March 30th, 2009
IBM - Wantin' and Gettin' Stimulus Money
Give them the same consideration that GM, Chrysler, etc. are getting
IBM has a PR problem. Asking for stimulus money from the U.S. government while transferring jobs overseas is not going over well in the U.S. CNN picked up on it and ran this on-air story recently. I saw three blogs today posting on the same material.
IBM is doing just fine financially and doesn’t need stimulus money. If they got it, it is assumed it would come via the government funding of a number of IT projects for government and other entities that IBM would complete. The money would help stimulate sales of IBM hardware, software and services.
But, if IBM had the same problems as certain Wall Street firms, commercial banks, Detroit car companies, etc, then they’d be subject to a much different set of rules for their stimulus money. Rules they wouldn’t like or accept but rules that are being applied to other firms.
I would recommend IBM back off the stimulus money begging as it makes the firm look weak - like a failing company. It also makes the company look silly when it cuts its domestic workforce, expands its offshore labor contingent and then asks for money it may or may not spend domestically.
Here are my suggestions as to the terms and conditions that IBM should get if it wants to get this stimulus money:
1) Make all IBM operating systems and systems management tools open source. If the taxpayers are investors/owners of the company, then we should get their software free!
2) Make the U.S. government a named co-owner of all IBM patents. For the last several years, this company usually leads the list in patent grants. As a taxpayer/owner, let’s make sure we get all the royalties we can from licensing these babies!
3) If IBM takes the money, then they should get rid of their CEO. The government is forcing out General Motors’ CEO and IBM should take the same medicine. The government may force GM to replace 1/2 of its board, too. I think IBM should do likewise. You know, maybe we should all polish up our resumes in case the government needs one of us to fill one of these slots.
4) Similarly, if Chrysler has 30 days to do a deal with Fiat, then IBM should get 30 days to cement a deal with a large non-U.S. competitor like Infosys, Wipro, Patni, etc. That way, IBM would have to sell that firm’s offshore solutions and maybe that would stop IBM from transferring even more jobs out of the U.S.
5) Let’s make their common stock worthless. Issue the U.S. government new preferred class shares in IBM that make them worth the total equity of the firm. If IBM really wants this money, taxpayers should participate in the equity upside of such an arrangement.
6) Tie receipt of stimulus money to the retention of jobs in the U.S. Wall Street banks aren’t happy that they can’t spend stimulus money on firms that would offshore a number bank functions. That provision alone could be the most difficult concession for IBM to make.
7) Make IBM executives give up their perks. Corporate jet loss wouldn’t be the only cut to be made here.
8) Last, let’s finally demand that IBM change it’s nickname from Big Blue to Big Red, White and Blue.
Yeah, I think I could live with those terms. Readers, what other terms should we ask for?
This blog explores the intersection set between services and technology. If it impacts either space, it will be covered here. Brian Sommer is a former Accenture partner. He did an 18-year tour of duty there and ran three small practice units (Finance Center of Excellence, HR Center of Excellence and Software Intelligence). He’s sold service projects in almost every continent and remains just as current on both services and technology today as ever before. Brian is currently CEO of TechVentive, a strategy consultancy servicing technology providers, and a research analyst with Vital Analysis. See his full profile and disclosure of his industry affiliations.
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