Soon, Ola might lay off nearly 350 employees: Here's why
After barging into categories like financial services and car rentals, ride-hailing giant Ola is looking to focus more on growth and profitability. To achieve this goal, the company is planning a broader organizational restructuring, which, reports indicate, might result in nearly 350 employees being laid off. Some might even be shifted to other verticals under Ola's umbrella. Here are all the details.
After speaking with people familiar with internal developments at Ola, IANS learned that the company is planning to downsize its staff by 5-8%. This, given Ola's workforce of 4,500+ people, would mean that some 350 people might lose their jobs in the coming months. The company confirmed the restructuring plan in a statement but didn't say much about the planned layoffs.
"With a view to become more nimble and have a sharper focus on growth and profitability, we are redesigning the organization to build a structure that strengthens and leverages our local and global scale and enables faster decision making across all of Ola's group companies."
As part of the restructuring, Ola will not only lay off employees but also shift some of them to other verticals under its business such as Ola Electric, Ola Foods, Ola Financial Services. The company's spokesperson added, "Our organizational redesign aims to rightsize all our operations as well as leverage skill sets and experience of mobility employees in available positions in new business verticals."
Further, in an email to employees, obtained by Economic Times, Ola's CFO Harish Abhichandani said that as a business, the company needs to sharpen its focus on revenue, growth, and profitability. He added, "We also need to refresh the way we run our daily operations - processes, people, productivity. Hence, a redesign of our organization and processes is the need of the hour."
The restructuring and focus on profitability - by laying off employees - come as Ola gears up to go public in the next 18-24 months. Sources told Inc42 that the company is optimistic about narrowing losses further and turning profitable before the IPO. In FY2019, Ola had increased revenue by 16% to Rs. 2,155 crore and slashed losses by 50% to Rs. 1,158 crore.