Telstra slashes headcount in enterprise support group

Up to 50 IT staff are facing the axe at Telstra as part of the telco's plans to abolish its subsidiary Telstra Enterprise Services (TES) Pty Ltd and move all services back in-house by the end of 2002.

The 1300 staff within TES, which provides desktop support and network solutions to clients such as Qantas, National Australia Bank (NAB) and the Federal Government's Group 5 agencies, have been advised to re-apply for their jobs.

Telstra public affairs manager Anton Jones confirmed staff will be made redundant as part of the ongoing process of integrating TES under the Telstra banner, but would not verify numbers as job reviews are still under way and steps are being taken to relocate staff and create opportunities within the organisation.

"Staff numbers will be reduced to avoid duplication between TES and Telstra; transitions like this can be unsettling for staff, but we expect the process to be completed by the end of the year," Jones said.

Jones also confirmed Telstra's 14 operational support centres will be replaced by four mega-centres in Sydney, Melbourne, Canberra and Perth.

"Customers were telling us it was confusing having TES provide desktop support services on the one hand and Telstra network services on the other; there is no need for two separate companies to provide these services," he said.

However, a Telstra IT staffer, who wishes to remain anonymous, said it is basically a process of insourcing, which proves the creation of TES was a "monumental failure".

He said regional centres were in places like Ballarat, Adelaide, Bathurst and Grafton so relocating is not possible for most people in those areas.

"Many like myself are long-serving employees who are being forced out the door; about 50 of us cannot be moved elsewhere and one wonders how big customers will view this," the source said.

TES customers were unwilling to comment on the transition, but one source within Group 5 said the agency was uncomfortable about dealing with Telstra and was happy to remain with the subsidiary.

TES was originally called Advantra, a joint venture between Telstra, Lend Lease and IBM. Telstra bought IBM and Lend Lease out of the business in February 2000, changed its name to TES in September 2001 and announced it would move the operation under the Telstra banner in June this year.

Big wins last year included a $55 million deal to provide desktop and LAN services to National Australia Bank and a deal with Qantas for an undisclosed figure for IT infrastructure including servers, workstations and staff. The Federal Government Group 5 contract is worth $100 million and covers the Department of Prime Minister and Cabinet, Department of IT and the Australian Competition and Consumer Commission.

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