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Telstra seeks 120 voluntary redundancies due to SDN reskilling

Telstra is seeking to reduce its numbers through voluntary redundancies following the need to transition its workforce from traditional infrastructure networks to software-defined networking.
Written by Corinne Reichert, Contributor

Telstra is seeking 120 voluntary redundancies from its Network Delivery business, part of the Telstra Operations arm, with the telco attributing it to workers needing to be reskilled in software-defined networking (SDN).

"The next generation of technology brings the need for new skills focused on software-defined networks, rather than traditional construction of an infrastructure-based network. We acknowledge some of our people may not wish to undertake the reskilling required," a Telstra spokesperson said in a statement to ZDNet.

"We are proposing a voluntary redundancy process for our Delivery employees, as it enables Telstra to balance the needs of the business and considers the personal preferences of our people. Should the proposal proceed, we would be seeking up to 120 voluntary redundancies across the team.

"We don't take decisions like this lightly, and over the last week we have been consulting with our people and unions to ensure we made the right decision for our employees, our customers, and our business.

Telstra in January announced its global SDN services, unveiling two additions to the service that would allow organisations to procure virtual network functions and make digital partnerships on demand.

Telstra and Cisco in March then announced three new SDN and NFV products to improve cloud security and global datacentre interconnection: Cloud Gateway Protection, Internet VPN, and Data Centre Interconnect.

The voluntary redundancies were first reported by the Communications Workers Union (CWU), which claimed that they were due to the impact of the National Broadband Network (NBN) rollout on Telstra's operations.

"In Customer Service Delivery, Telstra is scrambling to meet the dual demands of its own internal maintenance work and its NBN Operations and Maintenance contract," the union claimed.

"It has introduced overtime rosters, is recruiting trainees, and has advertised a number of fixed-term positions in the field workforce.

"Its failure to win any major part of the NBN construction work, however, has placed a question mark over the future of this part of its operations."

The CWU added that Telstra's previous outsourcing efforts are also impacting the business, with Telstra having contracted out a large amount of the design and construction work. Calling NBN's rollout targets "ambitious", the union added that Telstra may have an opportunity over the next two years to win more construction contracts.

Conversely, the Australian Competition and Consumer Commission (ACCC) last week said that recent contracts won by Telstra to construct and upkeep NBN's hybrid fibre-coaxial (HFC) network are so beneficial as to possibly give Telstra a "head start" in selling NBN services, and gain preferential service activation and fault handling and more insight into the rollout.

In December, NBN signed a memorandum of understanding that saw Telstra pick up design, engineering, procuring, construction, and maintenance within the HFC network, as well as undertaking to upgrade the HFC network to DOCSIS 3.1; and in April, NBN awarded Telstra a AU$1.6 billion contract to provide design and management services of the HFC network until 2020.

In regards to redundancies, Telstra last month confirmed that it is considering cutting an additional 204 jobs in its Global Finance Services business across business intelligence and analytics services, operational billing, credit services, and accounting.

"We constantly review the way we work to simplify our business and remove duplication. These proposed changes would consolidate some work because we are standardise [sic] our reporting and processes," a Telstra spokesperson said, adding that 35 current vacant Services Operations roles could also be removed entirely.

The CWU at the time reported that of these 204 jobs, 139 would be offshored.

Similarly, in July, Australia's incumbent telecommunications provider confirmed that it would be cutting another 326 jobs across its business, saying it would "remove duplication" in its customer service solution, and would "increase slightly the amount of work done by our partners overseas", with work types to be consolidated across Australia and the Philippines.

Telstra has had a rough 2016, with three executives -- CIO Erez Yarkoni, COO Kate McKenzie, and CTO Vish Nandlall -- departing the company along with seven network outages.

Rival telecommunications provider Optus said in July that it is also considering outsourcing back office roles across its HR and finance departments, although the resulting redundancies have yet to be revealed and would not occur until next year.

This followed Optus' announcement in April that it would be restructuring its Enterprise and Consumer divisions through a series of around 480 redundancies, with a "reshape" of its workforce planned in order to support its transformation into a multimedia company rather than a pure telecommunications carrier.

Optus rationalised the process by saying it would allow it to become more streamlined and "innovative".

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