Customer Reviews

THE IBM LESSON: The Profitable Art of Full Employment

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The IBM Lesson
The author is a Professor at Harvard Business School, his book seeks to describe "the profitable art of full employment" where IBM trained and transferred 10% of its employees. Burdens were placed on people who had to learn new skills. People are valuable assets. Page 5 mentions the effects when companies started to buy computers instead of leasing them; no mention of tax laws.

Psychological stress results from losing a job (p.9). Those who remain are also affected, and their productivity. Full-employment companies are among the best-performing enterprises (p.15). Mills has comments on this (pp.19-20). When manufacturing ended at Boulder Colorado it was replaced with distribution and computer programming (p.33). IBM's concept of employees as those who know their job better than their manager reflects reality (p.39) [and "Dilbert" cartoons]. Chapter 3 discusses the closing of the Greencastle Indiana facility. A warehouse worker could talk to the plant manager. [A good place to work is where the managers and employees share the lunch room and facilities.] After the closing local property taxes went up (p.64). The IBM plant was given to the town in hope of attracting jobs for unskilled and semi-skilled workers (pp.75-76). The Westlake California facility was shut down, and its people moved to Boulder (p.84). A long distance move affected working spouses (p.93). Chapter 6 has empty-minded talk of "change" (p.98). People accept changes that benefit them, and avoid or fight changes that harm them. The author's definition of "career" as a series of "unrelated jobs" is phony (p.99). Mills was amazed that "managers and professional" got better jobs [then]. They bring more experience and a new viewpoint. Should a company only hire those who have worked at some other place? [You need to think this through.] A company gains by retraining and redeploying people to meet current needs (p.125).

Chapter 7 discusses the need for top-level commitment, and the part played by key committees in running IBM (p.131). Pages 135-137 tell of the contention process which empowers staff executives. Full employment is a measure of resource balancing. Subcontracting is used as needed, as is taking accrued vacation. Hiring standards are noted (p.141). Chapter 8 explains how IBM made redeployment work; they took action to ensure line management followed corporate programs (pp.157-159). Chapter 9 discusses in general the European laws on employment security. Mills argues against the laws designed to help employees: "added costs" (p.185). He says different state laws could make full employment "difficult to realize" (p.186). Yet all laws create costs, and benefits. What is the price for high morale (p.190)? Is it economic security (p.193)? What is the price for experience (p.194)? Mills claims "once America had a work force which would give commitment without expecting anything in return" (p.200). [What a fantasy!] Mills criticizes the practices of many corporations (p.201). Wall Street criticizes IBM's practices (p.202). Do these practices prevent a hostile takeover? [Remember, Wall Street produces nothing, they are parasites that profit from other people's money.] Layoffs have costs for a company (p.206). IBM gets long-term benefits from full employment (p.207).

Chapter 11 wonders about the future. One 1974 book's predictions about "no-growth" were proven wrong over the decade (p.211). Avoiding layoffs meant IBM retained its "well-trained young people" (p.213). IBM's pursuit of excellence and service to the customer are as important as ever. But Mills wonders if the full-employment policy will continue. In 1988 IBM re-organized to put operational decisions closer to its customers. Their three basic elements of management apply to every business (p.215). IBM now lacks the dominant position it once held, and this will affect its future (p.216).

[This book does not mention the layoff of 5% of employees that occurred in 1970. Elephants can't dance because their wing loading is way too high.] I wonder what his next book will say?