Around 300 executives across its India centres were laid off last week by Software major SAP Labs, research and development business unit of German technology firm SAP. The layoffs majorly impacted the offices at Bengaluru and Gurgaon, sources told the Economic Times.
According to one of the sources, the layoff was due to the closure of a worldwide delivery centre that held specialised development positions for SAP implementation projects. The impacted workers, some of whom have between 10 and 15 years of experience, have received severance packages that include benefits and salary corresponding to the number of years they worked for the company, the source said.
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According to a company spokesperson, the company is going through a strategic transformation that began two years ago, and as part of an organisational re-prioritisation, it has intensified its focus on providing value to both current and potential customers in the cloud as well as on high-growth opportunities.
“This was a difficult decision and we are deeply aware of the personal impact of these changes,” the spokesperson said.
As of now, it has a capacity of 19,000 employees in India. Some of the employees affected are hopeful of getting absorbed back into SAP via available roles, one of the sources mentioned above told ET.
“We have two months in terms of a notice period and have till then to find jobs,” said one of the affected employees.
SAP Labs is working on a second R&D campus in Bengaluru. Last year, it had announced to double its capacity in India by 2025. Back then, SAP Labs said it had 14,000 employees in the country across its five locations in Bengaluru, Pune, Mumbai, Gurgaon and Hyderabad.
India is the largest employee base for SAP outside its global headquarters. Recently, the firm had announced the intent to cut off around 3,000 jobs, or 2.5 percent of its global workforce, as the Germany software company looks to cut costs and focus on its cloud business.
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In an email to employees after the restructuring announcement, SAP executive board member Thomas Saueressig said, “…we announced the intent for a targeted restructuring that supports our transformation and helps set up ourselves for sustained success in the future. We are amid the most complex transformation SAP has ever gone through – and we are making great progress despite an incredibly challenging macroeconomic environment. To continue this journey and make the turnaround, we will need to align our portfolio in select areas and adjust our presence in a few carefully chosen markets.”
“Yet today is a difficult day. And I must admit, it is hard to find the right words. While these will be targeted measures, in consultation with our social partners, a restructuring is always significant. It is significant because it impacts our colleagues, their families and their lives. We know that and we all feel the burden. That is why we will go through this process with the utmost respect, diligence, support and care for all our affected colleagues,” he added.
