SAP to slash 2,250 jobs to refocus the company

SAP is set to slash nearly 2,250 jobs, or around 3 percent of its global workforce.

The initiative is part of refocusing of the software company.

The business software maker will also be creating a similar number of jobs in expanding parts of the company, Reuters reported.

Last year Europe’s largest software maker, which employs about 75,000 workers worldwide, decreased a similar percentage of posts.

Stefan Ries, chief of human resources at SAP, said: “In principle this is a continuation of the company’s response to changes in market circumstances,” Ries said, adding the cuts were not part of a cost reduction plan but a refocusing of the company.

SAP workers in Europe can make use of voluntary leave arrangements. In Germany, France, the United Kingdom and the United States, SAP will in addition be offering early retirement.

In Q4 2014, SAP said its software and software-related service revenue increased 5 percent, cloud subscriptions and support revenue grew 85 percent in the EMEA region.

SAP revenue rose 7 percent to €5,458 million in Q4 2014. Cloud subscriptions and support backlog increased 94 percent, exceeding €2.3 billion in 2014.

SAP has more than 5,800 HANA customers and more than 1,850 suite on HANA customers.

The German software major is targeting €7.5 – €8.0 billion in cloud subscriptions and support revenue and €26 – €28 billion total revenue by 2020.

SAP HQ image

SAP said it excludes forced redundancies in Europe.

SAP is planning to create about 2,200 jobs this year in growth areas such as its cloud business, its in-memory database Hana and Concur, the expenses software maker it bought last year for $7.3 billion.

Last year SAP created a similar number of new jobs, Ries said.

The report said SAP is battling to boost internet software sales and fend off pure cloud-based rivals such as Salesforce.com and Workday.

Earlier, there were rumors that IBM could look at slashing around 100,000 jobs. IBM clarified that it is slashing jobs, but the target is not near the speculated figure.

Baburajan K
[email protected]