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General Motors To Slash Outsourcing In IT Overhaul

samzenpus posted about 2 years ago | from the bringing-it-home dept.

Businesses 232

gManZboy writes "GM's new CIO Randy Mott plans to bring nearly all IT work in-house as one piece of a sweeping IT overhaul. It's a high-risk strategy that's similar to what Mott drove at Hewlett-Packard. Today, about 90% of GM's IT services, from running data centers to writing applications, are provided by outsourcing companies such as HP/EDS, IBM, Capgemini, and Wipro, and only 10% are done by GM employees. Mott plans to flip those percentages in about three years--to 90% GM staff, 10% outsourcers. This will require a hiring binge. Mott's larger IT transformation plan doesn't emphasize budget cuts but centers on delivering more value from IT, much faster--at a time when the world's No. 2 automaker (Toyota is now No. 1) is still climbing out of bankruptcy protection and a $50 billion government bailout."

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232 comments

In-house staff do have advantages (5, Insightful)

Calibax (151875) | about 2 years ago | (#40596831)

In-house staff provide a number of advantages:
        Quicker response from people who actually work for the same orgainzation
        Dedicated staff rather than whoever is free at the moment
        Familiarity with how your business operates
        Longer term institutional memory

Which taken together provide long term cost savings, mostly because you are investing in your own resources.

At least you are less likely to be training someone who will be working for your competitor on his next project.

Re:In-house staff do have advantages (5, Insightful)

ackthpt (218170) | about 2 years ago | (#40596985)

In-house staff provide a number of advantages:

        Quicker response from people who actually work for the same orgainzation

        Dedicated staff rather than whoever is free at the moment

        Familiarity with how your business operates

        Longer term institutional memory

Which taken together provide long term cost savings, mostly because you are investing in your own resources.

At least you are less likely to be training someone who will be working for your competitor on his next project.

Smart, smart move by GM, who I do not often credit with making many. As a victim of outsourcing a couple times, I've seen how outsourcers operate - bring in the Crash team, of sharp, smart people, who gradually are rotated out to the next Crash site, while rotating in people with little to no experience who spend their days peering over the shoulders of others trying to figure out what they are supposed to be doing (and once they have it figured out to some degree, they leave their employer for a wage they can actually live on.)

Re:In-house staff do have advantages (3, Interesting)

the eric conspiracy (20178) | about 2 years ago | (#40597043)

Truth. This happened to one of my employers. We ended up buying out of the contract.

Cost a major buttload plus screwed the company up for years.

Then they went on a re-engineering binge.

Put the final nail in the whole thing.

What a bunch of clowns running the thing. They got their ideas about IT from playing golf with other CEOs.

Re:In-house staff do have advantages (0)

Anonymous Coward | about 2 years ago | (#40597155)

> Smart, smart move by GM, who I do not often credit with making many.

Don't forget the history here. GM used to own EDS, and it pretty much functioned as their internal IT org.

Re:In-house staff do have advantages (4, Informative)

ackthpt (218170) | about 2 years ago | (#40597285)

> Smart, smart move by GM, who I do not often credit with making many.

Don't forget the history here. GM used to own EDS, and it pretty much functioned as their internal IT org.

And I had many friends look them over, even going so far as to interview, just to test the waters. They'd pay high, but you had to shave all facial hair off and dress exactly as their code dictated. After a probationary period they cut those they didn't see fitting in - which meant you ended up with a bunch of conformists who wouldn't take a risk, by pointing out something may not have been a good idea or there was a weakness in a plan somewhere. Good ol' Ross Perot - run a company like the army.

Re:In-house staff do have advantages (0)

Anonymous Coward | about 2 years ago | (#40597369)

"which meant you ended up with a bunch of conformists who wouldn't take a risk, "

You have no idea how accurate this statement is. I worked for GM in the early 90's and managers got promoted for mantaining the status quo. Anyone who innovated or made waves ws marginalized. Can't believe it's still the same old story 20 years later!

Ross Perot said the same thing.

Re:In-house staff do have advantages (1)

ackthpt (218170) | about 2 years ago | (#40597533)

"which meant you ended up with a bunch of conformists who wouldn't take a risk, "

You have no idea how accurate this statement is. I worked for GM in the early 90's and managers got promoted for mantaining the status quo. Anyone who innovated or made waves ws marginalized. Can't believe it's still the same old story 20 years later!

Ross Perot said the same thing.

I also know they thrived on paper. Great stacks of it. I've had to work with EDS people on a couple of things and could not believe the amount of stupid, useless documentation involved in the least little project. I swear they must have regiments who do nothing but compose documents. ISO 9001 never meant that level of crap.

Re:In-house staff do have advantages (0)

Anonymous Coward | about 2 years ago | (#40598037)

They will point to the fact that they don't make "mistakes". You just told them wrong or rushed them. Internal IT always gets shafted because they "know what to do" and you get an angry line foreman yelling at kids just out of school and they will get whatever they want... The documentation goes out the window in a few months.

Re:In-house staff do have advantages (0)

Anonymous Coward | about 2 years ago | (#40597547)

I worked for GM in the early 90's and managers got promoted for mantaining the status quo. Anyone who innovated or made waves ws marginalized. Can't believe it's still the same old story 20 years later!

Why not--who was going to change things?

Re:In-house staff do have advantages (1)

sjames (1099) | about 2 years ago | (#40597677)

The last time I worked with people from EDS, they were totally flummoxed by a DNS change. There were 2 servers with identical content. All that needed to happen was change the A record and be happy, but they were SURE the new server couldn't be brought up for production AT ALL until the DNS change was fully propagated Naturally this meant unnecessary downtime.

