Partner gears up to streamline operations
Communications company to cut workforce by 10% by holding off recruiting to replace laid off employees. To date, Partner has some 8,000 workers – twice as much as competitors
Partner Communications cellular provider is slated to downsize its workforce by hundreds of employees over the next several months, probably by holding off on recruitment rounds aimed to replace employees whose contracts have ended, namely service representatives and targeted sales personnel, as well as by layoffs.
Last week, the company summoned some 70 headquarter employees for a pre-layoff hearing; however, most of the layoffs will be from among costumer oriented positions such as sales and service personnel.
The move is part of a comprehensive streamlining drive set forth by new CEO Haim Romano wherein several service centers might be shut down in order to consolidate separate centers and create one-stop-shop centers.
To date Partner has some 8,000 employees – twice as much as competitors, after having recruited a large number of employees over the past year in order to deal with the cancellation of exit fees which came into effect last February increasing customer churn among Israel's cellular providers.
Furthermore, contractor workers, mainly in the company's technology divisions, have become company employees over the past year, a move led by the previous CEO Yacov Gelbard.
The company's workforce might shrink by about 10% but exact numbers are yet to be determined.
In the past year, Partner has directed efforts at massive customer recruitment, for which it slashed prices and offered a wide variety of devices with refund per minutes packages.
This strategy seemed problematic as customers are now allowed to leave the company with a reduced exit fee and estimates on the market were that the cellular providers would now focus on conservation of their customers and increasing customer revenues.
The company's results were naturally affected by the strategy, losing a chunk of its available working capital (due to increased purchases of iPhones from device retailers as compared with falling purchases from the company).
The company, for the first time in several quarters, did not distribute revenues after the publication of its second quarter results for the year. At the same quarter, it posted a 30% drop in profits.
After stepping up competitiveness against other rival providers, Partner now has to prepare for the arrival of two newcomers: Mirs' new network expected on the second quarter of 2012, and Golan Telecom expected to arrive on the market later next year.
However, two MVNO providers are slated to join the cellular market as well – Rami Levy and Cellran Ituran Communications which will offer cheaper packages.
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