Judging from the 70+ reader comments, many from present or former IBM employees, my last column about the arrest of IBM Sr. VP Bob Moffat on insider trading charges hit a nerve. In a few hours I’ll be posting another column on a completely different topic, but I can’t let this one go without making one more observation. It has been almost a week since Moffat was arrested and in that time, as far as I can tell, IBM has made no comment on the case to the press or even to its own employees.
Why no comment? I’ve been wondering that aloud for the last day or two, asking my friends and almost anyone I meet why IBM would be so foolish not to at least issue a press release on the arrest? After all, the company supposedly cooperated with the SEC investigation. They should have known the arrest was coming. Why weren’t they ready with at least some statement reaffirming corporate values or possibly distancing themselves from Moffat?
Doesn’t IBM management owe that to its 398,000 employees?
They removed Moffat’s bio from the IBM web site, but that’s all.
Lack of comment suggests Big Blue doesn’t know what to say. Perhaps the company is paralyzed. Maybe there is disagreement in the executive ranks about how to handle the problem. Maybe Moffat, himself, was the guy who would have helped craft any response but now he’s unavailable. Beats me.
But it doesn’t smell good.
My Mom, who is 85 and, like me, doesn’t own any IBM shares, may have put it to me the best.
“My guess is that this isn’t over,” she predicted. “IBM could declare him innocent until proven guilty or they could write him off, but the fact they have said nothing at all means there are probably more shoes to fall. They could announce an investigation to ferret out others who made the same mistakes, whether those others exist or not. And that’s what they would have done, had all the remaining guilt lay below Moffat’s level. But it probably doesn’t. I’d look upstream.”
Mom is a clever girl.
I love that there’s an IBM “collaborate without boundaries” ad on this page.
Please keep up the good work–very interesting story developing…
I used to work for IBM. Incredible they couldn’t even say something weasely like, “IBM is fully cooperating with the investigation and does not condone insider trading.” They wouldn’t even have to throw Moffat under the bus in the spirit of innocent until proven guilty.
You should get your Mum to write some guest columns on here Bob. Most 85 year olds wouldn’t know what IBM is!
IBM has been around for over 100 years, so I am not sure this comment is correct. My mom, who is also 85, was a secretary when I was a kid. She used an, er, IBM typewriter at work and we had one at home. The Selectric model came out in 1961 and she thought this was the greatest piece of office machinery ever.
ahhh….. Selectric 111 w/ correctoe tape. Selctric 11 was perty good too.
It was the greatest piece of office machinery ever.
It was the best piece of office machinery ever invented. Unfortunately, it cost $2000 and they never lowered the price.
After a while someone else (Remington? I can’t remember) got the patent and started making them for $900. I bought one trying to save some money. Big mistake. It was a piece of crap.
It is all tied into Raj Rajaratnam checkout http://news.bbc.co.uk/1/hi/business/8313917.stm
D00d, we need more of Mrs Cringely – she obviously knows where it’s at!
The rat pictured in your article is a *lot* cuter than that scary picture of Moffat in your preceding article. Let’s not give rats (the non-human kind) a bad name.
Moffat was more of a prick than a rat.
But I’d much rather have a picture of the latter than the former.
Bob,
IBM did put out a statement, both internally and externally, on Monday, 10/19/09. Here is the WSJ article with a quote from the Corporate Spokesman.
http://online.wsj.com/article/SB10001424052748704500604574483153597287362.html
Here is the text available for free:
Edward Barbini, an IBM spokesman said “In view …
You obviously have some very interesting family and friends. I guess behind every good columnist is an army of smart, insightful people. I agree with the others. I may be fun to hear from them from time to time.
Mama Cringley should have her own collumn. “As the Cringley Cookie Crumbles”.
Mama Cringely’s Recipes and IPv6 Prediction Blog
You forget IBM’s well known abilities for legal silence. Legally they are a very reserved corporation; but when they speak, they speak.
[…] インサイダー取引 カテゴリーへ shiro が 2009年10月23日 に投稿 Silence isn’t Golden | I, Cringely IBM could declare him innocent until proven guilty or they could write him off, but […]
Bob, amazingly, I was saying this very same thing to my team in IBM today! The internal news pages are usually full of stuff about anything big affecting IBM, but I’ve seen nothing at all on this. It’s very odd. So, good one 🙂
No Info from the upper levels of execs…probably due to “another shoe” is yet to fall withinthe company !