Re:In-house staff do have advantages (1)

SomePgmr (2021234) | about 2 years ago | (#40597003)

Which taken together provide long term cost savings, mostly because you are investing in your own resources.

Not that I disagree at all (or want to), but a citation or two on this would be good to have around if anyone has 'em.

Re:In-house staff do have advantages (2)

swillden (191260) | about 2 years ago | (#40597057)

Which taken together provide long term cost savings, mostly because you are investing in your own resources.

Not that I disagree at all (or want to), but a citation or two on this would be good to have around if anyone has 'em.

I'm sure HP/EDS, IBM, Capgemini, and Wipro can provide plenty of citations showing the opposite.

Re:In-house staff do have advantages (5, Interesting)

Anonymous Coward | about 2 years ago | (#40597581)

Posting A/C because I'm still working at HP...

Mott was the king of cost cuts. When I started at HP in 2001, HP IT was awesome -- call a number, get an American tech who had a clue. They would even come to your desk, if necessary. Mott "transformed" IT by:

-Laying off lots of IT workers
-Forcing most of the remaining IT workers to move to a single location in Texas, or be fired. No telecommuting allowed
-Making it impossible to purchase any software not on a short "approved" list. Even if it was $20
-Requiring almost all IT issues to be entered into a web-based ticket system -- an overloaded system that was often slow or down
-Limiting telephone support to nearly nothing. Login screens directed employees to "use a co-workers PC to enter a ticket"
-Requiring users to categorize their own tickets. However, the categories were impossible to decipher and I estimate well over 50% of tickets were mis-categorized. Further, mis-categorized tickets were summarily closed as "Resolved" with no hint on what the correct category might be. Further, even if you categorized your ticket correctly, but the level 1 tech didn't find your issue in his checklist, your ticket was closed as "Resolved" -- even though they had NOT resolved your issue.
-Eliminated desk-side support, forcing 6-figure engineers and managers to do time-consuming IT tasks such as re-imaging rather than paying less expensive IT staff to do the same thing. Further, for hardware failures they shipped you a new PC via UPS/FedEx so you had no working PC for several business days.

I'm sure all these things saved a ton of money -- for IT. However, it cost the various other HP business units giant wads of money in lost productivity. Since the productivity didn't show up on IT's cost sheet, it didn't matter to Mott.

Re:In-house staff do have advantages (2)

Admiral Llama (2826) | about 2 years ago | (#40598021)

This is a metrics problem. Management typically has to perform versus metrics and if the metrics are shit, the product will be shit as well. "cut IT costs" is a terrible metric by itself given that IT is pervasive to the functionality of a modern corporation.

Re:In-house staff do have advantages (2, Interesting)

Anonymous Coward | about 2 years ago | (#40597139)

This is far to general a point to prove using studies. Basically, no study can get around the fact that the choice of whether or not to outsource is highly influenced by existing conditions in the company, which in turn are correlated with the outcomes the study is trying to measure.

So basically we have MBA types (who are biased towards the fashion of the day), vs IT types (who are biased towards whatever they perceive as maximizing the demand for IT employees). IT professionals, like all people, develop a bias towards their own profession, and will therefore oppose measures that they perceive as reducing the demand for IT professionals, such as outsourcing, which consolidates IT tasks into a single company, allowing them be done with less people. Highly skilled IT professionals will also oppose moves that shift demand from highly skilled IT professionals to low-skilled IT professionals.

Many arguments, some good, some bad, will be made, but the debate will always be muddied by people's inability to separate their own interests (maximizing the demand for whatever kind of skills they happen to have) with the interest of the company (maximizing profit). The quality of debate is also lowered when people are allowed to get away with using weasel words like "short term profits" and "long terms savings" -- at least nominally, companies are expected to maximize total futures earnings (discounted at the interest rate), and unless you can prove that they don't, it is simply a cop-out to label every decision you don't like as "maximizing short term profits".

Re:In-house staff do have advantages (0)

Anonymous Coward | about 2 years ago | (#40597289)

So basically we have MBA types (who are biased towards the fashion of the day), vs IT types (who are biased towards whatever they perceive as maximizing the demand for IT employees).

Do you have any evidence for this? I know it's true of the "MBA types", because they're trained to think that way. But I've seen no evidence that IT employees act that way. They generally seem to prefer automation and low-interference systems which only need skilled employees when something's broken.

Re:In-house staff do have advantages (1)

Anonymous Coward | about 2 years ago | (#40597459)

Do you have any evidence for this? I know it's true of the "MBA types", because they're trained to think that way. But I've seen no evidence that IT employees act that way. They generally seem to prefer automation and low-interference systems which only need skilled employees when something's broken.

Yes but these systems may have a high initial cost to set up, and require the skilled employee to be hanging around (and getting paid) in case the problem arises. I cannot count the number of comments on /. which are based on the assumption that a "quality" system designed by good (i.e. expensive) engineers is always better than a poor system designed by cheap engineers, without considering the costs involved. The fact is people are just like any other commodity from the POV of a business. You don't always want to hire the best quality people, any more than a nail factory wants to buy the best quality steel.

Re:In-house staff do have advantages (0)

Anonymous Coward | about 2 years ago | (#40597531)

My experience is IT guys will push for whatever hot new buzz tech they want on their resume. Then after they work on it for six months they switch to a new job using the skills they developed working for you and now you're stuck with some useless buzz shit. You seem kind of naive like maybe your only experience is running the IT infrastructure in your mom's basement.

