back to article Ginni Rometty to pocket $4.5m bonus for IBM leadership

What do you get if you preside over 15 straight quarters of shrinking sales, evaporating profit and a sliding share price? A seven figure bonus if you are Ginni Rometty, the chief exec at IBM. Her base salary for 2015 remained unchanged at $1.6m, but the bonus swelled by $1m to $4.6m. Oh, and the long term incentives package ( …

  1. Anonymous Coward
    Anonymous Coward

    We mustn't let IBM die yet...

    It's central to monitoring the remaining population of Lotus Notes servers. As long as those babies are out there checking for updates we know that an infestation persists somewhere. Only once the last wild tendril of this scourge is eliminated can we relax and file it alongside smallpox as a terrible blight that our children need never know.

    [I just finished laughing in dismay at a Notes dialog box I'd never met before. An ugly and incomplete attempt at mimicking the Windows dialog it could have used for free, with a text field that spilled narrowly over the edge of the frame, this being "fixed" by adding scroll bars to the whole dialog (rather than just sizing it usefully in the first place, or better yet making the dialog resizeable), and a menu-launching button bolted to the text caret, a blot moving across the screen with every keystroke and dwarfing the text I was writing. Modal dialog, of course. ]

    1. Mr Dogshit
      Headmaster

      Re: Lotus Notes servers

      No such thing as "Lotus Notes servers". Lotus hasn't existed as a company, indeed a brand for eons. Notes is the name of the email client - the server is called Domino. Perhaps because it falls over?

      1. Captain DaFt

        Re: Lotus Notes servers

        " the server is called Domino. Perhaps because it falls over?"

        And here I was thinking it was named after the Mask that pantomime burglars wear.

    2. Hans 1
      Boffin

      Re: We mustn't let IBM die yet...

      >[I just finished laughing in dismay at a Notes dialog box I'd never met before. An ugly and incomplete attempt at mimicking the Windows dialog it could have used for free, with a text field that spilled narrowly over the edge of the frame, this being "fixed" by adding scroll bars to the whole dialog (rather than just sizing it usefully in the first place, or better yet making the dialog resizeable), and a menu-launching button bolted to the text caret, a blot moving across the screen with every keystroke and dwarfing the text I was writing. Modal dialog, of course. ]

      Have you ever seen localized versions of Windows ? Especially the French and German versions of Windows 7 have multiple dialogs where text is simply cut off, no scroll bars, cannot be resized .... that is probably why IBM went with their dialogs and scrollbars ... Actually, notes is multi-platform, that probably explains it ...

  2. PhilipN Silver badge

    Market leader

    I am more concerned about IBM sliding towards irrelevance than the arrivistes in Redmond flailing for direction.

    In the days when MS was given the journalist's accolade of World No. 1 software company, it wan't. IBM's software sales, once you stripped out hardware sales, were consistently greater.

    More pertinently, IBM has consistently been the largest customer of the US Patent Office - year after year after year. If IBM cuts its R&D budget, who is going to take up the slack?

    1. Anonymous Coward
      Anonymous Coward

      Re: Market leader

      I am more concerned about IBM sliding towards irrelevance than the arrivistes in Redmond flailing for direction.

      From my perspective, it can't happen soon enough.

  3. a_yank_lurker

    Not Convinced

    I've Been Moved seems to be suffering from a problem; what do they do that makes them someone to contact. Slurp, Adobe, Leisure Suit Larry, and others seem to have an idea that customers need to understand what they are about. With the three, one can actually name specific products or product types that they sell

    Also, the declining sales shows that Isty Bitsy Morons have lost the swagger from the time "Nobody got fired for buying IBM". The figures seem to indicate they have lost something in the market and are not getting it back. One of the problems any company faces, as Steve Jobs? noted, was to stay on top required self-cannibalization over time or you lose customer relevance because you are a decrepit dinosaur. Your death may take awhile but it will come.

  4. Morten Bjoernsvik

    Top management get their bonuses whatever

    I recall my years at SGI, Warren Pratt our Chief of Engineering got a $1mill bonus the year we canned MIPS to go for the terrible Itanic, the annus horribilis. I asked at a shareholder conference if they could state the reason for his bonus, but I was completely ignored. I really like all bonus incentives for top management to be clearly defined in the annual reports. Lots have stock value incentives, which means pointless buybacks to reduce assets and inflate stock prices, Selling off low margin divisions and headcount reductions are most effective.

    Taking IBM's size into consideration a $4.5mill bonus is quite modest. IBM is becomming more and more irrelevant. Bluemix/softlayer vs AWS. dont make me laugh. I spent 2 days getting a cluster app singing on AWS and EC2. With bluemix I never got the nodes configured and the database was DB2 and middleware WebsphereMQ. This was 1 year ago, they may have improved since then.

