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 email@example.com.
Read more about IT Careers in Computerworld's IT Careers Topic Center.
- 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.
- Jyske Bank extends brand message to more than one million visitors a month
- IBM WebSphere Portal software helps bank offer a clearly differentiated digital experience
- 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...
- Improving IT Efficiencies: Four Advantages of Multi-Tenant Data Centers
- Increasing demands on IT are forcing organizations to rethink their data center options. For many organizations, that means turning to the flexibility afforded...
- Accelerating Cloud Deployment and Operations with Managed Services
- Companies that do not have sufficient in-house expertise to either deploy or maintain an IaaS cloud should turn to Managed Service Providers .
- Rethinking IT Operations in the Cloud
- This paper breaks down the challenges that often prevent the cloud from delivering the fast, flexible and affordable infrastructure companies seek - and... All Financial IT White Papers
- NSS Labs & Cisco Present: Evaluating Leading Breach Detection Systems Today's constantly evolving advanced malware and APTs can evade point-in-time defenses to penetrate networks. Security professionals must evolve their strategy in lockstep to...
- Will the Real Endpoint Threat Detection and Response Please Stand Up? This webinar explores new technologies & process for protecting endpoints from advanced attackers as well as the innovations that are pushing the envelope...
- What should I look for in a Next Generation Firewall? SANS Provides Guidance With so many vendors claiming to have a Next Generation Firewall (NGFW), it can be difficult to tell what makes each one different....
- Why Are Customers Really Deploying an NGFW? It seems every IT Security expert is talking about the NGFW, but what are people really doing? This webcast covers 5 real-world customer...
- Charting Your Analytical Future - "Making predictive analytics part of your business processes" Webinar This session will show how predictive analytics can be used throughout the organization by anyone looking for answers and how organizations can make...
- All Financial IT Webcasts