Re:In-house staff do have advantages (1)

JaredOfEuropa (526365) | about 2 years ago | (#40597019)

Not just that. Most large companies want at least some in-house IT people: architects, integrators, project managers and business analysts who understand the business and the company. Two common problems I pick up at large corporate clients:
- The best and brightest of the contractors are quickly promoted to bigger and better things... at a different company. There's your loss of insitutional memory.
- It turns out to be almost impossible to hire and/or nurture employees for these positions, and even harder to keep them there, for the simple reason that having outsourced most IT work makes in incredibly difficult to offer IT staff a meaningful in-house career in IT.

Most companies I've worked with do not openly drive for a reversal of the outsourcing trend (it's still pretty much anathema in management circles). But they all express the desire (and subsequent failure) to fill more positions currently held by contractors with actual employees.

Re:In-house staff do have advantages (0)

Anonymous Coward | about 2 years ago | (#40597109)

it is a bit like renting a house, what you pay in rent you will never get back, improvements you make are not yours but you can move at a short notice if you want to

if you buy a house instead its all yours (eventually), improvements you make are yours, -but- you cannot move so easily

Re:In-house staff do have advantages (4, Interesting)

dkleinsc (563838) | about 2 years ago | (#40597077)

Another big advantage: No middle-men.

The way that IBM makes money managing GM's IT infrastructure is to pay their people less than GM paid IBM, say 25% less. So if you're GM, you can go to the guys who are currently doing your work and getting a paycheck from IBM, and say "Hey, how would you like a 15% raise to work for us doing the same job you've been doing all along?", get a lot of people to say "Great deal!", and you've just gotten a 10% cost savings.

Re:In-house staff do have advantages (4, Insightful)

Raistlin77 (754120) | about 2 years ago | (#40597199)

10% cost saving which you will likely need to help your new potential employees fight their non-compete contracts with the employer that you just poached them from. And possibly to fight your own lawsuit for poaching them in the first place. Outsourcing firms are typically fully aware of the possibility of losing their mostly underpaid workforce to their clients. Most have non-competes in place for this very reason.

Re:In-house staff do have advantages (0)

Anonymous Coward | about 2 years ago | (#40597223)

Except there is a non compete clause in the IBM contract with 100% of the guys who get paid less by IBM. Some of those IBM workers are on temp assignment from temporary agencies who have a even worse non compete clause. Some of the IBM workers are on H1b or a B1/B2. So you gotta get them a H1b transfer petition which costs $10,000 with lawyers fees and fees of $5,000. If they are on a B1/B2 with IBM you can't have them until next year when GM files a H1b petition for those workers. If $10,000 is 10% of the average salary paid by IBM it's a huge cost for GM to hire the same guy.

So essentially it's all going to be zilch. It's a new team at GM. Of course the real smart cookies in the IBM team will get pulled into GM none the less with GM forcing IBM to sign a waiver on some of the guys who are extra smart and excellent workers. Welcome to the world of outsourcing. Next time you want to go after a guy working for one of these companies you gotta feel pity for them first. Then get angry at all the outsourcing firms. They are neo-slave labor. GM might have to pay more initially but it should help in the long run.

Outsourcing is good for a company in the first five years. After this the outsourcing firm has the expertise. You need to get knowledge transfer back from the outsourcing company before you can take over. The outsourcing agreements have these provisions.

Re:In-house staff do have advantages (1)

Jesus_C_of_Nazareth (2629713) | about 2 years ago | (#40597383)

Sure, 10% savings. It's not as if there may be additional overheads, such as training and the liability from having the IT staff directly on GMs payroll. What's the secret here? Build a pig farm for every 5 IT staff, and have at least four IT guys working the goldmine?

Re:In-house staff do have advantages (1)

sjames (1099) | about 2 years ago | (#40597827)

You were already paying for those overheads when the contractor was standing in-between.

Re:In-house staff do have advantages (1)

Anonymous Coward | about 2 years ago | (#40597521)

Working for a contractor myself, the overhead is more like 75% less.

I make a healthy salary (around $10,000 per month). My billable rate is closer to $10,000 per week.

Yes, I bill 4 times my salary. It's a bit of a unique situation because of resources and support provided, but regardless, internally ,we recognize a 45% profit margin for the sales folks selling my service.

You could almost double my salary and still save money :-D

Ironically, nobody wants to do it. The salaried positions with my title pay 20% less than I make.

Shrug.

 

Re:In-house staff do have advantages (0)

Anonymous Coward | about 2 years ago | (#40597093)

plus...

Loyalty (both company and country/state)
Security (chances slightly lower of corporate secrets being sold/given away)

it's the patriotic thing to do.

Re:In-house staff do have advantages (0)

StripedCow (776465) | about 2 years ago | (#40597187)

And... no issues with patents. Since, afaik, stuff you don't sell isn't covered by patent laws.

Re:In-house staff do have advantages (1)

sapgau (413511) | about 2 years ago | (#40597211)

Also... you get to talk and work with your actual users.
You get immediate feedback, even directly between developer and user.
This interaction creates new business rules that stay in house that could put you ahead of your competitors.

If you are in control of your IT you are not at the whim of your contractors, no rush to upgrade to the latest version, you get to understand what gets more priority in your IT assets.

Lots of benefits if your business depends on having IT running your business and giving you "business intelligence" (trends).

Of course you can achieve the same thing through contractors but need them on a tight leash and you will be distracted in managing costs (timesheets anyone?).

Re:In-house staff do have advantages (1)

Joe_Dragon (2206452) | about 2 years ago | (#40597287)

Less overhead and less sub contractors.

