In 2017, it had given voluntary severance packages to 400 senior employees.
IT services major Cognizant may soon cut more jobs as the company's financial details showed a mismatch between the number of people hired and its revenue growth in the past two quarters, as per a report in Business Standard.
The US-based company's growth in this calendar year has been the lowest in its history. In 2017, it had given voluntary severance packages to 400 senior employees to manage a part of its costs. However, sources said this time the number of people being let go will be higher and the process will be across the levels.
"While last time, the job cuts were limited to senior-level staffers, this time, even non-billable mid-level executives such as managers and even staffers in the consulting vertical with low utilization levels are likely to be affected," a source said. Another person aware said these layoffs will mostly be focused in India, which is the largest offshore delivery location for Cognizant. The company has over 70 percent of its 281,000 employees (2018) in India.
"As part of our realignment progamme, management is currently evaluating various strategies, including additional employee separation programmes. The timing, nature and magnitude of these initiatives are not finalised yet," Cognizant told the paper in an email.
Brian Humphries, the new CEO of the company, said that there is a dire need for austerity measures, including layoffs. Cognizant, in a surprise announcement last week, cut its revenue guidance by almost half to a range of 3.6 to 5.1 percent. "I believe cost equals growth. We will improve our cost structure as a means to invest in growth. Our headcount growth has exceeded the rise in revenue in the past two quarters," said Humphries.Before expanding the company, Chief Financial Officer (CFO) Karen McLoughlin said that there has to be an improvement in prices, employee pyramid optimisation and utilisation of the company's resources to the fullest.The Great Diwali Discount!
Unlock 75% more savings this festive season. Get Moneycontrol Pro for a year for Rs 289 only.
Coupon code: DIWALI. Offer valid till 10th November, 2019 .