Before I saw the comment that IBM had after all commented, I was going to write that, on general principles, when there is a problem, not saying anything is often the wisest rule to follow. After all, anything IBM said on the matter would only make more news, right? And every fresh bit of ‘news’ on this story brings the story back onto blogs, newspapers, and tech columns. And every time the story comes back, a few words of background are required — and that means restating that one of the company’s top executives was charged with a crime.
And if the company says something internally, it will leak, and that will make news, along with the question, ‘Why isn’t IBM talking to the press?’
It’s a no win situation as far as I can see. On the other hand, I’ve never worked in a corporate PR dep’t, so I’ve no idea about what the official policies are on such matters.
According to today’s issue of “The Financial Times” (see page 3), McKinsey “has asked an outside law firm to do an investigation” into Anil Kumar’s involvement in the Galleon case.
You would think that Palmisano would do the same with Moffat, but I doubt that will happen.
As an IBM’er, I’ve never seen a budget or a business plan. I don’t know what the business strategy is and I don’t contribute to its development. When I first started working at IBM I thought this was very unusual. Then I found out 95% of IBM’ers are kept out of the business information loop. It is IBM culture for its senior management not to tell anyone anything, inside or outside of the company. If you think IBM does some really dumb things and has problems, this is why. How can you expect teamwork and innovation when 95% of the company does not know what the company wants to do, or how it is doing, where it is headed? To IBM leadership it is not necessary for us to know the situation on one of our Senior VP’s. In their eyes we’re not important enough to merit that courtesy.
How many IBM’ers have been asked to get their PBC’s (performance reviews) done 3 months early? There is only one reason for this — so that they can have the next resource action sooner.
99 to 100% agree with you. Sadly the economy has tanked and we low levels at IBM have to keep our jobs. PBCs are a joke!!. No mgt staff member at IBM really cares about their employees. This company preaches a lot of propoganda.
Not sure where you are in IBM or what you do but try checking out one or more of the 1000s of pages on our internal website which explain IBM’s overall strategy and the strategy of each business unit in detail. Also check out the quarterly updates from Mark Loughridge (IBM CFO) and every senior business leader around the world … 100s of them. In fact, I think very few companies disclose as much strategy internally and externally as we do.
> They removed Moffat’s bio from the IBM web site, but that’s all.
He was also removed from ‘Bluepages’ the internal IBM personnel directory. I did a few more searches before I realized he use to head the division I’m in; I had forgotten that (if I ever knew it).
FLASH! Maybe we are looking at this the wrong way.
Several months ago when Steve Jobs was sick, the investment community became outraged. They felt Steve Jobs health problems were important enough to merit a formal business disclosure by the company.
There is no comparison between Steve Jobs and Bob Moffat when it comes to their leadership skills. Steve is a quantum leap better than Bob. Nonetheless Bob was the Senior VP of one of IBM’s biggest money making divisions. He may have been the next CEO. Doesn’t that deserve a formal business disclosure?
This isn’t a PR matter. IBM is a publicly traded company subject to SEC rules. There has been a significant change in the company leadership and an officer of the company has been accused of a crime. Is it legal for IBM to say nothing?
Something sure stinks. I am surprised IBM’s stockholders are not demanding answers.
Without a doubt, LEAN and other stuff initiated by Moffat are going to be investigated very closely.
Do you honestly think someone is going to investigate LEAN? IBM thinks it’s the best thing since sliced bread. They got rid of boat loads of American workers and sent the jobs offshore. The execs lined their pockets with more gold and patted each other on the backs. No matter what is found out about Moffat as the trial unfolds, IBM won’t be investigating LEAN.
At EDS/HP they call it ‘BestShore’.
We know it for what it is. We call it ‘CheapShore’.
Lots of comments on the employees Alliance@IBM web site http://www.allianceibm.org
She’s right, there have to be a lot more investigations going on behind the scenes – the hedge fund has to be seen as spectacularly unsuccessful if they only made $25M from this kind of treachery. When you look at the relative amounts of money in this game – and particularly the SEC funding vs. Galleon’s pot I’m amazed that this case has even got this far.
