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IBM Businesses The Almighty Buck United States

IBM Now Has More Employees In India Than In the US (newsindiatimes.com) 217

New submitter Zorro shares a report from The New York Times (Warning: source may be paywalled; alternative source): Over the last decade, IBM has shifted its center of gravity halfway around the world to India, making it a high-tech example of the globalization trends that the Trump administration has railed against. Today, the company employs 130,000 people in India -- about one-third of its total work force, and more than in any other country. Their work spans the entire gamut of IBM's businesses, from managing the computing needs of global giants like AT&T and Shell to performing cutting-edge research in fields like visual search, artificial intelligence and computer vision for self-driving cars. One team is even working with the producers of Sesame Street to teach vocabulary to kindergartners in Atlanta.

The work in India has been vital to keeping down costs at IBM, which has posted 21 consecutive quarters of revenue declines as it has struggled to refashion its main business of supplying tech services to corporations and governments. The company's employment in India has nearly doubled since 2007, even as its work force in the United States has shrunk through waves of layoffs and buyouts. Although IBM refuses to disclose exact numbers, outsiders estimate that it employs well under 100,000 people at its American offices now, down from 130,000 in 2007. Depending on the job, the salaries paid to Indian workers are one-half to one-fifth those paid to Americans, according to data posted by the research firm Glassdoor.

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IBM Now Has More Employees In India Than In the US

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  • by Viol8 ( 599362 ) on Friday September 29, 2017 @05:05AM (#55275255) Homepage

    .... got fed up being put through to some idiot in Bangalore who couldn't solve his own shoelaces whenever there was an issue who then had to escalate it 3 levels up before there was even a satisfactory response, never mind a solution. Of course IBM arn't the only ones guilty of this. You'd think companies would have started to realise now that outsourcing isn't always the solution to their problems, sometimes it IS the problem.

    • by thesupraman ( 179040 ) on Friday September 29, 2017 @05:14AM (#55275279)

      Ah... you seem to be miss-informed about IBM these days.

      Once upon a time that would have been true, these days IBM specialises in not even delivering a solution in the first place, and still somehow keeping a bit pile of the money involved.
      Then they let things cool off for a year or so, and have another dig at the gravy trough.

      The usual formula seems to be that a project that could be done for $x by getting local companies to quite it is instead quietly contracted through a process only involving several of the 'big names' for $x*100, and then IBM is given the contract for 5 to 10 times that figure, and bollocks it up so badly it never ever works.

      I think we call it progress and open government?

      IBMs primary skill is a small group of nice suits who talk a very good talk and present a very good presentation, and then walk away never to be seen near that project every again.

      Oh, and the fact that still, no one ever gets fires for buying IBM.

      • Re: (Score:3, Informative)

        by Mordaximus ( 566304 )

        Ah... you seem to be miss-informed about IBM these days.

        Once upon a time that would have been true, these days IBM specialises in not even delivering a solution in the first place, and still somehow keeping a bit pile of the money involved.
        Then they let things cool off for a year or so, and have another dig at the gravy trough.

        The usual formula seems to be that a project that could be done for $x by getting local companies to quite it is instead quietly contracted through a process only involving several of the 'big names' for $x*100, and then IBM is given the contract for 5 to 10 times that figure, and bollocks it up so badly it never ever works.

        I think we call it progress and open government?

        IBMs primary skill is a small group of nice suits who talk a very good talk and present a very good presentation, and then walk away never to be seen near that project every again.

        Oh, and the fact that still, no one ever gets fires for buying IBM.

        Case in point: The Phoenix payroll system the Canadian Government wasted millions upon millions on. Not just on the non-functional system itself, but on major staffing needed to manually process payroll so employees could actually get paid.

        • To be fair, even the government admits that the problem was mishandling on the government side. The contract specifically gave the government full control over the project since they were worried the alternative was for IBM to essentially control the government.
      • by shuz ( 706678 )

        EX-CIO Beth Jacob's from Target Corp. My opinion on why she was really asked to leave is due to the significant number of vendors and outsourcing of IT that was done before 2014. IBM was one of the largest vendors and since 2014 and since Beth Jacob's departure a departure from IBM has also occurred.

