Samuel Palmisano, the outgoing CEO of IBM, was interviewed by the New York Times, and showed why the company does so well at image management.
As you know, AllianceIBM and other union groups have been pointing out that IBM has been shedding American workers for the good part of 20 years. IBM refuses to say how many of its 400,000 worldwide employees are American, much less in America, but the estimate is only 98,000.
Steve Lohr had a follow up on his blog, which went a little bit deeper into this deep thing. It appears that Mr. Palmisano simply had a fancy way of saying that people who just happen to have the in-demand skills at any given moment are going to be able to find a job. He thinks everyone should just go out and get these “deep” skills.
I can tell you, this is not the key to IBM’s current success. It is the fact that they eliminate jobs in higher wage countries, and then send the work to lower-wage countries while marketing themselves as very much part of the old country. You may be headquartered in one country, but when you spread out your workforce into foreign lands, is this to the benefit of America? Or is it to the benefit of the people in the foreign lands, who get access to the American market?
America’s problem for the last 30 years is that we have been pitching this idea of the global free market, when, in fact, none of the other countries are playing by that rule book. For the other countries, when it comes to good employment, they are looking to play it as, “heads, we win; tails, well, we win tails, too.” They are not interested in the free market. They are interested in free access to our market. They are interested in we take your jobs. That’s how they play it.
I like IBM’s advertising. It is also subtle and in the background. It doesn’t make people think or question, even when that is the word coming at them. The latest theme is “Building a Smarter Planet”. It sounds so good. They are figuring out how to get other countries to use 25% less energy, for example, to mobilize their traffic grid in some city, somewhere. With engineers who are workers in that country, or with designers in Shanghai. And payroll in Dalien. And fixed income accounting in Bratislava. We are supposed to feel good about this. It’s brilliant.
I have commented that “Building a Smarter Planet” means taking about 2 years to answer a federal administrative charge—with most of that time used to debate federal jurisdiction over overseas employment. It means taking another year to drag out federal court processes. “Building a Smarter Planet” means not really knowing how many Americans you employ in America. (“How could we possibly keep track of all those people?”)
And what works with “smart”, is that, well, if you don’t have a job, then, obviously, it’s because you aren’t smart. You’re not “deep”, you see. (I suppose this means we’re shallow. We’re definitely not the 1% of deep. Twenty-one million dollars a year is “deep”. Are you that deep?)
Of course it’s important for everyone to get more skills. But if an skillful engineer can be hired for $25,000 in India, or the computer can be put together for $7-a-day labor in Vietnam, it isn’t that IBM is “deep”. It’s that IBM is cheap. The success of today’s IBM is because the innards of the company are a third-world organization, that is headquartered and run from a first-world country, under the rubric, “global”.
It feels to me, very deeply, that the American workforce is very talented. I don’t think that’s the problem. Certainly, the Japanese workforce had a lot of talent, too. Mr. Palmisano is blowing smoke.
The companies that hire and protect American deep talent should be the ones that get federal contracts and easy business entree in America. The companies that want the benefits of here, but aren’t willing to “be” American, really need to acknowledge that they aren’t with us.
Hey, man, that’s deep, right?