re: IBM Medical & COLA Promises" by "larryrgeorge". Full excerpt: Kathi, I know exactly how you feel. Several years after I retired, I started inquiring about the COLA's that we were told we were going to get on this 1991 VTPP retirement plan. Finally after having no success with some low level grunts, I wrote a letter to Lou Gerstner and told him that we had been lied to. This was after the Board of Directors voted to raid the retirement fun d to pump up the stocks prices. I got a call from one of his staff and this arrogant jerk really ticked me off.

  So I took my retirement certificate and cut it up in small pieces and mailed it to Gerstner with another letter and really gave him a piece of my mind. I sent this one Registered mail requesting a receipt. He didn't sign it of course. <Grin> Larry

• Yahoo! IBM Employee Issues message board: "Re: IBM Medical & COLA Promises" by "dogbreath127k". Full excerpt: I clearly remember a wheelchair bound programmer getting the RA notice, going home at the end of the day and shooting himself in the head. Does that qualify under your "ruined life" definition?
• Fortune: IBM's Sam Palmisano: A super second act. Posted by Jessi Hempel. Excerpts: CEO Sam Palmisano took a revitalized IBM and made it the envy of the tech world and darling of investors. His secret? He's restored Big Blue's focus on innovation and set it up for an even brighter future. (Move over, Lou Gerstner.)

  Now, here's what you might not know: Nine years after Gerstner stepped down as CEO, IBM is financially and strategically stronger and, yes, sexier than ever -- all thanks to Sam Palmisano, Gerstner's successor. Under Palmisano, earnings have quadrupled and the stock is up 57%. He's not merely cutting costs (though he's done plenty of that, including shifting work from the U.S. to India). He's remaking the company by pushing into new countries and expanding hot businesses such as supercomputing and analytics that require heavy-duty lab innovations. Last year's R&D spending? Some $6 billion, or 6% of IBM's nearly $100 billion in annual sales. Its 5,896 patents in 2010 -- more than any company in the world -- help explain why it lands at No. 12 on Fortune's annual list of the World's Most Admired Companies. That Jeopardy-playing computer isn't just a gimmick; it is at the heart of IBM's long-term growth strategy.

• Selected reader comments about the above Fortune article follow:
  • He is a genius. I always have admired him.
  • Great piece. Thanks for the insight into Mr. Palmisano.
  • "Palmisano also delivers quarter after quarter"? Really? This is only after firing employees quarter after quarter. Come on, wake up Fortune and tell the WHOLE story.
  • What Palmisano did was all the more impressive because Gerstner left him with a compromised balance sheet, which isn't uncommon for CEOs of large firms to leave their successors. So, for investors in IBM, watch the accruals when Palmisano leaves. Perhaps he will be more honorable.
  • This article fails to mention the tens of thousands of America workers, many in the prime of their careers, IBM permanently laid-off to help bolster the stock price. It is a strategic tool used to bolster short-term stock gains at the expense of IBM talent. It also fails to mention the tens of billions of dollars of stock buy-backs that IBM has made over his career, money better spent on improving the company rather than a short-term stock gain gimmick. Palmisano may be the darling of Wall St. (and the Bush Clan), but he is the devil incarnate of tens of thousands or American works, including me.
  • It's mostly smoke and mirrors. Earnings per Share has risen almost solely on massive buy backs. IBM is maniacal about hating Americans. It was announced in their 2010 earnings call that $8B of "efficiencies" are expected over the next five years. That translates into $8B worth of American jobs going off the books.
  • Yes IBM use to be a great place to work. Respect of the individual was their motto. It is now respect for the almighty buck. I worked their 14 years and ever 6 months I had to lay more people off. When it was my time to go, I was happy. We won't even bring up the fact that IBM took people's retirement away from them. Many people made career decisions based on this. Its a shame that Mr. Palmisano's goal is to pretty much outsource the entire company. Why should he care, he'll be sitting on millions of dollars when he retires.
  • Yeah, Sam is super great. When IBM fails to cut it, instead of admitting the problem is internal to IBM, he claims some external issue and sells the business unit off. IBM profits are driven by exploiting cheap global labor, and driving US based wages down via any means possible. They few times a Sam P. led IBM has attempted to drive technical innovation have been a joke.
  • He is doing this by firing (RA is the IBM Term) North American staff 600+ this month alone. Morale is so bad in the company at this time you wouldn't believe it. In 2010 they would not even release the 2010 results in Canada they were so bad. Sam you will be gone before the real impact of your changes become apparent, just ask your buddies at Toyota how their Lean Program has worked out. How many recall in the past 18 months. Your time is coming.
  • In 2009/10 IBM UK forced over 850 older employees into early retirement without any of the usual redundancy or early retirement packages - as part of IBM's programme to transfer jobs from the US and UK to India, China, and other low cost countries. Over 250 of those employees are now taking IBM UK to Industrial Tribunals for unfair dismissal and age discrimination. Sam's reputation, and that of IBM, will be badly damaged when IBM UK is found to be guilty of age discrimination.
  • It is inaccurate to say that Sam Palmisano has "expanded hot businesses such as supercomputing" The High Performance Computing (HPC) business pre-dates Palmisano's tenure as CEO. In addition, the development cost of the current iteration of the project comes almost entirely from a contract with the Department of Defense (and DARPA). It is called PERCS, and was a highly publicized win for IBM, as they had to compete for the project. Having worked in HPC at IBM for over 10 years, I have witnessed the software testing and lower-level programming support jobs shift to IBM development labs in China and India. A highly-skilled software development group continues to be employed in the US, albeit with fewer resources and head count. Were it not for the government contract, which requires an integrated hardware and software solution, I am convinced that IBM would not be in the HPC game to the same extent. There is an internal push to make an off-the-shelf HPC solution and shift all of the development to India. This is not innovation. Fortune needs to provide another example besides supercomputing to support the claim that Palmisano has "expanded into hot new businesses". Within IBM, he is mostly known for outsourcing IBM's US workforce.
  • I am an IBM retiree who was forced out after 28 years and have steadily watched my "free for life" medical costs go up. The respect for the individual principle went out the window with Lou and Sam was a great student, learning all the tricks. Most admired? IBM used to be number 1 on best company to work for; now it is not in the top 100. Sam is a greed CEO, certainly not a role model for any moral person.
  • "Somewhere the ghost of Tom Watson Sr. is smiling." - More like turning over in his grave. Respect for the individual is a thing of the past in IBM.
  • Sam has worked very hard at improving the company's earnings and bottom line but the culture here and employee morale is at an all time low. It would be better to own stock in IBM, rather than work here unless you're up very high in mgmt. Almost everything that made working at IBM over the decades has been cut. There's nothing great about IBM as an employer. Outperform and you might keep your job. Perform to expectations and you're surely gone soon -- your job sent to India/Asia. More than 100,000 jobs have been sent overseas. No loyalty to the people that help produce the so-called turnaround.
  • What this article fails to see, is that he is selling out for bonus money, his only concern is share price. Why is it high, because they spend the profits buying it back to limit shares, raising the price. What does he invest in the company. ZERO. Anyone who is a non executive lives day to day with threats for personal reduction. IBM claims to be fair and progressive, yet first line managers hire people with no experience for more money then people working at the company for 10 years. Ask a actual non management employee what IBM truly is, not a spokesman who hides in Armonk behind corporate lawyers.
  • IBM will probably be Sam as the sole employee & everyone else as a vendor, business partner or sub con. Hey Watson, how close is IBM turning into Enron?
  • How about discussing the fact they have record profits, but that's due to cutting expenses but consistently firing good US workers and hiring people in overseas markets. Let's discuss how we have record profits and record performance, but US bonuses are less than last year, our raises are barely 1-2%, yet costs keep going up (benefits up 46% over the last 2 years). IBM does not live up to the values and traits they expect us to follow.
  • Every time I see Sammy I get sick to my stomach. I was let go on Black Friday April '09 with 10,000 other U.S. employees, and after 30 years of service. If you work for IBM and are over 50 years old looking at retirement just forget it. Age discrimination is rampant at IBM. I bet Sam will get to retire with full benefits and a multimillion dollar payout. Then you see him at some summit with the president talking about creating jobs... yeah, maybe in India.
  • The record EPS numbers is directly on the backs of former (fired) and current (soon to be fired) IBM employees. Is it any wonder why Doug Shelton (IBM spokesman) states "we do not comment on layoffs." It's because they DO NOT want anyone (especially Obama) to know IBM is silently and surgically firing their US employees and moving work to the BRICS. Fortune, please investigate and report level and complete journalism, not just the feel good stories that tickle the money-bone of top 2% in this country.
  • Our company has IT help desk support & some of them are in South America. What a joke - they are probably nice people but they are under-skilled and act like robots...no help at all. I'm amazed we actually pay for this "support". As someone else said our company's executive don't use this help desk so why would they care about the level of service. It will swing back the other way as people in the US realize outsourcing gains you nothing but problems.
  • What is so hard about laying off your higher paid staff and replace them with lower paid staff from low-cost countries? And in the process increase your profit margin? Any first year MBA student can do that. What has IBM done in the past 7 years to grow revenue? The revenue stays pretty much constant during Mr. Palmisano's stewardship of the company. The only reason why profits kept on growing because of massive cost cutting at the expense of IBM's employees in North America, and Western Europe i.e. high cost countries. IBM is now an acronym for Indians, Brazilians and Mainland Chinese.
  • Interesting article. Palmisano's strategy is this. Raise earnings per share in a two-fold strategy: buy back shares and cut costs. Buy-back is simple. Cost cutting: increase low cost India employees, decrease US and EU employees.

