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.
Crafty hackers hack craft stores -- again.
Michaels Stores (NYSE:MIK) has finally confirmed the details of the point-of-sale hack revealed in January. It's unclear what's taken them so long -- the company claims the hack was "highly sophisticated," but everyone uses a blah-blah phrase like that.
Your humble blogwatcher notes that the problem persisted for more than a month after the news first broke. smh.
In IT Blogwatch, bloggers are aghast that, for the second time, the company's POS was hacked -- lasting almost nine months.
- 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.
- The Big Data Opportunity for HR and Finance
- If CEOs, CFOs, CIOs, and CHROs want to drive their businesses forward, they will need to quickly recognize the enormous value of big...
- Manufacturing Outlook: Improving time to market, operational effectiveness and innovation in a highly competitive environment
- An enterprise project portfolio management solution can help manufacturers position themselves in the new competitive landscape.
- Time-to-Market: The Need for Speed in the Automotive Industry
- Bringing new vehicles to market quickly has never been more challenging. To bring new models to market on-time and on budget, automakers need...
- Application Rationalization Scorecard: Analysis to Action
- This paper details a proven method, used most recently to evaluate a financial services application portfolio. At the method's core is the scorecard....
- Changing the Way Government Works: Four Technology Trends that Drive Down Costs and Increase Productivity
- This paper discusses four technology-based approaches to improving processes and increasing
productivity while driving down department and agency costs.
All Financial IT White Papers
- Cloud Knowledge Vault Learn how your organization can benefit from the scalability, flexibility, and performance that the cloud offers through the short videos and other resources...
- LIVE EVENT: 5/7, The End of Data Protection As We Know It. Introducing a Next Generation Data Protection Architecture. Traditional backup is going away, but where does this leave end-users?
- On-demand webinar: "Mobility Mayhem: Balancing BYOD with Enterprise Security" Check out this on-demand webinar to hear Sophos senior security expert John Shier deep dive into how BYOD impacts your enterprise security strategy...
- Mobile Security: Containerizing Enterprise Data In this on-demand webinar, Fixmo's Lee Cocking, VP of corporate strategy, explains why Apple-ization trends like mobility and "bring-your-own-device" (BYOD) are driving the...
- Endpoint Data Management: Protecting the Perimeter of the Internet of Things Not surprisingly, "Internet of Things" (IoT) and Big Data present new challenges AND opportunities for enterprise IT. Teams need to harness, secure and...
- All Financial IT Webcasts