IBM to move a third of India staff to new cloud unit: Reports

About a third of IBM’s employees in India will reportedly move to NewCo, the recently created cloud and infrastructure services entity of the technology giant, under a new leadership team. 

The Armonk, New York-based firm announced on October 9 that it would split itself into two entities by the end of 2021. While IBM is expected to focus on the $1 trillion dollar open hybrid cloud business, the managed infrastructure services wing will handle the legacy workloads of its clients and function as a new public company. 

Sandip Patel, managing director for India and South Asia, is expected to lead one of the entities, CEO Arvind Krishna said, according to news agencies IANS and PTI.  

“I do not expect the creation of the new company to have any material impact in India. The move isn’t one of restructuring, but rather a spinout,” he reportedly said. “... Maybe about a fourth or third of our employees (in India) would be part of the new company.”

The firm, which has a 3,83,000-strong workforce and a presence in 170 countries, employs about 1,20,000 people in India.

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A key research and innovation hub for the technology giant, India currently houses four of IBM’s labs, one each in New Delhi and Pune, and two in Bengaluru.

“We are committed to our footprint in India. We also have a very large R&D presence in India and as our business begins to grow, we expect opportunity for people in India both in terms of employment and growth,” Krishna reportedly said. There would be indirect support to build new infrastructure in India, he added.

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IBM currently runs facilities in Bengaluru, Ahmedabad, Delhi, Kolkata, Mumbai, Chennai, Pune, Gurugram, Noida, Bhubaneswar, Coimbatore, Visakhapatnam and Hyderabad. It claims to provide services to two of India’s largest telecommunication companies, nine of the top 10 banks and the country’s largest airport in terms of traffic, IANS said.

The company recently built the industry’s first public services cloud for the financial institutions. It also announced a partnership with IT solutions giant HCL Technologies to digitally transform enterprises in regulated sectors.