Technology giant Hewlett-Packard said overnight that it
would chop about 24,600 jobs, or 7.5 per cent of its total workforce
following its US$13.9 billion acquisition of Texan IT services firm
Electronic Data Systems.
In a statement, the company said the "restructuring program"
would take place over the next three years, with the staff
reduction to vary by country, "based on local legal requirements
and consultation with work councils and employee
However HP also expected to replace roughly half of the
positions over the same period, to create what it called a global
workforce with the right blend of services delivery
No mention was made of the fate of HP and EDS' Australian staff,
although the company may need to deal with unions
locally to reduce its headcount substantially, as EDS' local
workforce is heavily unionised. Nearly half of the reductions will
occur in the United States.
In general, HP said the firm wanted to better align the combined
company's structure with the operating model it had used over
recent years. "In addition to making changes to its global
workforce to better serve its services customers, HP has identified
synergies in corporate overhead functions, such as real estate, IT
and procurement," the company said.
The restructuring program is expected to result in annual cost
savings of about US$1.8 billion, with that amount taking into
account some reinvestment. The company will take a charge of US$1.7
billion related to the program.