For decades, employees of the venerable International Business Machines Corp. who willingly transferred cross-country in return for job security joked that the initials of their company stood for "I've Been Moved."
Earlier this month, a sizable chunk of the company's employees were stunned to find the expression taking on a grim twist. Though they're physically staying put, 4,400 employees at IBM's typewriter, keyboard and printer operations in Lexington, Ky., are likely to be moved right out of IBM.
Such a move would hardly be news in this time of widespread corporate cutbacks if it weren't happening at IBM, a company that for generations has been an icon for all that is fair and honorable about corporate paternalism.
IBM has fostered an almost family-like bond in its huge work force, roughly 15,000 of them in the Washington area. The loyalty cuts two ways: IBM workers tend to be quietly conscientious, while the company nurtures their professional development and implicitly promises job security.
Such tight bonds are rare these days, when more value generally is put on "loyalty for the minute" than on a commitment "to live and die with this place," said David Shanks, a business strategy expert at the Cambridge, Mass.-based management consulting firm Arthur D. Little Inc., which has done work for IBM. While firms say they want to build loyalty, many try do so with offers of challenging work or flexible hours rather than employment security.
IBM's plan to spin off a unit into the hands of a Wall Street investment firm underscores just how fuzzy those remaining promises of full employment can be. And how IBM's decision plays with workers -- whether seen as the company doing its best to keep its commitments or as a company abruptly breaching a promise -- will likely be key to the firm's future ability to attract and keep bright employees.
Though never intended to be a lifetime job guarantee, IBM has a full-employment practice described by spokeswoman Rita Black as meaning that "if employees perform satisfactorily ... they will have a job somewhere in IBM."
The divestiture, which still is being negotiated, is in keeping with that objective, she said, even though it would result in thousands of employees working for an as-yet-unnamed company that would be majority-owned by Clayton & Dubilier Inc. of New York. "From our perspective, these people will have continuity of employment," Black said. The new concern will be headed by someone from IBM and reportedly will remain committed to providing economic security to employees.
But what may seem like a fine line to officials at IBM's corporate headquarters is a jarring gap to some employees in Lexington, for whom the prestige of the IBM badge is irreplaceable.
"To me there's a difference between just a job and a job at IBM," said one engineer who has worked at IBM for more than 15 years. "It's like they just ripped away part of me. I don't know that I'm ever going to be able to say I'm an employee of Clayton & Dubilier with the same pride as I've said I'm an employee of IBM."
Said another engineer: "Everyone feels like they've been terminated by IBM, regardless of what they call it. ... They fostered the loyalty. ... I was loyal. What happened?"
The jolt is especially troubling to employees like these because they have been pulled so fully into the IBM fold by a company that has led the way when it comes to training, fair employment practices and generous benefits. But in light of the recent cutbacks, employee loyalty could wane.
When employees are asked to transfer, for example, they "may wonder whether these different assignments are dumping grounds," said Jeffrey Sonnenfeld, director of the Center for Leadership and Career Studies at Emory University.
For IBM, the reaction of its employees is particularly critical because their loyalty is so essential to its business success. "They're put in a very embarrassing position when they have to downsize because they've invested all this effort in implicitly guaranteeing" jobs, said Paul Hirsch, a Northwestern University professor of strategy and organization. "They need to retain the trust of the large majority of the employees they don't want to lose."
IBM officials say they have successfully weathered divestitures before. In 1988, for example, 2,000 employees were affected when Eastman Kodak Co. bought most of IBM's U.S. copier business. The next year 2,800 IBMers became employees of West Germany's Siemens AG when IBM sold its Rolm telecommunications unit.
But in both cases IBM offered cushions. In the copier case, employees who chose not to go with Kodak were guaranteed positions somewhere within IBM. And in the Rolm instance, employees were told that if their jobs were later deemed "surplus" and they could not be accommodated within Rolm, they would be offered positions at IBM.
Although details of the Lexington deal have yet to be negotiated, no such accommodations have been announced.
Perhaps the closest parallel to the new case was the smaller sale in 1988 of Science Research Associates to Britain's Maxwell Communications PLC. About 500 IBM employees moved to the new unit, which already has undergone a shift in ownership, a spokesman said.
In addition to such spinoffs, IBM has been streamlining its work force through a variety of voluntary incentive programs that reward employees who leave. Four such programs in as many years have helped trim the company's U.S. payroll, which is expected to be 206,000 by year-end, down 37,000 since 1985.
In all these cuts, IBM has been generous in its attention to the needs of outgoing employees, a gesture that hasn't gone unnoticed. Said Kenneth Franklin, a 17-year employee on IBM's Lexington manufacturing line: "They've always treated me fair," he said. "They always respected each person."