    He cuts US + EU employees in two main ways. Each year 25% forced low performance grades - once you have one of these your days are numbered. He also uses legal loopholes as per UK where 850+ 50-55 year olds were given Hobson's choice regarding their pension. Both methods are dishonourable to time-served employees.

    What is lacking in IBM strategy is any technical developments, OK so the new Power 7 chip continues the strong market hold of mainframe and big UNIX boxes where competition is weak. However in the Wintel space and datacentre the network companies like Cisco and Juniper will dominate. Software group is a strong business model to be fair.

    IBM has become a Services sweatshop based on low cost delivery. They are losing many skilled and talented customer facing people in US+EU. It is hard to sell and project manage from India. It can only result in poor service and customer defections.

    The Earnings per share strategy has driven share price increase. Where is the Revenue increase strategy? The share price is over inflated. Palmisano's legacy will be judged by corporate history.

  • Sure the stock price is going up but at what cost? Tens of thousands of people that made lifetime career choices based on what IBM promised them are laid off. All this to line Sam's pockets with millions in compensation. IBM used to be an honorable company but not any more. I'd be will to bet that Sam does not loose any of his benefits.
  • Oh, please. IBM's no Apple and this guy just knows how to outsource jobs. Laid off another 250 people just last week. He's no Steve Jobs.
  • What an unbelievable group of myopic whiners. Wake up, old timers - the world has passed you by. You're out at IBM because your skill set is no longer needed and your entitlement mind-set is a relic of the 1950's and 60's. Thinking like that is what nearly destroyed IBM in the early 90's. Nothing lasts forever; not jobs, not company cultures, not terms of employment. It's a globally integrated enterprise now at the top of its game and if that means moving work to the BRICs, it's hardly IBM's fault. I'm a 33-year employee in my mid-50's and while I could get whacked tomorrow, I'm proud to be a member of a company that has figured out how to prosper in the toughest economic conditions in decades. Snipe at us if you wish while you cash your dividend checks, but I'm betting Big Blue will be around in 2111.
  • IBM will no longer give headcount numbers for it's USA workforce. Why? To obfuscate the resource actions (RAs) they continually do. And Palmisano is supposedly advising President Obama on job creation? IBM is offshoring more USA jobs and only hiring a fraction of USA jobs they are RAing. Palmisano should not be on the President's advisory panel. Since IBM's pillar belief was dropped with Gerstner and now further buried by Palmisano of "RESPECT FOR THE INDIVIDUAL" IBM feels they no longer have to disclose USA IBM employment information.

    To say IBM doesn't have to disclose this information because their competitors sometime don't shows IBM doesn't truly lead anymore, but does follow the crowd.

    If IBM had integrity and was forthcoming with the information in the past it shared, like employment numbers, then maybe it would be the great company it used to be.

  • When I think of INNOVATION I think of corporations Apple or Microsoft. Not IBM. Can anyone picture Palmisano doing an IT pitch like Steve Jobs does or Bill Gates used to do? IBM? I just think of acquiring (buying through acquisitions) innovation and just cheap offshored IT services. Once IBM cost cuts itself to death to make their almighty EPS target we can finally lament what was once a great company. Palmisano, a junior executive compared to Gerstner, need not have any worry. He will retire and sleep on a 24K gold sheeted mattress filled with tons of $$$ much like his predecessor Gerstner.
  • This whole praise is BS. The Company is making profits by moving thousands of high-tech jobs offshore (cheap sweatshops in the name of Gloablisation!) while we Americans are now jobless. Shamefully IBM has a culture of laying off hard working & dedicated American workers who have been preached BLUE values. I guess Sam's innovation is to boost stock value at the expense of the middle class hard working folks in this country! Our Govt. needs to regulate better, before we dwindle down to being a third World!
  • Amazing how consistent the comments are. Sam represents what's worse in corporate America. Cut the employees salaries and massive layoffs while the bosses bonuses go up for the executives. History will view these titans as responsible for the downfall of the United States. IBM has totally turned its back on US employees and the 100 years we spent building the company. If you want to learn about the character of IBM execs look at Bob Moffat.
  • What a joke...IBM has done nothing but layoff all their US workers including me. I was forced to relocate to another state by my IBM Manager 6 months later I was reassured my job was safe I purchased a new home in the new state because I was "just relocating" even though my house in the other state had not sold yet. Then was laid off gee Thanks Sam now I have two houses and no job. Should have just axed me before making me relocate HELLO what is wrong with that picture?
  • IBM under Sam Palmisano has been offshoring U.S. jobs to the BRIC Nations (Brazil, Russia, India, China, also Vietnam, Malaysia, Philippines, Argentina) at a frantic pace for many years simply for cheaper labor and never for technical advantage. For example, staffing in India has jumped from just 9,000 workers in 2003 to 74,000 workers in 2007 while U.S. jobs have steadily declined.

    IBM has chosen profit over patriotism which is treasonous and therefore should *NOT* be eligible for tax breaks since they are eroding the Federal, State, and Local tax bases and are contributing to the devastation of the U.S. economy by eliminating U.S. Jobs. It is rather disgraceful that IBM laid off Employees after disclosing a 4Q2008 profit of $4.4 billion in arguably one of the worst Economies since the Great Depression. IBM simply took advantage of the prevailing economic conditions to fly under the radar and justify these layoffs to fatten up their bottom line and Corporate Fat Cat wallets.

    A smarter approach for a profitable company in a down economy would be to show some loyalty and retain their valuable employees rather than risk a mass exodus by their top talent when other employment opportunities become available. No Talent - No Company! From a personal standpoint, I am a retired IBM'er who was Resource Actioned in 2007 at which time my job was offshored to Brazil, so I have first hand experience with IBM layoffs.

    IBM will also extort money from the various States to keep the jobs in place and will pit each state against the other to up the ante. The sole residence factor for a Corporation should be that there is a skillful local labor pool available and not how much money the State will fork over to IBM to appease them and supplement the labor cost. http://www.recordonline.com/apps/pbcs.dll/article?AID=/20090123/BIZ/901230359

  • @Joseph Smith...thanks for commenting on that...Revenue is truly down, so the only way to increase is to cut...how do you think IBM will meet their goal of 20 bucks a share in 5 years...bye bye to all US workers except Sam's group... Some of our clients in our division put in the contract not to offshore any work, because they know the quality stinks. Americans have to do all the rework when offshoring totally messes up the programs, etc....so in the long run, clients are paying more than they would if we did it to begin with.
  • Let's talk about how IBM is "expanding hot businesses", shall we? IBM buys a US company that has a product IBM couldn't develop, then transfers ownership of the product to one of its sites in BRIC and lays off the US staff. What a great way to reward and encourage American innovation.
  • Great article. Sam has done a great job in continuing to bring the company around. I see a few disgruntled people who failed to perform are here complaining about them being fired. It seems they are having a write in contest from the small make believe union group. I'm sure people can see the success of Sam's management based on the performance of the company. After retiring last year I am more then happy with the stock performance. Great company and solid management with a great employee team.
  • It's all smoke and mirrors. EPS is the rule of the day, and cut/cut/cut to make that happen. Don't invest in your people, and offshore every mature-market job to BRIC asap. It's a sad state of affairs
  • Retired Too, are you a shill for management? Gutting the US workforce is a short term solution that will not succeed in the long run. You say that the American workers fail to perform. If you mean fail to perform for only pennies per day, perhaps so, but that's not a true failure. Did you get your cushy pension and medical benefits? Those who are being kicked to the curb now are being stymied. Fortune mag shows its true colors here, as a very partial reporter.
  • IBM's sole focus is totally on EPS. The EPS graph looks spectacular, but look beneath the covers and it's all an illusion. IBM's revenue figures for example (in $Bn):
    • 2003 - 89
    • 2004 - 96
    • 2005 - 91
    • 2006 - 91
    • 2007 - 98
    • 2008 - 103
    • 2009 - 95
    • 2010 - 99

    (Source - IBM.com)

    Hardly spectacular. Over the same period, IBM has propped up EPS by spending $Billions on share buy-backs: instead of investing hard-earned profits in long term growth, it has frittered away billions on short term gain for investors. IBM has even borrowed additional $Billions to buy-back its own shares! Utter short-term folly.

    Palmisano has also destroyed IBM morale in the US and Europe. Evidence for this? IBMer overall employee satisfaction levels in internal surveys is at record lows (about 50% of IBMers say they don't like working for IBM). Further evidence can be gleaned from the fact that IBM has not featured at all in the Fortune 100 best places to work in almost a decade.

