Hewlett Packard has announced that the company will get rid of over 27,000 employees in a new restructuring plan, which is around eight percent of HP’s current workforce of 349,600.
The company has announced a restructuring plan which is intended to make savings of around $3 billion and $3.5 billion over the next few years until the end of 2014.
As part of the restructuring, HP expects approximately 27,000 employees to exit the company, or 8.0% of its workforce as of Oct. 31, 2011, by the end of fiscal year 2014. The company is offering an early retirement program, so the total number of employees affected will be impacted by the number of employees that participate in the early retirement plan. Workforce reduction plans will vary by country, based on local legal requirements and consultation with works councils and employee representatives, as appropriate.
Impact on Employees and Operations
The decision to reduce the workforce by such a significant number is not taken lightly. HP has emphasized that the restructuring plan is part of a broader strategy to streamline operations and invest in areas that promise growth and innovation. The early retirement program is designed to mitigate the impact on employees, offering them a voluntary exit with benefits. This approach aims to reduce the number of involuntary layoffs, which can be more disruptive to both the employees and the company.
The restructuring will also involve a thorough review of HP’s global operations. This includes evaluating the efficiency of various departments and potentially consolidating roles and functions to eliminate redundancies. By doing so, HP hopes to create a more agile and responsive organization that can better compete in the fast-paced tech industry.
Strategic Goals and Future Outlook
HP’s restructuring plan is not just about cost-cutting; it is also about repositioning the company for future success. The savings of $3 billion to $3.5 billion are expected to be reinvested in key areas such as research and development, cloud computing, and data analytics. These are sectors where HP sees significant growth potential and where it aims to establish a stronger market presence.
For example, HP has been making strides in the cloud computing space with its HP Helion portfolio. By reallocating resources to this area, the company hopes to capitalize on the increasing demand for cloud services. Similarly, investments in data analytics will enable HP to offer more sophisticated solutions to its enterprise customers, helping them make better business decisions based on data-driven insights.
Moreover, the restructuring plan includes a focus on innovation. HP recognizes that staying ahead in the tech industry requires continuous innovation. The company plans to foster a culture of creativity and experimentation, encouraging its teams to develop new products and services that can drive future growth.
You can find out more details about HP’s new restructuring plan over at HP.
Source The Verge
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