    • You'd think companies would have started to realise now that outsourcing isn't always the solution to their problems, sometimes it IS the problem.

      err.. in reality, companies demonstrate by their actions they have come to the opposite conclusion; outsourcing is the solution.
      face reality, not wishful fantasy.

      • err.. in reality, companies demonstrate by their actions they have come to the opposite conclusion; outsourcing is the solution.

        This is not "outsourcing". The Indians working for IBM are employees.

    • Re: (Score:3, Insightful)

      by geekmux ( 1040042 )

      .... got fed up being put through to some idiot in Bangalore who couldn't solve his own shoelaces whenever there was an issue who then had to escalate it 3 levels up before there was even a satisfactory response, never mind a solution. Of course IBM arn't the only ones guilty of this. You'd think companies would have started to realise now that outsourcing isn't always the solution to their problems, sometimes it IS the problem.

      You really think the person who's getting a fat bonus every quarter really gives a shit about what "companies" think?

      Once again, pure unadulterated greed stands out. The only thing that matters is their benefit from managing a number at the bottom of a page, no matter what that takes. Banking executives have certainly proven unethical and even illegal activities are worth the effort and risk.

      • Re: (Score:3, Troll)

        Banking executives have certainly proven unethical and even illegal activities are worth the effort and risk.

        Maybe I am missing your point in making this comparison, but are you implying that hiring brown people instead of white people is unethical? Please explain.

    • What is IBM known for now?
      The last thing was Watson... Which is starting to be old technology. And IBM despite its commercials doesn't seem to be implemented anywhere to do things amazing or could be done for cheaper with custom coding. And Consulting, where you need to fight with a bunch of big names.
      IBM just doesn't hold the same recognition anymore.

      Part of it is the decline of customer support where you have level 1-3 support more or less being useless, especially for most Companies that have a competen

  • So now it stands for Indians Become Managers?

  • by turkeydance ( 1266624 ) on Friday September 29, 2017 @05:24AM (#55275305)
    currently, India is starting to lose employee count since it is no longer a "low cost" supplier.
    • There is also automation that has started digging in. A lot of work that gets offshored for clients is stuff like checking some fields before releasing a PO, executing a script to implement a change into prod, resetting user passwords, creating a VM from image, restarting & checking servers for patch level, etc. Mundane stuff that historically was cheaper to offload to the lowest cost labor but now it's better to have one small scripting team and a small executing team.

      • There is also automation that has started digging in. A lot of work that gets offshored for clients is stuff like checking some fields before releasing a PO, executing a script to implement a change into prod, resetting user passwords, creating a VM from image, restarting & checking servers for patch level, etc. Mundane stuff that historically was cheaper to offload to the lowest cost labor but now it's better to have one small scripting team and a small executing team.

        So, all the jobs that robots/dumb AI/shellscripts will be replacing soon?

    • by ShanghaiBill ( 739463 ) on Friday September 29, 2017 @05:40AM (#55275351)

      currently, India is starting to lose employee count since it is no longer a "low cost" supplier.

      Bangalore and Mumbai are getting more expensive, but if you go north and east, there are another billion Indians who will work for less.

  • I'd argue that it makes sense to offshore to India, to Lithuania, to Africa, to Brazil. This is an information industry, and it is eminently portable to anywhere with decent connectivity. If there are some presumably temporary currency exchange, living costs or lifestyle differences that some tech company will exploit, in the race for the bottom then all tech companies will need to consider it.

    The difference for me is that we pay a high premium for IBM, and expect #1 performance for that premium. If we a
    • by tomhath ( 637240 )

      This is an information industry, and it is eminently portable to anywhere with decent connectivity.

      India had a big advantage because, as a former British colony, the English language is widely spoken there. Have you ever worked with teams from Brazil or Eastern Europe? It can be done, but not easily or efficiently.

