IBM scraps rewards program for staff inventions, wipes away cash points | Hacker News Reader

IBM scraps rewards program for staff inventions, wipes away cash points

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132 pointsBrajeshwar120 comments

If I am understanding this correctly; you could file 3 "high value" patents, which would result in 12 points awarded, which you could convert to a...$1,200 payout?

I guess it is better than nothing, but $1,200 is like is like gold sticker level for people in those tiers (at least I hope so).

$1,200 is really lower than any company that want to incentive patents would pay.

Bug bounty programs are the next iteration for these companies to avoid hard and expensive research.

IBM conveniently does not seem to offer bug bounties. Granted, it's possible that they have a private program.

https://hackerone.com/ibm

Maybe the program is dominated by a few people who got really, uhh, efficient at cranking out patents and the new prices reflect the hourly rate of keeping the hustle going rather than attracting new prospective inventors with fresh ideas.

Seems like the fix for that problem is a cap for annual payouts instead of torpedoing the whole program? Though I would think for a lot of people who might be able to contribute to only one or two per year (and still do their dayjob) the $1200 would be pretty underwhelming.

I'd guess that's true, and also that the people on the most patents are just "co-inventors". It likely makes the program highly profitable for a few, who may not even be the ones doing most of the followup work with the lawyers who actually get the patent filed.

At HPE, it's $3000.00 per patent, for each author.

Yeah, I was going to say, I think the number at IBM was $1800 per patent, per author back in 2000, which would be ~$3300 today. It wasn't "buy a boat" type of money but it was more than "nice meal", for sure.

Correct, though if there are more than 3 authors it is 9000/(No. of authors).

I worked at a company where a yearly bonus structure was conceived of by a team in HR who were IMO bad with numbers. Many emails went out about how it worked and so on.

One year we got $300 (or less...) bonuses. It was just how the math of this complicated system worked out.

A lot of feedback was given about that program and it wasn't positive. They came back to a few of us asking us to elaborate. I told them "I once got a $300 bonus working at Little Caesars (American pizza chain) for selling the most crazy bread in a month."

They finally got the hint and canceled the entire thing, it was better not to have it at all IMO, more demoralizing having it around. $300 is better than nothing, except when it sends the wrong message.

Companies really, really want their employees to perform specific behaviors that they desire, except they don't want to compensate them extra.

In truth, a base pay + bonus structure that is commensurate with the outcomes the company desires is the best solution.

Leaders shouldn't trust folks who go into HR to come up with these.

Yup, and in this case a lot of the numbers that went into the math were department wide macro numbers. I could do amazing at my job, the numbers wouldn't change, I could do nothing, the numbers wouldn't change... and it was a mystery/ a core to get a feel for how the math would work out. That opaqueness was an issue too.

Better to just do a low amount of profit sharing - if we all win you win, if we all lose you get nothing; its way less stupid than saying "well you are being dinged for our failure on X thing" when they had no ability to impact it and often times that's not even tied to profitability.

Yeah I worked at a place that did that. Company hits X,Y,Z numbers and everyone got what was equivalent to a paycheck as a bonus. A number that seemed to scale well and people cared about / appreciated.

The times we hit two or three pay checks were great.

That's most of the point of the employee-employer relationship. The company pays a flat rate and tries to maximize output reaping the extra output of over-achievers. In return the employee is relatively insulated from business risk (well except for layoffs to juice the stock price).

If you can be fired at any point then how exactly are you insulated from the business risk? You are only insulated from the upsides such as record profits etc. All the downsides are still there.

Compared to freelancing. If you're an independent contractor you have to market yourself, close deals, manage client relations, and of course do the actual individual contributor work. You have to convert a stream of individually unreliable prospects into a steady income.

There's plenty of firms that run at a loss from time to time but don't immediately cut jobs or pay.

Companies are also really good at coming up with values and creating bonus structures that incentivize going against those values. Most companies like to say they value teamwork and collaboration, but also give out individual awards to people who do the most visible work while ignoring the contributions of the 100 other people that made a project succeed. Nothing kills morale faster than giving awards and bonuses to the manager that forced massive overtime to complete a project, and giving the team a pizza party.