But $25M… and his bond is only $100M – if I robbed my neighbors house and stole a $500 stereo would I get let out on bail for $2,000 ?
$25M … I just don’t get it… to quote Sir Thomas More from A Man for all Seasons: “Why Richard, it profits a man nothing to give his soul for the whole world… but for Wales? “
I’m glad to see that dirtbag Moffat got caught. Not surprised, expecting more to fall.
IBM has turned into a dying cash cow for its execs; bleeding it to death with their greed. They’ll rape and pillage the company, sacrifice service to its customers, and bail out with a golden parachute.
IBM’s only successful “product/service” is eliminating U.S. jobs…. how else would they post a profit with ever-decreasing revenue (due to it’s crap service and products).
Cringely sez: “…Doesn’t IBM management owe that to its 398,000 employees?…”
Bob! IBM is now an off-shore company with a vestigial headquarters in Armonk, NY! There are no more than an estimated 100K employees stateside and that is likely to shrink to 60-70K in the next two years…or sooner.
Your Mom may be correct, but IBM discloses highly camouflaged substantive information only in legally required filings.
Hmm, a sassy gal who’s quick to deliver a surprisingly pithy and humbling “wish-I’d-thought-of-that” kicker… kinda brings to mind “our gal” Pammy. (sniff.)
Oh, good ol’ Pammy! Wonder how she’s been keeping herself busy these days…
I left IBM a couple of years ago, and have always felt so good that I left. The management is incompetant, and yet, they are judging us on our PBC’s. All the wasted time on development plans, but wait, training was cut years ago! The list goes on, no raises, no training, low morale, yet stock holders don’t seem interested, but, eventually, won’t the bottom drop? These jobs offshored, do they pay taxes? I’m sure not! The real injustice, is the treatment many of those from India would do to us, most are incompetant, but for some odd reason, management thinks their smart, I didn’t understand that, and yet, many of those people from India have rosen in the ranks, but like the guy busted on wall street, he wasn’t that smart, he was a crook, I wish people would wake up to this. Give us our country back, and our jobs. Things are just so messed up in IBM, I honestly believe they will soon be out of America all together. And our President will help finance this project will stimulus money. Very sorry about all of this.
For possible explanation, see commenter angst over “Parrot Secrets”:
https://www.cringely.com/2009/03/parrot-secrets/
https://www.cringely.com/2009/03/bowling-for-dollars/
Perhaps your poor grammar had something to do with it?
did you mean:
that the management is “incompetant” on “incompetent”?
that management refers to the incompetant (or incompetent) Indians as “their smart” or that “they’re smart”
and that they have “rosen” in the ranks, or “risen”?
for me, English is a second language, but clearly for you it is a blunt tool even on a good day
It is not a surprise that ibm is not issuing a comment. This is the new ibm. THEY DON”T CARE. They DON’T CARE about shareholders, they DON’T CARE about their employees and they certainly DON’T CARE about their customers. So, why should they issue a comment.
Here’s the comment from Monday:
“In view of a U.S. federal investigation into his personal activities, Mr. Moffat has been placed on temporarily leave of absence and is no longer serving as an officer of IBM,” said company spokesman Edward Barbini.
IBM named Rodney Adkins as acting head of the systems and technology group. Adkins will also oversee development and manufacturing, the company said.
What happened to:
“In a few hours I’ll be posting another column on a completely different topic, “
Few= 100+
post shmost. i think i’ll have another white russian.
Now you have your answer. The column was on Windows 7. Unfortunately the upgrade processor took Bob much longer than planned. He probably set aside most of Friday to install the upgrade, then collect a few hours of first hand experience before sharing his thoughts with us. When the upgrade took the whole day, getting the column out in a few hours was no longer possible.
Unlike normal journalism we don’t demand deadlines on Bob. He can post a column anytime one is ready.
This column saved me some aggravation. I bought an early bird copy of Windows 7. I was going to install it pretty quick. Fortunately my Windows 7 is still on a truck somewhere making its way to me. I now know I need to do some more planning and set aside a lot more time for my upgrade. Thanks to Bob’s column I won’t be upgrading too hastily. Thanks Bob.