    1. Anonymous Coward
      Anonymous Coward

      Re: Top management get their bonuses whatever

      We used Softlayer until recently, but moved to Google's Cloud a few months ago. Softlayer is basically tech from 10 years ago, barely updated to keep up.

      Provisioning takes forever, about the only redeeming feature is their separate management backend, which is completely let down by shitty 15 year old client software.

      AWS, Google Cloud, Digital Ocean, hell even Azure are better than Softlayer.

    2. JimC

      Re: Top management get their bonuses whatever

      Is an interesting observation that we plebs who do the real work are considered to be likely to do as good a job as we can through pride in our work or fear of being sacked, and yet our lords and masters consider themselves so amoral and so lacking in commitment and self respect that they will only do a good job if they are bribed with megabucks.

      At my level, if I thought a prospective employee would only do good work if given huge bonuses then I would be wondering about whether to employ them at all

  5. Anonymous Coward
    Anonymous Coward

    Yawn

    TLDR: Top company exec gets bigger bonus after continuing to manipulate stock price.

    This is completely expected, it's IBM we're talking about.

    When the shit finally hits the fan, this same exec will depart (voluntarily or not), with literally no negative consequences for pulling this crap.

    1. Code For Broke

      Re: Yawn

      In fact, after selling most of the valuable assets of a company and leaving behind little but an empty shell of marketing managers and overseas call centers, it's prime time to run for US Predident.

  6. Alistair
    Windows

    IBM

    Is still upright and breathing -- sort of --

    Ginny's vestment is 2019? -- three years. I suspect she'll walk out the door with everything in pocket. Quietly and gracefully.

    How much longer after that it continues to stagger forward without slaughtering the entire GDF division and selling it to Tata I do not know.

    1. Anonymous Coward
      Anonymous Coward

      Re: IBM

      How much longer after that it continues to stagger forward without slaughtering the entire GDF division and selling it to Tata I do not know.

      And therein lies the problem. GDF was one of IBM's growth ideas after they tried and failed to own a big share of "productivity" software. Of course, just as the productivity adventure was crushed under IBM's relentless bureaucracy, so the benefits of outsourcing and offshoring turned out to be a mirage for both clients and IBM's investors. Cue panic at Armonk. Everybody runs round like headless chickens looking for the next bandwagon to pile onto. And then two (separate) words spring to mind: Security! Cloud!

      In the security space, I'm unconvinced there's any credible proposition from IBM. And in cloud they're arriving at the party five years late, and the technology has bypassed them, and the pricing reached commodity levels.

      Ultimately, IBM is like HP, General Motors or the old Motorola: A self serving, heavily siloed, lard arsed bureaucracy that is slowly withering for lack of entrepreneurship. Within all four companies they did enough R&D and product development to have saved themselves. But the cancer of bureaucracy is virtually impossible to remove once it gets hold, risk is forbidden, consensus trumps adventure, and the board play at corporate finance and M&A because that's easier than real work. And so we see a slow drift to irrelevance.

      I work in business strategy, and all the time I see a battle between the forces of light (good ideas, passion, risk taking, entrepreneurship) and those of the dark side (inertia, complacency, risk aversion, sloth, bureaucracy). This battle goes on every day in any large business, but at IBM, the dark side has won. It could yet be turned round, but it won't, because the management are entrenched and overly comfortable. They will mostly do very well out of the slow decline - why take a risk, or take on more hard work? And because of the way Wall Street works, even if the entire board were (quite reasonably) sacked without notice and without compensation, unfortunately their replacements would be exactly the same sort of C-suite leeches, with the same selfish values, the same lack of closeness to customers and markets, the same cluelessness, and the same contempt for shareholder value.

      1. The Boojum
        Thumb Up

        Re: IBM

        Your fourth paragraph is just perfect. I particularly like the "and the board play at corporate finance and M&A because that's easier than real work" line.

        1. Anonymous Coward
          Anonymous Coward

          Re: IBM

          Your fourth paragraph is just perfect

          Small and perfectly formed, as I tell the ladies! But that's because I see this time and again, inside my (non-tech) company and in others. A particular tragedy of many of these entirely avoidable cases of slow lingering deaths through corporate obesity is the hand played by the company's HR department, who fail to serve up management able to challenge, correct, (or even work round) the ineptitude of the current board.

