Fresh redundancies illustrate IBM’s continuing cloud challenge

IBMWithin the last twelve months, the company has inducted more than 70,000 IBMers and spent more on acquisitions than in any other 12-month period in its history. Focusing on data analytics, security, machine learning and mobile, the business is attracting a new breed of employee to its ranks. All would seem well until you consult social media.

The Facebook group, Watching IBM, has increased its following by more than 66% over the last week. The group has taken responsibility for bringing light to the 70,000 job losses experienced by the firm in the past few months. Comments such as “At the beginning of 2015 our department had 25 people in it. At the beginning of 2016 our department has 13 in it,” highlight the decline.

For all the positive news of expansion, new product offerings, and 70,000 new employees, the headcount over the course of the twelve month period has shrunk around 1% to 377,757 from 379,592.

With company revenues declining for fifteen consecutive quarters, this should not come as a great surprise for most; IBM’s struggles to re-invent itself as a cloud business have been well documented over recent years.

Back in January, Clive Longbottom, Service Director at Quocirca commented that IBM could risk being left behind, should the transition take too long. With AWS, Microsoft and Google continuing to surge forward, that risk is continuing to grow, though the consultancy skills nurtured in IBM will remain in demand “I still believe that IBM will remain a major force in the IT world, it just has to make sure it positions and messages itself effectively to its existing customers and to its prospects”

Last week IBM released a report which highlighted that two- thirds of organizations implementing hybrid cloud are gaining competitive advantage from their hybrid environments are nearly three times as likely to use it to assemble data assets or monetize data.

Surveying more than 500 hybrid cloud implementers, in 26 countries worldwide, the report highlighted that 85 percent of respondent commented that a hybrid approach to cloud is accelerating the digital transformation in their organization. During 2015 Q4, total cloud revenues (public, private and hybrid) for the vendor increased 43% to $10.2 billion, though revenues throughout the business were down 9% to $22.1 billion in the same period for 2014.

Despite some negative press, and a surge in social media activity being directed towards the tech giant, it seems the workforce transition is far from complete. “We’ve been shifting resources aggressively,” CFO Martin Schroeter commented last week “and we’d like to shift them more aggressively.”