SAP to cut more than 2,000 jobs in second wave of downsizing

Three per cent of workforce to be axed but 2,000 new jobs will be up for grabs in growth areas

German business software maker SAP is to cut about 2,200 jobs, in a second wave of downsizing under CEO Bill McDermott.

The job axe will affect about three per cent of SAP's workforce, which currently stands at 74,000, according to SAP's chief of human resources, Stefan Ries.

Ries claimed that it was "not about cost savings but rather being fit for the future" as the German company aims to adapt to "changes in market circumstances".

But the firm also expects to create about 2,200 jobs this year in its cloud business, around its Hana in-memory database and in its newly acquired expenses software provider Concur.

Last year, McDermott told media and analysts at SAP Sapphire Now in Orlando that SAP had to become more "simple" internally, so that it can react faster to customers' needs.

Reports at the time had suggested that this "focus" meant a swathe of job cuts, but McDermott aimed to quell such rumours by claiming that the firm is actually adding to its workforce.

"Let me be crystal clear, we are adding jobs at SAP; at the end of the year we will have more jobs than we do now," he said.

"It is true that if you are working on yesterday's project instead of tomorrow's then you may have to be redeployed or learn something different," he added.

Deepak Krishnamurthy, senior vice president and head of corporate strategy at SAP, told Computing at the conference that the company was going through an "innovation curve".

"We are training people and we will see new opportunities being created at SAP. We're going to have a much more cloud-centric portfolio, so we need a workforce that is designed to deliver that," he said.

Ries said that SAP had also created about 2,000 new jobs last year.

In January, the firm announced an estimated operating profit cut of around £1.1bn for 2017 as it continues to pump money into its expanding cloud operations. The firm saw a reported 45 per cent cloud revenue growth to €1.1bn in 2014.