British mobile company, Vodafone, has recently announced that they will lay off around 11,000 jobs globally in the next three years. The decision was taken to improve performance and bring much-needed change to the company. Read this article to know more.
The tech sector got hit with a layoff spree, and Vodafone has also announced that they will lay off employees throughout their global branches.
Recently, Margherita Della Valle is announced as the new chief executive for Vodafone. She reviewed the company’s performance and concluded that Vodafone needs to change for better performance. It was the base of the decision of laying off 11,000 jobs around the globe over the next three years.
Why was the decision made?
- The chief executive, Margherita, said that the annual revenue of the mobile giant is coming out to be flat. It is said to be the result of the poor performance of the company throughout its branches.
- It was also stated that the company has made only $50 billion in the financial year 2022-23. It is considered flat when compared to the revenue in the previous financial year.
- Last year the global workforce of Vodafone was 104,000 jobs. This shredding of the workforce will be about 10% current workforce.
- Margherita has further stated that she wants to simplify the organizational structure and cut out all the complexities holding the company back from growth. This decision is a step towards bringing the company back into the competition.
The tech industry has faced the layoff season this year. It is said that inflation has weakened the economy and is affecting the companies in the industry. Thus, Vodafone has also entered the trend of shredding the jobs after Meta, the parent company of Facebook, laid off employees.
Margherita Della Valle took the position after the former chief executive, Nick Read, stepped down from the position. He was in the position for 4 years. Nick had stepped down from the position as the share price of the company declined, and the sales declined as well.
Before he left, Vodafone was in talks for merging with another telecommunication company, Three UK. The UK branch of Vodafone was said to form a merger with Three UK. Three UK is owned by CK Hutchison, based in Hong Kong. The deal is supposed to be worth $18.7 billion. It is in its final stage.
Importance of Margherita’s role:
- Margherita Della Valle was handling the position of Chief Financial Officer (CFO) at Vodafone.
- After the previous CEO had stepped down, the board decided to give Margherita a chance to bring fresh air to the company and bring the company back to its potential.
- It puts pressure on the new CEO to show her capabilities and prove to the shareholder whether their decision was wise or not.
- She wants the organization to be inclining to customers, simplicity, and growth. They are currently focused on the growth of 5G in the UK.