Layoffs and New Services Shake Up Cap Gemini

Cap Gemini is cutting back and growing at the same time. In response to worsening economic conditions, the company has announced plans to cut 2,500 jobs, bringing the total cuts this year to 5,400. Employees were notified in late November that the company was seeking 2,000 volunteers to participate in a layoff program. Now the consultancy is confirming plans to reduce the workforce by 2,500.

Cap Gemini chief executive, Geoff Unwin, has announced plans to retire next month. Paul Hermelin who is currently the company's chief operating officer will succeed him. Mr. Hermelin will retain the position of chief operating officer in addition to taking on the responsibility of chief executive officer.

Cap Gemini has also announced plans to launch a spin-off company tentatively called LPS, which stands for Local Professional Services. The company will be staffed by approximately 5,000 employees from France, the United States, Belgium, Holland, and Luxembourg.

The new company will provide manpower and expertise on a time and materials basis, whereby company engineers with knowledge of specific hardware and software will be provided on a daily or short-time basis. The goal is to attract smaller information technology projects that might normally be turned away by Cap Gemini.

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