IBM and Outsourcing.

Discussion in 'Economics' started by SouthAmerica, Dec 9, 2006.

  1. .

    December 9, 2006

    SouthAmerica: The latest issue of Barron’s (the issue dated December 4, 2006) had a cover story “The New IBM” – and the headlines also said: “Big Blue’s shareholders have been blue for the past few years. But the tech giant has a new strategy, focused on software. Best of all, it’s working.”

    They also had a chart under the title “Changed for the better” with the following info:

    Revenue Mix:

    Hardware & Financing = 27 %
    Software = 20 %
    Services = 53 %

    The article implied that today the service area is the major source of revenue for IBM – about 53 % of total revenue.


    What the article does not highlight is that IBM’s major business today and the major source of money is “IBM the Outsourcing Company on Steroids.”

    The major product IBM has to offer today to the world is: IBM is a major exporter of good paying American jobs – they export jobs from the US market to foreign lands.

    IBM the Outsourcer on Steroids is outsourcing a massive number of good paying American jobs to cheaper locations around the world including India.

    IBM the Outsourcer on Steroids does not export to other countries only IBM jobs; today IBM is also outsourcing thousands, and thousands of good paying American jobs from many other major American corporations as well.

    If you have IBM stock on your portfolio I would suggest that you dump it ASAP.


    Because some day in the near future “IBM the Outsourcer on Steroids” might outsource your job, or the job of a friend, or of a member of your family to a foreign land. Remember the major source of IBM’s revenue today it is from exporting good paying American jobs to foreign markets.

    In March 2005 Brazzil magazine published my article about IBM and outsourcing – “Outsourcing is ruining the US and Brazil’s economy”

    I don’t know what is necessary to happen for Americans to wake up and realize that IBM is in the business of exporting a massive number of middle class jobs out of the United States.

    Many Americans have the illusion that IBM is an American company and they would not do anything to hurt the American people.

    If you are so foolish to think that way then you better wake up before it is too late – IBM just cares about the bottom line and many of the actions that IBM has taken in the last few years speak volumes about IBM’s values today.

    You can bet that caring about the United States and the American people is not one of them.

    Here are some clues:

    IBM has been a very profitable company, but they got greed and they want more – look at what they have been doing over the last few years to their employees benefit programs including pension, health insurance, and so on...

    IBM just had their annual meeting in India for the first time – They are trying to say something to Americans since they always used to have their meeting in the New York Metropolitan area, but today India it is more important for IBM’s future than the old USA.

    Today the United States it is important for IBM only as a source of good paying jobs that IBM can export to foreign lands.

    Today I would not buy an IBM product even if it were the only product available to me.

    I wonder if there is anyone or any organization in the United States keeping tabs on how many jobs “IBM the Outsourcer on Steroids” is exporting from the United States to other foreign lands - not only IBM jobs, but also jobs from other companies located in the USA. (I would not be surprised to find out that IBM is exporting millions of good paying American jobs to other countries.)

  2. Admitedly, while I often don't agree with a lot of the bs you post on here, S.A. you bring up an important point. In fact a trend I've seen in the last 20 years: corporations being allowed to screw their American employees and their own country all in the name of a higher stock price. It seems though, that the media always manages to convince the apathetic public that's in their best interest. My thinking is that since many more millions of people now own stock than several years ago, that's their main concern now...the short term stock price.
  3. Add cisco systems to that list. I have friends there, and they tell me about their USA groups that went from 200+ developers to 5 in the last few years. All of IT is going to india. Too bad, there is no way to stop it.
    Thats why I got the hell out of IT. Dead end in the USA.

    Hewlett Packard is even worse. They have slashed their IT positions by 90%, and plan to do that again in the next few years.
  4. .

    December 9, 2006

    SouthAmerica: Reply to risktaker

    When I wrote that article in March 2005, some people asked me why I was picking on IBM?

    Because IBM is a special case – IBM has a special relationship with most major US corporations – the doors of the major US corporations are open for the army of thousands of IBM consultants who’s major purpose is to export US good paying jobs to cheaper labor markets around the world.

