Wednesday, October 15, 2008
SAP is joining Oracle, Epicor, Sage, Infor and other enterprise systems vendors in cutting back expenses in light of current economic conditions. SAP's action also follows its announcement of disappointing Q3 earnings.
Ben Worthen at the Wall Street Journal got hold of an internal email to SAP staff from co-CEOs Henning Kagermann and Leo Apotheker, and it outlines a number of immediate actions that SAP is taking to cut costs. Worthen quotes portions from the email:There is a complete headcount and hiring freeze, and all existing job vacancies will be canceled. This includes any temporary workers, interns, and students. There will be no replacements for employees leaving SAP. No internal transfers may take place. Only those written offers sent to a candidate and/or internal transfers agreed to on or before October 7, 2008, will go forward.Worthen finds it ironic that--in spite of the public position of many in the technology industry that organizations will continue to spend on IT to become more efficient in the current economic client--SAP is cutting IT spending:
Since we are not hiring, all engagement with external recruiters must cease immediately. We will discontinue engagement with management consultants and evaluate the impact this has on ongoing projects. Until further notice, all external training is to be canceled. Internal meetings must be held within SAP buildings, and you cannot rent external conference facilities for this purpose.
Cease ALL internal non-customer-facing travel in October…Any non-customer-facing travel already booked should be canceled immediately, even if this incurs penalties.We will review all planned investments in IT equipment, hardware, software, facilities, and company cars, as well as internal IT projects....Do not order any new equipment at this time.Over at Computer Economics, we're running a short survey to evaluate the impact of current economic conditions on the outlook for IT spending and staffing. If you'd like to participate in the survey and get a free copy of the results you can take the survey now.
IT spending pull-back: SAP warns on Q3 earnings
Layoffs in Oracle Consulting unit
Layoffs at Infor and Sage
More layoffs at Epicor