MUMBAI: IBM’s cost-cutting “resource actions” reached Indian shores this week and insiders warn of at least a few hundred job cuts at the Big Blue’s unit in the country as part of the company’s larger plans to lay off thousands globally.
Already, at one centre in Bangalore, IBM has asked about 40 people at its Systems Technology Group to leave, one person at the company told ET. STG is often referred to as IBM’s hardware division, according to the company’s website. IBM is said to have over a 100,000 staff in India, its largest presence outside the US The hardware business, which sells mainframes, servers, storage and related gear, was facing difficulties and would see job cuts, chief financial officer Martin Schroeter told analysts in a conference call last month after the company reported its fourth quarterly decline in sales.
News also broke last month that IBM eventually agreed to sell its low-end server business for $2.3 billion (Rs 14,300 crore) to Lenovo, which had already bought the Armonk, New Yorkbased company’s personal computer business. At STG, “even people with very high rating were asked to leave. Two weeks ago they were told there would be no salary hikes this year.
But this was truly shocking,” the person in Bangalore said on condition of anonymity. “They were asked to surrender their official laptops and leave. They were told STG business has been suffering financial woes. Employees across IBM India are extremely disgruntled. Several middle level executives have put in their papers in the last few weeks,” the person added.
An IBM spokesperson couldn’t immediately be reached for a comment and an email didn’t elicit any response. “STG Bangalore literally turned into a slaughter house today,” Lee Conrad, national coordinator for Alliance@IBM, a union-backed workers group told ET in an email. “Several employees were called to a meeting and RA’d… and they were asked to vacate premises immediately. Severance package was on an average three months basic component of salary, which is like six weeks full pay,” Conrad said.