Cognizant incurs $229 million in 2023 in direction of NextGen programme

In 2023, Cognizant incurred $115 million in worker separation prices and $114 million in facility exit and different prices totalling $229 million, or 1.2 per cent as a share of the revenues for the yr ended December 31, 2023, in reference to the corporate’s NextGen programme launched in Could 2023. It expects to incur whole prices of roughly $300 million with roughly $70 million of such prices anticipated in 2024, mentioned the US-based IT firm in its 2023 annual report.

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The NextGen programme was geared toward simplifying its working mannequin, optimising company features, and consolidating and realigning workplace area to replicate the post-pandemic hybrid work setting. Personnel-related actions of this programme had been anticipated to affect roughly 3,500 staff, or roughly 1 per cent of the workforce, the corporate then introduced.

The estimates of the costs and expenditures that the corporate expects to incur in reference to the NextGen programme, and the timing thereof, are topic to various assumptions, together with native legislation necessities in varied jurisdictions, and precise quantities could differ materially from estimates. As well as, we could incur different expenses or money expenditures not at the moment contemplated resulting from unanticipated occasions which will happen in reference to the NextGen programme.

Cognizant expects the NextGen programme to be accomplished by the tip of 2024, the annual report says.

Workers

The corporate had about 347,700 staff on the finish of 2023 — 254,000 in India, 40,500 in North America, 16,300 in Continental Europe, 8,500 within the UK and 28,400 elsewhere. This represents a lower of seven,600 staff from December 31, 2022. The corporate mentioned it utilises subcontractors to supply extra capability and adaptability in assembly consumer demand, although the variety of subcontractors has traditionally been immaterial relative to the worker headcount.

For the years ended December 31, 2023, and 2022, the corporate had voluntary attrition — tech companies was 13.8 per cent and 25.6 per cent, respectively, mentioned the annual report.

On the enterprise outlook, Cognizant mentioned it’s specializing in increasing its associate ecosystem throughout a broad vary of know-how corporations, together with hyperscalers, cloud suppliers, enterprise software program corporations, best-in-class digital software program enterprises and rising start-ups. This associate ecosystem will allow the corporate to boost its revolutionary, built-in choices, by combining third-party merchandise with our service options, to ship enterprise-wide digital transformation.

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The corporate can also be more and more utilizing AI-based applied sciences, together with GenAI, in its consumer choices and in its personal inner operations. AI applied sciences and companies are a part of a extremely aggressive and quickly evolving market. We plan to make important investments in our AI capabilities to fulfill the wants of our purchasers and harness its worth in a versatile, safe, scalable and accountable approach. As AI-based applied sciences evolve, we anticipate that some companies that we at the moment carry out for our purchasers will probably be changed by AI or types of automation. This may occasionally result in lowered demand for sure companies or hurt our skill to acquire beneficial pricing or different phrases for our companies, mentioned the annual report.