Struggling phone manufacturer Nokia has announced another round of job cuts. This time the workforce reductions are hitting the company’s IT department.
Eric Savitz from Forbes reported, “Nokia this morning announced plans to shift 820 IT jobs to a pair of India-based outsourcing companies, HCL Technologies and Tata Consultancy Services, in a move to ‘increase operational efficiency and reduce operating costs.’ The company also plans to cut up to 300 employees from its IT organization.”
Computerworld’s Mikael Ricknäs explained, “The day-to-day operations of Nokia’s internal IT infrastructure will move to HCL, which has provided Nokia’s IT service desk since 2009, a Nokia spokeswoman said via email. HCL has entered into a long-term agreement with Nokia that includes data center, network management, end user computing services and service management, it said in a filing to the Bombay Stock Exchange. Employees planned to be transferred to Tata work on the development of ongoing internal applications and services, according to Nokia.”
All Things D’s John Paczkowski noted, “The move, which ironically follows the preannouncement last week of better-than-expected fourth-quarter results — are part of a massive cost savings plan Nokia announced last summer. At the time, the company said it intended to eliminate 10,000 jobs in its mobile division by the end of this year. Today’s cuts are said to be the last from that plan, which was implemented to ‘rescale’ Nokia’s operation as it scrambles to reverse its fast-declining fortunes.”
The Wall Street Journal’s Sven Grundberg observed, “Under the watch of Nokia’s Canadian-born CEO, the company has become a substantially smaller outfit. It had a total of 105,000 employees at the end of the third quarter last year, down from 130,000 employees in the fourth quarter of 2010…. The company’s staff in Finland has been especially hard hit, declining 27% from the beginning of 2009 to the end of 2011, with the handset maker shedding an average 1,700 Finnish employees per year over the three-year span. The Finnish head count promises to have fallen further in 2012, during which the company implemented thousands of new layoffs and closed its only remaining production plant in the country.”