Margherita Della Valle, the newly Appointed Vodafone Chief Executive Officer has hinted of cutting 11,000 jobs, saying “the firm is not good enough”.
Meanwhile, if Margherita Della Valle, who is also Vodafone’s finance director’s move succeeds, the cut will constitute a tenth of its global workforce and will affect its UK headquarters and other countries.
The telecoms giant has 12,000 staff in Britain, based in seven offices including at its UK headquarters in Berkshire.
The firm, which had 104,000 staff worldwide last year, has already outlined plans to cut jobs in Germany and Italy.
The British telecoms giant has had a tough few years, as it struggles with higher energy costs and a slowdown in key markets such as Germany.
It also faces embarrassment in April when a problem knocked out its broadband services for around 11,000 UK customers.
Della Valle, who was appointed as Vodafone’s new chief in January, “To consistently deliver, Vodafone must change”.
“My priorities are customers, simplicity and growth. We will simplify our organisation, cutting out complexity to regain our competitiveness.”
Della Valle
It announced the job cuts after reporting a small rise in full-year sales to €45.7bn (£39.7bn) and a fall in pre-tax profits. It also forecast earnings would be broadly flat for the current financial year.
Vodafone’s former boss Nick Read stepped down in December amid concerns over the group’s performance. During his four years in charge the firm’s share price fell sharply.
Plans to Achieve Around €1bn
Mr Read had unveiled plans to achieve around €1bn of cost savings at the telecoms firm and signalled that job cuts were likely.
Matt Britzman, equity analyst at Hargreaves Lansdown, said the firm’s performance had been “lacklustre” in recent years. He added that Ms Della Valle’s honesty about the challenges is refreshing, but investors were yet to be convinced she could turn things around.
Shares in the telecoms giant fell by 4% after the announcement before regaining ground.
“Ms Della Valle’s plans make sense on paper, but markets will need to see tangible results over the coming year before they get more excited,” Mr Britzman said.
Meanwhile, in the local scene, Vodafone Ghana has transferred it’s ownership to Telecel. The move led to some job losses.
Vodafone Ghana recently went through a restructuring exercise which will reportedly impact their workforce. 100 workers have been reported to have been laid off as a result of the exercise.
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