IBM to cut 10,000 jobs
Published: 05 May 2005 09:00 BST
IBM plans to cut between 10,000 and 13,000 positions worldwide and to reorganise its management structure.
The changes, which will mostly affect IBM's European operations, will result in a charge of between $1.3bn and $1.7bn in the second quarter this year and "yield benefits" in the second half of the year, the company said on Wednesday.
The restructuring, a significant move for the company, was expected following the firm's disappointing first-quarter 2005 earnings. Last month, IBM chief financial officer Mark Loughridge said the company would undergo a "sizable restructuring" to address weak areas, notably in Europe.
IBM said employee reductions will include both layoffs and voluntary departures. The majority of the cuts will be in Europe, where the company has initiated discussions with unions.
The reorganisation involves the streamlining of management in Europe. IBM said it will eliminate its pan-European management layer to reduce internal bureaucracy.
"IBM will create a number of smaller, more flexible local operating units in Europe to increase direct client contact," the company said in a statement.
The plan also calls for IBM to move some of its European personnel who work in its IBM Global Services division and consolidate them in fewer locations worldwide.
Loughridge will offer more details about the restructuring on Thursday morning, the company said.
Did you find this article useful?
54 out of 119 people found this useful
Digg
Slashdot
Del.ici.ous
Stumble
Reddit
Full Talkback thread
2 comments
