Thread regarding DXC Technology layoffs

The only way to to defend these clients is to bend over and give them everything they want for no profit.

That's where the market is these days, everyone demanding the earth for cheap.

It's how dxc and everyone else is in a death spiral.

@1xw Brilliant plan. Defend a castle that can’t be defended in a valley that can’t be escaped. No moat, no supplies and soldiers who’d surrender for a slice of bread.Yet fret not thy miserly coin shall stay put ’til the King falleth and the church bell shattereth.

We are at the point, where we need to "Defend the Castle and prepare for a long siege."

We need to protect our anchor clients in INSURANCE and beyond. This way we will have something of value that we can use to barter our way into our next phase. With key client relationships, DXC could be an attractive merger partner or takeover target.

So get ready. This is going to be a war of attrition as similar IT companies (looking at you, Kyndryl), fight for our clients while they reduce costs through AI and labor arbitrage.

@1tg they've done that before back in 2021.

I could be wrong but this dxc subsidiary is based in Ireland.

I suspect it's "lending money" to other dxc subsidiaries and then that money isn't then any part of the profit those companies make.

It's a Starbucks style syphon of profits to avoid tax.

DXC seems to try collecting money,
https://de.investing.com/news/company-news/dxc-technology-platziert-vorrangige-anleihe-uber-650-millionen-euro-93CH-3256066
650 Millions exactly what for???

"DXC intends to use the net proceeds from the offering to repay existing indebtedness, including the senior note due in 2026 with a coupon of 1.750%, as well as for working capital and general corporate purposes."

I could handle a bit "general purpose" money to spend on my own discretion in lieu of a salary raise.

@kt thank you for your articulate post. Very well said.

@nw You’ve got a fixation on continuity. Companies are like projects. They begin, they develop and they conclude. This company is simply a project at its end stage. Once you recognize that you’ll find it easier to be at peace with Del Bene, Fernandez and DXC.

@kt hi Rob. Only you could write something as ridiculous as this. Rob is a major part of the problem. He just cuts stuff without understanding what he's doing.

The company lies. It's engrained culture. It's a toxic place to work that keeps people awake. It wants this I'm sure. We're all about ready to just quit. What will they do this week to make you leave!? Severance is a myth. Only the execs get anything around here.

DXC is no longer delivering meaningful value to its customers, shareholders or employees. The first two of those groups have been walking away for the past decade. This means downsizing. Because downsizing in a services company is a costly business, DXC relies on debt-funded share buybacks and staff layoffs to shrink its footprint without straining its cash position.

As an employee, you can try to wait it out, but that means enduring an uncertain and discouraging stretch. You will never know how long your salary will be paid.

You should fully expect the company to minimize costs wherever possible. This means there will be no pay raises, no investment in your skills, no acquisitions. This also means a small group under NDA is tasked with finding creative ways to limit your severance pay. This may even involve shifting you and your work to third-parties in creative outsourcing arrangements.

If you’re wondering whether it’s worth waiting for a DXC turnaround, there is no turnaround coming. The company simply does not have the pockets to invest in the restructuring needed to fix its heavy overhead and deep operational inefficiencies. The only realistic path to that kind of overhaul is a buyout but it’s hard to imagine any serious private-equity firm or competitor taking on that level of risk especially in a market that has swallowed the AI hype line and sinker.

The company is in a controlled decline and its only chance of keeping that descent orderly rather than tumultuous is to be run by a genuinely capable and independent CFO. If another of Fernández’s friends is placed in the role, financial discipline will erode and the situation will deteriorate beyond repair within a single fiscal year, perhaps even a single quarter.

You’d better be praying to your Holy Cow every day that Del Bene stays at the helm, because without his financial discipline, you will be staring at a missing paycheck within a quarter.

If Del Bene leaves, that should be your final warning shot.

By the way, CES’s CFO left months ago.

If you know the numbers, you know the numbers.

What is good for stock traders and what is good for dxc employees are two very distinctly different things.

PE buyout will be absolute carnage for everyone involved except those at the top who will get golden handshakes as per their contracts.

Don't imagine that if you escape in the lifeboats to a purchaser of insurance or some other unit that it will be sweatness and light too. They will integrate their purchase into whatever organisation they have and it's going to also cut deep and probably destroy whatever value it had... Acquisition in IT services always destroys, it's plain stupidity for these analysts to imagine it will go differently. Sure, someone's stock price will shift up briefly and there is money to be made there but...

Don't imagine these analysts are looking for long term working companies, they are looking for a quick buck.

The only positive here is that some dxc folks might get the redundo payment they are looking for. If that's not you, I'd not recommend cheering these vultures.

What everyone needs to understand is that we are essentially just agency workers — supplied on demand to clients. The shorter-term and more urgent the requirement, the higher the cost should be. We all know the rates we're charged out at. And it's scandalous they go up by inflation+, but staff get 0% year in year out.

We use the client’s systems and follow the client’s processes. We do what the client wants. There is no single “DXC process”; every client is different.

Staff should simply be paid what the client pays, minus DXC’s commission. End of issue.

If someone can’t find a role because they aren’t motivated, then they earn $0 — and DXC takes 50% of that. Pretty soon you'd find the staff have a vested interest in retaining their role, or leave.

