Telecommunications giant Telstra, in collaboration with consulting firm Accenture, has announced a proposal to cut 209 jobs from their data and AI joint venture. This move is part of a strategic decision to offshore some work to India, aiming to leverage advanced AI expertise and enhance cost efficiencies.
The joint venture, valued at $700 million and one of the largest AI investments by an Australian company, was initially launched in January last year. Its primary goal was to integrate AI capabilities across Telstra’s operations, enhancing business processes. At the time, Telstra’s chief executive Vicki Brady emphasized the development of specialized AI tools designed to enable teams to “work smarter and faster.”
Strategic Shift to India
A spokesperson for the joint venture confirmed the job reductions, stating that roles would be cut “where work is no longer needed.” The work will be transferred to the joint venture team in India, which boasts a specialized hub capable of delivering Telstra’s data and AI roadmap more swiftly.
“We anticipate that over time, this would result in improved cost efficiencies and bring an enhanced experience to Telstra’s customers,” the spokesperson noted.
Accenture is expected to offer redeployment opportunities for affected employees, particularly in roles requiring AI and data skill sets. The joint venture has committed to supporting team members in finding new roles within either company if the proposal proceeds.
AI’s Role in Workforce Changes
When questioned about the potential replacement of jobs by AI, the spokesperson clarified that such measures are not currently being proposed. Instead, the focus remains on applying new technologies, including AI, to streamline tools and services, ultimately delivering faster and more intuitive customer experiences.
“We are not proposing that any roles be replaced by AI today,” they stated. “Through our joint venture, we’ll be able to apply new technology, including AI, to simplify our tools and services.”
Industry-Wide Cost-Cutting Measures
The announcement follows a broader trend among Australian companies to reduce costs by offshoring work to countries with lower labor expenses. Recently, KPMG proposed cutting 200 executive assistant roles, moving work to the Philippines, while banking giants NAB and CBA have faced criticism for similar offshoring strategies to India.
Telstra’s decision to cut jobs aligns with its previous plans to reduce its workforce by up to 2800 employees, approximately 10 percent of its total workforce, by 2024. The company reported significant profits last year after reducing operating expenses by 6 percent. Telstra is set to release its half-yearly financial results on February 19.
Looking Ahead
The proposed job cuts reflect a growing emphasis on leveraging AI and global talent to enhance operational efficiency. As Telstra and other industry leaders navigate these changes, the focus remains on balancing technological advancement with workforce impacts.
For employees and stakeholders, the evolving landscape underscores the importance of adaptability and the potential for new opportunities within the AI-driven future. As the industry continues to evolve, the implications of these strategic shifts will likely resonate across the telecommunications sector.
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