IBM Already Tentatively Down for Next Week (Monday) After Its Worst-Ever Week
What a week for IBM! But wait, next week it'll likely start in the red again, based on late Friday trading (post-market close):
IBM Doesn’t Have a Deployment Problem. It Has a Truth Problem.
Another reorg. Sold as agility, felt as whiplash. Leadership didn’t even wait for the planned date — they tore up a structure barely a year old and rebuilt it mid-year, with zero regard for what that costs the people living through it. The stated reason: “boost software deployment.” The real reason is simpler and darker. IBM has spent years buying growth instead of building it. Every quarter, another acquisition gets folded in, rebranded as “software strength,” and used to justify the next reorg. Strip out the acquisitions, and the growth mostly disappears. This isn’t a strategy. It’s a treadmill, and shareholders finally noticed — the stock just had its worst single day in the company’s history. The money to keep buying is running out. Debt keeps climbing. Buybacks have been frozen for years because the company is still “digesting” its last purchase. Cash meant for growth is quietly being redirected to service the last deal, not fund the next one. When a company can’t return money to its own shareholders, it’s telling you something about how thin the cushion has gotten. And the sales playbook is exhausted. For years, big renewals were “won” by reshuffling the same contract — discount here, markup there, call it a signing. Do that once, fine. Do it a third time on the same account, and there’s nothing left to move. Customers aren’t d-mb. Many are also sitting on mountains of software they were sold and never deployed. Asking them to sign another restructuring on top of shelfware gathering dust isn’t selling — it’s asking for patience that ran out a while ago. That’s the real story behind “large deals failed to close.” It was never about speed. So here’s what a summer reorg actually buys: nothing, fast. Territory changes take a quarter just to stabilize. Real deals take six months to a year to close. Launch a reorg in July, across a holiday season when half of Europe is offline, and demand results in Q3 — and you’ve built a machine engineered to fail on schedule. Except failure doesn’t cost everyone the same. IBM books the reorg as a clean, one-time charge and moves on. Sellers absorb the real cost: quotas that don’t shrink to match a broken calendar, commission checks that quietly get smaller because targets were unrealistic from day one, accounts inherited mid-relationship with no memory of what was promised or already burned. When the numbers come up short, it won’t be called “the reorg cost us a season.” It’ll be called underperformance. The same event, blamed upward as strategy and downward as failure — a strategy that costs nothing on the way in and everything on the way out, just not for the people who designed it. That’s the pattern worth naming out loud: a company that has run out of things to buy, running out of ways to reshuffle what it already sold, paying for both by quietly shifting the bill onto the people closest to the customer. Another reorg won’t fix that. Only shipping what was already sold will.
Some comments have started to come in and one new comment was added 1 hour ago by "33 years at IBM (most in management)"; it's about the Peter Principle, which was mentioned here before:
The Peter Principle is definitely at play in 21st century IBM, but it’s not the main issue. The main issue is that IBM now aggressively weeds out those with promise for performing at a higher level.Formerly, IBM paid lip service to “wild ducks” and sometimes even valued them. Among the highest thin sliver of their technical talent pool, they tolerated people with established track records of being right unusually often when they spoke up against the product plan and corporate think du jour in thoughtful, reasoned ways.
These people are too highly regarded inside IBM to immediately discard without consequences. Now, senior execs instead slowly chisel these technical truth speakers loose from their foundations. Once execs have sullied the sterling reputations and reassigned one leadership role after another to ‘groom’ their younger pets (nothing personal; take a hit for the good of the company … that’s what good senior people do) they’re able to set up the former water walker for one assignment after another that has been crafted to force awkward failure. Now that the water walker’s spirit and reputation have been destroyed, it’s easy to topple them without any pushback from the general employee population who formerly admired or even revered this person.
IBM is now led by micromanagement from on high. Successful independent leaders are a severe threat to this new order. IBM needs middle management and technical leaders that enforce fine print edicts from above without question and with no room for even slight deviation. The wild ducks must be annihilated and all the rest assimilated.
IBM seems doom and the people betrayed by IBM (at present or in the past) like it. Remember that IBM is historically the latest tech employer. Some speak about the investigations and lawsuits by shareholders because they think IBM can no longer evade scrutiny:
And more here, as seen in recent hours:
IBM lost about 30% of its "value" in roughly one week and some media has attempted to spin this (see comments). It just comes to show how abusive and dishonest the media became. It's a mouthpiece for hire. █