Tuesday, April 14, 2009

IBM trying to be productive shifting jobs to India ..


IBM to cut thousands of jobs in the West and to shift them to China and India as these countries do these jobs at 10 % of the cost to the company from the Western employees. ie it goes to say that for IBM, a Western/American employee is just 10 % productive as an Indian employee. That is a sad state of affairs !! I am sure this is not the case with all the Industries in the west.

The productivity of industries in India and China as a whole is at least ten times that in the west. The pampered population of the west has slowly started realising where they went wrong.. or are historical wrongs being righted (corrected) now ??

Let us face facts.. If IBM wants to survive as a company then it has to shift to low cost work environments.. Else it will face the same results as General Motors / Ford / Chrysler. GM had physical capital which could not be shifted from one place to the other. IBM on the other hand has the advantage that it has only intellectual capital which can easily be shifted anywhere at short notice..

Constructive destruction, or the term for liquidating oneself and reemerging as a new entity (avatar) in the new environment is what has subsumed GM. GM with an open and heavy heart (prodded by an uncompromising Obama) has taken to it 'whole-heartedly'. The hundred year old IBM is fully aware of this contemporary reality and is trying to keep away from the inevitable as much as possible..

The Computing Tabulating Recording co turned International Business Machines corp strategy to remain afloat is bringing employment to the new wave, highly-productive, low-wage, highly-skilled employees in India and China.

A brief time-line of IBM

No one can work against the natural rhythm and cycle.. At times we have to march to its tunes, though unwillingly .. Egos, get subsumed then !!


1 comment:

  1. I had a talk 3 months ago with Jim Spohrer, the services director of IBM Almaden lab in california, and he stated strongly that IBM would set up its new business units where new opportunities are i.e. the emerging countries like India or China.

    there is a difference of productivity for the moment not due to intellectual capacity but as an "ecosystem" issue. It's changing quickly and the best proof is success like Bangalore and others.


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