Accenture India staff to face brunt of layoffs

BENGALURU: Technology major Accenture is expected to lay off around 25,000 people or least 5% of its global workforce, with firings expected in India as well.

The development was first reported in The Australian Financial Review, citing a staff meeting by Accenture chief executive Julie Sweet in mid-August.

In India, it employs 2 lakh people, making it the employee hub for the technology major which has a global staff count of 5 lakh.

The Australian Financial Review reported that in an internal global staff meeting streamed online this month, Accenture's Julie Sweet had said that despite cutting subcontractors and halting fresh recruitment, the company still required to trim employees.

According to the report, Sweet had said "chargeability", or the amount of working hours its staff could attribute to paying clients, had dropped below 90% for the first time in a decade, and performance metrics were being used to target staff to "transition out" of the company.

Layoffs at Accenture first came to light when the US media reported about hundreds of jobs cuts in the UK. According to a 1 July report in The Guardian, the company was slashing up to 900 jobs in the UK to reduce costs in the face of lower demand for its services. The New York-listed company employs 11,000 people in offices across the UK including in Aberdeen, London, and Cambridge.

Commenting on the layoffs in the UK, an Accenture spokesperson for India had earlier said that "Beyond this, we are not planning extraordinary global workforce actions".

Addressing analysts' questions on layoffs in the Q3 (March-May) earnings call, Sweet had said, "We have identified some real areas of efficiencies and so that has obviously headcount implications to it, which maybe what you are calling layoffs. We really see it as focusing on our cost structure and then otherwise, managing our supply and demand as I went through before, pretty ordinary course.”

To be sure, Accenture is not the only IT company to have laid off employees. Recently, Nasdaq-listed IT services firm Cognizant Technology Solutions Corp. which has more than 2 lakh employees in India, reportedly laid off thousands on the bench who were not actively involved in any project. IBM too has reportedly laid off about 2,000 employees globally.

“At this time we are not planning extraordinary global workforce actions.

Every year, as part of our performance process, we have conversations with our people about how they are performing, areas for improvement, their potential to progress, and whether they are a long term fit for Accenture,” Accenture said in a statement.

“This year, across all parts of our business and all career levels, we will identify approximately 5% of our people as our lowest performers, and these individuals will transition out of Accenture. This is consistent with our actions each year.

We continue managing our business for the long term and critical to this is ensuring we have the right people with the right skills to best serve our clients. In India, we continue to hire, and as part of our ongoing compensation programs, we also recently recognized a number of our people with bonuses and promotions,” the company added.