Concerns have been raised by SAP’s European Works Council regarding the software company’s recent plans to reduce its workforce by one to two percent annually. According to a report in the “Handelsblatt” the council has cautioned against “long-term damage” resulting from talent losses and diminished trust among clients and employees.
Speaking to the “Handelsblatt” Works Council Chairman Andreas Hahn stated that the measure appears to be driven by short-term financial goals rather than a strategic transformation and is implemented without adequate assessment. He expressed fears that the SAP executive board may increasingly utilize layoffs as a routine instrument to meet financial targets.
Currently employing approximately 109,000 individuals, SAP could potentially see up to 2,200 positions eliminated as a result of the plan. The company has yet to disclose the precise scale or geographical distribution of the cuts.
The communication surrounding the planned reductions has also caused confusion and dismay. Chief Financial Officer Dominik Asam likened the layoffs to routine teeth brushing when addressing financial analysts – a comparison that he subsequently apologized for.
In a statement to the “Handelsblatt” SAP said that it is concentrating on continuous process and structural optimization, alongside strategic investments in future capabilities, as the industry undergoes a transformative shift driven by artificial intelligence and cloud technologies. The company affirmed its commitment to investing in training and recruitment within “critical growth areas”.
