Vodafone will lay off 11,000 workers after its new CEO declares that the company is “not good enough.”
Vodafone wants to shed 11,000 positions over the next three years as its new CEO outlines her plans to “simplify” the telecoms company.
The reductions represent almost a tenth of its global personnel and will effect its UK headquarters as well as other locations.
Margherita Della Valle, Vodafone’s finance director, stated that the company’s “performance has not been adequate.”
Vodafone employs 12,000 people in the United Kingdom, who work in seven offices, including the company’s headquarters in Berkshire.
The company, which had 104,000 employees worldwide last year, has already announced plans to slash positions in certain locations.
The UK telecoms behemoth has suffered with rising energy costs, which are driving up expenditures and reducing earnings.
It has also had lower sales in Germany, its largest market, as well as Italy and Spain, where it has struggled to compete.
“Part of that can be attributed to lower levels of customer satisfaction in those regions,” said Matt Britzman, an analyst at Hargreaves Lansdown.
According to the industry watchdog Ofcom, Vodafone’s broadband service in the UK was the second most complained about of any major provider in the three months to December.
It also faced embarrassment in April after a glitch disrupted broadband connections for approximately 11,000 UK users.
“To consistently deliver, Vodafone must change,” said Ms Della Valle, who was selected as Vodafone’s new CEO in January and is currently working as the company’s temporary finance director until a replacement is found.
“My top priorities are customers, simplicity, and expansion.” To reestablish our competitiveness, we will simplify our organization and eliminate complexity.”
It announced the job layoffs despite reporting a little increase in full-year sales to €45.7 billion (£39.7 billion) and a decrease in pre-tax profits.