IBM 1997 Annual Report Download - page 50

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48
In addition, the acquisition of Object Technology International, Inc. in 1996 resulted in a valuation of purchased in-process
research and development amounting to $18 million, bringing the total amount of purchased in-process research and
development in 1996 to $435 million. In accordance with applicable accounting rules, the $435 million was expensed upon
acquisition in the first quarter of 1996, and the $1,840 million was expensed upon acquisition in the third quarter of 1995.
Employees
Percentage Changes
1997 1996 1995 1997-96 1996-95
IBM/wholly owned subsidiaries 269,465 240,615 225,347 12.0 6.8
Less than wholly owned subsidiaries 20,751 28,033 26,868 (26.0) 4.3
Complementary 43,000 37,000 38,000 16.2 (2.6)
management discussion
International Business Machines Corporation
and Subsidiary Companies
As of December 31, 1997, employees of IBM and its
wholly owned subsidiaries increased 28,850 from 1996,
mainly from hiring in high-growth areas of the business —
services, storage, Tivoli and Lotus, as well as from
continued expansion in emerging geographic markets
and acquisition of business entities, such as Unison
Software. In 1997, Advantis, with approximately 5,000
employees, and Technology Service Solutions, with
approximately 5,100 employees, previously less than
wholly owned subsidiaries, were acquired from Sears
and Eastman Kodak, respectively.
The decline in employees in less than wholly owned
subsidiaries reflects the acquisition of the minority
interests in Advantis and TSS, offset by growth in the
company’s rapidly expanding global services business, as
well as in emerging geographic markets, such as China.
The company’s complementary work force is an
approximation of equivalent full-time employees hired
under temporary, part-time and limited-term employment
arrangements to meet specific business needs in a flexible
and cost-effective manner.