BCX has announced that it will implement a “new operating model”, which has resulted in the issuance of Section 189 notices at the company.
This is expected to result in significant job losses at the Telkom-owned company, with approximately 284 BCX employees being affected.
The company cited “the rapidly evolving customer demands and the drastic downturn of industries key to its business, brought on by the COVID-19 pandemic” as the reasons for this operational shift.
“The ICT landscape is changing rapidly, and customer demand is evolving at a faster pace, it was important for BCX to consider whether its current model still enables it to deliver on the changes in the market, especially when COVID-19 remains a long-term financial threat to our clients and therefore BCX,” BCX CEO Jonas Bogoshi said.
It said that BCX considered its strategy earlier this year, but COVID-19 created immense financial pressure that forced the company to review its position.
“COVID-19 has had disastrous consequences for our economy, and its impact to our clients has been substantial,” Bogoshi said.
As a result of the lockdown, BCX identified clients’ inability to meet financial responsibilities, received increased requests for payment options, identified a reduction in clients IT spend, and reprioritising of business requirements as some of the challenges.
“This created further pressure on BCX margins and on our ability to generate revenue,” Bogoshi said.
Section 189 notices served
Due to the implementation of the new operating model as a result of changing market conditions, structural changes were inevitable, BCX said.
The company subsequently served the Section 189 notice to Unions and the CCMA in accordance with the Labour Relations Act this morning.
“This is not an easy decision for any management team to make and is never taken as a first-line decision,” Bogoshi said.
“There were various measures implemented to try and mitigate this.”
BCX said it considered the issuing of the section 189 notice to Unions, following adjustment to its business strategy, the implementation of cost-cutting measures, a reduction in discretionary spend, measures to increase business efficiencies, and by reducing business complexity.
“Unfortunately, these measures could not insulate us from the rapidly changing ICT landscape, changes in customer demand and the devasting impact of COVID-19,” Bogoshi said.
BCX informed its employees of the decision at a meeting on the morning of 15 October 2020.
“Our main priority is to support our employees over the next few months, as we go through this process together,” he said.