Samsung India Cuts 90 Jobs, More Layoffs Planned
Last week, the country’s one of the largest smartphones and consumer electronics maker communicated to nearly 90 employees to put in their papers with immediate effect. After Diwali, another 125-150 employees will be asked to leave, it has been learnt.
In phases, the remainder will likely be shunted out between December and March. In total 750 to 1,000 employees set to lose their jobs unless their performance improves! In Samsung India, at present, there are about 22,000 employees. This includes workers at the company’s two factories.
About 35 of those who have been shown the door are in the grade of general manager and higher. Four senior executives at vice president level have already quit.
Samsung India, Industry executives said, has modified its appraisals and even average performers are being asked to look for jobs elsewhere. Those who are asked to leave, are given 3-6 months’ salary as compensation.
Last week, president and chief executive officer of Samsung India, HC Hong conveyed the need to restructure the business, in a video conference to more than 250 mid-to-senior managers, the industry executives said.
After handling Latin America for three years, Hong took charge of Indian operations last December. He is cutting costs and flab across divisions. The moves are aimed at right-sizing the company and improving efficiency and profitability so that the Indian operations can contribute more to global earnings.
According to the reports, due to a slowing market and increased competition across businesses, Samsung India’s sales are below target. The October-December quarter accounts for 30-40 percent of the company’s annual sales.
In the past few years, Samsung India has increased sales by 30-40%. However, this year it’s halved to 15-20%.
Samsung India commands a value share of nearly 40 percent and the company has improved its performance in the premium segment, beating Apple, but it is still under pressure in the entry-to-mid segment. The Chinese and Indian brands are ruling this market.