Yea I experienced that from the customer side. I purchased a car, the sales person wanted me to submit a survey on how she did. When I got the link for the survey, it was to rate how their department was, and it was attached to their manager. I found out later the employees get $100 per review, but we are not rating them, we are rating the manager, they get no recognition. I'm not going to support systems where the managers get all the credit and the employees get nothing but $100 per customer as an incentive to make the manager look good..

My last job had a bonus structure of “everyone gets $X each year, as a percentage of yearly profit, based on time worked at the company up to a year”. On average my bonus was about $8k - no strings, no requirements. If you started that year, your bonus was prorated.

My current position is merit-based - over the year you have several goals you set with your manager like learning something new and presenting it to the team, attending a trade conference, etc. Yearly bonus is x% of around $15k, and that % is based on how many of those goals you accomplished.

Both systems feel tangible, and the rewards feel like they’re worth it. The former being completely without any requirement was really nice, and also I don’t mind having self-improvement and professional learning goals to work towards for a sizable bonus.

https://en.wikipedia.org/wiki/Overjustification_effect

What if it was a $150 gift certificate for a nice restaurant?

Strangely, that somehow seems more valuable.

Ugh, this brings back (bad) memories of my first job out of college. I remember some of the engineers who really put in a lot of extra time -- like, we're talking plenty of 60+ hour weeks for months on-end to get projects done for various customers. These customers' contracts were easily in the seven-figures (USD), sometimes eight-figures. In at least one quarterly meeting, the CEO & some VPs were thanking these engineers for their efforts... With $50 gift cards to Starbucks or wherever.

From a purely logical, objective measure, this is good - these engineers received extra compensation. But I think most people saw it as a huge slap in the face. Probably hundreds of hours of extra work compensated by an "atta-boy" and a gift card worth a few coffees and scones; in exchange, the owners of the company reaped huge monetary rewards.

Or better yet - $150 gift certificate tailored to the employee's interests. For example, if Tom likes to golf, find out where he likes to play and get a gift card there. And give him an afternoon (or better yet, whole day) off to play golf - and don't count that as PTO. The small personalization means a lot, at least in my experience.

Better yet the CEO could puckerup and kiss my bhole with tongue and it won't cost a thing.

What prompted you to write such a strange comment?

> One year we got $300 (or less...) bonuses. It was just how the math of this complicated system worked out.

I worked at a company where HR had too many people coming up with complicated reward schemes, but not enough money to make them worthwhile. Same thing: Reward levels were $100 here, $200 there, and required a relatively large amount of work to get.

The weirdest thing was watching a subset of people pursue these small rewards so aggressively that their primary work started to fall behind. Some people would be grinding away at the next step to win a $100 reward while neglecting real work that others were depending on.

Good lesson in how weird incentives can be for some people.

I'm reminded of an experience a friend of mine had while shopping at an Old Navy. She stepped in a pile of human feces that was in the middle of the aisle. For her trouble, the store gave her a $5 gift card.

Her dad taught a business class at a local college and for years thereafter used it as an example of how giving a small amount of money can be worse than doing nothing at all.

> They finally got the hint and canceled the entire thing, it was better not to have it at all IMO, more demoralizing having it around. $300 is better than nothing, except when it sends the wrong message.

I wish more companies realized this.

It's a lot better to just not dangle rewards if you don't make it worth their while.

A day off or a healthy bonuses is a lot cheaper than screwing up the morale of a team or person which results in them leaving or cutting productivity because they know your 'carrots' aren't worth it.

Yeah, those numbers are so far down into chump change they're more like a slap in the face than a reward. But hey, if your name is on the patent, it's on the patent forever. It may not give you any money at your current job, but it might help in salary negotiation at your next job.

When I worked at IBM, the pay was not great, and managers were extremely combative over raises and recognition.

IBM was actually a terrible job. Upper management consistently shits on the workers for “not being agile enough”, but the walls they put up for you to change anything are impossible to climb. It was constant finger pointing and generally bad morale. Do not recommend.

I also worked at IBM (Research) early in my career. Most folks I know left but some good folks went into manager/leader positions. I always wonder .. do manager/leaders get paid better at IBM (Research)? Cause the people are really good.

