Layoffs and Shutdowns at IBM, Not Just Microsoft
Last week, a day before a holiday: (national holiday in the US)
Lost in the "noise" of Microsoft layoffs (timed to coincide with a period of time journalists are "away from keyboard") were IBM layoffs and shutdowns. Quoting Sydney Asher: "IBM Corp. is closing an office in Coppell and laying off 59 employees. The company, a legacy technology giant with operations around the world, alerted the Texas Workforce Commission in a June 30 letter that it will shutter its Innovation Studio at 1177 S Belt Line Road in the suburb northwest of Dallas. The closure will impact 59 jobs, with 53 let go by Aug. 29 and the remaining by Nov. 30. The majority of employees impacted are digital sales specialists. Others are sales development representatives, brand sales managers, digital sales managers and digital technical specialists."
The article has no comments, but those who link to it say that IBM's CEO "AK just needs to keep the fake AI and Quantum story going until he retires (imminent) then it will be RT's problem when it crashes." Prior to that someone said what's also applicable to Microsoft right now: "You have to wonder how Wall Street keeps pumping up the IBM stock while there are human tragedy stories like this one which show valuable IBM employees cast aside like trash in the gutter by uncaring company executives. But then, corporate greed and extreme capitalism have no limits. Right, Alvind and Pipmunks?"
Just like Microsoft's Nadella. The company (Microsoft) shrinks and shuts things down while it claims its value is "increasing".
A day ago somebody added:
I have to ask “why does this continue to surprise folks” IBM since the purchase of Redhat and perhaps even a little before that, has done nothing but pursue an enterprise engagement strategy. Let’s be very clear, In General If you in your job at IBM touch an enterprise customer, product, or service you have a future at IBM. If you don’t, your future at IBM is limited, as IBM continues to withdrawal from non-enterprise opportunities.Let’s recap IBM’s 3 divisions over the last 10 years
Infrastructure has been reduced (60%) mostly due to Intel and its supporting products going away Power was suppose to fill this void, but failed to launch as Intel invested in new marketplaces and OS’s, and Power withered on the vine. IBM responded by investing in enterprise solutions, and partnering off non-enterprise solutions.
SW has been greatly reduced (50%) because IBM has decided to buy innovation vs internally developing it. Enterprise innovation was the target and IBM focused relentlessly on it. Can you name one SW acquition since the purchase of Redhat that hasn’t been “enterprise” focused.
Consulting has been relatively unscathed over the last 10 years as it fed SW and HW recommendations which resulted in lots of back office support operations for consulting support teams (yes we are looking at you India as you benefitted over the last 5 years via selling commodity labor to support the back office and consulting) That game has now run its course as AI has finally gotten good enough to automate a lot of those support operations. It’s not just focused on HR anymore, but has grown to encompass coding modernization, automated help desks, and automating various other repetitive tasks. So what does that mean? Look for consulting to downsize over the next two to three years by 50-60% just like the other two divisions have. 150k going to 80-90k
Consulting is in the bullseye, BUT Niche high cost operations wherever they are within NA and Northern Europe are also fair game.
Net net IBM continues to shrink 25-30k per year while revenues grow by 1-2%
Same as Microsoft. We estimate about 29,000 Microsoft layoffs since January. █