Relax, people. Booger diver Ramnut and his elite unit of the toothless Solutions VP and the economy-sized lisping thumbsucker SAP VP are about to generate so much revenue the company won’t even know what to do with it. Truly, we’re in the finest of hands.

The whole issue is relates to inferior leaders whose only vision is to grow thierselves by decline.

They couldn't even grow the company in bo-m times such as Covid and AI. They are just interested in raiding the company for themselves and useless friends relegated from other companies they bring on board. These friends just install more layers, creat re-orgs, and procedures instead of looking at ways to grow.

Employees have been raided over several years and therefore there is no morale or trust left, and following on clients realize the situation of a slave shop with no ESG creds.

There needs to be urgent change with employees on pay, and client engagement. This will bring around re skilling and client wins.

Not a terrible analysis, but it misses a lot of facts. Dropping from $24B in revenue to $13B, M1 contributed a lot by simply laying off huge numbers of revenue generating positions, and he actually terminated people delivering services that were already sold - about $500m last few months of his tenure. His acquisitions also lost money, except Luxoft. Not only M2 not acquire, he spun off some big parts of the company. Those spin-offs took billions in revenue. That’s the primary reason for the largest declines. While M1 created a Frankenstein company and never integrated businesses or culture, M2 did at least recognize this problem and put a priority on the internal systems integration and data visibility. Once they had a better view of the data, they found the company was in worse shape than anyone thought. Problem was M2 lost focus of the employees and drove away what talent they had. The one big thing the analysis gets right is there has been no strategy, and no coherent execution of any strategy. The result is the continued slow decline. Insurance may look like a crown jewel but it’s still a bit fragile.

Don't worry CES will be a cash cow with ramNots special sauce and his COO/CFO who spends more time wearing eyeliner than focusing on actual issues.

@eh DXC will do anything not to give people redundancy. They don't get the hint that people who want to leave aren't going to be doing an especially great job. They even have people on the bench who they are hanging onto for no apparent reason. Other than the process is slow, or they hope they will just leave anyway.

@d3
Raul might have talked about selling the insurance bit but if/once that goes there is nothing left of the business that any sensible buyer would want so why not keep hold of it for as long as possible and milk the profits?

@dp
I’d take a payout but whats the betting that it will be the absolute minimum they can get away with?

Spot on. It’s a textbook example of how NOT to operate. We never seem to learn. Instead of investing time, effort, and resources into proper systems and processes, we keep reinventing the wheel time and time again. By now we should have built solutions that streamline and automate this work—AWS solved these problems years ago. Yet everything here feels like it has to be recreated from scratch, managed through emails, Word documents, or clunky spreadsheets.

That’s acceptable if the work were truly new, but we’re dealing with tasks that would take an afternoon anywhere else but somehow take months at DXC. Why would anyone choose DXC under those conditions?

So let it all fall apart. We’ll take the payout, and maybe something new will rise from the ashes. But for most of us, that potential payout is the only reason we’re still here.

Under Salvinos ‘Leadership’ the company didn’t grow at all and missed the opportunity to acquire other niche specialists in AI and Cloud when they were cheap enough to do so. Now that we’ve totally missed the boat on this there’s very little left to do and as this article highlights, many of the talented people who could have made a difference have gone.
We all thought Mike 1 was bad but Salvino seems to have surpassed that and collected something like $20m a year to do so.
DXC will probably become a textbook case in how not to run a company in the 21st century.

One thing is also certain: if we can see this article on LinkedIn so can all the potential clients and customers who might have been thinking of using DXC but now might think it’s a bad risk and go to one of the more outwardly stable and bigger competitor of ours.

Imagine the desperation of the clowns on LinkenIn bragging about growth while everything is collapsing, GIS, custom apps, SAP, ServiceNow, enterprise apps, AI, data, analytics. Even their so-called insurance success is just hype. They’re legacy there too and their ServiceNow shift is failing. The whole company is a dump. Get out as soon as you can.

That article doesn't really reveal anything new. It's content is just what has been out there for some time, even Roool talked about selling Insurance.

Some of the strategy this guy writes about has been dxc strategy too... Its talked about here like it's easy to make it work.

It misses the elephant in the story... That billions were raised by the massive sell off of whole units of CSC and DXC but that cash was never used to buy into the future. That's the missing part of this story and demonstrates that it was meant to be like this and only Salvino didn't get that memo.

Is this why they want everyone out the way for 2 weeks over Christmas?

and a great new marketing tag line courtesy of Phil Fersht (forget the Man Utd and Ferrari sponsorships)

"DXC - Hospice care for dying infrastructure contracts"

most insightful (and accurate) analysis of DXC I've ever seen - but we know the board will (again) ignore the inevitable, and the opportunity to save something out of DXC will be lost, and the insurance business will continue to suffer damage and degrading value by being burdened within the DXC carcass

That is exactly the analysis you hope the DXC board and execs are doing but it’s probably head v in the sand time as usual.
So much for Salvino telling employees to leave the company if they didn’t want to be part of his ‘transformation journey’ - it would have been better if he had left and someone more adventurous and capable came in.
Certainly seems only a probably short question of time before DXC goes.

The begining of the end !!

Thanks for the share - best analysis yet of the situation DXC find itself in today - leadership failure has sent DXC into a death spiral.