The subreddit /r/IBM is eyeopening about what a terrible place to work IBM is. Most of the posts seem to be by people trying to find ways to escape.

Like you and another commenter point out, incentive amounts send a different message depending on the context.

Out of curiosity I once did a small amount of "research" on different car sales payment plans and the commission for selling a car was much lower than I had imagined. In that industry I would imagine that the benefits of base salary level end after onboarding, and begin to have a negative correlation with their performance afterward.

I had a lot of experience with patent rewards programs like this; both starting one (Packeteer) and helping administer one (Google).

People who are named as inventors sometimes actually contributed to it. The legal definition is "they conceived of at least one element in one claim." In practice, the claims change as the prosecution proceeds, usually removing things rather than adding, and the inventor list should shrink. It rarely does.

That's if the company is following the rules. Often the manager just puts himself or herself on as an "inventor."

As for the monetary value: occasionally a patent is worth a lot to the company, and often it's zero. Google acquired a number of IBM patents, so in that case you could put an exact value on it!

I was so proud of my first patent, and also heartbroken that several other non-contributors were somehow listed as inventors.

If you really wanted to be career-limiting, you could notify the PTO that the other "inventors" didn't really qualify. I've never heard of anyone doing this, so it would be maximum fun to watch what happens.

Why would the patent office believe you?

We're dealing in hypotheticals here, so that's why I said it would be career-limiting fun. I can only speculate on what would happen.

They would be required to investigate that during prosecution.

Which in practice might mean "ask the lawyers."

I worked for a large company where a patent had no chance of being filled if it didn't contain the manager's and director's name.

Management by parasitism. Lovely.

That can invalidate the patent.

> and the inventor list should shrink. It rarely does.

The thing is there is literally no downside to adding people (assuming they have an assignment clause of some sort) but missing someone can cause problems later.

So it's a pretty obvious alignment to incentives.

I've dealt with this before. We had a prior employee who stole a team's work and filed it himself. When it was discovered it raised a ruckus and it turns out you really can't "drop" a person from a patent without invalidating it, but they were able to amend it to get the team added back. So now they share credit.

I recall questions on the Patent Bar study guide about "death of the inventor" and "uncooperative inventor." It's all covered, but I don't recall how.

I’ve got my name on about a dozen US patents which translates into hundreds of worldwide patents. To me setting the minimum value at 0 seems arbitrary and almost certainly wrong.

From my experience what ends up happening is that every time a patent office comes back with some sort of response I end up having to stop doing productive work to deal with it while being paid my normal hourly rate. Plus lawyers etc. my best guess is that the net value of each of those patents is closer to -100k$ than it is to 0.

Interesting. My own experience is that lawyers never bother the engineers for Office Actions. They just handle it themselves, since it's usually pretty rote. In fact, they don't even tell you when they abandon it!

Taking up too much engineer time is a good way for them to lose future business.

> which translates into hundreds of worldwide patents

Possibly. Every country costs a ton of money, so they don't necessarily file worldwide on all of them. There's no such thing as an "worldwide patent." At most a part of the cost by saved by Patent Cooperation Treaty filings.

I do have to say, I have seen some really trash patents approved that were only submitted because the company in question had a patent bounty system. I have a colleague who has racked up about 50 so far and none of them have been used in a product.

https://www.thedrive.com/the-war-zone/20782/boeings-been-gra...

pew pew pew

The point isn’t to use the patents in products, the point is to give lawyers ammo to countersue when an infringement suit arrives.

That very rarely happens, despite what the lawyers tell you.

You don't countersue a troll, because they have no assets. You might countersue a rival, except they probably won't sue you. Mutually Assured Destruction is the more common defense among competitors.

So it works as intended! (at least by lawyers)

You said "give lawyers ammo to countersue" so no. Most infringement suits are from trolls.

A countersuit against a rival would need at least some basis in reality, so they'd have to be selling something that infringed your patent (unlikely).

You’re just making my point but somehow disagreeing with me.

The are no suits because MAD works. MAD only works if both sides have enough ammo to glass the other. So you need all the patents you can get to have a reasonable chance of finding a few your opponent infringes upon.

I'm not making your point. You had a small part of the truth.