    Despite the hype about Watson and Jeopardy, the bulk of IBM's business is not in supercomputers, it's in provision of IT services. The bulk of this business is now in low-cost countries. IBM regularly lays off highly experienced Western IBMers and ships work to inexperienced staff in India/China. The service subsequently delivered to customers is appalling. Witness numerous high-level complaints from the like of Air New Zealand. It's not the fault of the Indian/Chinese/off-shore IBMers, they have been dropped in the deep end. It's the fault of Palmisano and his cohorts, chasing a cheap buck in the lowest cost labor pool.

    Under Palmisano's tenure, IBM has implemented a brutal staff appraisal system. In short, the system attempts to "manage out" about 1 in 5 IBMers every year (the "relatively low performers"). An IBMer can perform their job in an exemplary fashion, and still be forced to leave. The system is hated by a large proportion of IBM staff and managers. If we look at IBM's results since 2003, Palmisano himself should have been "managed out" when revenue dived in 2005, 2007 and 2009. Sadly, Palmisano doesn't seem to apply the same exacting appraisal standards to his own stuttering performance!

    Overall, Palmisano has been a disaster for IBM. He has wrecked the morale and ethic (respect for the individual) of a once great company. Palmisano is cited as saying "It's not you're father's IBM". He's right. Our IBM forefathers would be shocked and dismayed at what this greedy, immoral man has done to the company of Thomas J Watson. Watson once said "A manager is an assistant to his men". Palmisano does not care about his troops, and he is certainly no Thomas J Watson.

  • To 'Retired Too' re: "... I see a few disgruntled people who failed to perform are here complaining...". Please note that IBM has fired MANY people that were absolutely top performers and loyal employees for many years! It does not matter what ones rating or ranking is if IBM decides to ship your job to a BRIC country. Many of these top performers could easily fill other job slots within IBM but IBM does not care. They are only concerned with finding a cheaper resource and they tell anyone who has been put on a 'resource action' list (i.e. fired) that they have 30 days to find another job - and then they freeze hiring for anyone on the list. Short term - things are looking great for IBM shareholders because of this massive cost cutting. Long term - heading towards a major catastrophe. IBM continues to get rid of top U.S. employees at a record rate. This will catch up with them.
  • The companies name is INTERNATIONAL business machines. So yes, Sam has done a great job finding success GLOBALLY. Yes that means a reduction in US employees but that's part of the business. He's taken the hard steps and taken advantage of growth opportunities outside the US. I do feel for the US workers. I've seen some slackers let go, which was great. I've also seen some high performers get laid off which was tough. But this is not a communist country. Its capitalism and Sam doesn't need to care about the US or any of the US employees. He needs to worry about the company and he has done really good job at that.
  • unfortunately a public traded corporation doesn't answer to the state, federal gov......... they answer to their shareholders, customers, and investors. If it means shafting all the us employees due to the fact they can hire lower cost employees out of the country - they do it. Until the three (shareholders, customers, and investors) start saying no - it's gonna continue.
  • It's not only in the US that IBM has been moving work to low cost countries and using tight cost control (including reneging on promises previously made to its loyal workforce) as a way of driving up profit in the absence of any real growth. IBM is now run for the benefit of the senior execs, not the share-holders, not the Customers and not the employees. Does anyone really think an effective, dynamic, creative board could not find something better to do with the profits than buy back its own stock? Unless of course, buying back stock increases EPS and bonuses are linked to EPS.

    As a counter to "Retired Too", I'm still employed by IBM and deemed an above average performer. This once great company is now utterly without any sort of moral compass.

  • Nice paid piece - but IBM is no longer a great company. Just ask the people that work there (I am one of them). Sam may have created solid financial results, but in the process he has stripped the heart and soul out of IBM's culture. Employees are treated as machines and not empowered. Over the next 5 years, 25,000 American IBMers will be discarded and replaced with cheaper Indian models. That is hardly sexy.
  • Excellent article! as a thirty-plus year IBMer who had the pleasure of working directly under Sam in the past, I am proud of what he has done to keep IBM growing. Too bad so many wannabe union cheese folks came hear looking for whine (pun intended), no wonder they aren't with the company anymore. IBM may have shrunk its U.S workforce, but there was a lot of dead wood there that didn't realize the world was changing and new skills were needed, and wanted guarantees for doing so-so work. Just look at the jobs IBM is advertising on this jobs website, there is lots of opportunity for those with skills. I am glad how IBM is positioned for the future. Even if I should be laid off (which I doubt, since I maintained my skills and the whiners did not), I will still thank IBM for a great career, pay and benefits that will give me a comfortable retirement.
  • With all due respect to '@Retired Too from Burlington Vermont', most IBM'ers I know who were RA'd were extremely talented technical people who were targeted because they were either over age 50 or were simply in positions that were targeted for offshoring or general headcount reduction and -were not- "people who failed to perform" as you have claimed. Being from Vermont, I would have expected you to be more sympathetic to the layoff issue since your local IBM Burlington Site took it's share of layoffs over the years with many high quality people being pushed out the door. Please have some empathy for talented hard working people who encounter a job loss due to conditions beyond their control and don't simply assume that they were fired due to incompetence. I personally volunteered to be RA'd in 2007 to allow someone else's job to be saved since I could readily retire and not because of a "failure to perform".

    As a retired 30-year IBM veteran, I have worked with some wonderful people during my career and can honestly say that IBM has some awesomely talented people in their technical ranks and that they have arguably the best workforce in the world right here in the U.S.A. On the other hand, IBM Management 'led' by Sam Palmisellout is totally clandestine and self-serving and are completely out of touch with the general IBM Employee Population. Employee morale at IBM is at 'rock-bottom' since they are generally overworked, underpaid, are totally disrespected by Management, are no longer provided with any sense of job security, and have seen many of their talented fellow IBM employees fired and their jobs moved to offshore locations (Brazil, India, China, etc.) simply for cheaper labor and definitely not for technical advantage. Their Raises and Promotions are rare and realistic career paths are non-existent for non-executive personnel. Many IBM'ers I know totally despise those pompous and greedy ARMONK-EY Executives and would hardly call them 'leaders' since they don't have a clue how to grow revenue and rely on perpetual cost cutting (offshoring, layoffs, salary rebanding, benefit reductions, etc.) as the primary means of profitability. The Technical folks are the major reason why IBM is a successful Corporation and they deserve the utmost respect from those IBM Corporate Executives.

    A final thought: Don't believe everything you read. IBM is probably a major advertiser for many of these Trade and Financial magazines and they would be hard pressed to print any negative stories about IBM and risk losing that 'Big Blue' revenue steam. Money talks and they will take all possible steps to protect that income by only printing 'glowing' stories about IBM.

  • Hmmm... IBM lies too much...fooling people into believing they are creating "NEW JOBS" such as the 1300 jobs in Dubuque, IA... when they were just jobs of people they RA'd.... that's not what I call change that America Needs
  • I am third generation IBMer. Sam and Lou have totally ruined a once great company. I worked in Endicott New York. At one time IBM Endicott employed over 12,000 people. Today there are a total of 500 IBM employees. Fortune Magazine ought to do a story on Endicott New York, home of IBM, and see how Lou and Sam has ruined a town in upstate New York and discuss with the residents the drinking water from IBM chemicals.
  • As an IBM customer, I have to say I am disappointed in the quality of IBM Software Products. Once upon a time IBM's software was solid with great customer support. Today's IBM software product are so buggy I had to hire extra staff to deal with all the complex problems that arose. It's become obvious that it's become more important to IBM that they manage quality instead of producing it. When I try to get fixes for obvious problems in their software, I get the run-around and delays and excuses. I'm very tired of it. I am in the process of researching competing products for an eventual top to bottom replacement. I do see some innovation, but it's not worth the cost to dependability for my critical systems.
  • Well I see some of the alliance readers are on a letter writing campaign trying to discredit the good job Sam is doing. I assume they can't stand the success of the company and the stock results. I enjoy working there and expect many more successful years.
  • It's all right here: http://www.ibmemployee.com/
  • To "Retired Too": You obviously left your cush job in Burlington and were probably even one of the lucky ones to get the old pension plan, huh? Or, do you just play golf with Mr. Palmisano? IBM has become an unpleasant place to work for many, particularly in the Global Services division. This is due to off-shoring of jobs. Morale is the LOWEST I've ever seen in my many years @ IBM. I am not in any union, but I assure you that it is painful working in IBM Global Services, seeing your colleagues laid off continuously and wondering when you will be next. They were not laid off due to performance. It was because their jobs were sent offshore. IBM is a big company, and some divisions are definitely more miserable than others. So, "Retired Too", consider yourself lucky, and have a little empathy for what it's like for others. And BTW, I am a "1" performer (1 is top), and I still do not feel secure in IBM, so there goes your theory.
  • Very good article of the turning of IBM. It demonstrates the flexibility of the management team and it's employees. It makes me proud to be on the IBM team. I hope that Sam's replacement will continue the path to success. Thank you IBM.
  • To those who say they are doing great in IBM and calling the others posting negative comments whiners or union-lackrys, I don't see you refuting with facts. Without a counterargument, your comments are more dismissive than the "whiners" and basically worthless.
  • As a 25-year IBMer laid off about 7 years ago, I can say without doubt that the company has changed over the years, and not in a good way. In the good ol' days, IBMers from the lowest to the highest rung on both the management and technical ladders had a high sense of loyalty, integrity, honesty and respect for the individual. And people felt relatively secure in their jobs. None of these apply now.

