19,000 jobs are to be cut at the US consulting firm.
(Photo: Reuters)
Dusseldorf The world’s largest consulting firm, Accenture, is planning large-scale job cuts in its global organization. 19,000 jobs are to be lost within 18 months, a good 2.5 percent of the entire workforce. The company, which specializes in IT and technology consulting, is thus reacting to the recently weaker business.
The company’s announcement is seen as a further signal that the difficult economic environment is also affecting the consulting business. The listed Accenture earned less in the second quarter of the current financial year, ie from December to the end of February: the margin fell from 13.7 to 12.3 percent, and sales increased by five percent to $15.5 billion.
However, the increase was solely due to the Managed Services division, in which Accenture bundles global outsourcing services. The Group takes over the operation of IT and other internal processes for its customers and can build on long-term contracts.
Accenture announces job cuts – consulting business has recently shrunk
The pure consulting business, on the other hand, shrank in the second quarter – and above all the services for tech and media companies in the USA, which are currently on austerity measures themselves.
Accenture is an industry leader with more than 700,000 employees worldwide and most recently $62 billion in annual revenue. The company has grown rapidly in recent years – both organically and through acquisitions.
But now the management is cleaning up its own organization. A step that can currently be observed at many consulting firms. A few weeks ago, McKinsey announced internally that it would cut 2,000 jobs and find a new strategy.
>> Read also: Unrest at McKinsey – consulting calls its own strategy into question
In an email sent to McKinsey alumni, it says: “Our business model no longer suits the purposes of a modern company.” With 45,000 employees, the company is three times as big today as it was ten years ago.
Like McKinsey, Accenture is not planning any cuts in the operational units, i.e. among the consultants and specialists with customer contact. Significantly more than half of the job cuts are attributable to employees from the so-called “back office”, i.e. the internal service units.
According to Accenture, it expects costs for severance payments and other personnel costs in the amount of 1.2 billion dollars. The group also plans to save 300 million dollars in one-off costs for office space.
Whether and how the austerity program will affect Accenture’s German unit was still unclear on Thursday. In Germany, the US company is estimated to have around 16,000 employees and, according to market researcher Lünendonk, sales of 2.6 billion euros.
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