I wrote an article last year about IBM’s plans to reduce its permanent headcount and make use of many more contractors.
To cut a long story short a senior IBM HR executive told a journalist that that IBM was considering cutting its permanent workforce from 399,000 today to 100,000 in 2017. It would use contractors when needed.
Although IBM denied the report it actually made sense to a few senior IT executives I spoke to.
One said to me that this type of strategy is known as “the BP model.” BP uses contractors for almost everything he says.
Today I did an article about BP and the report into the recent oil spill in the Gulf of Mexico.
The spill at the Mocondo oil well has been catastrophic for the local people and the environment and will have major repercussions on BP for years to come.
The report points out that a multitude of factors combined to cause the disaster with the overall failure one of management. For example monitoring systems were not up to scratch
If BP uses contractors for almost everything surely this could have contributed because it is more difficult to manage a large number of individual contractors and contracted firms.
So IT service providers adopting the BP way, or even the IBM way if it happens, must realise the potential repercussions.