Baan has warned of more redundancies during its long haul back to profitability.
Mark Hamilton, Baan's senior vice president of global marketing, said: ?It is not our intent to make more layoffs, but we cannot rule it out.?
He confirmed an internal memo from president Mary Coleman highlighted the need to replace only critical staff. Baan laid off 1,200 staff last quarter, reducing headcount to around 5,000.
Coleman warned that there could be no promises of job security because Baan does not have a clear picture of market demand over the next few quarters.
Hamilton said the enterprise resource planning (ERP) sector has seen annual growth rates plummet from more than 80 per cent per annum to under 20 per cent. He also cited a number of factors including frozen IT spend because of Year 2000 work and economic difficulties in Asia Pacific and Latin America.
However, he said reports of Coleman?s memo, ?mischaracterise Baan?s intentions since we focused on headcount changes last quarter, and this time we are looking at expenses like travel and supplies.?
The Dutch software supplier aims to cut $15 million from its budget. It appears to be suffering particularly badly from the current ERP malaise, and its annual results, due next Tuesday, could make dismal reading. It expects to report a fourth quarter loss of $250 million, and it is deferring about $50 million to cover unsold inventories.
Baan has bought several companies to expand its enterprise applications portfolio, and commentators suggest it may dispose of some. Two of the most notable acquisitions are Coda and Aurum, acquired about 12 and 18 months ago, respectively.
Hamilton said: ?We announced last year that we are selling off agency operations in emerging markets like the former Soviet Union... but we won?t comment on disposals and acquisitions.?
Barry Challinor, consultant with Cambridge based ERP specialists, Cambashi, said: ?The actions Baan took last year were not effective.?
He said that the bottom has not fallen out of the ERP market, ?but there are more competitors fighting for the same customers.?
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