Also easier to have people work overtime as some contractors don't want to pay overtime.

It's how you want to go when you are large (4, Insightful)

Sycraft-fu (314770) | about 2 years ago | (#40597715)

You only outsource general functions like IT, payroll, maintenance and so on when you are small enough that it makes economic sense to do so. When the amount and kind of service you need is such that it would cost more to employ people in house than to outsource it, you do. However when you get large, it is silly to outsource. You can get it cheaper in house since you are large enough to need the equivalent of many full time people working for you, and if they are outsourced it is just another layer of cost.

A small business of 5 people? Ya you probably want to outsource IT needs (and other stuff). It would be infeasible to hire an IT person and have 17% of your staff be IT. A company of twenty thousand people? Don't outsource it, you will need a hundred plus IT people anyhow, might as well have them work directly for you.

Re:In-house staff do have advantages (2)

bouldin (828821) | about 2 years ago | (#40598013)

Here's another advantage: your internal IT organization doesnt skim a 20 - 30% profit off the top.

Seriously, proponents of strategies like outsourcing and privatization always talk about how these companies increase efficiency. But, since they always have a profit motive, these companies must operate (say) 30% more efficiently just to break even.

Good luck with that. (2, Insightful)

daninaustin (985354) | about 2 years ago | (#40596841)

They should be done with hiring right around the time they file for bankruptcy again.

Why is this labelled "Troll" (1)

Anonymous Coward | about 2 years ago | (#40597195)

Forbes has an article claiming same thing [forbes.com]

Re:Why is this labelled "Troll" (1, Interesting)

artor3 (1344997) | about 2 years ago | (#40597301)

That article is nearly three years old, and bases it's conclusion on GM missing the "green wave". They've since introduced the Volt, among other fuel-efficient models. If the author's base assumption had been borne out, if GM had stuck their heads in the ground and continued to churn out Hummers, then he probably would have been right. But as it stands, I doubt even the author still stands by that article.

yeah, how are the sales on those Volt's? (0)

daninaustin (985354) | about 2 years ago | (#40597517)

Does anyone really believe that the tens of billions of dollars that the govt gave to GM actually fixed the problem? Their cost's are still too high relative to the competition. They have spent way too much money on a pink elephant (the Volt), and there are a lot of people that will never purchase another GM product while the Govt has any stake in the company. I was only half kidding about the 3 years. Europe is heading into another recession (or worse). China is slowing down and the US economy stinks (and may get a lot worse if things in the rest of the world go to shit.) An IT re-org is nothing more than re-arranging the deck chairs.

Re:yeah, how are the sales on those Volt's? (2, Informative)

Anonymous Coward | about 2 years ago | (#40597999)

Does anyone really believe that the tens of billions of dollars that the govt gave to GM actually fixed the problem? Their cost's are still too high relative to the competition. and there are a lot of people that will never purchase another GM product while the Govt has any stake in the company. I was only half kidding about the 3 years. Europe is heading into another recession (or worse). China is slowing down and the US economy stinks (and may get a lot worse if things in the rest of the world go to shit.) An IT re-org is nothing more than re-arranging the deck chairs.

I gave up buying GM products a long time ago despite my family being diehard Cadillac and Oldsmobile owners when I was growing up. Frankly, it was all about quality, long before gubmint had a stake in the company. They have probably fixed the quality problem by now, but I'll never find out. There have been one or two cars they've made in the last twenty years that I was a bit interested in, but never enough to give up my American made Toyotas and Hondas.

And despite me not buying their cars, GM still manages to be the number one automobile producer in the world. I have no doubt that when push comes to shove, GM will figure out how to sell Volts.

because there a lot of IT people who... (1)

daninaustin (985354) | about 2 years ago | (#40597561)

Because there are a lot of IT people that have been outsourced and they will believe anything if it hints that the whole process was a mistake. In this case, the IT department may or may not have been part of the problem, but it certainly wasn't the main reason that GM is a failed company. Hiring lots of IT people won't fix the problems but it may make it worse since the company will have considerably less flexibility in staffing.

Re:because there a lot of IT people who... (1)

sapgau (413511) | about 2 years ago | (#40597629)

You are absolutely correct, as long as you see IT as any other department. If the Janitorial dept., IT dept and Facilites dept are all the same, then you will be insane if you wouldn't outsource IT !!!
It's just computers and stuff, even a monkey can do it...

Not at all (1)

daninaustin (985354) | about 2 years ago | (#40597709)

Having a great IT department doesn't mean a thing if you have disfunctional managment, inflexible and expensive unions and uninspiring designs. It can make a great company better, but it won't make a bad company good.

Just about time (5, Insightful)

mwvdlee (775178) | about 2 years ago | (#40596863)

It's been about 5 years or so since all IT was outsourced.
We're right on time for managers to start the in-house cycle again.
Good luck in the next 5 years and see you all again on the jobmarket in 2017!

Re:Just about time (1)

Capt James McCarthy (860294) | about 2 years ago | (#40596997)

It's been about 5 years or so since all IT was outsourced.
We're right on time for managers to start the in-house cycle again.
Good luck in the next 5 years and see you all again on the jobmarket in 2017!

This would be part of the 50Billion dollar bailout to increase the number of H1B workers since there are no longer enough trained IT workers in the U.S. Then the Govt (insert your political party here) can claim that they created "X" amount of jobs, even if they go to H1B workers.

