Dell Inc. (Nasdaq: DELL) has put the final nail in the coffin of its Ottawa-based customer service centre laying off approximately 500 people in the process.
Dell spokesman Jess Blackburn said, in a previous interview, that Dell wouldn’t be recruiting any extra partners to help offset the Canadian job cuts. “We are developing our channel strategy and working with partners but the two are not associated,” he said.
Less than three months after Dell announced plans to shutter its Edmonton contact centre, the Round Rock, Texas-based hardware maker said it will close its customer contact centre in the nation’s capital and eventually offer 1,100 employees, including the 500 let go, “separate packages” or other jobs within Dell.
About 100 sales staff will remain in Ottawa, said Dell Canada spokesman Blair Patacairk. He added the company will keep about 1,000 employees in total in Canada, including about 800 in sales, marketing and legal, plus 100 account executives in various cities.
“There will still be some footprint in Canada,” he said.
The 500 who left yesterday were technical professionals taking customer calls, and the Ottawa call centre will shut down “closer to the June-July time frame,” Patacairk added.
“It’s a business decision, unfortunately, that we had to make.”
Founded in 1984 by the company’s CEO, Michael Dell, the vendor’s major selling point for its PCs was cutting out the middleman, allowing customers to order by phone, and later over the Internet. Though it has branched out into the server, storage, printer and switching markets, the company has since faced stiff competition from older manufacturers who sell through distributors, such as Palo Alto, Calif.-based Hewlett Packard Co.
Dell has recently started to move away from its direct sales model, and earlier this month Dell announced Best Buy and Future Shop would be selling up to eight different Dell products, including the Inspirion desktop PCs, XPS notebooks and monitors.
When Dell opened its contact centre in Edmonton in 2004, the municipal government offered tax credits over a five-year period and a 20-year lease on the land for a dollar a year. But the manufacturer announced in February it would close it and either move its 900 employees elsewhere within the company or give them pink slips.
Those cuts, plus yesterday’s layoffs, are part Dell’s year-old plan to reduce the worldwide workforce by 10 per cent. The layoffs were part of a series of changes that took effect when Michael Dell returned to his former position as CEO, replacing Kevin Rollins.
In Canada, Dell customers calling with a problem will get re-routed to another call centre, Patacairk said.
“We still have 25 contact centres around the world,” he said. “We have experts still around the world working on all the different types of products that we support.” He added he is not concerned customers will get poor service when calling tech support.
“This is about facility optimization,” Patacairk said. “It’s a series of changes being made around the world. This isn’t (only) Canada. Everyone is going to feel a bit of this everywhere.”
In addition to the severance pay they’re entitled to under Ontario labour laws, the approximate 500 employees laid off yesterday will be “placement counselling,” which includes advice on writing resumes and interview skills.
He added the tech support workers laid off by Dell have received extensive training in desktop and IT skills, which they can take to another employer.
“This will give them that much more business acumen.”