IBM Still Mired in Layoff Spiral

As IBM continues to quietly lay off more than 4,800 workers, the company takes another blow to its image as documents leak about an effort called Project Match. Project Match helps IBM's U.S. and Canadian employees find jobs in countries where IBM is expanding, such as India and China, while IBM eliminates positions in the United States. Robert E. Kennedy, a professor at the University of Michigan's Ross School of Business, says global sourcing and offshoring are realities that IT infrastructure and software companies like IBM and their employees must come to accept. Also, as high-tech layoffs continue, what impact will there be on H-1B workers?

IBM continues to lay off employees and to take heat from employee groups for its practice of not providing more information such as exact numbers or other particulars on the layoffs. The word is IBM has eliminated nearly 5,000 positions since the action began in January, according to sources.

An IBM employee organization called [email protected] says IBM has laid off more than 4,800 people, including 1,449 in Sales and Distribution, 1,419 in the IBM Software Group, 1,200 in IBM's Systems and Technology Group, 307 in IBM Finance, 193 in IBM Research, and 92 in human resources.

Meanwhile, according to reports, IBM has an effort called "Project Match" that aims to help IBM employees in the United States and Canada move overseas to work for IBM, or essentially "offshoring" themselves.

Although the Project Match initiative has been characterized as an either/or solution-where IBM employees are encouraged to either accept a job in India (or elsewhere) or lose their positions in the United States-it does not appear to be exactly that.

Of course, word of Project Match leaking as IBM is in the throes of a broad-based layoff that is a potential source of embarrassment for the company. The goal of the program-as stated in a document describing the program obtained by eWEEK-is not simply to displace workers or present them with unpalatable choices.

The document says, "IBM has established Project Match to help you locate potential job opportunities in growth markets where your skills are in demand."

According to the document, countries where opportunities are available include Argentina, Brazil, Mexico, Czech Republic, Hungary, Nigeria, Poland, Romania, Russia, South Africa, India and China.

In addition, the Project Match document said, "Should you accept a position in one of these countries, IBM offers financial assistance to offset moving costs, [and] provides immigration support, such as visa assistance, and other support to help ease the transition of an international move."

Moreover, the document said:

"Project Match is a fit for IBMers who are:Eager to broaden their career and develop new business skills by living and working abroad-a valuable commodity in today's global economy.Excited at the prospect of contributing to a developing economy, potentially taking on different job responsibilities.Open to new experiences and cultures.Satisfactory performers who have been notified of separation from IBM US or Canada and are willing to work on local terms and conditions."

Indeed, that last point is the kicker, as it points to employees who have been notified of "separation" from the company. Yet, IBM officials say Project Match is not intended as a primary outlet for such employees for a number of reasons-among them that the number of Project Match positions is limited.

Robert E. Kennedy, author with Ajay Sharma of a book on offshoring called "The Services Shift: Seizing the Ultimate Offshore Opportunity," executive director of the William E. Davidson Institute and the Tom Lantos Professor of Business Administration at the University of Michigan's Ross School of Business, told eWEEK he believes IBM has simply come to grips with the new global economy and is making use of talent available throughout the world to reach maximum productivity and efficiency.

In Kennedy's view, asking IBM to refrain from employing overseas workers directly affects U.S. consumers, slows innovation and hurts the company's overall health.

Regarding the IBM layoffs, Kennedy told eWEEK, "There are at least two big pressures driving this. One is, by far, there is an economic downturn and IBM sales are suffering so they have to make cuts. And two is that globalization has come to the service sector and IBM knows it can move some jobs offshore."