Sounds to me that Mike and Paul told Wall Street that "strategic alternatives" are in play. Code wording for sale of these businesses or exit. Layoffs looming!! Very poor results for DXC Q2. Stock will drop.
What do you think?
12 replies (most recent on top)
I am glad to be sold off from DXC, WORST. EMPLOYER. EVER.
Its simply a way to wring out a short term gain for the stock market (to perpetuate the myth of success) and to further line the pockets of those at the top, they do not care $0.01 for the staff or what ever the hell DXC is supposed to be.
Why sell that parts of the business that are profitable? That's not logical even considering DXC long term goals.... What they are doing is dumping the stuff that is not be profitable. They are talking up the value of these divisions as I type this preferably looking for a s—er to take them off their hands. Then they will strip off any monetary value before dumping them... This is exactly what they did with the sale of Paxus in Aus. Thing is though it wont work. The "Digital future" is a catch phrase right now. No one really know what it means. The same thing happened when CSC was going to become a cloud specialist company. Almost the same strategy with some redundancies and they planned to break off parts of the company but it never happened. Then came more redundancies and then the merger. Looking back it was bleak but I never thought it would end like this. At the end of all of this you'll have a comparatively small CSC in the US only and DXC, HP & EDS etc. will be gone forever. Replaced with much smaller specialist IT outsourcing and support companies. These new companies will be very different to the leviathans of the past. Most staff will work from home and only travel when absolutely needed. The "Digital future" will be dominated by the remaining big players. DXC wont be part of that.
EUWP and BPS are the big, complex, resource heavy engagements which we traditionally undertook for enterprise customers .. hard to get right but a lot of opportunity to grow the account, with the reduced number of big deals on the horizon and issues in delivery (like a southern hemishere gov engagement drastically reducing scope) you can see why manglement don't understand or like the look of the group on the balance sheet.. especially as where our new mike came from - an organisation that is reluctant to "get its hands dirty" preferring instead to partner.
Where does this leave DXC... well security & software is gone, leaving commodity cloud services, "data" a couple of acquisitions and of course the rest of the vapour ware (bionics) ...
Still the $5bn odd value will nicely finance new Mike and his cohorts for a year or so... as ever pity about the staff..
From email...they will most likely spin these 3 units off:
Today we also communicated that we will seek strategic alternatives for three businesses: Workplace and Mobility, U.S. State and Local Health and Human Services, and Horizontal BPS. These are the only businesses that will be under review. They each are market leading, however they are adjacent to our focused strategy. Throughout this process we will remain closely engaged with our customers, and with you, to ensure we are delivering on our commitments.
The news couldn't be worse... In short they plan to break up the company... Any fool can see what's going on. They are going backwards in a big way and they can't stop the slide. The only alternative is to lighten the load by spinning off the parts of the business that are not making money. If they do it and it doesn't work DXC will soon be a bad memory and nothing more. This is what happens when you don't look after your clients and staff and then off-shore everything you can to India and pray your customers don't complain.... What a fiasco... What a bunch of clowns...
Who exactly is Workplace & Mobility?
Isn’t a huge part of legacy CSC providing desktop support for our clients? Technically that came under Workplace GDN. Then got rebranded into the various ‘i’ teams.
Very sad indeed. Pre DXC Workplace & Mobility was one of the leading business areas for HPE. Managing over 6 million desktops worldwide was not insignificant. The ITO infrastructure to manage this was not insignificant . With the formation of DXC and combining CSC's managed service, this figure went up. Massive workplace deals enabled pull through of business in the areas of utility computing/ITO, Cloud and Security. Workplace always focused on the end user and the clients business. With the shift to DXC and the people who were put in charge of that part of the business we lost focus. The people left, the clients left. Clients lost confidence . All the talk about 'Digital' lost our clients confidence that we knew what we were talking about in Workplace. Lawrie got rid of the Advisory function and people who drove growth in this area. Architects and Engineers who knew how to build workplace and mobility solutions left - they went to HP, Microsoft, to our clients and our competitors. To be honest, we cannot even manage our own workplace in an integrated, modern fashion. I wouldn't buy a workplace solution from DXC as I know we don't know how to deliver one. I would be ashamed to show my client the end user solution that our employees use.
Will be interesting to find out from Mike what his plans are.
These are the BUs are actually doing good. Maybe company like PwC would want to buy them.
These 3 business units represent $5 billion in revenue. They have significant value.
Some of the DXC BPS business is very strong. Do you know how many credit card transactions DXC processes every day? This is definitely a business that FIS or TSYS will scoop up.
What sort of company would be likely to buy any of them?