Sony Fires 120 Indian Employees As TV Sales Hit Due To Xiaomi, Samsung; Cognizant Fired 3000 Americans In 2019
On the other hand, Sony India has axed about a seventh of its local workforce, totaling more than 120 jobs across functions.
How Did This Happen?
Cognizant reported its number of its employees in North America at about 46,400 at the end of 2019, which is low from about 50,000 at the end of 2018.
While in the same period, headcount in Europe grew 2,900 to 21,200, while that in India increased 9,000 to over 203,000.
It seems that Cognizant is hiring to expand in Europe as it looks to diversify revenue streams.
Surprisingly, the drops in North America headcount at the US-headquartered company comes at a time when Indian IT firms are increasingly hiring in that market to deal with visa restrictions.
Moreover, the number of executive officers at the company has also dropped to 11 at the end of 2019 from 18 a year earlier, Cognizant’s annual filings showed.
What About Sony?
In another development, Sony, the Japanese electronics major struggles to sell its pricier television sets in a market where cheaper Chinese alternatives are increasingly dominating retail shelves amid an overall slowdown in TV sales.
The company primarily caters to the market’s upper and upper-mid segments, confirmed that it has shed jobs lately.
It seems that the popularity of Xiaomi and Samsung LCDs has a greater role in Sony’s less sales in India.
In another development, Sony India’s television business head Sachin Rai has also resigned, but the company said Rai’s is a voluntary exit and not part of the broader rightsizing.
Now Sony is merging smaller branch offices and roles now deemed redundant to hold down costs.
Following the tune, the company has merged multiple offices in Surat with Ahmedabad and Gurgaon with Delhi.
What Does Sony Say?
According to Sony India spokesperson, the current market scenario has posed several challenges for the company to be able to sustain growth in the short and medium-term.
He said, “This requires us to relook at our business strategy, including human resources, and we are taking corrective measures to make ourselves more agile, efficient and robust in the long term,”.
“We are undergoing dialogue with our personnel and expect a fair and reasonable outcome consistent with Sony’s culture of proactive engagement with our internal stakeholders. Since this is our internal matter, we expect to deal with utmost dignity, sensitivity and responsibility,” he added.
The number of jobs lost could be in the vicinity of 200, as per the four senior industry executives.
However, the company rejected the contention that 200 jobs have been axed. Sony India’s website says that there are 900 employees in the company.
Why Would This Happen?
An industry executive who runs a chain of electronic stores said“Consumers do not want to pay the premium that Sony is charging after the entry of the aggressive Chinese brands,”.
He added, “Moreover, Sony appears to be losing connect with younger consumers who are considering OnePlus, TCL, Xiaomi or even Samsung instead of a Sony TV,”.
In reality, Sony India’s revenue fell for the fourth consecutive year in FY19 and net profit took a beating for the first time.
In response, the company had attributed this to the exit from mobile phone and laptop businesses as part of a global restructuring.
On the other hand, the entry-level products, such as the 32-inch TV set, also got the chop due to Chinese competition that made Sony largely unviable.
According to data from sales tracker GfK, the television market has slowed down in India, with sales growth declining 2% each in 2019 and 2018.
Moreover, the consumers have postponed purchases amid a slowdown, choosing instead to stream content on their smartphones.
Earlier, Sony India’s managing director Sunil Nayyar said that the company will focus only on the premium end in India — in televisions, headphones, party speakers or full-frame mirrorless cameras.
Although, the television business makes up three-fifths of Sony’s total sales locally.