Could IBM really function with tens of thousands fewer staff?

Posted: Feb 27,2015

Whether IBM is still the bellwether of the IT industry or not is up for debate. But regardless of the outcome of such a debate, talk of mass redundancies at the IT giant will always spark discussion about the future of the industry. There has been talk of up to 100,000 IBMers in India being cut. Recent years have seen speculation about the size of IBM’s workforce. A few years ago there were suggestions of up to 300,000 being let go globally. Although both stories were not confirmed, there is no smoke without fire. Talk of scaling down is likely to occur whenever financial results are not so good. It is an IT giant with a long history. But could IBM really function with so much less human resource? For that matter, could any of the large IT service providers operate with such a reduction in staff? IBM reduced its India-based workforce from about 165,000 in 2011 to 113,000 in 2014. The report quoted sources close to IBM’s plans who said this number will fall to 100,000 in 2015. IBM has more than 400,000 employees globally – about the same as the urban population of Liverpool. IBM, like much of the industry, is trying to move away from linear business models based on the provision of full-time equivalents. The introduction of modern technologies that make services less labour-intensive is reducing the need for staff in lower-cost locations. As industries mature, practices become more efficient through the use of technology and fewer human resources are required. The IT services sector is no exception.

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