IBM is facing an unprecedented morale crisis. Chairman John Akers is to blame. In recent years, IBM has pared thousands from its payrolls. By the end of 1991, according to the Wall Street Journal, IBM’s workforce will have been reduced to 360,000 from a recent peak of 407,000. This year alone, 14,000 people will lose […]
IBM is facing an unprecedented morale crisis. Chairman John Akers is to blame. In recent years, IBM has pared thousands from its payrolls. By the end of 1991, according to the Wall Street Journal, IBM’s workforce will have been reduced to 360,000 from a recent peak of 407,000. This year alone, 14,000 people will lose their jobs. On May 23, IBM said that it would no longer merely encourage some of its people to quit. From now on, under orders from the very top of IBM, managers at various levels will identify IBM employees with whom they are dissatisfied. These IBMers will be offered a severance bonus for leaving quickly under their own steam… and a smaller payment if they are later fired by their bosses. The reaction within IBM was swift and sure. Less than a week after John Akers read the riot act to a group of managers, one of them, Brent Henderson, shared his notes with some colleagues. From there, the Henderson notes zipped around IBM’s electronic mail network. Somebody at IBM leaked the notes to the press. In explaining his action, Henderson pointed out that John Akers not only complained about the performance of IBM employees but also derided managers for watering down his discontent. Now that Akers’ words have been quoted throughout IBM and made public – and the general accuracy of Henderson’s notes has been confirmed by IBM – the chairman has one less thing to grouse about. This is not the case for the other 360,000 employees of the company. The 33,000 people IBM eased into the street during the past few years wore a mantle of pride.
Branded as inferior
They had been hired by one of the world’s most selective companies, trained by superior instructors and, for the most part, promoted through the ranks by virtue of their merit. They had a lot going for them if they sought new jobs elsewhere. This year’s culls will have a harder time finding work. They must compete in a weak job market, and they must do so after having been branded as inferior by John Akers. Their careers at IBM, which until now gave them an advantage in the workforce, are now liabilities. It is bad enough that IBM has felt compelled to lay off more than 10% of its workforce. The tragic plight that many former IBMers will undoubtedly face as they seek new jobs is, by itself, an embarrassment to the IBM company and a burden for the economies of every nation in which IBM has put its people on the dole. But the blacklisting of those laid off is unforgivable. How many of those put on the street owe their discharges to personal failure? Plenty will be fired because IBM can’t sell enough goods and services, or because their bosses were ordered to get the job done with fewer people. Without a doubt, some of those who lose their jobs are poor performers… at least by IBM standards. In the past, other employers would have considered such people excellent workers nonetheless. As a student who does poorly at Yale may well excel at a lesser institution, so, too, might one of IBM’s less brilliant stars shine brightly in another constellation. But by adding obloquy to the injury of dismissal, John Akers has for the first time in IBM’s history created a antagonistic relationship between management and labour. The ultimate employers of every IBMer are the shareholders, who may well now conclude that the unacceptably poor performance among its employees highlighted by John Akers extends right to the very top of the company. – Hesh Wiener Copyright (C) 1991 Technology News of America Co. All rights reserved.