SAP Restructure to Prioritise AI Growth and Upskilling Staff

Amid a Strong Revenue Forecast, SAP Is Set to Restructure Its Workforce to Facilitate AI Growth, Which Includes Upskilling 8,000 Workers and Cutting Jobs

SAP is set to restructure its business in favour of AI.

Joining a long line of technology-led companies making job cuts in favour of AI development, SAP is doing something slightly differently and also committing to upskilling. It has stated that it will restructure roles for 8,000 jobs so that the organisation can focus on growth in AI-driven business areas. 

Whilst this is inevitably expected to impact the company’s workforce, SAP has stated that it is aiming to have the same headcount by the end of 2024. The news comes in the midst of other high profile companies such as Amazon and Google making significant job cuts.

Crucial strategic developments in favour of AI

SAP shares have increased dramatically by 7% in the wake of the company forecasting cloud revenue growth of more than €21.5bn (US$23.5bn). The company also anticipates a total revenue of more than €37.5bn (US$41bn) in 2024.

Last year (2023) was a significant year for SAP in the realm of technology, having started experimenting with OpenAI’s ChatGPT and announcing that it would be embedding the technology into its products. The company also partnered with the likes of Google Cloud to combine their AI strategies, enabling customers to expand upon their digital transformation and AI and machine learning development.

Towards the end of the year, SAP also launched its enterprise Gen AI assistant Joule to include in its existing AI offerings. Acting as a Gen AI copilot, Joule was designed to develop existing SAP business operations.

Having undergone significant AI developments, SAP now expects generative AI (Gen AI) to fundamentally change its business. It has therefore pledged to invest more than US$1bn by backing AI-powered technology start-up companies via its investment arm, Sapphire Ventures.

2024 will also see SAP further increasing its focus on key strategic growth areas, in particular business AI. It also intends to transform its operational setup to capture organisational synergies, AI-driven efficiencies and to prepare the company for highly scalable future revenue growth.

AI upskilling crucial for business growth

In order to ensure that SAP continues to meet future business needs, it is planning to execute a company-wide restructuring program in 2024. Mainly focused on AI, the affected positions are expected to be covered both by voluntary leave programmes and internal re-skilling strategies.

In a rapidly changing digital landscape that sees businesses continue to be impacted by threat actors exploiting business infrastructure, the need for employee upskilling is crucial. As a result of AI technology developing at such a fast pace, there are ever-increasing talent shortages within the technology sector that need addressing. 

It therefore makes sense that businesses like SAP would commit to upskilling their workforce. According to a recent AWS report, AI will only continue to shape the global business landscape in 2024, with 90% of workers anticipating that AI will be integrated into their daily working lives by 2028.

However, this will only take place if employers prioritise recruiting highly-skilled talent, or via staff training programmes. 

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