CFA Society Singapore
SINGAPORE (Oct 3): StarHub is embarking on a strategic transformation review that will include laying off an estimated 300 of its full-time staff, primarily those in non-customer facing functions, with those affected to be notified by the end of this month.
In an aftermarket press statement issued on Wednesday, the telco attributes the decision to “ongoing natural attrition and tighter management of contractor roles [which] will result in additional roles being made redundant”.
The group says it expects to incur a one-off restructuring cost of $25 million including funding to support outplacement, training, and coaching.
It also intends to work closely with its affiliated companies and government agencies to identify suitable roles for the impacted employees of its restructuring exercise.
Support will also be provided in terms of comprehensive career transition and outplacement counselling, including coaching and skills upgrading programmes, it adds.
Local media reports of the company’s intended restructuring and staff layoffs emerged last week after CEO Peter Kaliaropoulos unveiled new strategic priorities that highlighted an “agile and lean organisation” as a key driver of strategy execution.
The workforce reduction initiative come as part of the group’s overall strategic transformation programme, which it expects to realise $210 million in savings over a three-year period from 2019.
Aside from workforce reduction, StarHub says it is also targeting savings in procurement activities, leasing costs, rationalising spending in network and systems repairs & maintenance, and overall sales & distribution expenses.
“We wish to recognise the extensive contribution that our impacted employees have made to the company’s past development and growth. Such decisions are never taken lightly. I am very aware of the impact on all our employees, and we are making every effort to support those impacted through this challenging transition,” says Kaliaropoulos, who was appointed StarHub’s CEO earlier in April this year with effect from July 9, in an aftermarket press statement on Wednesday.
“The redundancies are not an individual performance issue but one of strategic realignment of StarHub. We have been extremely fortunate to have many competent people in our team but some positions are not sustainable given the current industry pressures,” he adds.
In line with its new strategic transformation plan, StarHub says it will continue to focus and invest in new businesses and digitisation initiatives. It also aims to accelerate investments in developing information and communications technology (ICT) solutions and capabilities for its enterprise customers.
Shares in StarHub closed 3 cents higher at $1.87 on Wednesday prior to the announcement.