Economy "Roaring Ahead" IBM tripling investments to $6 billion

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Fer Echegaray

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Indian economy, that is...

consulting firm McKinsey and Co. estimate the global service outsourcing business will be worth 110 billion dollars by 2010 and that Indian companies will get more than half of that.
 
Great for IBM!



Way to go!



As an employee of Big Blue for 7 years (I left in 1994), I have to say that IBM is doing exactly what it has to in order to be competitive.



IBM's Global Services division is in the business of outsourced IT. Its MO (modus operandi) is to go into a large company that has it's own IT organization and is drowning, and throw them a life preserver in the form of an outsourced services contract. What IBM typically does is BUY all the IT equipment the company uses, showing an immediate revenue bump for the company. Then, they lease some equipment back to them, consolidate most of the equipment, and remote much of the IT services. However, to do this, they have to typically "port" or "move" most of the companies critical, legacy applications to new operating systems versions and platforms, and that "maintenance and refit" is what is typically outsourced to places like India.



And, why India? Because they have the skilled people in the numbers needed to get the work done. And, because, frankly, it is the equivalent of "IT Janitorial" work that most capable people here in the US simply DON'T WANT to do, at any price. There simply aren't the number of willing, capable developers in the US to satisfy that demand for mainframe maintenance programmers.



So, IBM is doing what it needs to do to execute on the business model, which is in itself outsourcing based. Outsourcing is not a bad thing. Most businesses outsource at least some non-core function or another.



Others here have said businesses should be allowed to do what they want, as long as it is legal, and if people don't like it, they can start competing businesses.



Tons of money can be made working for IBM Global Services today, or as a vendor liason managing the India outsourcing contracts...or even as a startup doing maintenance programming hiring domestics for those customers who simply don't want to offshore for any number of reasons.



TJR
 
Last edited by a moderator:
TJR - IBM is huge and with a huge company also has it's pit falls. When I was working for a ECM company anytime we were up against Open Text or Documentum we would get the IBM team involved because we knew they would sell the IBM hardware and recommend our software over IBM's own ECM Solutions. One hand greases the other. Essentially competing within itself for business.
 
IBM sold their laptop and desktop division to a Chinese company since their products sucked so bad. Can't say much better for the outsourcing they provide my employer, either.
 
SST, you don't have to explain to me the size, internal intricacies and self-created hurdles of IBM. These were part of the reason I left the company...though there were times like today I wish I hadn't (and when I recognize I would have 19 years in now).



Darin, I agree, IBM does a lot of things poorly, but for the most part, they are a professional system that stands behind their products and services.



TJR
 
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