Citigroup cutting IT jobs, shifting some work offshore
Tech staff seen heavily impacted by Citi plans to lay off 11,000 workers
Computerworld - Citigroup is cutting 11,000 jobs, many in IT, as part of a restructuring announced Wednesday.
The job cuts are part of a plan to save about $900 million through a variety of actions, including "increasing standardization and the use of automated processes," as well as streamlining the organizational structure.
The financial services plan, in its announcement today, said it will also cut costs by consolidating functions and moving certain job functions to "lower-cost locations."
Citigroup, which reported that it employed 266,000 workers at the end of last year, provided few details about its various actions, such as what benefits the standardization will bring. A spokesman did confirm, however, that moving some jobs lower cost locations meant offshore sites.
Of the total number of jobs being cut, about half appear to be in its operations and technology areas, according to the announcement.
Citigroup, unlike many firms announcing layoffs, was upfront about its decision to move work to so-called lower cost locations. That may be due to the company's longtime experience in using overseas services, including running its own offshore centers.
In 2008, for instance, Citigroup sold its IT subsidiary in India, Citi Technology Services Ltd., to Indian services firm Wipro Ltd., for $127 million.
"Citi is one of the most experienced banks for offshoring both banking operations and IT processes," said Phil Fersht, the CEO and head of research at HfS, an outsourcing research and advisory firm.
"This is a well-thought out strategy to shift much of their back office to low-cost locations where they have plenty of capacity to scale-up operations, notably India and the Philippines," Fersht said.
For the onshore operations, Citigroup's move will make it "leaner and more focused on the more complex IT work that requires frequent interaction with the business units," said Fersht.
The onshore Citigroup IT staff will also have to spend more time working with their offshore counterparts to manage projects, said Fersht.
Patrick Thibodeau covers SaaS and enterprise applications, outsourcing, government IT policies, data centers and IT workforce issues for Computerworld. Follow Patrick on Twitter at @DCgov, or subscribe to Patrick's RSS feed . His e-mail address is firstname.lastname@example.org.
Read more about IT Careers in Computerworld's IT Careers Topic Center.
- Google I/O 2013's Coolest Products and Services
- 10 Star Trek Technologies That are Almost Here
- 19 Generations of Computer Programmers
- 25 Must-Have Technologies for SMBs
- A walking tour: 33 questions to ask about your company's security
- 15 social media scams
- The 7 elements of a successful security awareness program
Can the financial services industry prevent some of these disasters through better quality software? I believe the answer is yes!
- IT Certification Study Tips
- Register for this Computerworld Insider Study Tip guide and gain access to hundreds of premium content articles, cheat sheets, product reviews and more.
- ESG: The Contemporary Value of Virtual Storage Appliances: HP renews its focus with StoreVirtual VSA
- A good virtual storage appliance (VSA) can simultaneously make good business sense and deliver operational value by allowing users to avoid the additional...
- Taneja Group: HP 3PAR StoreServ 7000 - Enterprise for the Mid-range
- In this report, the Taneja Group takes an objective, in-depth look at the features of the HP 3PAR StoreServ 7000 powered by Intel...
- Edison Group: Stepping Up to the Next Generation: The Business Value of Upgrading from HP EVA Storage to 3PAR StoreServ Storage
- HP EVA Storage users who face performance and scalability tradeoffs should consider an upgrade to 3PAR StoreServ Storage, powered by Intel Xeon processors.
- Taneja Group: Ensuring Business Continuity of SAN Storage with the HP 3PAR StoreServ 7000 Family
- Built from the ground up with business continuity in mind, Taneja reviews the HP 3PAR StoreServ 7000 array, powered by Intel Xeon processors,...
- ESG: The Business and Operational Benefits Achieved With HP StoreVirtual 4000 Storage
- Learn how HP StoreVirtual, features deliver time and resource savings, faster recovery capabilities, reduced outages and an impressive and quantifiable ROI. All Financial IT White Papers
- 3 Reasons Why Sepaton is the World's Fastest Backup Solution
- Leading analyst, Storage Switzerland learns how Sepaton backs up and deduplicates massive data volumes while maintaining the industry's fastest performance - all in...
- Enterprise File Sharing: All You Need to Know
- Security. Scalability. Control. These are just some of the many benefits of enterprise cloud file-sharing that you'll discover in this KnowledgeVault, packed with...
- Bridging HTTP and FTP with FileXpress Internet Server
- What if you could take an FTP server on your internal network, and allow external users (partners or customers) to securely access it...
- MFT and FileXpress - An Overview
- Business users and applications exchange files on a regular basis. File transfer is a core part of the flow of business activity.
- Content Analytics: Big Data Conquered, Customer Service Elevated
- For organizations looking to start a content analytics program or improve their existing capabilities, Aberdeen Group and IBM will lay out several recommendations... All Financial IT Webcasts