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Analyst speculates IBM is cutting up to 8,000 jobs; cuts are global

IBM pays CEO $15.4M in her 1st year on the job

IBM Security Tool Can Flag ‘Disgruntled Employees’

Analyst speculates IBM is cutting up to 8,000 jobs; cuts are global

By Staff, wire reports

WRAL TechWire

IBM (NYSE: IBM) the world’s largest computer-services provider, began cutting jobs in the U.S. and around the world Wednesday as part of a global restructuring plan announced in April, IBM acknowledged and workers reported.

Based on data gathered from around the world, Alliance at IBM estimates several thousand cuts already have been made or are planned.

A source familiar with the cuts said "hundreds" of jobs among IBM's 10,000 work force in North Carolina would be cut.

The company is probably cutting 6,000 to 8,000 jobs globally, based on the $1 billion cost figure, said Laurence Balter, an analyst at Oracle Investment Research in Fox Island, Washington. That would represent less than 2 percent of IBM’s total workforce of 434,246 as of Dec. 31.

Based on internal IBM documents provided to Alliance at IBM, the union seeking to represent IBM workers, more than 1,600 layoffs have been confirmed in the first 24 hours.

The layoffs by group:

    STG Storage Systems Development: 121
    STG lab Services and Tech Training: 52
    STG Test Site Design: 59
    STG SSE Intellectual Property: 64
    BT/IT CIO Enterprise Transformation: 4
    Corporate Marketing and Communication: 83
    Software Group tivoli: 98
    Software group WW Services and Education: 22
    STG Semiconductor Research and Dev: 165
    SO Delivery Integrated Competencies: 46
    GPS Solutions and Delivery: 116
    Software Group Marketing: 222
    Research: 65
    GBS AMS IBM Global Account: 123
    STG Operations and Transformation: 34
    Software Group NA Software Sales: 63
    SO sectors (GSSR): 31
    Software Group Information Management: 137
    Software group Industry Solutions: 126
    Total cut so far: 1634

Media reports have said IBM is cutting 700 jobs in New York and 200 in Ottawa, Canada.

Several workers from across the U.S. and Canada told Alliance at IBM, the union seeking to represent IBM workers, that cuts were being made in numerous locations and across several work groups.

The reduction targets employees with a range of seniority, from rank-and-file staff to executives, a source who asked not to be named because the information is private told Bloomberg.

In a statement provided to WRALTechWire, spokesman Doug Shelton confirmed the restructuring but did not provide any details.

"Change is constant in the technology industry, and transformation is an essential feature of our business model. Consequently, some level of workforce remix is a constant requirement for our business," Shelton said

"Given the competitive nature of our industry, we do not publicly discuss the details of staffing plans. IBM is investing in growth areas for the future: Big Data, cloud computing, social business and the growing mobile computing opportunity.

"The company has always invested in transformational areas, and as a result, we need to remix our skills so IBM can lead in these higher-value segments in both emerging markets and in more mature economies."

Some U.S. workers began to receive notifications of the cuts last night, according to Lee Conrad, a coordinator for Alliance@IBM, an employee group. The restructuring will cost $1 billion worldwide, including severance expenses.

IBM announced the job-cutting effort after releasing disappointing first-quarter results in April. The Armonk, New York-based company posted profit of $3 a share in the period, missing the $3.05 predicted by analysts -- the first earnings shortfall since 2005, according to data compiled by Bloomberg. IBM said at the time that the job reduction would be concentrated overseas and mostly complete by the end of June.

Recent media reports also have said IBM is cutting workers in Israel and other countries.

‘Workforce Remix’

Alliance@IBM said on its website that 121 employees were cut from a unit within IBM’s Systems and Technology group, the hardware division that saw revenue drop 17 percent last quarter.

“Change is constant in the technology industry and transformation is an essential feature of our business model,” IBM said today in a statement, without giving specifics on the job cuts. “Consequently, some level of workforce remix is a constant requirement for our business. Given the competitive nature of our industry, we do not publicly discuss the details of staffing plans.”

IBM shares fell 1.4 percent to $201.20 at the close in New York. The stock has climbed 5 percent this year, rebounding from a tumble in April following its lower-than-projected earnings.

The $1 billion plan represents an increase over IBM’s job- cut efforts in recent years. The company spent $803 million on workforce restructuring in 2012, up from $440 million in 2011.