    As a result, the company hasn't been truly innovative for many years, everyone's looking over their shoulders and most have little respect for the CEO who has stripped their pensions, benefits and salary increases while enriching his own. The Watson family members are rolling over in their graves.

  • I am a current IBMer and if you want an honest account of IBM's strategy, you need no more proof than this. I was personally in a meeting where Randy McDonald, Senior VP of Human Resources, made the following statement to a large group of mid-level managers: "Get your teams out of the U.S. before you can't." Lovely, huh?
  • I am not a disgruntled worker. I was "RA'ed" recently. I trained my replacements on the accounts they were going to run. The replacements are located in Argentina and India. On one of the accounts that I was working on the personnel in Argentina falsified an e-mail from a Project Executive (PE). Indicated they had received permission to do some work on the account with the PE's approval. I noticed that the time stamp was wrong. It reported it to my manager and nothing was done. The PE was not aware. This is an small example of what the out-sourcing people are doing. They can not do the work correctly and generate fake email to cover their mistakes. I have seen this more than once.

    I had sat in on a manager meeting. Our manager told us that the SAS70 auditors were killing them. He stated that IBM were working deals on accounts that showed poorly in a SAS70 audit. Trying to keep them out of the final report and make the SAS70 audit look better.

    Also, when working with my replacements in India. I was amazed on how little they knew about the service they were taking over. I was fielding calls all hours of the day and night to keep the account going because of low amount of training they had received in India.

    I feel sorry for any accounts that does not have in the contract "US only or American only" people to work the accounts. This would save the clients loads of money and time. Bottom line is Greed for the top people and talented people are being let go here.

  • I'm the granddaughter of one of IBM's early techies, and grew up with IBM's former culture. I'm disgusted with what the new leaders have done to what was once a wonderful company. May it evaporate overseas, and may new American companies bloom in the place where it once was.
  • Dear RTP: Sounds to me like you're upper mgt @ IBM and if that's the case, then you're like the rest of your peers and somehow have lodged your head so far up the butt of the other person above you that it's impossible to see clearly. If you're familiar with flow charts, I can link you to a well known process for "Cranium removal from upper managements anus."
  • I knew Thomas Watson, and Sam you are no Thomas Watson.
  • To "Retired Too" I also reside in Burlington, and I'm not sure if you wear blinders, but clearly you are not looking with your eyes wide open. I'm in GBS - I'm a '1' performer - consistently work 50-70 hrs a week, and constantly worry when the target will hit my back. I've seen many of my superior co-workers shown the door. These are experts in their field. They work on certifications, are willing to work 24x7, be on call, support their co-workers. How many times are US resources asked to fix problems due to the lack of knowledge from the offshore resources. Yes, offshore resources want to learn, but what happens when all the US resources no longer exist? Hmm.. don't think I want IBM stock when that happens.
  • This article is not looking at the big picture. It does not take into consideration the countless number of workers that have been laid off so Sam could look good. After 28 years and several months, I was laid off without full pension, no medical and with no warning. I suggest the magazine talk to more of the ex-employees. There is a right way and a wrong way to treat people who have given more than a quarter century of their life to this company.
  • IBM can compete and still get back the morale it once had. There is 12 Billion in cash. Share some of it with your employees. Recent bonus dollars were cut back about 20% or more for some. This formula was manipulated to reduce cost. The value of the stock has risen significantly. It is about time, executives in Armonk provide a meaningful compensation package that at least keeps pace with inflation. Many of us stayed here, over the bad years, and made sacrifices. We were told it would be made up to us when things improved. Well things have improved, but we are not seeing the benefits. I'm not bitter, I am just stating the facts.

    Sure we are all happy with the improvements on paper. Morale however is very low and the motivation of the average worker here, and not the executive with perks and stock options has been affected. It should not be this way. Simply adding and improving the compensation plan, and adding some award money would supplant all this negative energy. I do hope someone in Armonk summarizes some of these comments. I did enjoy reading this article and the comments. Still happy with IBM, but know it can improve. It's about time, isn't it? Look inside, we deserve better.

  • My IBM job (and NOT highly paid 'expensive' job) was 'Globally Integrated' to a former USSR 2 1/2 month from my 30th anniversary. IBM's plan it to have all jobs filled with contractors or foreign employees. There is no respect for employees. I do not know how he sleeps being the most hated man in IBM.
  • I've been retired 5 years after 35 years with IBM. I lived through the changes many decry in this blog. The plain fact is Gerstner and Palmisano saved IBM, period! Sure, some of the changes were Draconian and many lost jobs, some without cause, but the severance packages were always fair and better than most. And those that remained had jobs - none of which would have existed without some drastic actions. So its ironic that those in the lifeboat are complaining they are not on the ship that would have sunk if they remained there.
  • I agree IBM has done well. Imagine how much better they would have done if they did not desert the tens of thousands of dedicated 20 plus year US employees. I was a lucky 31 year employee that chose to leave and was able to get the pension I was promised in turn for a lower salary when I joined in 1977. While the decision to move from strictly a product company to a product, software and services company was indeed correct, it has come at a tremendous cost to the men, woman and the families the have enabled IBM to maintain 100 years of success only to be deceived and thrown to the curb as they reached what should be the pinnacle of their careers. An IBM with Ginny Rometty or Mike Daniels at the top will be an even worse place to be. Shame on you Sam Palmisano.
  • I second the comments made by San Jose Anonymous on 3/5/2011. I've been employed by IBM for 33 years. It is no longer the company I hired on with. Good performing teammates that had years of experience and necessary skills were let go and "replaced" by brand new hires in Slovakia, leaving people like me to do not only my own job but to teach the new people everything from the ground up. Of course IBM needs new markets. Americans who get laid off by companies like IBM can't afford the goods and services of US companies that have been IBM's strongest customers.
  • Being part of the Old IBM and seeing the IBM I'm not impressed with the gains that the company has made. While CEO Palmisano may have a vision for the future of the company how he and his staff obtain these goals is another issue. All too often over the past ten years the bottom lines were made by significant layoffs, elimination of manufacturing or sending it overseas, and reductions in development groups as well as funding. THIS type of management is not to be commended but rather questioned as it compromises the ability to acquire leadership in technologies as well as one's product lines.

    In the Old IBM employees were considered "golden" as they had the utmost respect of upper management. Bottom lines were made by sales of our world wide superior product lines. Today IBM is in the Services and Server industry. To my knowledge we do not dominate the market place in either of these areas but are just another "me too" company. Gone are the days where IBM owned the marketplace which is not the case today. One has to question why this is.

    Now it is said often that "....times have changed" as an excuse for not conducting business as we did 50 years ago. Nonsense. Today's management style is easy, involves little risks, small development dollars, elimination of manufacturing, and it often uses employee layoffs to achieve the end of the year financial results. AND where is IBM today in doing their part to solution the unemployment problems that this country faces? The company has been deftly quiet. That to me is NOT the definition of outstanding leadership in Armonk. Far from it.

    Sorry but I'm disappointed with IBM in 2011. I remember what IBM used to be all too well.

  • This discussion is important to bring to light, but as a relatively new (entry level, non-management) employee, I found that the sentiment of the article resonates with my feeling towards IBM. I have worked in growth markets technical strategy and now in IBM Research. This company is changing fast, and those whose skills and job descriptions align more with Smarter Planet, analytics, growth markets, etc. are probably more likely to be satisfied. I am proud to be a part of the incredible and meaningful innovation that is happening here. Despite the cost-cutting and layoffs (which I have not personally seen or experienced), there is a progressive, and innovative side to IBM. The people I work with care about and find meaning in their work. I believe the article captured that well.
  • I'm sorry but this article is just way too positive. When you think of innovation IBM does not come to mind. Palmisano is just a shill. Lou G. did indeed save the company in the 90's. He was the right hatchet man for the job - but he was there too long, went too far and cut too deep. He didn't understand technology. He left the company without a heart - in the hands of executives that were out of touch with the history, people and vision necessary to keep it great. Palmisano returned the company to peregrinates top heavy layers of management burdened with inefficient and ineffectual processes. Maybe his numbers look good but he did nothing to improve the company IMHO... he just rode it.

    BM when I "retired" from Global Services recently it was not the same company that I joined. It had abandoned its principles and everything that was its roots. It turned on its employees - Reneged on its promises. It turned its back on quality. It sent its jobs oversees to stay cost competitive because it lost the value and respect it once had. ( I only have to offer as evidence Bob Moffat http://www.makli.us/bob-moffat-arrested-0010156/ who I knew well enough to have no sympathy for).

    had a great 25+ year career with IBM but I'm glad I'm no longer there. The people I used to manage that still have jobs in USA are being abused. Some are forced to move at their own expense to keep their jobs. Salary cuts, long hours, lost benefits... its sad. Very very sad. Oh, but now they can play Jeopardy...