          HR departments the world over harp on about "leadership" when they don't have a clue what they're talking about. They establish "talent" schemes that act as a gateway to the promotion escalator and training, and they filter out the non-conformists. And the result is that even though a good brand will always attract a very high calibre workforce, HR actually weed out those with energy, innovation, those who might grow the business, and preferentially promote group thinkers, people whose skills fit old business models, people who don't rock the boat. For most of the corporate dinosaurs, the best thing they could do now would be to sack their HR director, and all of "HR professionals", put the work of redundancies and disciplinary with the legal team, and just retain HR administrators to do the paperwork. Next step would be to scrap the "talent" programme", meaning they need to trust their business and line managers, and let them decide who to promote.

          And pigs might fly.....

      2. SVV

        Re: IBM

        If you work in business strategy, I suggest you do a little research before makjing sweeping generalisations about what a company offers, and has offered over the years. otherwise people who've woirked with IBM products and services might just refute your statements....

        "In the security space, I'm unconvinced there's any credible proposition from IBM."

        http://www-03.ibm.com/security/

        This will help to explain why the vast array of IBM'ssecurity products and services are used in companies such as banks. (Clue : because thsey are about the best available)

        "And in cloud they're arriving at the party five years late, and the technology has bypassed them"

        http://www-935.ibm.com/services/us/en/it-services/virtual-hosting-virtual-server-services-for-xseries-pseries-and-iseries-systems.html

        http://www-935.ibm.com/services/uk/en/it-services/managed-hosting-solutions.html

        Been around for a long, long time : much longer than anybody started using the term "cloud". Which also means that their services are rock solid and reliable because they've had years to learn how to do it properly. Seen a story on here about service outages on IBM hosting? I haven't, nor have I ever experienced or heard about them from other colleagues.

        Sure IBM isn't perfect, nor is anyone else, but in the years I've worked with their pruducts and services, they're the benchmark by which I measure others. Expensive for a reason : if you want high quality you have to pay for it.

        To even remotely suggest that a company is dying or doomed based on a profit fall between 2 particular yaers is nonsense. They still made nearly 15 billion pounds profit that year! Have any businesses you strategise for made that much?

        1. Code For Broke

          Re: IBM

          Seen a story on here about service outages on IBM hosting? I haven't, nor have I ever experienced or heard about them from other colleagues.

          I tend to think the reason I haven't heard much about IBM service outages is because, when a VM host crashes in the woods and no one is running anything of any significance on it, it doesn't make a sound.

          1. Anonymous Coward
            Anonymous Coward

            Re: IBM

            "I tend to think the reason I haven't heard much about IBM service outages is because, when a VM host crashes in the woods and no one is running anything of any significance on it, it doesn't make a sound"

            And when, you know, they basically just never crash to begin with, you don't usually hear about that either! :)

            At the place where I am currently, on the PC/server side of the house they're constantly dealing with issues surrounding server/VM crashes/hangs of various types (in fact I'm helping them troubleshoot some of those now, because they apparently lack the skills or time or willpower to do it themselves), and lately with repeated ransom-ware attacks. So it's always fun and excitement all around on that side of the house!

            Meanwhile, the "old and outdated" (but in fact recently refreshed, so almost brand-new) IBM system which I typically spend most of the my time working on basically just never misses a beat! But because that very stable system needs to exchange data with those other, relatively unstable systems, there are knock-on effects here when something goes wrong on the other side. So it's now become part of my job to help them stabilize those other systems, to the extent that this is can be done.

        2. Anonymous Coward
          Anonymous Coward

          Re: IBM

          Ok SVV, justify Websphere then.

      3. ecofeco Silver badge

        Re: IBM

        Well said ledswinger. I've seen the same at other companies as well.

  7. Anonymous Coward
    Anonymous Coward

    Any news on the mammoth layoffs expected on Friday?

  8. Anonymous Coward
    Anonymous Coward

    Why does no one ever look at the implications of the chairman and the CEO being the same person ...

    1. Ken Hagan Gold badge

      They're probably pleased that it means only one set of ridiculously inflated bonuses. A one-person board would probably do less damage (there's only so many hours in a day) and cost millions less. (Also, if you look only at the inspirational examples (as gurus so often do) then you'd probably conclude that having a single person wielding absolute power like Gates or Jobs is utterly fantastic.)

      But seriously for a moment, I think that no-one ever looks because it is no-one's job. The shareholders are either mega-corp pension funds who know nothing about the business except its stock price or individuals (in IBM's case, many employees and former employees) who are too small to count. The result is that the board's only incentive is to manipulate the share price for short term gain. Actually running the company isn't anyone's job either.