It's much more complicated than you think. Sometimes MAD works, but sometimes the rivals do cross-licensing. "Getting more patents just in case we need them" is maybe one of the reasons, but there are so many others:

1) To protect the things we're already doing

2) To protect things we MIGHT do

3) Because that's what big companies do. Herd-following.

4) To keep someone else from horning in on our space

5) To use for cross-licensing or counter-suits

6) To sell in case we never want to commercialize

Don't underestimate #3. Every business "analyst" looks at your patent production.

That's pretty funny. At the risk of giving someone the idea to poison the well further, I think you could do a lot of this with AI these days.

Similar pattern in academia. The more you publish the better your CV, so there's a lot of pressure to publish, and a lot of garbage research.

At Notion Labs Inc, a patent is worth one Cuisinart® Precision Master 5.5 Quart Stand Mixer. I got a patent and the stand mixer to show for it.

At SMART Technologies (the whiteboard company), I got an iPod nano and a glass cube.

The glass cube sounds like it could be cool.

I swear there's a patent incentive company that's selling into these programs. everybody was doing patent cubes for a while. I've got a patent light (from Facebook), which I'm guessing must have been a thing too.

About the only thing my patent was useful for was when a PM came around asking about a new vendor with a creative way of doing something, I could defer with "I have a patent on that, it didn't really work when we tried it"

i love how accurately you told us the model of the stand mixer

That’s nice but it’s no waffle party awarded to refiner of the quarter.

they couldn't even spring for the kitchenaid?

I know right? Well, it’s nicer than the other options I could choose from - a “smart” speaker or a duffel bag.

A modern kitchenaid isn't really better than a cuisinart. Back when they were made by hobart, yes, they were amazing (and, inflation adjusted, something like three times the price).

These days they have plastic (I'm sorry "composite") gears, and do not appear to be designed to be serviced, just replaced. My ex broke three of them attempting to make bagel dough.

I've always understood the plastic gears as a sacrificial, replaceable part designed to prevent damage to other components. (But I've got one of the old Hobart models that is pretty easy to service. Never worked on a newer model.)

Good. We will see a lot less dumb patent filings from them. Getting patents was a requirement for career advancement when I worked there, so a lot of people end up “collaborating” on patents that they didn’t really contribute much to.

They seem like they are just replacing the program with another similar program with an incompatible payout scheme and this is just an excuse to not pay people.

>IBM canceled the program at the end of 2023 and replaced it with a new one that uses a different, incompatible point system called BluePoints.

>"The previous Invention Achievement Award Plan will be sunset at midnight (eastern time) on December 31st, 2023," company FAQs explain. "Since Plateau awards are one of the items being sunset, plateau levels must be obtained on or before December 31, 2023 to be eligible for the award. Any existing plateau points that have not been applied will not be converted to BluePoints."

I don't think they file patents because of their incentive program.

I worked for IBM 15 years. It is so sad seeing what it is today.

correct me if im wrong but it looks like they just acquire new companies and their software but they either let it die or never continue improving on it. Just check IBM's products page. Its a mess. They literally have thousands of softwares some of which arent even being sold to customers

They can make a lot more consulting dollars on marginal software than for something that was sanely designed and worked well.

Thats my experience with them and qradar. Its literally littered with bugs and instead of fixing them they just made a new version with literally 0 things shared with the old one, naming it qradar+ (nice naming btw, next time it call it qradar 2)

A friend's startup competes with Maximo, and IBM's "in-place version upgrade" has not yet been completed for a client with less than a year-long consultant engagement to fix changes that are both forwards AND backwards incompatible. Might as well be a new system.

We use maximo to track changes, its terrible.

What time frame did you work there?

I enjoy reading about the Mercury missions and the work IBM did in that era. There must have been a lot of smart people there then.

There's also a (recent?) book about IBM's work with the Nazis during WWII that has gotten some press lately. Has anyone read it?

They had similar contributions to apartheid, too.

From 1990.

"IBM and the Holocaust", Edwin Black, 2001.

https://en.wikipedia.org/wiki/IBM_and_the_Holocaust

When? Recently or back in it's heyday?

My cousin worked there from like 1999-2016 or so as an accountant. I've never seen someone so overworked.

