Strategic Staffing and Human Resource Challenges in IBM

Strategic Staffing and Human resource challenges in IBM
Introduction
International Business Machines or IBM is one of the world’s biggest technology and consulting
firms based out of Armonk, New York, US. Since its inception in 1911, IBM has diversified
into various streams like Global Technology services, software services, infrastructure, hosting,
Global consulting, Global financing apart from its core business of manufacturing computer
hardware. In 2012, it had revenues of $104.5 billion and net income of $16.6 billion (Yahoo
Finance, 2012). The employee count for IBM in 2012 was 434,246 and subsequently it was
ranked the second largest American company in terms of number of employees. IBM has also
been ranked very highly in terms of market capitalization, global brand, most respected
company, innovation, green company and others. IBM has a multicultural work environment
where diversity is respected and innovation is fostered. As a result, IBM has been successful in
creating a strong research based environment. Evidently, IBM has a record of having the highest
number of US patents than any other company for 20 consecutive years (Frier, 2013). Moreover,
its employees have won various prestigious awards in research & development including 5
Nobel prizes (IBM research, 2012). IBM follows a strategic staffing and diversity philosophy
where the recruitment and selection (both internal and external) is done through established
processes. As a next step in talent transformation and development, IBM has incorporated
various training and development methods. Thus, given its magnitude of operations, number of
employees and established processes IBM makes a very interesting case for human resource
research. This report attempts to understand the recruiting, staffing and training & development
philosophy of IBM linking them with successful human resource management theories and
provide some suggestions on how to improve the overall IBM human resource strategy.

down, internal recruitment for such positions is desirable. Moreover, internal recruitment for
higher positions also adds a sense of loyalty and an added aspiration in the minds of existing
employees. Thus, getting the right balance between internal & external recruitment is one of the
key challenges.
Another issue that is normally faced by a company like IBM is that of employee retention.
Voluntary employee resignation is very costly for the company as an immediate need to replace
the employee arises. Plus, there are a lot intangible costs like knowledge transfer, disruption in
the operations, settling time for the replacement etc. associated with it.
Challenges in training & development
IBM has created a wonderful step by step training program that starts with initial assimilation
when an employee joins the company, includes several individual development programs and
other skill enhancement programs. However, certain challenges exist in the current training &
development setup at IBM. First and foremost there is a need to create dynamic and new training
programs that focus both on technical and management skills. Also, there is a lack of cross
functional training programs that allow an employee to switch his stream. Finally, finding the
right training team is always a challenge and the associated costs of in house training are always
rising. Hence, IBM needs to streamline the training & development program by solving these
issues.
Link between practice and theories/concepts
There is a vast amount of literature on staffing and training & development and IBM does follow
some of the core methods and practices.
Theories of Staffing
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IBM. Hence, whatever staffing methods or training & development methods IBM incorporates
are always in line with its organizational strategy.
IBM has created such a system where human resources add value to the organization. For this,
IBM provides specific training to individuals in order to develop skills and knowledge that will
help it achieve its organizational objectives. Accordingly, IBM has created training programs for
employees at different levels and with specific purposes.
As an example of this, one of training programs that is aimed to increase understanding of
working in a multi-cultural environment is the expatriate program. Blue Opportunities program
is designed to make sure that expatriates not only learn the new culture but also the business
processes of the new host country.
Similarly, IBM uses another program called “Constraint Solver” that is designed to enable
strategic staffing, one of the essences of the organizational strategy. In order to fill positions,
this program facilitates in identifying the best fit according to the skills required by taking into
account various factors such as individual’s skillset, pay levels, geographic location and
availability (IBM research, 2013).
Another factor to be considered here is the restructuring of IBM human resources under Randy
MacDonald in 2000. The linkages to the organizational strategy were made much clearer by
creating an HR function that added value rather than keeping it as the traditional cost center. This
along with the “Diversity as Strategy” has been few initiatives that have fundamentally changed
the HR function at IBM and have aligned it with the organizational strategy.
Link between staffing & training and development
A survey shows that most managers believe that having people with right skill sets is the most
important criteria for the success in their teams. Staffing and Training & development go hand in

providing employees a structured training program and a guidance module to explore his options,
IBM could improve employee satisfaction and retention.
Another aspect of the training programs is the governing mechanism. In order to expand the
training programs and make them more dynamic, it is advisable that IBM outsource some of
them. This would allow IBM to focus on its core competencies. Developing new training
programs in house could be more costly while outsourcing them to the industry experts would be
a better idea both economically and operationally.
Thus, in order to become a change driven and an easily adaptable company, IBM needs to fine
tune some of its training programs while at the same time adding new and innovative ways of
injecting fresh talent in the company.

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Strategic Staffing and Human Resource Challenges in IBM