Sales staff safe from HP cuts

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Sales staff safe from HP cuts

Some 9,000 positions lost to automation.

Client-facing positions are likely to be spared from the 9,000 global job cuts announced by HP overnight.

On a U.S. investor call last night, HP revealed plans to "streamline" its Enterprise Services business with job cuts and an injection of US$1 billion (A$1.19 billion).

The changes would take place over a "multi-year" period and provide a platform for growth during the next decade, the company said, declining to disclose details of its timeline.

The restructure is expected to generate between US$500 million (A$596 million) and US$700 million (A$835 million) in net savings by the end of fiscal 2013.

HP Australia was unable to provide geographical locations of job cuts, or disclose its staffing figures by region or business unit. Globally, the company had a total of 304,000 staff in October 2009.

"Final decisions regarding specific positions are still being made; however, very few of the affected positions are expected to be client-facing," it said in a statement.

"HP will not be providing geographical locations of the job cuts at this time as final decisions have not been made."

Along with the redundancies, HP also plans to increase its sales and service delivery staff with 6,000 new hires globally.

"We expect the improved market competitiveness to enable even more customer wins," the company's Enterprise Business executive VP Ann Livermore told investors and analysts last night.

In September 2008, HP cut 24,000 jobs, generating expected savings of US$1.8 million. It promised employees severance packages, counselling and job placement services.

At the time, HP planned to consolidate real estate, IT and procurement services. It now plans to consolidate data centres, management platforms, networks, tools and applications.

The company claims also to have integrated more than 100,000 employees as part of its EDS integration, which Livermore said is now complete.

"As we look back over the last five to 10 years, most of the activity in the services organisations as a [broad] industry statement was focused on the location of jobs, geographic locations of jobs and a lot on labour arbitrage," Livermore said.

"We think the next five to ten years is all going to be about who can best use technology to automate the delivery of services ... that helps both from a cost perspective as well as automation drives the highest quality levels.

"We think that's a very important area of differentiation for HP," she said.

The Australian Services Union, which has represented IT workers at HP, IBM and EDS, declined to comment.

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