While HP cuts jobs, it plans to expand its 'global footprint'

As US-based employees of Hewlett-Packard and EDS grab their golden parachutes, many of their jobs seem set to fly away to other countries, based on the remarks of HP execs at an analysts' meeting.

About half of the 24,600 job cuts that Hewlett-Packard has scheduled for the next three years will happen by the close of 2009, noted Cathie Lesjak, HP's executive VP and CFO, during a meeting with analysts late Monday. During that process, Lesjak added, HP will also create new customer-facing positions better suited to "optimizing" the company's "global footprint."

HP plans to start hiring and training some of its new hires even while some of those faced with losing their own jobs are still on board, she noted.

Announced in the wake of HP's earlier $13.9 billion buyout of EDS, the staff layoffs will be accompanied by greater "cost efficiencies" in real estate and procurement as HP brings the acquired IT services company under its own arm, said Mark Hurd, HP's president and CEO.

Almost half of the total job cuts will affect US-based employees. Otherwise, the officials didn't specify the geographic locations of the jobs to be lost -- or the jobs to be added -- within HP's "global footprint."

The executives did say, though, that HP will add staff in sales and other customer-facing categories, while slashing positions across both companies in areas such as information technology, human resources, financial, and legal departments, where "redundancies" are cropping up between HP and EDS.

Traditionally, HP's had "more people working in our IT [department]...than out selling," according to Ann Livermore, executive vice president of HP's Technology Solutions Group. Ultimately, however, HP plans for "two times as many people serving customers than in IT," she said.

The laid off workers will get post-retirement benefits that are essentially equivalent across EDS employees and non-EDS-ers, Lesjak said. Aside from severance packages, golden parachutes will also include job placement and counseling services.

Meanwhile, for those employees who remain, HP's EDS buyout will bring "broader career opportunities across both companies," predicted Joe Eazor, formerly of EDS and now HP's senior VP for transformation.

"We will integrate this acquisition and we think we will do it well," CEO Hurd remarked. "A more efficient cost structure directly relates to [our] ability to scale and grow."

More specifically, HP expects to save additional money by streamlining the combined company's real estate holdings and leveraging its increased size in procuring goods and services, Lesjak said.