  • IBM is a Great company, Sam is a great leader and I find this article to be balanced. I work for a company that is a partner to IBM. I have been 18 years now and I have been involved in projects in and outside the USA. I consider a privilege to witness how people transform their way of living using IBM's technological and services muscle. Fraud detection, water supply optimization, improvements in medical analysis, improvements that help teachers in places were you cannot imagine teaching possible... real stuff that saves lives. Not only toys that some selfish may consider the only source of innovation. And yes, I am sure IBM also was a great company in the past as I sometimes have to deal with some old timers that are stuck in the 70's where it was all golden and great. Yes, I know... "I gave all my life to this company and this is how they pay me, by transferring my job... bla bla bla..." I feel sorry for them, as I feel sorry for all those that post complains, they are missing the best part of IBM.
  • The mahogany paneling may be the only thing Sam Palmisano has preserved from Mr. Watson's day. During the past 10 years Thomas Watson (both Sr. and Jr.) has been rolling over in the grave.
  • If Palmisano is so great how come employee morale is so low? How come most IBM employees absolutely hate him and the rest of upper management? How come customers complain more and more about product quality and support?
  • Mr. Watson would definitely not be happy with Sam. During the depression Mr. Watson said he was more concerned with his people being able to put food on their table than making huge profits. He cared for American and its people. Sam could be helping the American economy by keeping Americans working. These are skilled technical employees...with great appraisal ratings. 5 years ago the lays offs just took the top layer of our flesh, but now he has taken the muscle and cutting into the bone. It takes 2 to 3 times the length to solve problems because the skill overseas doesn't know our applications. The latest cuts will hit our customers. Where is the value if we don't have experts left to solve problems. Bill Gates cares for America and has a group willing to give back...do you see Sam on that list? NO. He only rubs elbows with people who want to cut jobs not save jobs. Cuts were needed 10 years ago, even 7 years ago. But the last 3 to 4 have hurt IBM. IBM is like a speeding train headed for a brick wall and Sam and his VPs have their heads so high in the clouds they won't see it until its too late. So sad. Wish Sam would look down long enough to figure it out. And it would be nice to see an article that tells it like it is. Not Sam's mafia version. The new technology and focus is good and needed but we need our people to run our business.
  • Sam is raising the IBM stock price (and lining his pockets) at the expense of US/Canada workers. Highly skilled employees are fired (IBM calls it a "Resource Action")to be replaced by workers in low cost countries, mainly India and China. Many of these people fall just a few months short of 30 years of service and lose what little pension they may have gotten. The company is a shell of what it once was. They don't grow revenue, but they sure know how to cut expenses.
  • Excellent article you wrote here, and a lot of interesting history about IBM. It's also undeniable that Sam has done great things for the company's stock price, unfortunately it's been done by ruining the lives of an awful lot of American IBMers, and by slowly destroying the company from within.

    When I started at IBM in 2000, we were proud to say that we had 450,000 IBMers worldwide, 50,000 of which were overseas. Today we have 400,000 IBMers, and only about 130,000 are in the US. That means that in 10 years, 270,000 Americans were fired, or 27,000 per year - every year, for 10 years. That's an awful lot of ruined lives. And this pace has kept up as the economy tanked, and as we went into recession. IBM is more than doing it's part to contribute to that.

    Those of us that are left are not getting raises, bonuses get smaller each year, there is no mobility upward or even sideways into different divisions. We're underpaid as compared to our peers in other comparable positions, and expected to work insane hours. Sam and his inner circle on the other hand spend all their time on the golf course, and collect BILLIONS in bonuses each year.

    The feeling within the company is not one of Innovation and excitement, it's one of terror. The senior executives are brutal, screaming and cursing on calls and driving people to work 80 hour work weeks and achieve impossible goals. The cost cutting measures taken within the company are done with ONLY quarterly profits in mind, and will have dire consequences in another decade.

    IBM has been a great company for 100 years largely on the strength and dedication of it's employees, who can and will do things no one else will, because they're dedicated, because they were proud to be IBMers. No more. Those days have gone, and those of us with real talent are going to leave the company as soon as the economy recovers.

    IBM has been a great company for 100 years largely on the strength and dedication of it's employees, who can and will do things no one else will, because they're dedicated, because they were proud to be IBMers. No more. Those days have gone, and those of us with real talent are going to leave the company as soon as the economy recovers.

    Thank you for your time. Posted By A Senior IBM Executive Manager: March 8, 2011 8:47 AM

  • Much discussion here about the cost to US jobs of Super Sam's leadership. Not much to add there, except to second the sentiment that cuts are no longer just trimming the fat - and to say that it's not surprising when the dedicated workers left continue to do more with less and fix the problems created by the off-shore resources in an attempt to keep the customer satisfied (as much as possible).

    If the business goes on at a lower cost, why would the leaders not continue that direction? So instead I pose the question of how long the business can or will go on? If the business is Strategic Outsourcing, it needs customers to buy the service. Those US customers are increasingly dissatisfied with the service they receive. And the dwindling US workforce trying to hold things together for them is increasingly burned out. EPS does not sell or support customers - dedication to a client's business does, and that value does not appear to be shared worldwide. I see a third act following Sam's tenure -- one where he takes his golden parachute billowing with the millions he makes for himself and the other top executives and runs away to leave IBM crumbling in the wake of a diminished client base.

    Yes, EPS will continue to rise for a time, driven not only by cost takeout of US salaries and benefits but also by higher prices. Sam IS trying to drive revenue growth. And the way that is being done is through straight-out pricing increases -- no added value, no added service, software or hardware -- just plain out added markup.

    Yes, Sam has expanded on the direction set by Lou before him. But, from what I remember, at least Lou was honest about it, and while still painful I could respect his straight talk. He would send division-wide communications announcing Resource Actions saying that he was trimming the fat. And even inviting those who were coasting and not maintaining their skills to leave and make room for someone more energetic. What ever happened to the VOLUNTARY separation package, that would allow the remaining workforce to rebalance before involuntary cuts? Long gone, I'm afraid. Instead, shrouded in secrecy, quality US workers are replaced with off-shore workers whose water-cooler talk cheers the demise of the US overall in the global economy.

    There is nothing wrong with growing the global economy and global jobs. In fact it's good. What IS wrong is doing so by needlessly shrinking the US economy - the US salary, US tax base and all the other US jobs that salary supports - with no benefit to the end US customer unless they also happen to be an IBM stockholder.

  • I retired from IBM after 33 years with the company. I've since been working as a subcontractor for another 10 years. Is it the same company I joined 43 years ago - No; but neither is it the same world and the same industry it was 43 years ago. I continue working for IBM because I enjoy the working partnership of the people it employs. Yes, I've had many working partners 'surplused' after long careers with IBM, but had Palmisano and Gerstner before him not made the tough decisions they have, the company likely would have been on the trash-heap of history. It's sometimes hard to realize - but the purpose of a corporation is to return a profit to its shareholders. It is not to be a benevolent parent to its employees. When the company was founded, that was the way to increase profit; it's a different world today. Kudus to them!
  • IBM US Workers (1/4 of the total work force). Is it truly an American company? Please write an article about that.
    • 2010: * I bet under 100k.... if you manage to decipher those numbers from the annual reports
    • 2009: 105,000
    • 2008: 115,000
    • 2007: 121,000
    • 2006: 127,000
    • 2005: 133,789

    Then again, you will say his job is to make the company money. True, but at what cost? Ruining peoples life while top management pockets gets full?

  • This year I have attended town hall meetings where employees have stood up, shouted down their division general manager (staying just a hare's breath away from using profanity) and been applauded by other employees (much to the consternation of the GM ). This type of behavior would have been un-THINK-able in the IBM I knew. Employee morale has been decimated. They understood why their benefits were cut and their pay was stagnant (declining in real terms) over the last decade of tough times. They know that 2010 was a FANTASTIC year for IBM and they don't understand why they get NO SHARE of it. IBM had a great year and Sam is seeing an INCREASE in his bonus. Great! But the employees are seeing a DECREASE in their bonus. What? Didn't IBM have a great year? How does the boss get 180% ($9M vs a $5M plan) of his bonus plan and the employees get less than 60% of their plan (less than 3.5% vs a 6% plan). The employees I know are crushed. They know that results don't get much better than they were last year. If this is how they get treated when things get good then what could they possibly have to look forward to. They have awoken to the realization that the only think that they TRUST is that the SVPs and C-suite will continue to line their pockets while coming up with new and innovative ways to stepping on the backs of the employees. Maybe this is a sustainable model, but I doubt it. Fred, in Fishkill
  • This is a shameless puff piece that could have (has?) been written by IBM's public relations department. Revenues have been flat for years. Earnings have been increased by share buy backs and massive reductions in labor costs through offshoring of jobs. In the process, quality has suffered significantly. Though customer rumblings about poor performance have started, Palmisano will retire before the major effects on the company's business will be felt.
  • I work in the services division of IBM. After the 'RA' slaughter of American workers, here's what I see:
    • IBM executives no longer talk to us. We never see them, no email communication, nothing. When Gerstner was in charge, he'd get on the television and talk to us at least once a quarter.
    • Smart Planet... fine. But in services we don't see any emphasis on growing the business. The pressure to 'cut' is tremendous.
    • I cannot communication with non-US employees. I end up cutting the call short because I can't understand them.
    • Our support teams are siloed. No one goes above and beyond anymore. They turn their widget and that's it. Working together and teamwork is going the way of a 30 year employee.
    • Our main productivity tool is a spreadsheet. A spreadsheet in a technology company! Unbelievable.
    • We are audit compliance focused. Customer? What customer?
    • Someone mentioned fear. Yes, morale is in the toilet. No one knows when the grim reaper will appear and your job disappears.
    • While Sammy and the executives reap millions of dollars, we humble employees are told, 'sorry, didn't make the numbers. You're bonus is lower this year... and no raise again."

