Cisco Australia is not say whether they will retain their consumer products division in house or hand the sale of their networking products over to a distributor. The Company that is set to slash jobs in Australia as part of plan to axe 6500 employees globally recently dumped their Flip Camera operation due to poor sales.
The retrenchment figure is considerably less than 10,000 mooted by a number of observers in recent weeks. On the other hand it’s much more than chief executive John Chambers implied in May when Cisco said it planned to eliminate thousands of jobs as part of a larger plan to lower annual expenses by $1 billion, or about 6 percent.
Cisco has around 73,000 employees. Chambers in May promised a “streamlining exercise”.
As part of the company’s $1 billion annual operating expense reduction, Cisco said about 2100 employees had agreed to take a redundancy package offered as part of an early retirement program. The other 4400 will be retrenched.
Executives won’t be spared. Cisco said the numbers include a reduction of about 15 in the numbers of execs at vice president level and above, as well as a reduction of about 9 percent of Cisco’s regular full-time workforce. However it is not expected that Chambers will fall on his sword, even though his resignation is being sought by a number of shareholders, including activist Ralph Nader (CDN, June 28).
The company said all affected employees in the USA, Canada and “select” countries would be notified during the first week of August.
Cisco said further global workforce reductions were expected at a later date, in compliance with local laws and regulations.
In Sydney, Linda Horiuchi , senior PR manager for Cisco A/NZ, told CDN that, while she could not comment on whether the cuts would spill to Australia, all geographic regions would be affected.
“All functions and geographic regions have been impacted, but we are not disclosing specific regional impact,” she said.
“We’ve have taken action to date in line with our May corporate announcement to sharpen our focus and simplify our organisation.”
Cisco also announced it had reached an agreement to sell its set-top box manufacturing facility in Juarez, Mexico, to Taiwan’s Foxconn group. – Kate Castellari