Re:Just about time (4, Interesting)

gmanterry (1141623) | about 2 years ago | (#40597061)

I worked for a large electric utility in IT. We had to submit competitive bids against private companies to provide IT service. We usually were under bid and the IT contract was awarded to an outside company. Usually the service the utility received from the IT people they hired was good at first but soon the response started to slow. Now, when you have customers coming in the front door trying to pay bills and the customer service rep's computer is down, that is the worst of the worst scenarios. I makes an unhappy customer and no way to easily collect payment from the customer. Five or more customer service reps without the tools to do their job is not good. A few times like this while having to wait for the contract IT guys to show up, usually underscores to management the value of having in house people who are able to respond immediately. So like someone said, it went in cycles. In house - contract - in house - etc. They figure when times get tough that they'll take the savings, until the service just gets too bad and the the multivibrator of management flips again.

Re:Just about time (1)

Anonymous Coward | about 2 years ago | (#40597115)

You forgot that all those IT workers who are working for GM in 2017 will get canned. Some will be picked up by the new outsourcing company while others will be shown the door and if they have a little "too much experience", "over-qualified" or some other arbitrary and capricious benchmark applied to them, they will be permanently unemployed. You see, once you're pigeon holed as an "IT guy", retraining to do something else and getting a job is a very difficult if not impossible because people think there's something wrong with anyone who wants or has to get out of such a lucrative career as IT.

The biggest slap in the face I got was I was accused of being an alcoholic because I was having such a hard time finding a job. That person wasn't an employer - not that I'd file an ADA complaint - I wouldn't want to be known as one of "those" people.

I responded with, "I am considered a 'wannabe', incapable, lack the proper skills (C++/SQL/Java are no longer used, apparently), and I'm overqualified - even after over a decade of a pretty successful career. Also I am told, I want too much money, but there's something horribly wrong with me because I willing to work for what the market will pay me - meaning much less than what I was making."

Isn't that right all of you hiring managers here on Slashdot?

Re:Just about time (2, Funny)

espiesp (1251084) | about 2 years ago | (#40597839)

I think the reason you can't get a job is mainly because you're a whiny little bitch who blames everybody but themselves.

Re:Just about time (1)

OhPlz (168413) | about 2 years ago | (#40597245)

Seems to me this would improve the jobs numbers slightly and play to team Obama's "Romney was an outsourcer" campaign rhetoric. So, I'd shorten the back-to-looking-for-work interval to post November of this year, depending on the election outcome. It's similar to how right after the WI recall failed that the President was speaking about hiring more firemen and teachers, both are union strongholds and could push against the right-to-work movement. The timing is incredibly convenient.

Re:Just about time (1)

KhabaLox (1906148) | about 2 years ago | (#40597261)

I didn't read TFA. Does it say they are going to hire in the US? The multi-national I work for has some local IT staff in the US offices (mostly related to the hardware infrastructure we require for operations), but traditional help-desk support is out of India.

more like 7th largest automaker! (2)

nicovl (222095) | about 2 years ago | (#40596915)

Not sure how you are measuring size but:

"Volkswagen has retained its place as the number one car company in the world, according to the Forbes Global 2000 companies survey."

"US poster boy General Motors came in seventh position among the car makers"

Forbes’ top car makers for 2012
Volkswagen – 17
Toyota – 25
Daimler – 37
Ford – 44
Honda – 59
BMW – 61
General Motors – 63

Um, no. (1)

MrEricSir (398214) | about 2 years ago | (#40596967)

Forbes is free to rank companies any way they like. But when people say "Toyota is the #1 car manufacturer" the're simply talking about production totals.

Re:more like 7th largest automaker! (4, Informative)

Aphonia (1315785) | about 2 years ago | (#40596983)

Uh...: http://en.wikipedia.org/wiki/Automotive_industry#Top_vehicle_manufacturing_groups_.3Cby_volume.3E [wikipedia.org] (which does put Toyota #1 and GM #2)

If you had bothered to read the article you copy-pasted that from, "Volkswagen has retained its place as the number one car company in the world, according to the Forbes Global 2000 companies survey.
The report ranks the world’s biggest companies across an equal weighting of sales, profits, assets and market value. The result is a company ranking in order of size, with 66 countries represented in the mix." (http://news.drive.com.au/drive/motor-news/rankings-worlds-biggest-car-companies-20120420-1xc14.html)

Think of the brands VW owns versus the brands that GM owns.

Re:more like 7th largest automaker! (1)

Grave (8234) | about 2 years ago | (#40596989)

That is a pretty arbitrary way of measuring company size. GM and Toyota are neck and neck for the #1 spot in terms of most cars sold. Yeah, from a purely financial standpoint GM is not doing as well as the others on that list, but they are climbing out of bankruptcy and turning solid profits. So I'm really not sure why anyone should care about this Forbes list.

Re:more like 7th largest automaker! (1)

bhcompy (1877290) | about 2 years ago | (#40596995)

Largest relative to automaker is always volume. The measurement you are speaking of is "an equal weighting of sales, profits, assets and market value" and that list is all companies, not automotive, so obviously volume means nothing since Kellogg's doesn't sell automobiles.

Re:more like 7th largest automaker! (1)

ackthpt (218170) | about 2 years ago | (#40597029)

My biggest gripe with GM was how my car, once 25 miles over the Power Train Warranty was abandoned by the automaker when a headbolt broke. Why did it break? You couldn't reve the engine past 5,000 rpm! They're attitude was 'Normal Wear and Tear' that was at 30,025 miles. I'm still irked about it. I hope they are a lot smarter automaker by now, you are only as good as how well you stand behind your product - and if it's got problems you fix them, you do not run away from them!