      You're correct though, IBM charges a premium price and isn't delivering a premium product. As more businesses figure that out IBM's death spiral becomes faster and faster.

      • "You're correct though, IBM charges a premium price and isn't delivering a premium product. As more businesses figure that out IBM's death spiral becomes faster and faster."

        And yet, just today, one of biggest 50 banks in the world announced a strategic partnership with IBM to bring "innovation and transformation".

      • by niks42 ( 768188 )
        I worked at IBM for 27 years, so I speak with a modicum of knowledge. I wrote a management memo twenty years ago that said as long as IBM failed to recognise that few of our customers needed them to prevail, and they could go elsewhere for competitively priced solutions without fear of loss of a quality solution, or reputation then IBM could kiss their shiny metal asses goodbye. From when I joined the company, and they were the largest IT company in the world, nearly ten times bigger than their nearest riva
    • by gtall ( 79522 )

      You mistake IBM for an ongoing business concern. That's not the managers' job. The managers of IBM are only there to slowly eat the pig until its gone, then they'll move on to another pig.

  • "One team is even working with the producers of Sesame Street to teach vocabulary to kindergartners in Atlanta. "

    This may be the first phase of bringing 1st line technical support jobs back to the US.

    /aisle seat

    • This may be the first phase of bringing 1st line technical support jobs back to the US.

      When IBM bought Tivoli they implemented a level 1 support team to answer the phone and open cases for us. And we started seeing cases with shit like "yowzij" (usage) and "dragon drop". And this is why I.B.M. is S.H.I.T.

  • by pablo_max ( 626328 ) on Friday September 29, 2017 @06:01AM (#55275393)

    This issue is nothing particular to IBM. It is simply the way of Globalization.
    It is a predictable and repeating pattern.
    A company leaves an area with high standards of living for a 2nd or 3rd world country in order to save money and increase their profit margins.
    Other companies do the same.
    2nd world economy grows, wages increase, standard of living increases.
    Company moves to the next 2nd or 3rd world country since the current one is too expensive.
    After a few cycles, the wages and standard of living in the original country should have reduced enough due to goods no longer being produced there that the company can relocate back to country 1 and start the whole thing over again.
    They are basically locusts. Moving from place to place until they have taken every ounce of profit they can.

    • by dnaumov ( 453672 ) on Friday September 29, 2017 @06:45AM (#55275529)

      Not sure if you noticed it, but you are basically saying global corporations increase standards of living everywhere they go. Your attempt to make them look like the bad guys is backfiring spectacularly.

      • Oh, I thought he was saying that high taxation was driving companies out of first world countries and that had nothing to do with the government.

      • Re: (Score:2, Insightful)

        by Anonymous Coward

        Globalization increases the standards only temporarily. And they don't increase it by much before they hop out and leave a big, gaping hole that makes the problem worse than when they were there. Because the fact is there is always someplace cheaper with less regulations and pesky work standards.

      • If you look at how little living standards are actually increased versus the very few that are actually getting a vastly disproportionate benefit from it (hint: these people don't have an issue with living standards in the first place), it is still a valid point. It's no different than heads of humanitarian aid organizations living in big North American mansions.
      • He meant to say it's like reverse-locusts that show up and barf delicious grain all over farmers fields.
      • Not sure if you noticed it, but the post explicitly stated that the increased standard of living was temporary.

    • by zifn4b ( 1040588 )

      2nd world economy grows, wages increase, standard of living increases.

      Let's stop right there. Here's a lesson to learn. What this means is that by subsidizing the standard of living of the citizens of your own home country, you raise the standards of living in a different country and possibly one that hates you. That's almost the definition of treason is it not? Yes I use the word "hate". Why you might ask? Let's take India for example, do you know where the majority of scam robocalls come from? Have you heard what these folks have to say about Americans and probably n

      • Let's stop right there. Here's a lesson to learn. What this means is that by subsidizing the standard of living of the citizens of your own home country, you raise the standards of living in a different country and possibly one that hates you. That's almost the definition of treason is it not?

