Accenture Announces Job Cuts, Increase in Outsourcing Services

International consulting firm Accenture, formerly known as Andersen Consulting, has announced the planned layoff of 1,000 personnel, primarily in the United States, the United Kingdom, and Australia. The job cuts represent slightly more than 1 percent of the company's 75,000-person workforce and are the result of a general economic slump and a cutback on spending in the fields of information technology by large corporations. This time last year Accenture announced a similar cutback of 1,400 jobs.

Following this announcement, sources in the UK confirmed the layoff process by announcing the immediate layoff of 150 members of Accenture's UK senior management.

It is not abnormal for Accenture to experience an annual voluntary turnover rate of as much as 15 percent, however expectations this year are for only around 7 percent attrition, according to Accenture spokeswoman Roxanne Taylor. While the firm cuts 1,000 employees and expects additional turnover from the natural rate of attrition, Accenture expects to go ahead with plans to add some 8,000 employees in the fiscal year that will end September 2003.

Accenture plans a company reorganization later this summer that will involve splitting the company into five new business units to be named Consulting, Solutions, Services, Enterprise, and Networks, and a major focus of services will be on outsourcing. Additions to the workforce next year are expected to fill a growing need to supply outsourcing services.

There's an interesting story on the Accenture Web site describing the hurdles faced by consultants trying to encourage clients to use outsourcing services. Typical outsourcing services include managing back-office operations, providing human resource services and customer support, and providing logistics/distribution and technology services.

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