Re:more like 7th largest automaker! (2)

bhcompy (1877290) | about 2 years ago | (#40597299)

Tommy: Let's think about this for a sec, Ted. Why would somebody put a guarantee on a box? Hmmm, very interesting.
Ted Nelson, Customer: Go on, I'm listening.
Tommy: Here's the way I see it, Ted. Guy puts a fancy guarantee on a box 'cause he wants you to feel all warm and toasty inside.
Ted Nelson, Customer: Yeah, makes a man feel good.
Tommy: 'Course it does. Why shouldn't it? Ya figure you put that little box under your pillow at night, the Guarantee Fairy might come by and leave a quarter, am I right, Ted?
[chuckles until he sees that Ted is not laughing]
Ted Nelson, Customer: [impatiently] What's your point?
Tommy: The point is, how do you know the fairy isn't a crazy glue sniffer? "Building model airplanes" says the little fairy; well, we're not buying it. He sneaks into your house once, that's all it takes. The next thing you know, there's money missing off the dresser, and your daughter's knocked up. I seen it a hundred times.
Ted Nelson, Customer: But why do they put a guarantee on the box?
Tommy: Because they know all they sold ya was a guaranteed piece of shit. That's all it is, isn't it? Hey, if you want me to take a dump in a box and mark it guaranteed, I will. I got spare time. But for now, for your customer's sake, for your daughter's sake, ya might wanna think about buying a quality product from me.
Ted Nelson, Customer: [pause] Okay, I'll buy from you.

Re:more like 7th largest automaker! (1)

Anonymous Coward | about 2 years ago | (#40597091)

According to L.A times they're number 1 now. Recent news too.
http://articles.latimes.com/2012/jan/20/business/la-fi-autos-gm-sales-20120120

Slash Outsourcing (5, Funny)

Spad (470073) | about 2 years ago | (#40596959)

I presume that Slash Outsourcing is Slashdot's latest unwanted "channel" to go with that Business Intelligence nonsense?

Control (1)

cyberspittle (519754) | about 2 years ago | (#40596999)

It is all about having control over your intellectual property.

Re:Control (1)

Anonymous Coward | about 2 years ago | (#40597099)

It is all about having control over your intellectual property.

Please elaborate on that point, because at the moment it seems like you don't quite understand who owns IP for works made under contract.
(Hint: it's the person who pays for them)

FUCK OBAMA MOTORS (-1)

Anonymous Coward | about 2 years ago | (#40597001)

let the free market ring! outsourcing just moves jobs americans dont want overseas! john galt 4 lyfe!

Re:FUCK OBAMA MOTORS (1)

WindBourne (631190) | about 2 years ago | (#40597307)

Americans do not want these jobs? You trolls are just amazing.

Re:FUCK OBAMA MOTORS (0)

Anonymous Coward | about 2 years ago | (#40597387)

If Americans want them how come no qualified people apply for them? The only people who are willing to do the work are from India.

Design Flaw? (1)

Dareth (47614) | about 2 years ago | (#40597017)

From the article, "Data center consolidation: GM plans to go from 23 sizable data centers worldwide to just two, both in Michigan. "
Note the locations, or should I say location. Is Michigan so big you can get physical diversity?

Re:Design Flaw? (3, Interesting)

Ungrounded Lightning (62228) | about 2 years ago | (#40597159)

Yes. Michigan is enormous. It's farther from the Detroit to the straits of Macinac than it is from Detroit to New York City, and the straits are only a little over halfway to the border.

It also has an unusually high-reliability power grid. (It had to be designed for some severe storms and icing.) During the great northeast blackout the problem propagated to the Detroit Windsor boundary, Detroit Edison's equipment detected it, and cut off from the east coast. Pick a spot (like the west side of Ann Arbor) where Detroit Edison and Consolidated meet and you can get redundant feeds from both company's grids (as Compuserve did long ago), in addition to your backup UPS and generator. (Ann Arbor is also a good spot for communication connectivity, too.)

Michigan's topography breaks up the weather patterns enough that even a few tens of miles of separation often make the difference between a heavy storm and clear skies.

Re:Design Flaw? (0)

Anonymous Coward | about 2 years ago | (#40597529)

It's farther from the Detroit to the straits of Macinac than it is from Detroit to New York City

bull. shit.

Re:Design Flaw? (0)

Anonymous Coward | about 2 years ago | (#40597747)

Interesting, Google Maps shows 275 miles from Detroit to St. Ignace (city on the north end of the straits) and 660 miles from Detroit to NYC. Granted, I-80 to NYC is more roundabout, but not that much.

Re:Design Flaw? (1)

SScorpio (595836) | about 2 years ago | (#40597843)

Agreed, Detroit to the Mackinac City near the tip of the lower peninsula is 298 mi. Detroit to New York, NY is 614 mi if you go through Philly. However, Detroit to Copper Harbor which is the northern tip of the upper peninsula is 605 mi.

But, yes Michigan is huge if you actually count both peninsulas. There just isn't much developed if you go really far north. Ann Arbor, Flint, Grand Rapids, and Kalamazoo would all work well as areas for data centers. I know Ann Arbor, and Flint already have at least one data center apiece, and I wouldn't be surprised if Grand Rapids and Kalamazoo had some as well.