      No-one knows how to run a company. No-one knows how to run a country. Once you get larger than the proverbial whelk stall, you are beyond what humanity actually understands. Fortunately, as long as everyone else doesn't understand either, you mostly get away with it if you do nothing.

    2. The Boojum

      In the UK they do. Corporate Governance at the larger listed company level all but requires the separation of the roles and any such company trying to combine them has some serious and public explaining to so.

    3. Anonymous Coward
      Anonymous Coward

      She's currently chairman, president, and CEO. And while filling more than one role here might be OK on an interim basis, when done long-term it's almost always a very bad sign.

      At a former Fortune 500 employer of mine, the CEO there took on these other roles for himself, so he could dance all-but-unopposed to the tune of Wall Street, rather than actually worry about running the company in a fiscally responsible manner. (I expect that GR is in much the same position for the same reason.) Now they're in the middle of one of the largest bankruptcies in corporate history.

  9. Anonymous Coward
    Anonymous Coward

    It's even more fun working there

    Could be worse. You could be working there and being told it's mandatory to watch her sermon's from the mount. Reading vomit inducing sycophantic praise for the 'Dear Leader's insightful and inspiring presentation - some appear to have some setup to alert them when her video blog is updated as some of the praise is posted within minutes of it's posting before they could have watched it in it's entirety...

    The fun of recording your time in 4 different systems - one to predict your hours for the next 4 weeks, one to record individual tasks units over the course of the day, one to record your actual hours and another that duplicates the second but with a different format (both with pre-defined task types based on a pre-defined role that you can change.) All of this data supposedly being analysed but just don't ask if you can see the analysis or ask how it's being used...

    1. ecofeco Silver badge

      Re: It's even more fun working there

      It sucked when it was just 2 systems.

    2. Anonymous Coward
      Anonymous Coward

      Re: It's even more fun working there

      So North Korea is just following standard large US corporation business practice ?

      1. Solmyr ibn Wali Barad

        Re: It's even more fun working there

        Megacorps seem more like stagnation-era Soviet Union. There are at least 3 key similarities:

        - Internally they operate by the principle of planned economy. Plans are sacred. Markets may sometimes be acknowledged in words, but in practice they'll try to avoid influences from that scary unpredictable wilderness at any cost.

        - Unified propaganda service that uses a lot of doublespeak and newspeak. Gaps are occasionally filled with pure noise.

        - They have an enormous caste of administrative personnel and a rather mild cult of the leadership. Apparatchiks pay some lip service to the upper echelon, trying to parrot as much phrases from the official propaganda as they can. But in everyday life they just play by the byzantine rules of bureaucracy, mostly unwritten and obscure, rarely changed as the leaders come and go.

        1. allthecoolshortnamesweretaken

          Re: It's even more fun working there

          @Solmyr ibn Wali Barad: as far as analogies go, this is an excellent one.

          1. Solmyr ibn Wali Barad

            Re: as far as analogies go

            Yes, mature corporations tend to have some similarities, which is rather worrying.

            There's one more: by tradition, leaders of the communist party occupied several governing positions - either heading the executive branch, or legislative branch. Conflation of duties tends to be a bad omen. It didn't matter very much in the USSR, because all influential positions were tightly controlled by the party, down to the street level, so the system was screwed anyway.

        2. ecofeco Silver badge

          Re: Soviet era is right

          You have problem with Corporate Communist Capitalism, comrade?

          1. Solmyr ibn Wali Barad

            Re: Soviet era is right

            "You have problem with Corporate Communist Capitalism, comrade?"

            Title 'comrade' was actually reserved for those loyal to the party line. Dissenters were addressed as 'citizen', with a hint of disgust in the voice. Quite Orwellian, come to think of it.

            /bigbrother.jpg/

    3. Anonymous Coward
      Anonymous Coward

      Re: It's even more fun working there

      So, whose job is it to go back in a later and massage your time entries in order to make the books look better than they actually are? Because that's the issue we ran into when our company started making us record our time very closely - our entries started getting changed and moved around a lot after the fact, maybe even getting moved to projects that we didn't even know our names were attached to! After a while I guess they got tired of our questioning all this, because eventually we just couldn't even look at any of our entries which were more than a few weeks old.

      IIRC, the first sign of trouble here was when they started leaning on us to assign our time to things which could be capitalized vs. expensed. (At least I think that's right - it might have been the other way around.) Then they started going in behind us and moving things around if they weren't happy with what we'd entered, and it snowballed from there.

  10. Anonymous Coward
    Anonymous Coward

    Board Kickbacks

    I'm sure board kickbacks took a hefty chunk of that bonanza.

  11. Anonymous Coward
    Anonymous Coward

    Imagine that

    4.5 million.