        Ok this is the stupidest comment I've read all day.

        Why would you want to raise the standard of living in a country where the country's disposition towards your country is far less than friendly? You do the math.

        Well apart from the fact that India has been an ally of the west for hundreds of years, the math has already been done. Centuries of foreign affairs has taught us that increasing the standards of living has the greatest force for peace there is.
        When you've got nothing, you've got nothing to lose.

        • by zifn4b ( 1040588 )

          Ok this is the stupidest comment I've read all day.

          I think I lost brain cells reading your response. Next time I vote, I will vote with the intent to cancel out your vote. Cheers!

        • Well apart from the fact that India has been an ally of the west for hundreds of years, the math has already been done.

          Well apart from the fact that India has been a colony of the west for hundreds of years, the math has already been done.

          You had a minor typo there, which I have fixed for you.

          Now that the folks in the UK want a Brexit from the EU, they are chucking out low-paid, unskilled workers from Eastern Europe, mostly Poles.

          The Brexit crew wants to "return England to its former glory" . . . which means they will be colonizing again. They need a new source of low-paid, unskilled workers.

          However, an angry, scrawny

        • Actually, India's closest allie happens to be Russia and Iran. India is only close to the west for economics.
    • You portray this as if it was a negative trend but it isn't. It boosts the economy of poorer countries and adjusts them slowly to the economy of richer countries, which is an overall positive trend. We're all living in one world. That being said, this self-correcting feature of capitalism does not suffice in general. There is no way around monetary transfers from rich regions of the earth to poorer regions if you want to prevent mass migration movements (and the same will be true in future if we start to h
      • by tomhath ( 637240 )

        It boosts the economy of poorer countries and adjusts them slowly to the economy of richer countries, which is an overall positive trend.

        It pulls the poorer country up by pulling the richer country down, which is a positive trend for one and a very negative trend for the other.

        • Furthermore, in the richer country the rich get richer while the poor get poorer. The people bearing the brunt of this are people who are struggling in the rich country in the first place.
    • by gtall ( 79522 )

      No, you need to check in with el Presidente Tweetie. He lauded IBM not so long ago for promising to create 25,000 new jobs in the U.S. It wasn't that he was too stupid to realize they were playing him, he got his sound bite and was a happy camper. His interest was no deeper.

    • by Mitreya ( 579078 )

      This issue is nothing particular to IBM. It is simply the way of Globalization.

      More interestingly, Globalization only works for companies.
      If I want to buy a DVD or textbook from India (at their prices) or, say, medicine from Canada, that's against the law.

  • Welcome to Big Blue, India!

  • Quality? (Score:5, Insightful)

    by Petronius ( 515525 ) on Friday September 29, 2017 @07:01AM (#55275569)
    Maybe revenues are down *because* the work is being done in India and the overall IBM value prop is no longer there. Did that ever occur to the bean counters?
  • What's the surprise? US is 4% of the global population and 24% of global GDP. Why would you expect any worldwide company to have its workforce concentrated there based on those stats? Companies have no particular allegiance to the US, friends, and its a mistake to think they do anymore.
    • by gsslay ( 807818 )

      Indeed. It's funny to see so many people here thinking that the US has some sort of claim on IBM, they're betraying the home country, and somehow Indian employees are worth less than Americans.

      IBM is a multinational. It sells to whatever country is interested and it'll hire employees where-ever suits it.

    • by Junta ( 36770 )

      Of course India contributes about 17% to GDP, so by those stats, the US market should still matter more by that calculus. Of course by that same calculus, the mom and pop restaurant up the street from me should be trying to cater to the global population, despite having no ability to sell to them..
      A more relevant metric is *IBM* income percentage. The US comprises 44% of IBM income, while *all* of AP (including Japan, China, India, South Korea, Australia, New Zealand) makes up about 21% combined.

