EDS' Asia Pacific South corporate communications manager, Brian Finn, said in a statement released to ZDNet Australia today the raft of cost reduction measures being assessed by internal task forces "will not do anything to reduce our service to clients".
The remarks are likely to be welcomed by EDS' heavyweight client base in Australia, some of whom are believed to have informally queried the supplier amidst reports the cuts could affect up to 15 per cent of its workforce worldwide. EDS, whose global workforce totals around 140,000, has secured a client list here that reads like a who's who of Australian business, including the Commonwealth Bank of Australia (CBA), SingTel Optus, Telstra and Westpac. A raft of government agencies are also clients, including the Australian Tax Office and the South Australian government.
Finn added that while the local operation had "not finalized any plans" and had "nothing to announce at this point," it had internal task forces in place "looking at our forecasting system as well as our asset deployment in 2002 and 2003".
His remarks follow the circulation last week of a global e-mail to staff by EDS' global chairman and chief executive officer, Dick Brown, in which he acknowledged the company was looking at slashing jobs not "critical to client care".
"This undoubtedly will lead to some job loss and realignment in other areas," he told his staff.
Brown issued his e-mail after EDS warned of a sharp slump in its third-quarter financial results, to be announced on 30 October and indicated the company did not expect a recovery in the fourth. The company has also suffered from a hefty decline in its share price. The e-mail has heightened tension within EDS' operations both in Australia and globally as employees await more definite news of their fate.
Finn's and Brown's remarks are expected to receive particularly close attention at the CBA, following speculation this year the relationship between EDS and the bank had grown frosty after CBA chief David Murray lashed out at information technology at the EDS-sponsored World IT Congress in February. Murray told delegates in South Australia "we have several times failed on projects that are large and costly and do not work".
The CBA secured a 35 per cent stake in EDS Australia under the terms of a 10-year, AU$5 billion outsourcing deal between the two signed in 1997.
In South Australia just two weeks ago, EDS said it would hire "between 60 and 100" new employees for its Adelaide operations to support applications work sourced from EDS' global network.
"will not do anything to reduce our service to clients"
makes sense to me.
15% less of nothing is still nothing.