In an exclusive report by The Register, IBM's layoff strategy is going in a new direction. To initiate a new round of global job cuts, the company is offering voluntary layoffs to employees as it aims to achieve significant cost savings by the end of 2024.
This new initiative comes from the company's "Resource Action," as it's termed internally. It targets Enterprise Operations & Support, CIO, HR, and Real Estate departments, particularly impacting roles in Europe.
The move, while not solely financial, underscores IBM's transformational agenda, aligning with CFO James Kavanaugh's goal of achieving $3 billion in annual savings by 2024.
Reports suggest that 80% of the global job cut targets specific departments crucial to IBM's operations.
IBM's layoff initiative coincides with similar downsizing trends across the tech industry, including announcements from companies like Cisco and Dell. Recently, VCPost also reported a major global workforce reduction from Vice Media and Sony.
European Works Council discussions hint at substantial reductions across the continent, with regions like Slovakia, Hungary, and Bulgaria facing significant workforce reductions.
Behind IBM's Voluntary Layoffs
As for IBM, the voluntary layoff does not equate to a profit decline.
The tech company also maintains that its restructuring isn't solely driven by cost-saving measures but rather aims to enhance productivity and align its workforce with evolving client demands, notably in areas such as AI and hybrid cloud technologies.
This is all despite reporting positive revenue growth and operating profit in Q4.
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