Parent is absolutely right, and this is true of many large companies today. Within IBM, there is too much focus on saving a dollar and doing things on the cheap, while missing the bigger picture and becoming ever distant to one's customers through intertwined cogs and wheels of process bureaucracy. There is a very strong innovative drive by doing your development in regions that have strong universities, a culture for innovation and local use and appreciation of the end product. Where that is depends on what you're doing. For cars, southern germany, for the web, california, for finance NYC and London.
However, by outsourcing everything to China and India, you loose that innovative drive, which erodes your longer term growth.
This is fine in only two cases I think, A) you don't care about the innovation of what you're developing (it's not your core business), or B) the type of work you're doing is extremely expensive *and* specialized (eg. chip design & manufacturing,) making it hard for an upstart to compete with you, even if your work is sloppy.
IBM rarely innovates anymore aside from some of its hardware, I'm not aware of any genuine software innovations from IBM in, say, the last 10 years.
The way large companies seem to be doing it now is by acquiring their way into innovation. I'm happy they do, because it makes startups that more valuable to do. Perhaps if large companies are changing their game, we engineers should wake up and adapt ours.. do more startups?