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Friday, May 04, 2007

IBM’s LEAN Initiative & The Changing Global Services Landscape -Part 1

Months back, Bob Cringley wrote IBM- Disaster In The Making. In an update post he writes, problems continue to abound within IBM writes,Bob Cringley. He thinks that close to last weeks layoffs of 1300 people,another 100,000+ layoffs would no later than the end of this year. He explains,LEAN, an IBM initiative is aboutoffshoring and outsourcing at a rate never seen before at IBM. He estimates that for one overseas hire within global services, one may get the axe in the US. This, he contends is aimed at eliminating 150,000 posiitons within the US. He adds, initiatives are on within IBM to identify common and repetitive work now being done that could be automated or moved offshore, and to find work Global Services is doing that it should not be doing at all. Implicit in LEAN is that Global Services will be eliminating not just employees but customers, too - customers whose contracts were underbid and whose projects may never be profitable for IBM.All this is supposed to happen by the end of 2007, by the way, at which point IBM will also freeze its U.S. pension plan. there is a broad expectation at all levels of IBM familiar with the LEAN plan that it will cause huge problems for the company. He concludes that this may just speed up the death spiral of IBM. (All these are Mr.Cringley's view).

In the follow up post to this, let's see whats changing in the services marketplace.

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