As part of a cost-cutting measure, phone maker Nokia on Thursday announced restructuring of its IT organisation, which includes transfer of 820 of its employees to HCL Technologies and Tata Consultancy Services. Nokia also plans to reduce its global IT organisation by up to 300 employees.
Nokia will offer employees affected by these planned reductions both financial support and a comprehensive bridge support programme.
These are the last anticipated reductions outlined in Nokia’s focused strategy announcement of June 2012.
The majority of the employees affected by these planned changes are based in Finland. Nokia India said its operations in the country would not be affected.
India operations
“The India operation will run as it is and the Chennai facility will also remain unchanged,” a Nokia India spokesperson told Business Line, adding that the facility will continue manufacturing the ‘Asha’ series of smartphones, apart from more than 20 entry-level handsets.
The Chennai plant is now the biggest manufacturing plant for the Finnish major.
TCS has been operating in Finland servicing clients such as Nokia Siemens, ABB and Telenor. HCL Tech had won a large contract from Nokia in 2009, under which it provided IT infrastructure and helpdesk support in 13 languages to the phone maker from its centres in India and Finland.
While HCL Tech’s share price on BSE increased by 4.3 per cent to Rs 703.30, the TCS share price was up 1.05 per cent to Rs 1,362.
Tough competition
Nokia’s global announcement comes even as the phone maker fights for survival against tough competition from Samsung and Apple.
As part of the restructuring process, Nokia announced the closure of its facilities in Ulm (Germany) and Burnaby (Canada) last year.
It also sold its luxury brand Vertu to a private equity firm, EQT. It sold its head office building in Espoo to real estate investment firm Exilion for €170 million (over Rs 1,218 crore).