NCR is to slash 1,500 jobs and reorganise itself into three new business units in a bid to transform itself from being a hardware supplier to a services company.
The company anticipates the overhaul will hit its fourth quarter balance sheet to the tune of $250 million, but expects to save $75 million per year beginning in 2000. Much of the charge will be associated with the restructuring of its commodity hardware based channel business.
Lars Nyberg, NCR?s chairman and chief executive, said: "Our already improved operating income in 1999 would be better by at least another $100 million had it not been for the underpeformance of the financial group, both in data warehousing for banking, where our execution has been weak, and in channel delivery solutions, where we have incurred significant losses."
As a result, NCR plans to reorganise itself into three businesses to improve focus. These comprise financial self service, which includes the firm?s flagship automatic teller machines, retail store automation, and data warehousing.
The company also intends to acquire data warehousing specialist, Strategic Technologies and Systems, for an undisclosed sum to boost the business unit further. Strategic boasts such customers as Fidelity Investments and Office Depot of the US. Its founder, Stephen Brobst, will become chief technology officer of NCR's data warehousing unit.
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