      While you

  • Terrible Metrics (Score:4, Interesting)

    by coofercat ( 719737 ) on Friday September 29, 2017 @08:09AM (#55275859) Homepage Journal

    Headcount is a terrible metric of anything - how many western jobs were lost to exactly one person in the developing world? Yep, 0.3-0.5. Pretty much every time a team of 50 in the west gets replaced, it's by a team of 100 or more in India.

    Headcount might be a headline-grabbing metric, but it's pretty terrible for anything else. How about revenue? That would probably be a better metric - and for the US, how much of that money earned internationally made it back to the US? With your crazy tax rules, not much, I'd guess.

  • by Kohath ( 38547 ) on Friday September 29, 2017 @08:30AM (#55275985)

    Is it 1983? Who cares about IBM?

    • Is it 1983? Who cares about IBM?

      Erm, I think all the banks and insurance and other financial companies running on IBM mainframes with a gadjillion lines of robust, thoroughly tested COBOL code care a great deal. The reason IBM has so many people in India is that they are pretty much the only country still teaching people COBOL. My sister was in the last class to teach COBOL before they stopped the classes.

      I don't know why COBOL gets so much hate from other programmers, for what it was created to do it

      • My sister was in the last class to teach COBOL before they stopped the classes.

        Where and when was that, if you don't mind saying?

        • Johannesburg, and it was a LONG time ago, at least 10 years, probably more, if you require and exact date I can drop her a mail, I am sure she would remember the date better than I.
          • Thanks for the offer, but I was just curious about the general date. I met someone on an airplane 15 years ago, who was doing a brisk business maintaining COBOL used for banking software. Even then, he did not know where it was being taught. He had learned it 20 years prior.
  • "One team is even working with the producers of Sesame Street to teach vocabulary to kindergartners in Atlanta. "
    It's not saying much about India.
    It's not saying much about Atlanta either.
    It's *certainly* not saying much about IBM...

    I can tell you, living in Atlanta now, this is an improvement.

  • After all the talk about "America First". Trump is definitely not making that happen. Whether it's because he doesn't know how to work the political scene, or he doesn't care when it comes to major corporations (even declining ones), it isn't happening. The irony is no matter how many times IBM tries to marginalize their operations, they seems to go further into decline, certainly in comparison to their glory in the sun during the home computer wars back in the 80's. What is likely to happen (as it's happen
    • by SeaFox ( 739806 )

      After all the talk about "America First". Trump is definitely not making that happen. Whether it's because he doesn't know how to work the political scene, or he doesn't care when it comes to major corporations (even declining ones), it isn't happening.

      Only an idiot would think Trump was going to do anything so grand about unemployment to start with. He's the President, not the king he believes himself to be, and the "hometown employment issues" are caused by several factors, not all of which he has the power do anything about.

      Environmental issues and advances in technology are putting the coal miners out of work. Trump cant stop tech progress, and he's not able to convince everyone Global Warming isn't a thing.

      Manufacturing? That's been going away so lon

  • IBM Global Business Services is a GLOBAL business. It's in their name. It's their mission.

    Locustlike? IBM, like any very large corporation, is intent on dominating their market. Domination. Not just success. Because if you don;t dominate, some other organization will. And they will take from you. Just the way it is.

    Now, the question is how you choose to succeed at your mission - exceptional customer service? Scraping the value out of every transaction? Underpricing the competition? Driving costs down to for

  • Yet their payroll in India is a quarter of that of the US employees. Yee-haw.... More money for IBM. Lay off those US based moochers :) you can do it ! On the more serious side where or when this will end ?
  • It's five for the price of one!

  • India Business Machines? Didn't they used to be a technology company or something?
  • Indian
    Bowel
    Movements

    • Indian Bowel Movements

      I
      Bought a
      Mac

      (I used to work as a contractor at IBM back in the late 80s and this actually went around internally. The sad truth is I jumped ship to Mac)

  • Good as I am sure now we are going to see cheaper rates now from IBM .... BAHAHA who am I kidding

  • Computerworld had the story: https://www.computerworld.com/... [computerworld.com]

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