US IT service firm DXC has let go of 10,000 people, or 7 percent of its workforce, in the last fiscal year as part of a turnaround plan. At least half of these cuts were in India.
The firm which was formed in 2017 with the merger of CSC and HP Enterprise's service business had a headcount of 1.7 lakh employees the time the merger was announced. Now the employee count is down to 1.33 lakh. DXC employs 43,000 people in the country where it has its largest delivery engines for application outsourcing and software development.
In the Q4 investor call, DXC CEO Mike Lawrie stated that the company plans to add people with digital capabilities adding,” this balance between digital growth and traditional decline will continue to be lumpy as we go through the next year.”
The firm has looked at a three-way approach to cost rationalization, including headcount, subcontractor expenses, and real estate. The cuts come as the IT firm is looking to find a path to growth and stability during this market. In India too, the company is facing growth challenges with the net profit in 2017-18 down to Rs. 276 Cr compared to Rs. 305 Cr the year before.
While a significant number of job cuts have been made in India, it is unclear how many of the new jobs as part of the digital hiring will make way here. The cuts follow recent cuts made by another IT firm Cognizant firm last week which offered voluntary separation to 300 top executives.