Did PM Narendra Modi’s streamlined new cabinet inspire India Inc to downsize too? The recent trend seen in India seems to be that of layoffs and downsizing

layoff opt More Layoffs & Downsizing in Store for India Inc?

  1. When he assumed office, new Prime Minister Narendra Modi showed us that there will be changes made when he created a new look, streamlined cabinet with fewer, multitasking ministers. Whether this inspired India Inc to do the same is debatable; however the recent trend seen in India seems to be that of layoffs and downsizing.
  2. It was recently announced that Nokia would be stopping the production of handsets at its manufacturing facility at Sriperumbudur from the 1st of November 2014. When Microsoft acquired Nokia earlier, this factory wasn’t part of the deal because of an assets freeze order due to a tax dispute with authorities. A statement has been issued that 1,100 employees will continue to receive remuneration until the closure of the plant is officially declared. (Source – Economic Times).
  3. Yahoo will be laying off as many as 300 employees in India as a part of a radical restructuring plan. More operations will be moved back to the company headquarters in Sunnyvale California. 300 of the 800 employees are being asked to leave and will receive a six-month severance package. (Source – Times)
  4. HP has also recently announced the laying off of five thousand employees as a part of the restructuring of the company that splits it into two smaller companies. (Source – EE India)
  5. Earlier this year we saw another instance of downsizing, with as many as 350 employees of Dell deciding to go with an exit option offered to them. One third of the nearly 1000 employees at the SAS Nagar (Chandigarh) unit opted for the voluntary separation programme of the company which was seen as a cost cutting measure. Officials of the company announced that this was in keeping with Dell’s global policy. (Source – Hindustan Times)
  6. Getit Infomedia, the online classifieds company that brings us AskMe and Yellow Pages was another enterprise that looked to cut the flab. While outsourcing as many of the company’s processes as possible, new mid and senior level management was brought in.
  7. In July 2014, Tata Steel announced a cut of about 400 jobs at its UK plant because of low demand and in order to improve competitiveness. The idea was to lower costs to enable to company to remain competitive in the European market. (Source – The Hindu)
  8. IBM announced that it would be cutting as many as fifteen thousand jobs worldwide and that this process would start in Bangalore. The announcement was made in February 2014 when the firm also announced that top execs would be foregoing bonuses, and other restructuring would help to restore profitability in the face of declining sales.
  9. Indian technology giant Infosys had also announced that as many as five thousand employees would be facing the axe, a move meant to cut excess flab added by low and non performing employees. Whereas earlier the company would give non-performers time to come up to scratch, this time around, it was decided to simply hand out the dreaded pink slips; 3-4% of the 1.5-lakh workforce was asked to leave. (Source – Economic Times)
  10. One wonders how the spate of recent layoffs and downsizing operations will reflect upon the Narendra Modi’s “Make in India” campaign

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