    I would love, JUST LOVE, to have this conversation with an IBM executive. But I can't find one.

  • The worst mistake of my career was joining IBM. The second worst mistake of my career was staying there for 10 years in the vain hope that things would improve. They didn't.

    IBM is run as a sweatshop purely to boost EPS, period. The workforce are down-trodden, expendable and abused. Palmisano is the architect of carnage in the lives of tens of thousands of skillful, dedicated IBMers and in the lives of their long-suffering families.

    Smarter Planet? IBM is a bureaucratic, inefficient, lumbering monster. If that's Sam's vision for the future of planet Earth, book me on the next shuttle (RIP) trip to Mars. IBM needs to get its own house in order, treat its people with respect and live up to its fine traditions, before it starts preaching to the planet. The Smarter tag is just a ploy to get more government tax dollars from fat outsourcing deals. Having witnessed first-hand the comical IBM offshoring fiasco of recent years, I wouldn't outsource management of my electric tin opener to IBM, let alone allow IBM to manage a major IT installation. Child, play and loaded gun spring to mind.

    Palmisano has managed in a decade to destroy something precious that took 90 years to build. Now the trust has gone, the respect has gone, the morals have gone, the morale has gone. Shame on you Palmisano.

  • As a US employee, these negative comments aptly describe the simmering resentment I feel about IBM. For the past several years IBM earnings and stock price have climbed, yet our bonuses are cut. The rationale = we didn't "grow enough". We didn't? Well the executives still got their bonuses and stock options. Yet after putting in 60 hour weeks due to 1/3 of my dept being laid off in the past 3 years, that was not good enough? I beg to differ. What this displays is simply the greed that has overtaken IBM executive management. The executives claim "employees are our most important asset", but I realize now that's because if they need to impress Wall St with more cost cutting, they just load up a few more thousand jobs into the torpedo tube and fire!

    Perhaps a more sobering aspect of this story is the realization that this is the future direction of the country. US workers salary, benefits, even their very jobs are going down and away while China, India, Brazil, etc. will have jobs added and salaries increase. Those forces will continue until they are more balanced, but that will leave the US standard of living decimated and the economy reeling as there are no longer consumers able to spend. I fear for my children as that happens.

  • Hi All, I'm IBMer (from Argentina). And I'm NOT glad to say that. I know that a lot of you lost your jobs and we are the people that are doing your tasks. And to be honest with you we hate that. I believe that in Argentina we do a great job too (actually I get congrats every day from US) but is not fair you get fired. Just for you to know here there is not a paradise. We are under the 1000 dollars per month (and we have the same cost of life here than there in U.S. or more). They took out all the benefits we get. Our bonus was lower than the 2%. Last year our salary grow only 1-3% when the economic situation here is really bad (everything is 30% more expensive than last year). We have great technicians here, great people, great workers, but they all are going out from here (IBM). There is no carrier, the $ is really sad... so I just can tell you that I can understand you, and no this is not the same company that 80 years ago appears in Argentina. This is just what we think here in the south America.
  • IBM is not only bad in US, do you think that work for IBM in other country such as Argentina or India is better? We are all under the same rules and IBM is IBM in every country in the world. We have very low salaries, IBM politics are not to pay overtime hours, the company is doing billions and our bonuses are coins... and even if some people complain about work being done in other countries I can assure that here we have a lot of professional people with lot of skill and experience and also doing the work in a second language. I would like to see people in US just trying to work in Spanish...but this is not the point. Salaries are not updated, inflation is not respected, overtime hours are not paid and every day we hear stories of IBMers resigning their jobs going to work to other company for a better salary. Wish things could be different, and not have to be looking for another job out of the company as many of my coworkers.
  • Its refreshing to see the dialog among past and current IBMer, I agree there appears to be quite a disconnect of the observations of the article and people who work directly in IBM, maybe Fortune could broaden its research on this topic.
  • As a UK IBM employee, and soon to be ex-employee (I'm getting out now), my main reason for leaving is lack of respect and lack of reward; no pay rise since 2007; a stunning performance by IBM. My team and personally was very poorly rewarded. I have key skills in a growing technical area and would have personally brought in £250K revenue in just normal work let alone additional new business. Did anyone at the high-levels bother about this. Nope. Not one bit. The modern IBM does not care about employees; just costs and profit.
  • EPS is the only thing that counts for Sam and his cronies. If that means completely ruining the morale of the company he doesn't care. None of the management do, or if they do they are too scared about their own jobs to speak up. This was a great company once with employees that were proud to work for it. Sam Palmisano should be ashamed of what he has done.
  • As a current IBM employee, the people commenting about short-term cost cutting have it exactly right. In recent years long-term employees have been forced out by the pensions fiasco, younger band 6-8s are quitting in droves, and nobody is ever replaced. Minimal pay rises (in the last two years a PBC 2+, 1 and a promotion got me 1.5% and 1.5% - and I'm one of the 'high performer' lucky ones), declining benefits, no education, no replacement hardware ... everything's been cut to reduce short-term expenses. Result: severely under-resourced development (and we don't have a test team any more), buggy software, furious customers, overloaded service teams... short term it works and pumps SWG numbers, but long term the billion-dollar product I work on is being driven into the dust.
• Yahoo! IBM Employee Issues message board: "Re: Life on the knife edge of Sam's whims" by Paul Sutera. Full excerpt: Christopher, Many of us are in the same predicament or a little better or worse. Wondering whether Sam will decide to offshore our function or trim a few hundred here or there. But I don't subscribe to the grey-haired poison theory. Let's not sell ourselves short, OK? We have been formed in the crucible of a very challenging and difficult environment. Most former-IBMers who do find other careers often have employers who rave about the dedication and skill level of their newfound employee. Unlike many in our age-group we are very far from computer illiterate. I've learned skills here that would enable me to do a number of things, and branch out into areas tangential to my current skillset (which is software engineering).

  It's hard sometimes to think you can be working hard and performing well and executive management decides its neck is not yet fat enough. But that's the environment we're in. I've survived a few near misses, including one in 1994, so this old barnacle has learned a few new skills for the day when I'm cleaved off the not-so-good-ship IBM and need to swim on my own.

• Yahoo! IBM Employee Issues message board: "Re: Life on the knife edge of Sam's whims" by "fdaleflash". Full excerpt: True, I was outsourced to another company for 2 yrs then cut loose from IBM's clutches at 61 and had a new job with a fantastic company at much better pay almost immediately. There are companies looking for older workers with great training & a work ethic, you just have to keep looking.
• The Anita Borg Top Company for Technical Women Award: IBM. Excerpts: IBM is the 2011 Anita Borg Top Company for Technical Women Award Winner. IBM's application received the highest average score from ABI researchers and is the 2011 Anita Borg Top Company for Technical Women Award Winner. IBM exemplifies many of the acknowledged best practices in the creation of a diverse and vibrant technical workforce. These include having a strong pipeline of technical women from entry to executive level . Women have significant roles in technical management, in executive technical positions, and in individual contributor career tracks, which lead to strong role models at the top and allows for the significant benefits of diversity in innovation at all levels of decision making. ...

  How were data collected? Applications for the 2010-11 Anita Borg Top Company for Technical Women Award were received by November 15, 2010. As instructed on the application form, companies provided data on technical women in their U.S.-based technical workforce (regardless of where a company was headquartered). Data excluded temporary staff members who are contracted through a third-party agency.

