IBM Cutting More Jobs, Shifting Work to India
Weeks after slashing nearly 5,000 jobs, IBM is expected to shift the work of a large number of U.S. workers to IBM employees working in India, the latest example of a successful company that is continuing to slash costs and take advantage of cheap Asian labor, WSJ reported.
Source: WSJ, Fox Business News
Update (March, 25, 2009): IBM to cut 5,000 jobs in U.S: According to Reuters: “The job cuts will account for over 4 percent of IBM’s U.S. workforce, which totaled around 115,000 at the end of 2008. The sources, who were not authorized to speak publicly on the issue, said the cuts will mostly be in IBM’s global services business, which includes outsourcing and consulting services.”
BusinessWeek also reports (”IBM Cuts Jobs As It Seeks Stimulus Money“): “..the company would be cutting high-skill positions domestically as it and others jockey for new business from the $787 billion stimulus package Congress enacted in February”
In another wonderful situation, IBM and their inept operations at a key electronics retailer used offshore resources ( per cost schedules) and caused issues to help bring down an entire chain of stores. The project management people were told (by experts) why there were issues over a year before the major retail web application broke down helping the ailing retailer right out of business. The problem with offshore resourcing was and is that the resources in the new countries are often young people with poor language skills. They quit every day and change companies like they change thier minds. So when given the task of handling issues with complex problems, they cannot understand how to address a problem. When things get tough, they leave and have a job in an hour and a half. Moreover, the training they are getting is not strong enough to let them actually have a chance at doing it right. Test systems were not provided offshore and in the case of this project, many parts of the code were not even tested until it hit the “STORES”!!!!. They tried to field test it and when it failed, the customers had long delays, credit card issues, etc. Many people just went across the street and bought elsewhere. The people who ran that project were promoted and retained when IBM laid off in April. But the stock is going up so there must be some good news in there…you just have to look.
yea, that’s why IBM now wants to offer us, Americans, jobs overseas with overseas pay. Of course they know that we, Americans, are better in the field, just not cheaper in America in their money making minds. If it came down to performance, who would they prefer? Of course American’s and they know it…but they will never admit it.
Proper english would be “improved” not “improves”, learn proper use of tense.
As for this superior Indian product that would make IBMs products better…
I work in the industry and have had the displeasure of dealing with outsourcing for about five years now. In no way does Indian work product even compare with a US counterpart. I have seen no dedication in India’s work, see here in this country there still exists pride in one’s work.
At first, those sent over from India to begin the dialog with the US team are knowledgeable, conversations proceed with both sides using and understanding the technical terms and procedures one would learn in any reputable technical school. There’s very little dumbing down. These either move on to the next outsourcing project or find a job paying better and leave.
They are replaced with those who can’t speak or write fluent english and that you have to dumb down almost every technical term or procedure. As much of the knowledge seems to be handed down one person to the next, over time they do less and less, eventually if a skeleton US team remains as oversight, India begins to that claim responsibilities which had once been transitioned to remains with the US. It is at this time that routine procedures stop being completed on schedule, stop being done correctly or stop being done at all, causing audit failures and compliance issues generally resulting in emergency projects where the US teams are brought in to cleanup from India’s incompetence.
If a US coworker asks for help or instructions, they will try to do as much themselves and only have you assist or provide instruction where they cannot. If an Indian counterpart requests help or instruction, you often end up with them dumping the whole thing on “your more capable hands” in the next status meeting. And beware bringing up shortfalls in their work or you could find everything being dumped on you.
It’s not that you don’t mind working hard, but when you are working and India is doing nothing but taking the credit once the job is done, there is only so much you can do in a day; It’s a lot like the Cinderella story, you’re Cinderella, the employer is the wicked step-mother and India is like the wicked step-sisters.
You are a stupid sick idiot and its attitude of US IT people that you have briefly explained above. That’s why biggies like Microsoft, Google etc have huge staffed offices in india and they send their american ppl to india to learn…get it…suck it!!!!
No, get it right, “biggies like Microsoft, Google etc have huge staffed offices in india” because it’s CHEAP. because they work for peanuts. As soon as someone else is cheaper (see Vietnam, China, ) it’ll be bye bye bollywood.
Ya, because anytime I think quality work, I think India.
LOL!
I cannot agree with you. I am a pure Indian working in US in a company where the whole IT infrastructure is outsourced. It sucks BIG time ! The guys do not know how to communicate and the way they handle critical issues are horrid!. The VP still has a point that the money which he saves via outsourcing is more precious than the downtime ! Be it! The trade in is, you loose quality when critical work is outsourced!
I am not saying about “Indians” as a big unit of jack asses.. I can see my collegues in US - who are very much Indian, more productive and smarter than the americans who work with me! They know the processes, are pro-active and are good in making critical decisions! So, where is the line of difference? Its probably the work culture in US vs the Work culture in India which brings the difference! Not the colour of the skin, bit the attire, its the geography which makes the difference!
more like when companies think cheap, they think India and other countries
like the saying “you get what you pay for”
Last week I came across that PMI (Project management institute) is holding a conference in Hyderabad. This conference will provide a chance to interact with prominent speakers & there will be media coverage.
For more information check its website
To Big Blues:
You are 100% accurate. I worked for any big US bank & they brought guys that said they knew this & that and in the end they knew nothing. They were protected by upper management. Our team & other application teams never saw any finished product. Window screens with no code behind them. Absolutely shameful. With one group they took the code (programs, subroutines, data files,…) and claimed it as theirs. Really disgusting. I suspect they have no guts to come clean & say they could not complete the jobs. Which is another thing I noticed in my 7-8 years in dealing with them. They don’t know what to do an play spin the wheel. Am I right? Cheers.
There are many cost that can be cut in moving overseas. One is wages but there are many other cost too which can be lowered. Harassment and discrimination lawsuits cost. This is time consuming and expensive to deal with. Taxes are lower overseas. You can even see how companies more to different states because of these things. Moving over seas is not easy and it is often hard to make it work but companies do this to stay profitable. That is why they are cutting jobs now. Obama makes a lot of anti business talk but it is all talk till real action is taken then business will at that point make adjustments to survive.