IBM fires 2,000 employees over non-performance as tech giant looks to re-invent itself


JUNE 8, 2019

International Business Machine Corp has decided to fire about 2,000 employees in the United States over “non-performance”. The latest decision comes days after tech behemoth’s India unit fired nearly 300 employees from its services division. The Armonk-based tech giant said a “small percentage” of employees who have not been able to perform well at a competitive level would be affected by this decision, reported Bloomberg. With a total workforce of 3.5 lakh (2018 numbers) employees, IBM is looking forward to “re-invent” its operations and fulfil the changing demand of its existing customers.

The move would also allow the company to focus on high-value segments of the tech industry and to prepare a workforce to meet new challenges in the IT market. IBM has been cutting its existing workforce since 2016 as part of its strategy to aggressively work in the areas of artificial intelligence and cloud computing. The company has about 25,000 vacancies in its offices worldwide even as it continues to fire existing non-performing employees.

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“We are continuing to re-position our team to align with our focus on the high-value segments of the IT market – while aggressively hiring in critical new areas that deliver value for our clients and IBM,” the company said in a statement.

Experts suggest another possible reason behind firing could be the company’s falling revenue – IBM posted just 1% revenue growth in FY19. After asking a total of 200 senior employees to quit in August 2018, IBM India unit had let go around 300 employees in May.

Jobs cuts are becoming evident in the IT sector, with US-based IT services company Cognizant firing as many as 200 of its senior employees last month. The company asked its senior-level employees to leave as they could not adjust to the “changing environment” of the company by giving them three-fourth months of a severance package. The reason behind firing is believed to be Cognizant’s focus on “newer digital requirements”.

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Courtesy/Source: India Today