My FIL worked for IBM for 15 years (1980-1995, IIRC). He says that when he was hired he wondered why on earth a company like IBM would need a Civil Engineer. And wondered the same thing every day up until being laid off.

I think its been a long, long time since IBM was a shining star of American business.

When I was at IBM around 2010, they offered $250 for filing patent, then $750 when the patent office approved it, usually after 3-8 years -- if you were still at IBM.

Then after a few years, they swapped those numbers around, so that if you'd been waiting for your $750 bonus, you'd get $250.

I'm reminded of the maxim "Tax what you want less of"

what's interesting is that one of IBM's greatest assets has been its patent portfolio, but ...

Why would an employee spend the extra time away from core duties (in this layoff environment) to do this?

IBM should really want this - it is giving up the long term view for short term .. something?

Corporations famously are unable to take advantage of potential internal innovations. Sun Microsystems couldn't do dedicated network storage, leading to Auspex. Auspex couldn't do cheapo storage, leading to NetApp. And then there's the Fairchildren.

The typical business reason to do this is to erect patent walls around areas of innovation or investment happening parallel to the patents to prevent others from either competing directly or suing to enforce their own parents through a mutually assured destruction argument. Rarely is it a patent is the genesis of invention at these companies but as a result of other activity.

> And then there's the Fairchildren.

Is that referring to companies that originated from Fairchild in some way?

I worked at a large U.S. information company that gave $500 per author for filing a patent application. Once a year, you could submit your patent application for the "Inventor of the Year" award. Given the 60k employees worldwide, it carried some weight, was awarded by the global CTO of the corporation, and the cash prize was $10k. Yet the true main benefit is the line item in your resume, I suppose. I don't know if giving $500 pre-tax is a good idea, because it is so little after taxes. On the other hand, the annual $10k amount is more appropriate unless shrunk by sharing with co-inventors.

In contrast, German law has a clause that inventors must be given a share of the profit generated by patents. You cannot sign to opt out of this clause, and the profit must be proportional to your invention's part of the product or service generating said profit. This is interesting in that only value-generating, granted patents are rewarded, not applications. But it's hard to find a fair reward formula for detemining how much a particular patent contributes to a product's profit or revenue stream (if it's not Amazon's "1-Click" button...).

> And for each plateau achieved, IBM would pay its inventors $1,200 in recognition of their efforts.

After taxes, this is a pretty small amount. With paltry rewards like that, I wonder if employees even cared much about this program.

I wonder if they set up agreements whereby people would add each other to patents, like a webring. So you only had to really do 1 in 5 of your named patents and you'd all get $10k+.

My employer pays a patent bonus (I forget the exact number). They'll pay $X per inventor for up to three inventors but only $3X/n for n inventors if n > 3.

More and more I see corporate work as a fall back until you stand up your own business. Why would you stay somewhere that takes from the margins of your labor forever ?

Because starting your own business is usually even more of a soul-crushing activity, with even less pay, for many years, if not forever.

Not everyone can start a business and guide it to success. And if they can, it can easily become the corporate work you were attempting to avoid.

> Because starting your own business is usually even more of a soul-crushing activity, with even less pay, for many years, if not forever.

According to the hustle porn version of startups, sure. But if you find a niche market, build a simple product, spread out the work with people you trust, and deliver consistently to your customers, you can own a large chunk of more revenue than you'll ever see renting your time out by the hour.

We all know "it doesn't have to be crazy at work", but starting a business doesn't have to be crazy either.

> But if you find a niche market

Therein lies the rub. If the market you find is too niche¹, then any product you produce for it will likely be unprofitable, so defining exactly what niche means in this context requires bounds.

So now it's a game of shopping around for the right niche market. If you're lucky, then you'll find one which aligns with what intrinsically motivates you. If not, then it'll be a grind to become enough of a SME in that niche market segment to produce a product which meets the needs of its participants.

I therefore argue that step 1 is to be a normal enough person to have some niche interests, but ones which are not so niche that you only share this interest with— at most —a few thousand other people.

[1] The owner of The Laserdisc Database, lddb.com, doesn't make enough solely from this venture to support himself.

