27000 job cuts by the end of fiscal year 2014, is a part of Multi year restructuring plan to fuel innovation and enable investment. The announcement came on Wednesday.
HP has outline the multi year plans designed to simplify business processes, advance innovation and deliver better result for customers, employees and shareholders.
HP is expecting to save $3 to $3.5 billion after fiscal year 2014 and majority of this amount will be invested back in the company. Results which Hp will produce with this investment
- Enabling investments in people, process and technology will allow HP to accomplish the restructuring effort and generate saving.
- It will significantly improve efficiency and customers service for several years.
- The savings will be used to boost investment in innovation in three strategic focus area of HP that is cloud, big data and security.
Layoff is a part of restructuring and by the end of fiscal year 2014 HP will cut 8% of the workforce. The layoffs will vary by country and it will depend on local legal requirements. HP will achieve additional savings by supply chain optimization, SKU and platform rationalization, go-to-market strategy simplification and business process improvement.
Meg Whitman, HP President and CEO has said “These initiatives build upon our recent organizational realignment, and will further streamline our operations, improve our processes, and remove complexity from our business,”. She also added “While some of these actions are difficult because they involve the loss of jobs, they are necessary to improve execution and to fund the long term health of the company. We are setting HP on a path to extend our global leadership and deliver the greatest value to customers and shareholders.”
HP expects to reinvest savings in each of its business segments to strengthen their ability to stay ahead of customer expectations and capitalize on growing market trends. Investment which Hp will make will happen in following areas.
1. Core printing and Personal system business to drive innovation and differentiation. Investment will also be made in marketing and sales productivity and tools which will made easier for a customer to do business with HP.
2. Services will invest Cloud, Security, and information analytic by enhancing HP intellectual properties.
3.Software will invest to speed development in the areas of security, big data and the management of application lifecycle and infrastructure solutions, both on premise and in the cloud.
4.Enterprise Servers, Storage and Networking will invest to accelerate its research and development activities to extend its leading portfolio of servers, storage and networking.
Source HP newsroom