Dr. Hess wrote:
Snorklewhacker nailed it. Throw in that I've personally seen outsourcing take out the entire tip tier of management of a billion dollar corp.
I'm currently working as a contractor on the sinking ship that is Con-way. The majority of their IT is preparing to be outsourced, with the contract being signed by the end of the month and the transition finishing by the end of the year.
You can imagine the moral here, surprisingly most of the folks are still working fairly well and they still care about the employee's they support. They just have a huge chip on their shoulder for the upper management wonks (who're all hiding down south in California)
A bit of a back-story. Before Con-way there was CNF. CNF was the parent corp for Con-way, Menlo Logisitics and Emery Worldwide. I started working at Emery in June of 1999. Con-Way, Menlo and Emery were sister companies with CNF providing an umbrella (actually laundering money from the sibling companies to avoid taxes and to avoid paying profit sharing to the Con-way and Menlo employees) In 2005, Menlo took over Emery and changed their name to Menlo Worldwide. In 2006 UPS Supply Chain Services bought Emery from Menlo/CNF and began shredding it and their strong IT infrastructure to fit it all into their Brown soup (went from Windows Server 2003 to server 2000 because they hadn't moved yet), they made such a mess of it that UPS Small Package took over IT from UPS-SCS and has slowly brought things back to current.
While UPS was having its brown-way with Emery (and my former co-workers lost their jobs) CNF decided it wasn't worth keeping around since Emery accounted for 50% of the IT services that CNF provided, so they changed their name to Con-way which leaves Menlo as a child corp to Con-way. In 2006 apparently someone had Gartner prepare a report on the Con-way's IT and it found that they already had extremely low costs for IT infrastructure. However the report apparently stated that they were in a "spiral of death" with the way they were providing IT Infrastructure. Needless to say instead of spending the money to fix the issues found on the report (immature processes, lack of proper backup solutions and positions)
The money should have made it in the 2008 budget, but they spent it on something else instead. So then in 2009 did they spend the money on fixing the problems? Nope. Eventually outsourcing as an idea was raised to fix the problem. Get this quote, "Outsourcing emerged as a possible way to address the Gartner findings without requiring Con-way to invest significant additional funds, which it doesn't have available." Uh, what? Don't you have to pay the outsourcers? Oh right, they'll cut all of their employee's and use the outsourcer's, meanwhile the stock price will soar thanks to all of the profit and the upper management can take a beautiful parachute leap into retirement.
