The blogosphere is abuzz with talk that financial services giant Citigroup will lay off its North American desktop support staff in November to make way for an outsourcing deal with Dell Inc.
Citigroup reportedly told its 200 North American desktop support staff employees that their jobs would be phased out Nov. 6, according to the blog transdaily.com.
The blog's author, who identified himself as a six-year veteran of Citigroup, wrote that the company informed workers it would create 50 new IT positions and that Dell would hire between 50 and 80 people to work the contract.
Citigroup is encouraging the workers affected by the outsourcing deal to apply for the new positions or to apply to Dell. The soon-to-be-laid-off employees were also reportedly told that outplacement consultants would be provided to help them with their résumés and interviewing skills.
The details in the blog entry were confirmed by a Citigroup desktop support staffer contacted by SearchCIO.com. The staffer requested that his name be withheld.
Citigroup did not return phone calls seeking comment. A Dell spokesman said last night that the company has not announced any deal with Citigroup and would not comment on speculation.
Citigroup's decision to outsource a portion of its IT support staff did not take employees completely by surprise, however. The transdaily.com blog notes that many people in Citigroup's IT group were expecting the news since Mitchell Habib became CIO of the company's Global Consumer Group North America.
Habib has a reputation for doing large outsourcing deals. As CIO for GE Medical Systems, a unit of General Electric Co. that specializes in medical diagnostic imaging technology, Habib contracted with Indian outsourcer Tata Consultancy Services Ltd. for a wide range of IT services in 2002 and 2003.
Indeed, this change at Citigroup may just be the tip of the iceberg for outsourcing deals. In February The Hindu Business Line reported that Citigroup was "in the advanced stages" of signing a $500 million contract with multiple Indian vendors, including Tata. Habib was quoted earlier this year in news reports saying that the engagement would initially require 2,200 people in a year.