Business media is reporting that SAP is about to undertake this providers second round of headcount restructuring. The current cutbacks are reported to involve upwards of 2200 positions following similar restructuring last year.
A published Bloomberg report cites SAP’s personnel chief as indicating that the total number of jobs affected will amount to about 3 percent of SAP’s worldwide workforce of 74,000. However, SAP spokespersons are quick to point out that the job cuts are more to do with internal business changes rather than cost savings. The Bloomberg report cites Ralf Herzog, the chairman of SAP’s works councils, as indicating: “that groups received information Thursday afternoon about “a very high level” of job cuts. Since the program is “apparently voluntary,” SAP “seems to have learned from its experience” with last year’s job action.”
In its reporting, The Wall Street Journal pointed to SAP’s ongoing transition to being more of a cloud services provider as prompting workforce changes, namely less emphasis on installation and update of software. That article indicates that SAP staff deemed redundant will either be trained in new responsibilities and those unwilling or unable to make the change being asked to leave or in the case of European based employees, offered early retirement or other compensation.
As Supply Chain Matters and others continue to point out, the effects of cloud computing adoption and rapidly changing market realities are indeed real for existing enterprise software providers and they are attempting to adjust their business models to deal with such realities. We have heard undertones of similar job cuts emanating from other enterprise software providers as well.