Synopsis
Union and management Relations
In an effort to strengthen strategically and cut costs in its application services, International
Business Machines Corporation (IBM) plans to outsource its programming jobs from the
U.S. to China, India, and other countries. The motive to transfer programming jobs
offshore is to win new contracts in high-growth areas like Business Transformation
Outsourcing. IBM is striving to become the technology outsourcer of choice for global
business. Their new core value is outsourcing their non-core activities and focusing on
what they do best in the US. That is, innovating new technologies and providing better and
more cost-effective solutions for their customers. “What were about with this is giving
customers business flexibility to do what they need to do, to do it quickly, and when theyre
done, to stop paying for it,” said Craig Nygard, an IBM technology adviser to business
executives (Dalesio, 2004) . The labor union is planning to take action against the
transformation of jobs overseas and is requesting that employees refuse to train their
replacement workers.
The relevancy of the IBM and Global Communications situations is that both management
and Union failed to compromise their positions to benefit the welfare of the employees. In
both cases Union and management did not effectively work together on a problem solving
solution before announcing their outsourcing plans to the public. In a statement by IBM,
they expect to hire next year in the United States to equal or increase over 2003 levels. So,