    There are thousands of IBM consultants today who are trying to outsource jobs out of the US labor market. Read my article and you see what I am trying to say – multiply the contract that IBM managed to get from P&G and you see the potential of IBM exporting millions of good paying US jobs from the US labor market to India and other cheaper foreign labor markets around the world.

    By exporting all these jobs from the United States to other countries - IBM is also helping to depress wages inside the US labor market.

  5. Outsourcing is great.
    It brings high paying jobs to third world countries and takes em away from US citizens... It forces people to become more specialized in order to survive, is either becoming specialized or becoming extinct... Pure Darwinism with a twist of social justice...
    If you´re a middle class US citizen and you are afraid your job might get outsource, you should head back to school ASAP... or have your government dictate a law stating the minimum wage to be paid by any company that wants to sell products to the US... making outsourcing less attractive to corporations and at the same time bringing average wages up across the third world... kill two birds with one stone...
  6. This is a LOT of baloney....going back to school, which implies going back in debt to pay-off an overvalued advanced education...guarantees you NOTHING in this economy. My wife (and I was affected of course) went thru hell for 2 1/2 years getting her Masters in Health Care Law degree at night. Pure hell. 2 years later....and no significant progress towards a directorship position at any major healthcare institution despite her 15+ years experience on top of the degree. She is nowhere near getting back to even for her time and money spent in obtaining the degree.
    Education, even in a so-called "hot" sector, is NOT THE ANSWER.
  7. I lost my job for health reasons and cannot do physical work anymore.(bad back) . I was considering going to a local community college for a computer tech or something like that degree . ( A+ certification or something like that) or maybe bookkeeping . But now after reading this maybe I should reschool in something else? Any input from folks with experience or been through it would be VERY MUCH appreciated ..
    thank you , Phil
  8. Phil - the key is:
    spend $$ on education only if you know its going to pay-off...that's all. Check the job boards.....jobcircle, careerbuilder, dice, even craigslist. I'm totally amazed at the stupendous demand for physical and occupational therapists. Outsourcing hasn't gotten to these specialties...obviously. Take note and be wise.
  9. There are some jobs that are impossible to outsource due to their nature. Such as construction related jobs {engineering, architecture, and so on}, services that are provided directly such as a chef or a nurse. There are other jobs that are not easy to outsource because of the infrastructure that you require and the high level of specialization, or because of strategic reasons, such as jobs in the financial industries or bio-research. {though this last ones are starting to get outsourced now a days... we got people developing rocket engines for NASA down here... }

    On the other hand there are jobs that are fairly easy to outsource. Everything that´s related to programing can be outsourced in a second... same with book keeping and that sort of jobs.
    Everything that´s related to databases, network administration {but not setting up the network that one cant be outsourced}, accounting {not audits though}... so just basically look for an area in your field that´s not as easy to do remotely, or start your own business. The labor market is no different from any other market... and if the economy is just looking horrible you can always outsource yourself to some nice tropical or Mediterranean country... There are many countries where it´s a lot cheaper to live than the states and the job market isn´t as competitive...

    Outsourcing is here to stay... it´s just the market turning back to equilibrium, since the border is closed and people cant go into the states to get the jobs that are getting over paid then the companies are stepping out of the states to get to the people who are willing to do the jobs for less money which ultimately leads the labor market in the same direction as a massive migration. The imbalance of income between San Diego and Tijuana cannot be sustained, the market will go back to equilibrium in the long run. Wages in the US will go down drastically while wages in India, China and South America will go up to come to the same level as those in the US. Making all those markets more efficient.
  10. Great for whom?? People in Bangladesh or Vietnam making starvation wages working 12h/day 6 days a week? No health care, no union, no job security only semi-slavery working till you drop dead. Or is it great for US??? More and more people are working 2 jobs and they still do not make ends meet.
    Your solution is to go back to school, what about those who just cannot learn new skills, have family or other obligations, or just want to have a decent living without going to school for 25 years and going into debt for 100K just to live a comfortable life?
    You do not seem to realize that outsourcing and globalization in general is basically a race to the bottom were we all eventually will survive on a 40 cents an hour jobs the way people in Vietnam do. All in the name for higher corporate profit. What a facking shame!!!!!!!!!!!!!
    #10     Dec 10, 2006