• Glassdoor IBM reviews. Selected reviews follow:
  • IBM Senior Consultant: (Current Employee) "It's like you work for yourself and are responsible for finding your own project work much of the time." Pros: Pay is fairly decent. Also, you get exposure to bigger projects. There is often opportunity to get experience in a variety of areas where one prior experience was limited. Cons: As you are approaching the end of a project you are responsible for finding your next project utilizing an internal web site. Any time you spend unassigned adversely affects your year end rating even though it is not under your control. Advice to Senior Management: Require the RDM's to become more involved with the consultant in finding new assignments rather than just acting as glorified secretaries.
  • IBM Project Manager in Montreal, QC (Canada): (Current Employee) "Technical learning place for IBM products." Pros: Learnings - excellent learning place for technical implementations and how-tos. Cons: Management - literally no communications of changes within organization/departments. At certain levels, even if decisions are made wrong, everyone has to follow it. You have the right to question the wrong decision, but not to change it. Advice to Senior Management: Communicate, Communicate and Communicate
  • IBM Engineer in Poughkeepsie, NY: (Current Employee) "Great company to invest in...a challenging company to work for." Pros: High performance culture; Exciting as change management leadership skills are prevalent. Cons: respect for employees value; job security. Advice to Senior Management: People are more than a number
  • IBM Applications Developer in East Lansing, MI: (Current Employee) "The MDC is pretty much a joke." Pros: There is a lot of down time when you aren't on a project to do other things. Some projects offer good travel opportunities. IBM is now on your resume. Cons: There is a lack of communication between managers and it makes it frustrating to get on a project. Deployment managers are clueless to who you are and what skills you have. You get thrown into projects where you don't have the skills or you are sold as a professional. They say 10% travel, but many projects are every week to client location for months. Salary is a joke to other jobs in the field, even in other IBM departments you get paid nearly 2X. Advice to Senior Management: Pay your workers more, they are skilled for a reason. Start talking with each other, get to know your employees and begin keeping track of them. Because as of right now it is just a whirlwind of people that someone manage to land on projects.
  • IBM Hardware Advisory Engineer in Rochester, MN: (Current Employee) "Global, Adrenaline rush, overloaded." Pros: The business really is trying to do the right things for the world (in alignment with making shareholders profits). The techies really do share information (at my lower level) and help each other out. The lower management really does care about their employees. Cons: Very strong push for hardware to do more with less - that means layoffs, no promotions. But more projects. I think they're trying to get rid of the older generation to be able to hire more new (and cheaper) blood. Might be the right move for them....I'm getting tired of the long hours and nonstop sense of urgency. Hardware is commoditized now, run by project managers. Little left to actually invent. Advice to Senior Management: I know adding more products to the portfolio is exciting and could make big money, but at my level we're totally overworked, can't do more, and aren't going to see any of your rewards anyway so why again am I bothering...?
  • IBM IT Architect in Melbourne (Australia): (Current Employee) "Looks good from outside, great training opportunities that you need to fight to attend - you will. Plenty of dead wood." Pros: Great reputation. Training Opportunities. Large complex projects. Cons: Loads of hours for competent staff. You need to cover for a lot of incompetence. The better you are the more you will be asked to do, for no extra reward. Performance bonus process very ambiguous. Advice to Senior Management: Identify and reward high performers. Remove dead wood. Coach and train potential leaders.
  • IBM Anonymous in Toronto, ON (Canada): (Current Employee) "Waste of time." Pros: Flexible work hours and work from home. Cons: Management not appreciating hard work and long work hours.
  • IBM Anonymous: (Current Employee) "Excellent growth opportunities." Pros: Reputable, good ESPP and access to some of the brightest minds in the industry. Cons: Very rigid verticals; if you have to jump from one vertical to the other, it is almost impossible. At least that is how it was back then. Advice to Senior Management: Provide more growth opportunities for employees; Better effective communication of the value prop
  • IBM Principal Consultant: (Past Employee - 2009) "Lots of great people and technology, much in-fighting and account control." Pros: Reputation of company. Access to technology; ability to implement total solutions. Great client base; lots of good companies to work with and learn from. Cons: Infighting among different marketing groups. Too many layers of mgt. Very process driven; lots of rules that stifle creativity and initiative. Advice to Senior Management: Instill an entrepreneurial attitude in the company be rewarding new ideas and ways of doing things; eliminate some old processes that just add time and work and replace with fresh ideas.
  • IBM Anonymous: (Current Employee) "Unwilling to invest in people and tools." Pros: Ability to telecommute and flexibility in job hours is excellent. There are a great many excellent technical leaders willing to mentor. Clearly defined career paths for employees who are motivated by climbing the ladder.

    Cons: Company is unwilling to back fill attrition. They are also unwilling to invest in the hardware, tools, education and networking which will enable people to do their jobs well. Very few expenditures are approved unless directly related to current quarter revenue.

    Consequently, everyone is working harder than ever. Due to annual layoffs, most organizations have retained only the highest quality workers...but due to their inflexible "grading on a curve" review system, management is still required to give a certain percentage of workers below average performance reviews. The bar is being raised every year and it's to the point where people have to work on their vacations or purchase their own equipment to even compete with their peers. It's demoralizing to management as well as individual contributors.

    The habit of acquiring companies and then not investing in the technology also reduces morale for those people supporting the products.

    IBM's focus on the bottom line is short sighted, and will likely cause a spiraling problem as the job market improves and quality technical resources leave

    Advice to Senior Management: Please be more forward thinking in your internal investments. While investing only in your few "strategic products", you are alienating loyal customers and excellent employees who are dedicated to your non-strategic technologies.

  • IBM Anonymous: (Current Employee) "A place where employees are a number." Pros: There are various areas that an employee can research if you a looking for career growth. The benefits seem to compare to other companies. Cons: The company has no loyalty to its employees and has proven to provide minimal increase in salary or gross profit. A feeling of not job security is present. Advice to Senior Management: Provide a clear advice and vision for the employee's growth within the company. Explain why changes have occurred and how come compensation is always minimal when the company is doing well.
  • IBM IT Architect in Auburn Hills, MI: (Current Employee) "I feel that I am well compensated given my background experiences and my current job responsibilities." Pros: Breadth of project assignment opportunities. Ability to travel and explore the country if you don't mind travel. Compensation, bonus plan and benefits are above average. Cons: If you don't enjoy traveling than IBM will probably not be a good fit for you. Distribution of salary increases and yearly bonus seems to be inconsistent and that messaging of consistency and purpose are counter to what is actually done. Advice to Senior Management: Ability to more openly communicate about yearly bonus and salary reviews are key (not all people are treated the same in the organization when you factor in Job Titles, Rankings and ultimately the dollars that one individual sees vs. another).
  • IBM Managing Consultant: (Past Employee - 2010) "Good job, but limited career upside." Pros: Excellent benefits, various types of jobs/opportunities across the company. Strong brand identity across the world, thus a good name on the resume. Cons: Very political and many layers of management. Difficult to get noticed for good work, unless you play the "corporate / political game" well. Promotions go to those who are best at "the game" and not necessarily the best and brightest or most talented. Advice to Senior Management: Do a better job of identifying strong, capable employees who could be future leaders of the company, but are not necessarily strong "politicians" or simply "play the internal game" well. Seems the management ranks are full of old school "managers" with poor interpersonal and leadership skills; need more strong, capable leaders to move the company back into a market leading position. Internal politics kill external competitive capabilities.
  • IBM Oracle Database Administrator: (Past Employee - 2010) "IBM, not good place to work." Pros: Big company and good medical benefits. Remote working environment, co-workers are nice and cooperate, Open documents environment, good place to do nothing. Cons: no career growth, no path for growth, quarterly layoffs, offshore US IT staff, layoff US employees every quarter, minimum bonus, no salary increase for years. Advice to Senior Management: consider more employees but not your own bonus. Reserve US workforce, do more things for US employees, consider more US employees benefits.
  • IBM Senior Managing Consultant in New York, NY: (Current Employee) "Undefined role and opportunities." Pros: IBM has had excellent company performance overall and it has shown in the stock price. Strong benefits package. Numerous opportunities for career paths. Cons: It is difficult to define and pursue a career path as a consultant if you are not a technical resource (e.g. programmer.) Annual compensation is average and bonuses are meager. CEO's stated EPS targets require constant freezes on department spending.
  • IBM Systems Engineer in Bangalore (India): (Current Employee) "Best place to work for if you are already getting a decent pay." Pros: Excellent Work-life balance. Laid back place to work for. Managers are well paid. Leaves never a problem. Work from Home for long duration. High Attrition. Can change project easily. Cons: No hikes. Worst paymaster if u join as a fresher. Doesn't distinguish between top and average performer. Very slow process. Hardly any growth. Advice to Senior Management: Respect employees who served you for long. Try to give rewards to the employees who perform well. Try to be a little disciplined...people took this company as a chill out place.
  • IBM Anonymous: (Current Employee) "Getting Worse." Pros: There is a wealth of information and research available There are opportunities to move around within the organization. Benefits are good.

    Cons: Raises are minimal; - get a good salary when you join b/c cost of living increases are nil and merit increases are small. Bonuses have decreased significantly. Recognition is virtually nonexistent. Management is extremely secretive. Constant worry about job security. Utilization rates makes vacation almost impossible.

    Advice to Senior Management: Stop having such a short term focus. Despite the fact that your bonuses are dependant on the rising stock prices, if you continue reach those heights at the expense of your employees soon all the good ones are going to leave and IBM is going to be left faltering. I am 2+ performer and I'm am definitely thinking about heading out the door.

    Do more than lip service as to how much you value employees. You can win every industry award on work/life balance those people that work here know better. A majority of the individuals I work with are bright and capable individuals. We can see beyond the constant spin we are fed. We work extra hours to meet "new " utilization targets, receive emails about record quarters/year/etc., see the constantly rising stock prices and yet we continue to less and less with respect to raises/bonuses while the exact opposite is true for executives - 19% really? If you aren't going to show us the money than at least start showing us you value us in by allowing us to develop ourselves professionally thru training or organization membership. If you want to be a true consulting leader then carve out that time for your employees to write white papers/attend conferences/etc. And by carve out time I don't mean "on the weekend". At the very least openly communicate with us...we hear the rumors, we see the actions that are taken. And when you do communicate with us to do so by either putting so much spin on it's virtually false or not saying anything at all is just frustrating.

