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IBM`s Desperate Bid to Create Younger Organization - Big Blue’s Woes with Age Discrimination

IBM`s Desperate Bid to Create Younger Organization - Big Blue’s Woes with Age Discrimination
Case Code: HROB222
Case Length: 13 Pages
Period: 2010-2018
Pub Date: 2020
Teaching Note: Available
Price: Rs.400
Organization: International Business Machines Corporation
Industry: Computer Hardware and Software
Countries: United States
Themes: Workplace Diversity, Diversity and Inclusion, Managing Diversity, Discrimination
IBM`s Desperate Bid to Create Younger Organization - Big Blue’s Woes with Age Discrimination
Abstract Case Intro 1 Case Intro 2 Excerpts

Abstract

In 2018, US-based multinational information technology company International Business Machines Corporation (IBM) faced a series of lawsuits filed by former employees. These lawsuits accused IBM of discriminating against the employees who were over 40 years old, in order to make way for new talent and tech-savvy millennials in the workforce.

IBM was credited with several firsts in ensuring employee diversity. It was the first company to employ disabled people and black salesmen, promote a woman to the post of vice president, pay equal wages to men and women, and guarantee lifetime employment. The company had cultivated an employee-friendly culture, which provided each and every employee an opportunity to thrive. By the turn of the century, the information technology landscape underwent a huge change. Several new organizations like Google, Facebook, and Amazon emerged. These companies, with their young tech savvy workforce, were highly nimble and agile. IBM could not keep up with the rapid changes and missed opportunities in areas like mobile technology and cloud services.

In 2012, Ginni Rometty, who became the CEO, wanted to steer the organization toward these new technologies. The massive workforce of over 400,000 employees spread across the world was found to be aging and not in tandem with the future focus of IBM. The top management viewed the aging workforce as technically unsophisticatedand not being innovative.

Over the next five to six years, the company populated the workforce with millennials. It went out of its way to project itself as an attractive employer to the new generation professionals and young college graduates. By 2019, 50% of its workforce were millennials and had been in the company for less than five years.

The influx of new employees meant the ouster of the existing employees. IBM adopted several ways to fire the employees while ensuring that its acts were not unlawful. The case explains the different ways that IBM used to target the old employees and how it discriminated against them. With many employees approaching the courts and senior personnel testifying to the deep rooted age-discrimination prevailing in the company, IBM’s future course of action remained uncertain. The verdict in these cases would have wider repercussions for the aging employees and age related discrimination not only in the US but across the world.

Issues

The case is structured to achieve the following teaching objectives:

  • Understand what Workplace Diversity is
  • Learn more about diversity and inclusion
  • Understand the reasons for prevalence of discrimination at workplace
  • Analyze Age-Related Discrimination at workplace

Contents

Keywords

Diversity; Inclusion; Discrimination; Age- Discrimination; Ageism; Workplace Diversity; IBM; ethical issues; Inclusion Framework; Attrition; Lawsuit; Equality; Younger Workforce; Performance Appraisal; Permanent layoff

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