By Paik Ji-young
Digital Daily

jyp@ddaily.co.kr

IBM Korea has again begun a restructuring. The company laid off some 200 employees last year due to its deteriorating business. This time, it is merging its software business departments. During the process, the firm reportedly transferred its presales staff to the call center, a measure seen as a notice for a voluntary quit.

Industry sources said on Aug. 13 that IBM Korea has relocated 60-80 employees during the process of merging several solutions business inside its Software Group (SWG).

For example, business related to Cognos and ILOG solutions was merged into the Information & Analytics part, while the work related to DB2, FileNet and security products was integrated into the Information Management (IM) business.

The relocation was made mainly for the presales staff whose duties would become redundant in the new system.

IBM Korea transferred about a half of the staff to the System Integration (SI) division and the other half to the Lead Development Representative (LDR) on Aug. 4. LDR performs the function of a call center.

The transfer of presales staff, whose main duty is technology sales, to a call center is no more than a notice to voluntarily quit.

The company has reportedly notified the employees by e-mail that it would pay money amounting to four-month salary to those who quit.

The restructuring in IBM Korea was not unexpected. When an executive of the IBM head office mentioned sluggish sales in the Korean market during the conference call on the second quarter (Q2) earnings last month, a layoff was forecast.

Responding to a question by a Goldman Sachs analyst on IBM’s performance and future prospects in the Asia and Pacific region, Martin Schroeter, senior vice president and chief financial officer (CFO) of IBM, said, “Australia and Korea were slow in the second. And notably within that, I would say, we saw degradation in both Australia and Korea within that AP geography.”

It was unusual for an IBM executive to specifically comment on the Korean market as it is a relatively small market whose sales account for less than 1 percent of IBM’s total revenue. For this reason, his remarks were regarded as an indication of a plan to trim its business in Korea.

In addition, IBM head office reportedly conducted a large-scale inspection on the executive officials of IBM Korea. The company is expected to further restructure its business in Korea for several other reasons.

IBM has sold the x86 server business to Lenovo, which is likely to bring about movement of the related manpower. IBM Korea is also to relocate its office to the International Finance Center (IFC) on Yeouido, Seoul, in March, 2015.

IBM Korea officially refused to comment on the allegation, saying, “We cannot confirm any regarding the organizational change or restructuring.”