Oh I didn't say finding a market building a product and knowing the right people to partner with is easy, but it's also not impossible. It certainly is not something that takes everything from you no matter what. You can approach it with any level of intensity you'd like.

While sustainable businesses are perfectly possible, you say that like the economy entitles you to it. Profitable businesses can suddenly turn unprofitable for a variety of reasons, from big things like macroeconomic conditions to stupid stuff like one of your suppliers having a factory fire or your products ending up completely lost in customs over a bureaucratic mixup.

They go back to your fallback corporate gig. That's what a fallback means.

Possibly an indication that the value of patents has declined? It'd be a good thing if that is the case.

I heard from on Oxide and Friends that Sun had a pretty strong patent incentive program back in the day. I wish I could remember it off the top of my head but I believe Bryan Cantrill mentioned he still had furniture in his home that was paid for by some patents :)

Ha, this is true! (I know we talked about it recently, but I can't find it either.) I would say that the program at Sun definitely incentivized filing patents, but it was always perverse: when it paid out for invention disclosures, people did a bunch of bad invention disclosures; when it became much more heavily backloaded to reward granted patents, it rewarded people so long after the fact as to be meaningless. (But it did allow us to buy some good Amish furniture that I do indeed still have!) It's clear from the article that IBM went on a similar journey, settling on this goofy innovation frequent flyer system?!

All of that said, scrapping the program is probably the right decision: especially with patent law tracking the way it has (namely, making it harder for patent trolls), there has been less of an imperative around patents -- and paying out for patent-related work conflates all innovation with patentability, which is a mistake in my opinion. I have not (and would not) establish an incentive program around patents: it's great to reward innovation, but cash bonuses for patents isn't it -- however well-crafted the resulting furniture may be. ;)

One sided clawback of deferred compensation? I certainly hope someone sues them.

I don't, because it would be a massive waste of time.

Labor laws vary by jurisdiction, but it's extremely unlikely that "points" like this that have to be accumulated before being cashed out is considered "deferred compensation" in the vast majority of locations IBM operates out of.

Employers have an unbelievable amount of latitude in the administration of these sorts of fringe benefits.

> "deferred compensation"

Usually such programs are structured intentionally to avoid such designation.

When does IBM launch their commercial airline, to accompany the revamped, silly-named points program that invalidates all previously accrued points?

As far as I can tell, the frequent flier program is the one thing that almost never gets touched even in bankruptcy.

Taking away already earned compensation is wrong. And probably illegal.

Even if it is just points that convert into cash.

They're not getting rid of the program.

It's just being replaced by another program, but for some reason they are not transferring the points. Very dumb and easily fixable.

>for some reason

It's for cost cutting.

Oh really? and just WHAT is the conversion rate between a PatentPoint and a BluePoint? </s>

I hope in the next few years, someone can be bothered to see if/how this event correlates with IBM's yearly patent-filing numbers.

Do you think they planned the changes in the award program, company financing, marketing, and policy, but missed transferring points, just happening to change a $x liability into a $0 dollar liability by accident?

Your first patent is like "Ohhhhh!" but subsequent ones are like "meh!" If you take away the financial incentive to do patents then I won't even try filing them. If you don't pay me enough to file one then I won't bother. Filing patents is a hassle and dealing with the lawyers and crawling through legalese is a pain in the bum. Once you have a couple then it's all about the $$$ IMO.

iBM must be cutting their throat to save a few bucks. They used to be a massive patent harvesting machine.

When I was at IBM, the whole patent/publication process was intensely gamed. Most employees in my division weren't particularly interested but made efforts to patent/publish because it was part of moving up salary bands.

A few true sociopaths went totally scorched earth with it - digging up years-old reports generated by other teams, getting them published after minimal "updates", and claiming lots of bonus dollars along the way.

It was a very weird experience working at IBM for me . . .

I mean, it is IBM. From my experience working there you either have really young people that are just at the beginning of their careers or lifers who know and exploit the system inside out

“We simply have no problem continually cutting employee reward programs, as they allow us to return value to the shareholder, which is our #1 priority.”

I filed some patents under this system and made $10k

removing this system basically just reduces the number of garbage patents issued, which is a net gain for society even if some employees miss out on some money

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