AurosBlog

SAN FRANCISCO: Hewlett-Packard Co plans to cut 7.5 percent of its work force, or 24,600 jobs, seeking to realize savings from its recent acquisition of Electronic Data Systems Corp, the company said on Monday.

HP said it will carry out the cutbacks over the next three years, while replacing about half the jobs in new areas of its services business. It announced the plan ahead of a meeting with Wall Street analysts to detail the merger plans.

Nearly half of the job reductions will take place in the United States, the Palo Alto, California-based company said.. EDS was headquartered in Plano, Texas, near Dallas.

HP said it will take a charge of $1.7 billion in the fiscal fourth quarter ending in October. Accounting for goodwill will cost $1.4 billion, while cost of the restructuring will involve anther $300 million.

HP estimated $1.8 billion in annual cost savings once the three-year cost-cutting program is completed.

“We are good at integrating companies … I believe we will do it well,” Chairman and Chief Executive Mark Hurd told financial analysts at the company’s headquarters.

At the time the $13.2 billion merger of computer services provider EDS into HP was announced in May, Hewlett-Packard counted 178,000 employees on its books and EDS had 142,000 employees.

Including the value of common stock, options and restricted stock units, the enterprise value of the deal totals $13.9 billion. The deal closed last month.

Hewlett-Packard said the vast majority of the cuts would focus on eliminating overlapping jobs at EDS in corporate functions such as legal, accounting,information technology and human resources.

Work-force reduction plans will vary by country, based on local legal requirements and consultation with works councils and employee representatives, HP said. The company will provide employees affected by this restructuring program with severance packages, counseling and job placement services.

Satyam Computers to axe 4,500 employees
15 Sep, 2008, 0645 hrs IST,Debasmita Ghosh, TNN

TCS, Wipro recast hiring plans
16 Sep, 2008, 0743 hrs IST,Avinash Nair & Kumar Anand, ET Bureau

AHMEDABAD: As the heat of global slowdown spreads, several players in the IT and ITeS sector have modified recruitment policies, keeping them in sync with the changing market conditions and their pockets. The likes of TCS, Wipro and Keane are either going slow on recruitment or are hiring more number of trained hands.

“During 2008, recruitments in IT/ITeS sector has seen a fall of 20-22 % as compared to the same period last year. The players have become more cautious,” says Bangalore-based HR firm Ikya Human Capital Solutions chairman Marcel Parker.

“There is a delay in decision making. While most IT firms have deferred their hiring, some have postponed their training programmes. A few have opted for judicious justin-time recruitment process,” Parker told ET.

TCS, that recruits about 18,000 employees every year has decided to make significant cuts in recruitment patterns to tide over the crisis. “This year we are not going for any mass recruitment.
We have cut down on at least 20% of the total recruitment,” said a senior HR official of TCS in Gujarat. “Our focus has largely been to hire more experienced candidates than go in for fresh recruits”, the official added.

Similarly, international IT firm, Keane is not just going slow on recruitments, but have also adopted a ‘just-in-time-approach’ on hiring. “Since the last three years, we used to hire 30-40 % more people than the previous year. But this year we are sticking to almost the same number of people we recruited last year”, said Keane India senior VP S G Raja Sekharan.

“Since January we have already made job offers to 3,000 students, which is in the range of what we had did last year. We do not want to make job offers and scale back (if market conditions deteriorate),” he said.

“The confidence level in the markets is low compared to the levels that existed three years back. It is very difficult to forecast where the markets are headed in the recent future,” Mr Sekharan said.

IT-giant Wipro has introduced stringent ‘quality measures’ into their hiring pattern. “We have made our process even more stringent and brought in measures to ensure quality of hire. Innovative measures have been introduced including setting up a Talent Quality Group within Talent Acquisition”, said Wipro Talent Acquisition VP Pradeep Bahirwani.

In order to hire quality manpower, Wipro has also started campus hiring in US and UK. “We have pioneered programmes like Wipro Academy of Software Excellence (WASE) which helps graduates learn while they work on projects with us. We have an active campus program in India and have also started campus hiring in US and UK,” he said.

NEW DELHI: Wipro Technologies has put about 4-5% of its workforce, about 2,400-3,000 employees, under the scanner for non-performance. While some would be given counselling to improve their performance, others would be asked to leave.

Wipro’s corporate vice-president (human resources) Pratik Kumar confirmed the move. “It’s a regular annual exercise. As the appraisal cycle gets over, a multi-layer review happens. Following that, people who have fallen in the lower quadrants of performance are put on watch. Some are asked to pull up and others are asked to move on,” he said.

Asked how many employees had been asked to move on, he said the company did not disclose that number, but it was “significantly lower than 2,000″. Company sources said about 1,000 employees were being asked to leave. “I can’t comment on a particular number,” Mr Kumar said, when asked to comment. The review includes all the 60,000 global IT services employees from the senior leadership team down to the person with one-year experience.

In February, Tata Consultancy Services (TCS), the country’s largest IT services firm, had given pink slips to 500 non-performers. IBM, too, had asked about 700 employees in India to leave, citing non-performance. In July, Patni Computer Systems had shown the door to 400 employees. While IT companies said the move was not linked to the slowdown in the US, a key market for IT services, there was a consensus that it was time for belt-tightening.

At the end of the quarter ended June 2008, Wipro’s IT services employee base had fallen to 61,345 from 62,070 employees at the end of the previous quarter.

“It’s not just our view, but the industry’s view, that we have to be thoughtful of additions and drive productivity. We took a closer look at our hiring and realised that we did not need to hire more, since there were people on the bench,” Mr Kumar said. Bench refers to the buffer of employees not assigned to a particular project.

As the company works towards improving utilisation rates while keeping a tight rein on employee additions, its bench strength would come down. At the end of the quarter ended June 2008, Wipro’s utilisation rate was 78% (excluding trainees) and 74% (including trainees).

“We want to raise utilisation by 1-2% during the year and the bench strength would go down by a similar percentage,” Mr Kumar said.

Position
Nov 2006

Delta in Position

Programming Language

Ratings
Nov 2007

Delta
Nov 2006

Status

1

1

20.542%

+0.14%

2

2

13.969%

-3.23%

3

4

10.228%

+0.76%

4

3

8.750%

-2.30%

5

5

8.687%

-0.52%

6

6

4.738%

-1.49%

7

7

4.227%

+0.59%

8

8

3.917%

+0.89%

9

12

3.084%

+1.37%

10

9

2.928%

+0.62%

11

10

2.456%

+0.20%

12

14

1.704%

+1.02%

13

13

1.179%

-0.04%

14

11

1.129%

-1.08%

15

16

0.754%

+0.17%

16

48

0.746%

+0.66%

17

17

0.708%

+0.14%

18

15

0.647%

+0.01%

19

19

0.639%

+0.12%

20

18

0.613%

+0.07%

Programming Language

Ratings