Re:Design Flaw? (1)

napoleon_jo (2533548) | about 2 years ago | (#40597543)

Is this correct? Detroit lost power, and I'd believed that the parts of the state covered by Consumers, not DTE, lost power

Re:Design Flaw? (4, Informative)

Darth_brooks (180756) | about 2 years ago | (#40597617)

Let's start with all the stuff you missed:

-As the google map flies, it's 289 miles from the D to the Big Mac. It's about 600 to NYC. (Although it is about the same distance from Detroit to Ironwood, MI, which sits on the Michigan / Wisconsin border. )

-Consumers Power handles most of the non-DTE grid space. DTE's western border is about 20 miles from Ann Arbor's west side

-During the Northeast blackout, plenty of (I dare say most of) the DTE grid went down. The cutoff was where the grids switched over in either Flint of Jackson. We were back online a little faster than most places, but we were down for 24+ hours.

Re:Design Flaw? (0)

Anonymous Coward | about 2 years ago | (#40597689)

I just drove from Detroit to Mackinac Bridge in 5 hours, and 1 more hour up to Sault Ste. Marie on the Canadian border. NYC is about 11 hours, although to be fair that would be a couple hours less if there wasn't that lake in the way. But then getting up to Houghton would be faster than 9 or so hours if there wasn't a lake to go around either. How is that Upper Peninsula Secession coming? That would shrink it for you.

Re:Design Flaw? (1)

swillden (191260) | about 2 years ago | (#40597765)

Michigan is enormous. It's farther from the Detroit to the straits of Macinac than it is from Detroit to New York City, and the straits are only a little over halfway to the border

Huh?

Just measured (with Google Maps): Straight-line distance from Detroit to the strait is ~255 miles, driving distance is ~288 miles. Straight-line distance from Detroit to New York City is ~480 miles, driving distance is ~614 miles.

New York City is roughly twice as far from Detroit as the Strait of Mackinac.

Wow! (1)

ErichTheRed (39327) | about 2 years ago | (#40597111)

Given that this is GM, this might set off a few ideas in MBA-land that will be beneficial to IT at large. A huge company bringing IT back in house? Amazing how things come back around... kind of like the cloud.

I actually work for a service provider (not doing hands-on support but engineering work for customer projects.) If you are absolutely, completely not dependent on IT, or too small to have your own IT department, outsourcing is one way to go. Big companies I've been at that outsourced IT have almost always had a negative experience that only gets worse as time goes on. You can mainly attribute this to "no one cares about your IT infrastructure more than you do (or should.)" I do my job professionally, because I'm just that sort of IT person, but I've seen countless experiences where vendors try to weasel out of extra work by hiding behind contracts and procedures. Or, they throw up huge roadblocks because YetAnotherWierdProprietarySystemThatThe50YearOldYouFiredKnewEverythingAbout breaks every few weeks and it's too expensive to hire expertise and still make margin on the contract.

There's lots of reasons to avoid outsourcing if you rely at all on your IT -- A Team replaced with the F Team after the contract is signed, bottom of the barrel talent, cost, etc. etc. I'm sure GM ran into all of this and more, and got sick of wasting money. (Didn't EDS start out as the GM IT department way back when?) It's nice to see some different thinking in the marketplace now -- I know when I worked direct for a company, I felt way more plugged into what was happening, and on the hook to deliver. After all, if they can't deposit my pay into my account, I have a great motivation to fix the A/P system. :-)

Re:Wow! (1)

Anonymous Coward | about 2 years ago | (#40597143)

And oh yeah, I almost forgot -- one of the nice things about this happening now is that things like "cloud computing" are making some of the internal drudge work of IT someone else's problem, while allowing in-house IT people to build neat stuff instead of babysitting infrastructure. Not saying it's the solution for everything, but it's sometimes neat to be able to use someone else's hardware that they keep running, while you maintain control over your stuff running on top.

Hooray! (5, Interesting)

DCFusor (1763438) | about 2 years ago | (#40597149)

I'm a GM guy, FWIW, and I own a Volt, which I loved at first, and now I love more - it grows on you, especially when you can charge it off solar power. But...the GM web presence is the absolute worst written software I've ever experienced on the web - and I've been here since the BBS days.

I'm thinking specifically about the MyVolt site. Ok, it's mostly a bunch of ads and info on the Volt - obviously mainly motivated by brain-dead marketing, since it's also the main place owners go to check their car's status.

So, you push the log in button. Though there's room on the page, oh no, we have to pop up a window to log in on - meanwhile, the animations on the page behind are still loading and running blocking code that makes my other web apps stutter. After maybe 10 seconds, you get the log on window, with it all filled in (thanks firefox) and click the log in button....and you wait, and wait, and wait. Meanwhile, the button you clicked doesn't grey or disable, and clicking it again breaks it. Finally, you're logged in and it starts trying to talk to the car to see what the state of charge is for you. This takes at least two minutes, often ending in "we failed to contact the car, try again?". During those two minutes, it's busy drawing an animation of the state of charge, in blocking code, so my other realtime (stock trading and TV) apps stutter. And, if there was already valid info on the SOC meter, it gets wiped up while you are waiting. It can take over 5 minutes to find out state of charge on this app! Every single page element is reloaded from scratch and re-initialized in response to every single user action, often wiping out valuable data you had already showing each time. And yes, it logs you out every 30 min - during which time you may or may not have gotten the data you wanted. This site must hit 5-6 different (all slow) servers for each redraw. It's obviously done by drag-drop-monkey tools by someone who doesn't even know how to do that, plus a lot of pretty but useless art from some marketing idiot - owners don't need to see more crappy ads for something they already own (are you listening too, Amazon?).

