Accenture has laid off over 11,000 members of staff as part of a restructuring program.
The company’s 791,000 employees has been cut down to 779,000 in the past three months, and Accenture might not be done yet.
With AI continuing to dominate the tech space, the IT consulting group has introduced AI training for staff to keep up with this new era of technology.
Accenture has warned staff who cannot keep up with the new training could join the thousands already laid off.
In a discussion with analysts, Accenture CEO Julie Sweet provided further insights into the restructuring:
“We are exiting on a compressed timeline people where reskilling, based on our experience, is not a viable path for the skills we need.
We are investing in upskilling our reinventors, which is our primary strategy. Those we cannot reskill will be exited.
Indeed, Accenture followed this announcement with the news that it is set to acquire Aidemy Inc, a reskilling specialist.
In doing so, the company is looking to strengthen its own reskilling and learning service, LearnVantage, and seemingly double-down on its commitment to fully embracing AI.
The acquisition will also enhance Accenture’s end-to-end AI support – from talent development to long-term adoption – by leveraging Aidemy’s expertise in building and operating AI systems across diverse industries.
Unpacking the Restructure
The layoffs are part of an $865MN restructuring program for the year ahead, which aims to improve efficiency within the company.
However, despite the restructuring, plans for the new fiscal year expect the employee headcount to grow, particularly in areas such as AI and digital services.
Accenture’s fourth quarter report revealed that its revenue had increased by seven percent compared to the previous fiscal year, with Sweet suggesting it demonstrated the company’s “unique ability to deliver for our clients as they seek our help to reinvent and lead with AI”.
In the report, Accenture reveals its strategic realignment plan to increase its growth, upskilling and efficiency, driven by a demand for AI-related services, as well as an increase in employment.
The projected employee plan is part of a “refreshed three-pronged talent strategy to meet current and future client demand”, exiting those who cannot apply the skills required and hiring those who can.
Our overall workforce is positioned to grow in line with the future of digital and AI consulting.
Despite an increase in revenue, Accenture has had to adapt to budget constraints after the Department of Government Efficiency slowed its spending earlier this year.
In the past, the U.S federal government has accounted for roughly eight percent of the company’s revenue.
This year, the report suggests that with government spending, the projected revenue of Fiscal Year 25 would have been a percentage point higher.
However, after the restructuring was announced, Accenture’s shares dropped 2.7 percent, the lowest since November 2020, after concerns were raised over the plan’s costs.
Accenture is All In on AI
This restructuring is only the latest in Accenture’s plans to target the AI space.
At the end of August, the company acquired NeuraFlash, expanding its expertise in Agentic AI and enhancing its capabilities.
The company has also partnered with several other companies in the past few years to boost its AI knowledge in AI-powered insights, GenAI, digital experiences, and data analytics.
Despite the market’s less than enthusiastic response to Accenture’s layoffs, it will be interesting to see whether the company’s commitment to betting big on AI will pay dividends in the long run.