    Probably the total of all the money I will probably make in my working life.

    Or, do a bad job for a few years as a CEO and get it as a bonus!

  12. Howard Hanek
    Headmaster

    Logic

    Does this mean that if she piles up twice the losses next year she'll receive $9MM?

  13. This post has been deleted by its author

  14. Anonymous Coward
    Anonymous Coward

    Work at IBM

    Does anybody even work past 11AM at IBM ? I heard from an acquaintance working in the EMEA headquarters that he finishes "work" around 10:30 AM, stays in the office for the sake of it. He often arrives in the office at 9AM.

    He does have meetings in the evening with the USians, and clearly does not want to leave, earns a lot for f*all, not even trying hard ...the dream job, according to him!

    Anon for obvious reasons ...

    1. ecofeco Silver badge

      Re: Work at IBM

      I met a few "mid levels" who took work home and worked until midnight. The bulk of the work? Email round robins with required responses.

    2. Anonymous Coward
      Anonymous Coward

      I used to put in 12 hour days

      and skipped holidays and sometimes weekends. I'm in Europe too. I stopped (and left) when I realised what spending all that time on my customers got me...

  15. Anonymous Coward
    Anonymous Coward

    Ginni's done some good work. The strategic sourcing market collapse isn't her fault. She inherited the financial plan that focused entirely on delivering specific share returns from her predecessor, who I've met.

    There's credible competition from low cost countries that wasn't there a decade ago ("Credible" being key) and high quality niche competitors when customers are prepared to pay for premium service. IBM's been stuck charging a premium price for a declining service, surviving on a historic reputation as a premium brand. Those days are gone; it's not easy to find a reference customer now.

    The new strategy is promising, but it's hard to imagine the CAMMS segments replacing the beast that is GTS any time soon. Security is the brightest hope IMHO. Cloud strategy is opaque, incoherent marketing obscures actual deliverable product.

    1. ecofeco Silver badge

      They are 10 to 20 years behind in process, procedures and systems.

      All they have is momentum.

      1. Anonymous Coward
        Anonymous Coward

        In some very important ways, IBM is actually way ahead of the game in certain aspects of their systems, even though these have been around for decades now. It's surprising how many of today's so-called "advanced, start of the art" systems have fundamental flaws which should have been addressed much earlier in the game, but which haven't really been a problem for IBM (and maybe a few others) for ages now.

        For example, the IBM system which I spend most of my time working with is now on it's maybe 9th or 10th generation of 64-bit hardware (in software it goes up to 128-bits); has security which starts down at the hardware level and always has; has never (to the best of my knowledge) suffered a malware attack, and it may be all but impossible to create one for it; and so on. Meanwhile Wintel, with all of its troubles, is for some reason considered by most to be the technological front-runner!

        1. Anonymous Coward
          Anonymous Coward

          Yes, but name an IBM development since 2000 (picking it because that's when I started there) that is actually usable (or which has become more usable during that time)?

          1. Anonymous Coward
            Anonymous Coward

            You might want to keep an eye on IBM's POWER/OpenPOWER stuff. And they say they have 7nm chips working in their labs (or at least test circuits), while Intel is currently stuck at 14nm for production and having troubles with their 10nm test projects. IBM also claims that they can offer cloud services at maybe 1/3 of the cost of most of their competitors - which, if true, puts them at an advantage in any price wars. (Although, historically, "race to the bottom" situations haven't been so great for anyone's bottom line, unless maybe they end up being the last one standing.)

            Now, even if all of the above is true, they still have to move their products and services - meaning sell, sell, sell! And this will be hard for them to do if (a) they can't get out of their own way, or (b) there's nobody left in-house to actually do that type of thing.

            http://openpowerfoundation.org/

  16. allthecoolshortnamesweretaken

    Well, if it's in her contract... And who knows - maybe her work prevented much, much higher losses. We can only speculate.

    Anyway, peanuts compared to what you can make by driving fast cars in circles or kicking a ball.

  17. Anonymous Coward
    Anonymous Coward

    Strong signal of layoffs

    Greedy execs always get into the trough first. No 'new era' under Ginni

  18. tedward

    Here's a thought ... With less than 500,000 IBM Employees WW, Just wondering what impact could be made on those worker bees, who are making everything happen behind the scenes, if every employee received a 100k bonus as a gift from Ms Rometty's own bonus in 2015. Although somewhat behind, IBMs direction is in place and a good one, but with layoffs yearly and morale at an all time low, it just causes one to ponder what would happen if the employees (not the execs - but everyone not in management) received a hefty bonus as well.

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