Anything, and I mean even a site writen by a 13 year old retard who was the nephew of a GM exec would be superior. Thank god, the Volt runs linux in a cluster...that was done mostly inhouse and by IBM, who at least have a clue.

two thumbs up :) (1)

daninaustin (985354) | about 2 years ago | (#40597887)

Of course the "13 year old retard" would not have to listen to all the marketing and management bureaucrats, so he starts with an advantage. Maybe you should just install a separate browser just for the volt so it doesn't screw up everything else :)

Wal-Mart doesn't outsource their IT (5, Interesting)

rollingcalf (605357) | about 2 years ago | (#40597205)

And they are the king of cost-cutting. They outsource many other things, but still insist on keeping their IT in-house.

Re:Wal-Mart doesn't outsource their IT (4, Interesting)

sapgau (413511) | about 2 years ago | (#40597357)

+1
Wall Mart is the case study for Business Intelligence, Data warehousing, Data Mining, etc... They analyze every little trend in their inventory, sales, customer traffic, etc.
I remember reading one time they placed beer next to diapers during the week at night because that's was when young dads make a quick run to restock, coming out with diapers in one arm and a six pack on the other.

There is no way you can outsource that and remain competitive.

Re:Wal-Mart doesn't outsource their IT (1)

DerekLyons (302214) | about 2 years ago | (#40597423)

So does Starbucks - but according to a friend (who works as a DBMS manager for their business intelligence/analysis division) that has more to do with keeping the data under tight wraps.

It's not always about cost cutting or rapid turnaround or whatever.

Re:Wal-Mart doesn't outsource their IT (1)

LDAPMAN (930041) | about 2 years ago | (#40597739)

Having worked with them extensively I think they actually need a bit more outsourcing. In many areas they are way behind mostly due to an excess of "not invented here" and a lack of employees with extensive experience elsewhere. Their managers are primarily lifetime Walmart employees who grew up with the company. Another big chunk of their IT workforce were hired straight out of college and have no perspective on how the rest of the world does IT.

Depends on your definition of IT... (0)

Anonymous Coward | about 2 years ago | (#40597909)

I do on-site IT for 3 different outsourcing companies that service wal-mart. Everything central office may be done in-house but when it comes time to lay hands on a workstation, cashregister, server, router, etc, they often can't wait or won't pay for someone from Texas to fly to some small town in Canada.

Not high-risk at all (4, Insightful)

WindBourne (631190) | about 2 years ago | (#40597241)

What was high-risk was outsourcing to the likes of IBM, HP, CapGemeni, wipepro, etc. who outsource the work to India or China. That information is then able to be used against GM. Real stupid on GM's part.

Not risky when you own the politicians. (1)

trout007 (975317) | about 2 years ago | (#40597407)

Seriously if they screw this up they just get another bailout. It's a win win for them.

Re:Not risky when you own the politicians. (0)

Anonymous Coward | about 2 years ago | (#40597753)

"trout007" is so clever. It's all about _you_. Let me guess--coder.

Re:Not risky when you own the politicians. (1)

trout007 (975317) | about 2 years ago | (#40597993)

I've used that handle for about 25 years. So a 14 year old version of myself thought it was cool and I've kept it since it usually isn't taken and I'm a bit nostalgic for it.

Almost coder. BS Mechanical Engineering and a BS in Computer Science for fun.

Re:Not risky when you own the politicians. (0)

Anonymous Coward | about 2 years ago | (#40597799)

Well I'm sure when Romney starts the Iran war next year GM can get a fat juicy contract making military vehicles. The military-welfare state has kept Boeing and General Dynamics profits fat so why not GM?

Choose what you outsource (2)

Todd Knarr (15451) | about 2 years ago | (#40597479)

I have a simple rule:

Out-source monkey work. If it's something you can write instructions for that're sufficiently clear and detailed that a moderately-housebroken monkey can follow them successfully, it's a candidate for outsourcing.

In-source anything requiring intelligence, business knowledge or judgement. If you're depending on the people doing the job to know what they're doing and do it well then you want people that you have control over, you don't want people who answer to someone else. To find out who they answer to, ask one question: "Who signs their paycheck?". That's who they answer to.

Regardless of the above, in-source anything where a failure will cause a business interruption. If it's going to stop your business from operating if it's not working right, you want the people responsible for it under your control and answering to you. That way you can decide whether it's worth the overtime to keep them in until it's fixed. You do not want that decision left in the hands of someone whose business isn't being impacted by the problem and who won't suffer if the problem continues.

Re:Choose what you outsource (1)

vlm (69642) | about 2 years ago | (#40597787)

Would I be correct in summarizing that as if you shouldn't be doing it or it doesn't matter, outsource it, otherwise insource it?

I have seen outsourcing success in short term projects... in the telecom world if you're doing a forklift upgrade of a PBX, either you don't have enough people or you have way too many full timers (or you've only got like 50 phones... I'm talking about 1000+ phone offices).

Also I've seen outsourced cabling work go pretty well. Horrifically expensive compared to insourcing to a noob, but unlike most outsourcing that crashes and burns this merely bled cash.

"Who signs their paycheck?" is the single most important question to ask, thanks for bringing that up.

Think About It (1)

NicknamesAreStupid (1040118) | about 2 years ago | (#40597853)

Seventy-five percent of GM's sales are overseas, and their fastest growing market is China, where they are beating Toyota. GM American autoworks export almost nothing. This multinational company, like many other US multinationals, will not be bringing its foreign income back to Uncle Sam. Therefore, bringing IT 'in house' means hiring where their sales growth is -- China & the rest of Asia. Who knows, they might buy Wipro. Remember, they once bought and sold EDS.

Sounds like progress! (0)

multicoregeneral (2618207) | about 2 years ago | (#40597879)

The biggest thing working against them, I think, is that working for GM usually means living in Detroit. Honestly, I would rather work for Walmart IT in the heart of Alabama.
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