OYO to let go thousands across China and India
OYO Hotels is letting go of thousands of staff across China and India, as per people familiar with the matter. The company has let go 5% of its 12,000 employees in China partly due to non-performance while dismissing 12% of its 10,000 staff in India. On the anvil, are plans to shed another 1,200 in India over the next three to four months, as per reports.
OYO said in a statement, “We continue to be one of the best places to work for and one of the key reasons for this has been our ability to consistently evaluate, reward and recognize the performance of individuals in a meritocratic manner, and enable them to improve their performance.”
The downsizing and restructuring exercise is yet another setback for Masayoshi Son's SoftBank, one of the biggest investors in OYO. SoftBank’s portfolio companies have been stricken by trouble such as recent trouble at WeWork and falling share prices at Slack and Uber.
Further adding to OYO’s troubles, hotel owners in China have been protesting in front of the company’s offices, accusing the startup of violating contractual agreements. OYO has stated it will enhance communications with hotel owners and develop owner loyalty this year. It plans to launch the VIP owner program, and contact owners regularly, to ensure that the interests and needs of the hotels are equally taken into account.
The startup has also seen a slew of management changes in tandem with its aggressive expansion strategy. In December, it promoted its real estate business chief, Rohit Kapoor, to CEO for India and South Asia to further chart its growth strategy. However, its reputation has suffered on account of customer complaints about bad experiences as well as complaints from several of the more than 20,000 hotel owners in its chain about unfair treatment. The layoffs are further going to add fuel to this fire.