  • IBM IT Architect in Paris (France): (Current Employee) "It is getting worse!" Pros: The people I work with. I will never stop being amazed by my coworkers skills, friendliness and desire to achieve the best for their customer. The projects you might be able to work on. IBM does stuff that a lot of companies wouldn't do. Cons: I am sick of that PBC nonsense. It is meaningless as you never ever have clear (SMART as they say) objectives. And, on top of that, this is all relative to the overall performance of the whole company. How does that work? Advice to Senior Management: I have said it before but I think this is getting worse. You have no respect whatsoever for your employees. They work their asses off and get nothing in return! And I am not sure that Global Delivery is actually a solution. As long as shareholders and EPS will be the only target then there is very little hope the situation will change.
  • IBM Anonymous in New Delhi (India): (Current Employee) "Changing fast." Pros: Flexible work life. Option of work from home available. Options to change between business units and location. Some of the best people in top management. Cons: In past few years the culture is changing very fast. Company earnings is the only focus. Slowly but surely several of employee benefits are disappearing. No free tea coffee, employee needs to pay part of health insurance among many others in the name of cost cutting. To much focus on eps at the expense employee benefits.
  • IBM Senior Engineer and Manager in San Jose, CA: (Current Employee) "Well balanced work/life." Pros: work and life balance, easy commuting. Cons: Too many acquisitions and not enough organic growth
  • IBM Software Developer in London, England (United Kingdom): (Current Employee) "Wonderful company." Pros: 1. Good work life balance. 2. Great brand name. 3. Lot of options to move. 4. Work freedom. 5. Innovation is allowed. Cons: 1. Disconnected management. 2. Less responsibility. 3. No clear understanding/segregation of duties. 4. Numerous procedures. 5. Software products not organised or optimised for work. Advice to Senior Management: Please do case studies with other companies. Not with giant companies but with medium sized ones. Split IBM departments as mid sized companies
  • IBM Help Desk Analyst in Markham, ON (Canada): (Current Employee) "more work, same pay." Pros: Work for Fortune 100 giant. Will be plus on resume for next job. Flexible work hours and shifts. Cons: No opportunity for growth. Feeling of being expendable never goes away. More work is piled on but no appreciation in salary. Been here over 2 years and no performance reviews. And even if there was, very clear it would not have meant any monetary value.
  • IBM Software Test Engineer: (Current Employee) "It is a OK company to work for." Pros: I love my team and my work. Cons: - Continuous cost saving measure from IBM. - Compare to our company before acquired by IBM: No Christmas dinner, no free annual team lunch, increase working hours from 7.5 hrs to 8 hrs, family with children have to pay $380/year to get 80% of extended health insurance (we paid $0 to get 90% before IBM), annual layoff in March no matter a double digit increase of sales in our division, no more training that costs money, only allow online free training. - Company earning is more important than employee. - Many tedious process. i.e. you have to take the same security online course very year, online Business Conduct Guidelines course every year. Advice to Senior Management: Having the family with children have to pay $380/year to get 80% of extended health insurance is unfair. Most good company don't do that.
  • IBM Anonymous: (Past Employee - 2010) "Unappreciative Management, limited opportunities for career growth." Pros: - Prestige; - Worked with some very smart and talented engineers; - Opportunity to work from home. Cons: - Limited opportunities for advancement; - Long work hours and unappreciative management; - POLITICS; - Bureaucracy; - Sub-par compensation. Advice to Senior Management: Take care of your employees, tell them when they do good things, let them know they are appreciated. Stop laying people off so you can claim "most profitable quarter yet" EVERY single quarter.
  • IBM Anonymous: (Current Employee) "Low pay; very cheap company." Pros: Good experience, learn from contractors within project. Cons: Low pay low pay low pay. Advice to Senior Management: Higher pay to those who have stayed
  • IBM Managing Consultant: (Current Employee) "A good selection of project work, a pain when out-of-the-loop Blue Pages Managers get in the way of your career." Pros: - Great people; - Great projects. Cons: - It is a matrixed management structure. Meaning you have a worthless "Blue-pages managers" that judges your work even though you never interact with them. Normally, as a consultant, you get deployed to a project and complete project work there. That is what really matters, getting the job done, but too often the Blue-Pages Managers get in the way. Advice to Senior Management: Keep Blue Page Managers in their place.
  • IBM Anonymous: (Past Employee - 2010) "Good to have on the resume- just be aware that you are just a number." Pros: - Good health benefits; - Looks good on a resume; - Flexible work at home jobs; - If you like to travel, you can see parts of the world on their dime. Cons: - Be aware that you are just a number that can be replaced at any time; - Be sure to get a high starting salary because raises are very small to nil; - Annual bonus used to be up to 20% of salary, that has been reduced to about 6%; - Limited promotional opportunities; - Always feel like you could be laid off at any time; - Company continuously has lay offs about every 6 months; - Management doesn't care about you and be prepared to get laid off at any time; - Most employees would leave if they could find an equivalent job and the ones with pensions are just waiting around to get laid off and get the package. They don't care about the company. Advice to Senior Management: Bring back the days where the company actually cared about the employees. Since Palmisano took over the employee morale has plummeted.
  • IBM Anonymous: (Current Employee) "Good place to work." Pros: Well respected company...competent colleagues..good client base. Cons: Impersonal environment...do not care once you are on an assignment.
  • IBM Anonymous: (Current Employee) "good start point to then go anywhere else." Pros: stable and secure payments; good team spirit; meeting good people; traveling opportunities; experience a real work life; responsibility; flexible office program. Cons: no financial motivation/recognition promotion does not mean salary increase. Advice to Senior Management: put more pressure to upper mgmt/finances to be able to reward people for their work
  • IBM Client Manager in Glasgow, Scotland (United Kingdom): (Current Employee) "Demoralising." Pros: - competitive salary; - flexible working; - lots of opportunities. Cons: - stress and expectation levels; - workload ridiculously high; - zero work life balance; - lack of investment; - focus on cost reduction; - lack of reward for double digit growth; - processes and administration. Advice to Senior Management: Forget EPS and acquisitions, invest in staff and research, reduce workload, processes and unnecessary admin.
• Time: Why It's Time to Retire the 401(k). By Stephen Gandel. Excerpts: Retiree Robert Shively spends his days on the golf course. For many, that would be a dream come true, but not quite in the way Shively does it. The 68-year-old is the cart mechanic at the Niagara Falls Country Club.

  Two and a half decades ago, his then employer, Occidental Petroleum Corp., cut its traditional defined pension plan in favor of a 401(k)-type system. So instead of getting a guaranteed pension check of $1,308 a month for his 36 years as a full-time, salaried employee, the former chemical-factory worker receives $225 a month from his 13 years as an hourly employee, plus $180.16 a month from a profit-sharing plan Oxy had for salaried employees until 1994. He also has $70,000 left of the money he saved from his tax-deferred 401(k). On the days he works, Shively rises at 5 a.m. to get to the golf course. He mostly enjoys the job. But on tournament mornings, he has to be at the course at 4 a.m. A few years ago the country club switched from gas to electric carts, some of which have four 84-lb. batteries each. Every year, Shively and another worker have to lift out all the batteries and store them for winter. "Your body aches all over," he says.

  This isn't how retirement was supposed to be.

  If you have even peeked at your account statements in the past year, it's painfully obvious that something is wrong with the way we save. The tax-deferred 401(k) plan, and others like it, such as the 403(b) and the IRA, have become our nation's go-to retirement piggy bank. Invented nearly 30 years ago as an executive perk — one more way to dodge Uncle Sam — the 401(k) was never meant to replace the employer-guaranteed pension fund, supplemented by Social Security, as the cornerstone of our nation's retirement system. But propelled by a combination of companies looking to cut costs and consumers who wanted control of their retirement destiny, that's exactly what happened.

• Kansas City Star: Business fights Obama's fix for sick corporate pensions. By Kevin G. Hall. Excerpt: State and local government pensions aren't the only ones in trouble. Corporate pensions, too, are woefully underfunded, and the federal agency that insures them against losses is facing a dangerous deficit that taxpayers may end up covering. One government watchdog agency says the federal insurance funds are at "high risk" of failure. Moreover, the Obama administration's proposal to fix this is meeting stiff resistance from the U.S. Chamber of Commerce and other business interests.

  The little-known federal Pension Benefit Guaranty Corp. insures roughly 27,500 corporate defined-benefit pensions, covering 44 million U.S. workers. These plans, popular in the public sector but increasingly rare in the private economy, promise workers fixed monthly retirement income, often equivalent to a final year's salary or an average salary over the last few years of work.

• Yahoo! IBM Employee Issues message board: "Re: Wisconsin" by Kathi Cooper. Full excerpt: had a wonderful time at the Ash Wed service last night. When I got home and turned on the news, I was hit by the shocking news that Wisconsin broke the union by passing the non-fiscal part of the bill to break the union, passing 18-1 with only Republicans voting at a committee meeting:
  • It was about busting the union and the middle class all this time.
  • Wisconsin will be a democratic presidential state for many decades to come, guaranteed.
  • The words Recall and Republican (WI) both begin with an R, both go hand-in-hand, and both will make ugly dancing partners.
  • Lawyers will be gainfully employed for a long time.

  It's not over. This is only the beginning. WI and America are energized and can see more clearly this morning than they have for years. Kathi.