IBM also has been cutting hours of its contract employees. CDI Corp., a Philadelphia-based provider of staffing and outsourcing services, told its staff working for IBM to limit their hours in May, according to a memo obtained by Bloomberg. IBM at the time said that the company relies on contractors to manage labor costs on information-technology projects for clients.

IBM pays CEO $15.4M in her 1st year on the job

Associated Press – Mon, Mar 11, 2013

ARMONK, N.Y. (AP) -- IBM Chairman and CEO Virginia Rometty's pay doubled in her first year running one of the world's biggest and best-known technology companies, but she still took home less than her predecessor.

Rometty, the first woman to run IBM, received a 2012 pay package worth $15.4 million, based on an analysis of regulatory documents filed Monday. That's up sharply from the roughly $7.5 million she made the year before as senior vice president in charge of the company's global sales and marketing. As with most CEOs, most of Rometty's compensation consisted of long-term stock awards that could wind up being worth more or less than the $9.3 million listed in the initial disclosures.

Rometty, 55, got off to a solid start, focusing on growing IBM's software business, which has higher profit margins, over hardware. The Armonk, N.Y.-based company's adjusted earnings climbed 13 percent from the previous year under Sam Palmisano and it forecast 2013 results above analyst expectations. Its stock price edged up just 4 percent last year, though, lagging the 7 percent gain in the Dow Jones industrial average, which consists of 30 bellwether stocks, including IBM's.

Palmisano, who had been IBM's CEO for a decade, remained chairman until October and then served as a senior adviser to the company, receiving a total 2012 package valued at $22.3 million, by AP's calculations. That's slightly less than the $24.2 million he received in his final year as CEO, but more than the roughly $21 million that he made annually from 2007 through 2010.

Rometty's first-year package included a $1.5 million salary, a $3.9 million bonus and perks valued at $687,725, including more than $304,000 for personal travel on the company's airplanes. The AP's formula counts salary, bonuses, perks and stock and options awarded to the executive during the year. It doesn't include changes in retention and pension plans, two factors that IBM Corp. listed in its summary of Rometty's calculation.

IBM Security Tool Can Flag ‘Disgruntled Employees’

Joel Schectman

January 29, 2013, 7:29 PM ET

Wall St. Journal

A new International Business Machines Corp. security tool uses Big Data to help CIOs detect internal and external security threats in new ways—and can even scan email and social media to flag apparently “disgruntled” employees who might be inclined to reveal company secrets, according to Sandy Bird, chief technology officer of IBM’s security systems division.

The new tool, called IBM Security Intelligence with Big Data, is designed to crunch decades worth of emails, financial transactions and website traffic, to detect patterns of security threats and fraud. Beyond its more conventional threat prevention applications, the new platform, based on Hadoop, a framework that processes data-intensive queries across clusters of computers, will allow CIOs to conduct sentiment analysis on employee emails to determine which employees are likely to leak company data, Mr. Bird said. That capability will look at the difference between how an employee talks about work with a colleague and how that employee discusses work on public social media platforms, flagging workers who may be nursing grudges and are more likely to divulge company information. “By analyzing email you can say this guy is a disgruntled employee and the chance that he would be leaking data would be greater,” Mr. Bird said of IBM’s new tool.

For example, a company could analyze employee emails that express a positive sentiment to a manager at work, but detect “when he’s talking to a peer or someone outside the company, the sentiment comes out a little different,” Mr. Bird said.  Such a pattern, combined with other factors, could cause an employee to be flagged for more investigation by an IT team. Sentiment analysis works by parsing patterns in words and phrases that signify whether the intent behind a message is likely positive, negative or neutral.

The platform also helps companies protect against hacker attacks and fraud by allowing security personnel to look for patterns in past attacks — like the time or location of attempted intrusions, and the applications that have been targeted.

As corporate fears about data leakage and hacker attacks rise, CIOs are being called on to quickly defend against intrusions of increasing sophistication. More and more companies are using Big Data to discover the pattern of security lapses as they struggle to keep up with emerging threats.

An early user of the tool, Mark Clancy, chief information security officer for Depository Trust & Clearing Corp., says he does not plan to use the tool’s sentiment analysis capability. Instead, he plans to run queries that use other kinds of analytics, utilizing large stores of transactional data, emails, and travel records, to detect more granular patterns of improper file transfers.

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