Can IBM Survive?

Posted by Remi on September 2nd, 2008

The Business Week article by Stephen Baker titled “Managing by The Numbers” is a must read.

The article describes how IBM, the world leader in outsourcing services with almost 400,000 employees worldwide, is introducing mathematical models to help assemble the teams best suited for a job, manage employees’ time, etc.

A team of scientists, headed by Tamer Takriti is in charge of collecting as much data as legally possible, and extracting from this huge amount of information the patterns that will help increase productivity.

So what type of information is Takriti’s team using?

It is quite simple: almost everything. It includes employee resumes, project records, phone call backlogs (including cell phones), emails (recipients, cc’ed people, bcc’ed ones), etc.

Takriti explains that the system should eventually allow a project manager to sit at a computer and rapidly assemble the best-suited team of engineers to start a call center in Manila for instance.

My first reaction was to think of Big Brother, but then I gave it second thoughts.

Since the dawn of humanity, and in small communities around the world, everybody would know about everything on any other member of the same community.

It has been like that for centuries, always with some excess, but globally human beings have been able to live with this situation, and enjoy relative freedom. The emergence of the Internet just takes this concept of community to a global level, where everybody will soon have access to virtually any information on anybody, and I do not see why this other globalization would yield to a society similar to the one described by George Orwell in 1984.

I find more interesting the fact that IBM has reached a size where they cannot even rapidly assemble a team of 5 developers to start a call center in Manila!

This seems to prove my point that a global world calls for companies that are global, yet not monolithic anymore. I would be a company looking to outsource some IT functions, I would rather trust today a “federation” of smaller size outsourcing companies than IBM, Accenture or HP to deliver high-quality flexible applications.

IBM and the likes look to me like giant dinosaurs. Granted, they are the biggest, but will they be able to adapt to what’s coming? If they do not manage to get rid of their their rigid monolithic structure, their fate is sealed, even if it might take years before they effectively disappear.

Remi
www.outsourcing-vsc.com


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IBM vs. Tata: Which is More American?

Posted by Remi on May 11th, 2008

Business Week recently suggested that TCS (Tata Consulting Services) was somewhat a more American company than IBM. As per the author of the article, a comparison based on the percentage of sales in the USA for the last quarter shows that TCS generated 51% of its revenue in the USA, while IBM generated only 35%.

I have a couple of comments:

  • First, percentages are OK, but they do not make much sense without the raw numbers. TCS’ total revenue for the year ending March 2008 was of $ 5.7 B, to be compared to over $ 36 B for IBM (services represented last year 37% of the overall $ 98.8 B revenue). Even if only 35% were generated in the USA, this is still more than twice as much as TCS’ entire worldwide revenue.

  • And more importantly, I visited the “executive management” page on TCS’ WEB site. To me, the nationalities of the Executive Board members and corporate officers are an accurate indicator on how truly International a company is. All TCS executives are from India.

So, is TCS really more American than IBM?

Remi
www.outsourcing-vsc.com

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