With John Akers characterising IBM Japan Ltd’s first quarter performance as disastrous, the guys at the top over there must have been eyeing their ceremonial swords and contemplating hara kiri, but deciding that discretion is the better part of valour they have instead decided to scale back the work force in an effort to improve profitability. After being hit by a 21% fall in 1990 pretax profits to $1,100m and suffering the indignity of seeing its market share decline so that it now comes below NEC Corp as well as Fujitsu Ltd in Japan – Dataquest reckons the 1990 market split 23.1% for Fujitsu, 18.6% for NEC, 15.7% for IBM Japan and 11.2% for Hitachi Ltd, the company plans to get 400 employees temporarily off its books by assigning them to affiliates and cut its recruitment of college graduates by half, to about 500 – a third of its 1989 level, meaning that it will get a smaller share of the best talent. It is also moving 1,000 employees into sales from administration, and lowering the age for early retirement eligibility from 55 to 50.
