IBM Plans Restructuring Actions to Accelerate Global Integration of Operations

IBM Plans Restructuring Actions to Accelerate Global Integration of Operations

IBM today announced it plans to implement a series of restructuring actions designed to improve the company’s efficiencies, strengthen its client-facing operations and capture opportunities in high-growth markets.

The actions will accelerate progress toward more globally integrated operations, while addressing profitability in slower-growth regions, primarily in Europe. These actions will also allow IBM to shift resources to higher-growth markets and opportunities such as Business Performance Transformation Services.

As a result, IBM estimates that it will record a pre-tax charge of between $1.3 billion and $1.7 billion in the second quarter. The company expects to realize benefits starting in the second half of the year.

The company plans to realign its operations and organizational structure in Europe to improve the speed of execution and better meet the needs of its clients. The success of this strategy will depend on reducing bureaucracy and infrastructure in lower-growth countries and creating teams that can work across country borders, shifting more employees into direct client roles that support the company’s plans to deliver higher-value services and products. This eliminates the need for a traditional pan-European management layer to coordinate activity. As a result, IBM will create a number of smaller, more flexible local operating units in Europe to increase direct client contact.

On a worldwide basis, IBM plans to improve the efficiency of its services operations by consolidating much of the service delivery workload into fewer locations by using standard job roles, processes and tools.

Read the complete Press Release