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StarHub to start laying off 300 employees by end of month

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Telco cites 'intense local competition', to transform operating model

StarHub will start laying off 300 full-time employees by the end of the month, as the company seeks to restructure amid "intense local competition".

The telco yesterday announced an operational efficiency programme that aims to improve productivity and speed in decision-making as well as lower operating expenditure "across the board".

However, the move will result in job cuts, primarily in non-customer-facing functions, it said. Among the staff affected by the cuts is chief strategic partnership officer Jeannie Ong.

Other roles will also be axed due to ongoing attrition and tighter management of contractor roles.

StarHub said that the cuts to headcount - more than a tenth of its 2,500 full-time staff members - will come with a one-off restructuring cost of some $25 million.

But it added that this will not have any impact on the company's earnings guidance for FY2018.

Overall, the transformation drive is expected to realise $210 million in savings from 2019 to 2021, said StarHub.

Other areas where it could trim the fat include procurement activities, leasing costs, network and systems repair and maintenance, and sales and distribution.

StarHub chief executive Peter Kaliaropoulos noted that that layoffs are not due to individual work performance, but that of strategic realignment.

He cited a laundry list of challenges facing the company - "intense competitive ferocity right across the market, new entrants, lower voice revenues, thinning margins for fixed broadband services, high content costs for pay-television operations and high market penetration for mobile and fixed services".

He said that StarHub must transform its operating model as "otherwise we will face greater risks in the future".

"Our revised operating structure will be best placed to meet our strategic intent, enhance customer experience, increase accountability and effectiveness and improve competitiveness and agility," added Mr Kaliaropoulos, who took on his role on July 9.

StarHub, which is Singapore's second-largest listed telco after Singtel, will focus on and invest in areas such as new businesses, digital customer service initiatives, enterprise-oriented information and communications technology solutions, and wireless and fibre services.

This includes hiring more employees in fields such as cyber security, home and enterprise solutions, and customer care, the company said.

The telco said that it will work with affiliated companies, as well as the Singapore Industrial and Services Employees' Union (SISEU), the National Trades Union Congress' Employment and Employability Institute, and government agencies, to help affected staff find suitable new jobs.

BUSINESS & FINANCE