Concerns have been raised by the European Works Council of SAP regarding the software giant’s recent plans to reduce its workforce by one to two percent annually. According to a report in the “Handelsblatt” the council has cautioned about potential “long-term damage” resulting from talent loss and diminished trust among customers and employees.
Andreas Hahn, head of the Works Council, told the “Handelsblatt” that the measure appeared to be driven by short-term financial goals rather than a strategic transformation and was occurring without sufficient evaluation. He expressed apprehension that the SAP board might permanently utilize layoffs as an instrument if financial targets necessitate it.
SAP currently employs approximately 109,000 individuals, meaning the potential job cuts could affect up to 2,200 positions. The company has yet to provide specifics on the exact scale or geographical distribution of these potential reductions.
Communication from the management has reportedly caused confusion within the SAP workforce. Chief Financial Officer Dominik Asam compared the job cuts to brushing teeth – an ongoing routine – when addressing financial analysts. The CFO has since apologized for the analogy.
In response to inquiries from the newspaper, SAP stated that it is concentrating on continuous process and structure optimization alongside strategic investments in future capabilities as its industry undergoes a profound transformation driven by artificial intelligence and cloud technologies. The company affirmed that it will invest targeted funds in employee training and hiring within “critical growth areas”.