Keep this story going Bob! I think you and Mom are able to share some great insight and my educated guess is there is certainly more to come. Yes yes I know, innocent until proven guilty. Having been behind the big blue iron curtain for over 10yrs my bet is on… stay tuned for more to come. Though hopefully not before I dump the rest of my shares.
Seriously though. It’s a very sad and dark time we live in when US icons like IBM are not only shipping jobs over seas and squeezing the remaining US work force so hard they are becoming more complacent… Now this gem falls into the mix only to make matters worse. My only hope is perhaps this will set things in motion to root out the rest of the bad blue blood and help *fix* IBM. Perhaps it’s finally time to segment the beast into different companies? A new CEO might not be a bad idea either.
What I’m not seeing is any speculation about why he did it. I have no idea what he earned, but it was surely a lot, and he surely was not making 10 times that much by selling information,,,I saw low seven figures for everyone in total. He’s universally respected (except by Bob of course), extremely wealthy, is doing important work he likes, and he blows it all…for what? What did he want that he couldn’t buy already? We’re talking weird here, not money. People three levels lower down in the food chain leak data; guys like this don’t.
Ego, sex or money. Pick one as we may never know for sure
Have read on several other blogs that Moffat was a notorious bird-dogger, chasing tail around the world, on IBM’s dime, of course. Apparently, he was showing off for some hottie he knew through his co-conspirator, Diane Chiesi. That scenario would explain a lot. Now he’s got himself in hot water. As one blogger put it: “That’s one expensive piece of a**!”
“IBM could declare him innocent until proven guilty or they could write him off, but the fact they have said nothing at all means there are probably more shoes to fall.”
IBM has often been compared to a centipede; there’s always another shoe to drop.
According to ‘el Reg’ Moffat is gone now. They are quoting an intenal memo that someone sent them… gotta love the whistleblowers!
You must be the only guy on the planet who take about IBM with his old mother. You guys got nothing more interesting to talk about?
Who talks about IBM, is what I meant to say, of course.
Have never seen morale so low at ibm Research Triangle in North Carolina. Working here is like working with a bunch of zombies, the walking dead or semi-alive corpses. It’s like everyone knows their job is ending, just unsure exactly when. No one cares about what they are doing, everyone is complaining about management and record corporate profits while they throw cheap hot dogs at employees. If it weren’t so sad, it would be so funny. Please shareholders, keep buying ibm stock, it’s my only way out of here.
The news keeps getting worse and more funny in a sad sort of way.
Caught up are of note: Ali Hariri, a vice president Atheros Communications Inc. A wireless chip house
Emanuel Goffer [Spectrum Trading LLC and is associated with Incremental Capital] passed info on acquisitions of companies including 3Com Corp., Avaya Inc., Axcan Pharma, Hilton Hotels and Kronos Worldwide Inc.
I laughed when I read how much they liked the Bourne Supremacy
Other reports allege that an exec at Akamai was also tainted.
If the SEC keeps releasing info that’s sounding like the Quantum organization from <a href="http://en.wikipedia.org/wiki/Quantum_of_Solace" James Bond is really real. I think I need to pull out money from the bank and not buy gold but instead invest in drinking water.
I think perhaps the major wound has been the one nail in the head of IBM. Im unsure if the body will survive.
This may sound a bit shallow given the nature of what’s been going on with ex big blues but I think that picture of a ferret on the top of the page is absolutely delightful! I come to a page to see tech info and suddenly come across something from my second great love! Thank you.
“My guess is that this isn’t over,” she predicted. “IBM could declare him innocent until proven guilty or they could write him off, but the fact they have said nothing at all means there are probably more shoes to fall. They could announce an investigation to ferret out others who made the same mistakes, whether those others exist or not. And that’s what they would have done, had all the remaining guilt lay below Moffat’s level. But it probably doesn’t. I’d look upstream.”cheap VPS
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I used to work for IBM. Incredible they couldn’t even say something weasely like, “IBM is fully cooperating with the investigation and does not condone insider trading.” They wouldn’t even have to throw Moffat under the bus in the spirit of innocent until proven guilty.
good thanks o/
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What I’m not seeing is any speculation about why he did it. I have no idea what he earned, but it was surely a lot, and he surely was not making 10 times that much by selling information,,
From all the sites I have been to covering this subject matter, I think you do that best at explaining it, so very well done my friend.
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