Accenture's Strategic AI Transformation: 11,000 Layoffs as Company Pivots to Future Skills

Accenture is currently undergoing a significant Artificial Intelligence-focused restructuring program, which has resulted in approximately 11,000 employee layoffs over the past three months.

According to Business Insider, the global IT consulting firm has made the strategic decision to separate from staff members who cannot be effectively retrained with AI skills. However, the company also intends to bring on new employees during the next year.

CEO Julie Sweet emphasized that "upskilling" remains their primary strategy. She explained, "We are exiting on a compressed timeline and people where reskilling, based on our experience, is not a viable path for the skills we need."

The company plans to invest in AI systems training for its remaining workforce. Sweet noted, "Every new wave of technology has a time where you have to train and retool. Accenture's core competency is to do that at scale."

Accenture's AI consulting services have generated $2.6 billion in revenue over the last six months, suggesting that the restructuring initiative is driven by AI's growth potential for the business.

As reported by Tech.co, this restructuring measure may cost Accenture around $865 million in severance packages. The company's total workforce has decreased from 791,000 to 779,000 between May and August of this year.

Beyond layoffs, the restructuring plan includes additional components. Chief Financial Officer Angie Park mentioned that alongside "rapid talent rotation," Accenture will divest two acquisitions.

"These actions will result in cost savings which will be reinvested in our people and our business," Park stated.

Sweet described Accenture's view of AI as "expansionary" rather than "deflationary," emphasizing that it's integrated into all aspects of their operations. Accenture joins several major tech companies adjusting their workforce strategies around AI capabilities.

For example, while Microsoft has conducted layoffs, they've simultaneously hired new talent, maintaining their overall headcount. Similarly, Mark Zuckerberg's META reduced its workforce by approximately 5 percent earlier this year but subsequently embarked on an AI hiring initiative, filling many positions with upskilled personnel.