Ola company starts handing pink slips and defers appraisal 2022.
Because the mobile platform is restricting sure of its services and because the global funding environment is becoming more constrained, Ola company is cutting positions and delaying the performance evaluation of personnel for the year.
People in the know claim that the SoftBank-backed company has started laying off employees across all skill sets, although they did not specify how many jobs will be lost. According to news reports, there may be 400–500 people employed.
ET’s inquiries were unanswered by Ola Cabs.
Ola had a decrease in jobs in April as well. In recent months, several other Indian businesses have also given their personnel pink slips as funding has dried up, and investors around the world have become more cautious due to a gloomy macroeconomic outlook, geopolitical pressures and tensions, and volatility in publicly traded technology shares.
Balachandar N, an HR officer at Ola, sent a message on the company’s internal messaging network, Slack, on July 6 as the workforce there grew angry at the lack of legibility on the assessment course. “Crew — We notice the tension surrounding Pushed, Ola’s evaluation program.
It did not provide specifics on the restructure or indicate when the appraisal process would start. On June 25, ET claimed that Ola was discontinuing three of its businesses, including used car, cloud kitchen, and groceries supply, putting an end to the company’s plans to build a super-app.
The workforce of those companies may be transferred to its transportation, fintech, and hybrid vehicle businesses, people in the know told ET at this time. Stalling the appraisal scheme will only increase employee turnover in a company known for high attrition rates, several Ola employees told ET.
According to a worker who spoke anonymously, “stalling the evaluation may also lead to many people handing in their resignations, making it easier for the company since they wouldn’t have to terminate them.”
Over the past few months, Ola’s attrition rate has increased. Senior executives are also included in the list of those who have left.
Yashwant Kumar, the managing partner and Harvard business school for Ola Electrical’s recharging community, was the most recent top executive to leave his position. The CEO of Ola Cars, Arun Sirdeshmukh, resigned last month but had previously done so in May, as per ET.
Bhavish Aggarwal, the man of Ola, has a track record of closing companies as he moved quickly from one big concept to the next. According to sources, two thousand one hundred employees who worked at the company’s dark shops for Ola Sprint were reportedly put go in April. In a recent article, ET Prime stated that the company had begun tearing down the mysterious stores and had delayed its expansion plans.
After the company shifted from the become model to a one-time full payment for the vehicle, sales at its highly publicized electronic scooter business had slowed to 130–200 pieces per day, ET reported on June 24. This may appear to undermine Ola’s goal of producing 10 million scooters annually.
The food industry is another. Ola introduced Ola Cafes in 2015 but closed it down a year later. It bought Foodpanda in 2017 but shut it down and laid off the workforce in 2019. Later, it concentrated on the cloud kitchen business with Ola Meals, but reportedly the manufacturers never gained popularity, and the company is now selling its kitchen equipment.
With about 5,000 employees, this is anticipated to have an effect on the employment status of about 1,000 people. According to sources, there have already been three rounds of layoffs during the last three weeks, and 500 workers have received termination notices.
Prior to applying for a public listing in the following couple of years, the ride-hailing service has been attempting to cut costs. Two of the four persons cited above said that Ola’s aim to reduce its personnel by 20% over the next 4-6 months is a component of this effort, known as Manthan and an intensive cost optimization study.
Entrackr was unable to confirm the project’s name independently.
One of the four individuals described above, who asked to remain anonymous, stated that “almost half of the 1,000 include executive employees, including senior managers, and the other half is expected to be staff members at mid-level functions.” A different source confirmed this.
A corporate representative, however, said that this operation had impacted just 5-7 percent of Ola’s 4,500 employees.
“We are redesigning the organization to build structures that strengthens and utilizes our local and global scale and allows quick decision making across all of Ola’s group companies,” the spokesperson continued, “intending to become more nimble and have a sharper concentration on growth and profitability.”
The number of Ola’s employees was last estimated at 6,000. However, over the past few years, the company has experienced a number of exits along with a wave of layoffs inside its Foodpanda sector, reducing the size of its workforce to about 5000, according to the persons cited above.
According to several industry sources Entrackr spoke with, most of the big tech fund-backed backed businesses have been told to shift to profit and focus on revenue metrics as a result of the WeWork scandal, which affected its main backer SoftBank.
Analyst Chris Lane of research firm Sanford C. Bernstein recently claimed in a report that SoftBank’s Vision Fund, which has stakes in other ride-hailing platforms such as Didi, Grab, and Ola, all of which “will likely face same issues as Uber, with their economics likely remaining challenged until Robo-taxis will become viable and eliminate the cost of the driver.”
In addition to the layoffs, Ola has experienced a number of senior-level departures during the previous few months. One of them was Srivatsan Sridhar, who oversaw the company’s cab division until leaving Ola in September. As per his LinkedIn profile, Sridhar is currently employed at the financial company Rupeek as the vice president.
The Head of data science at Ola and another top executive who left the cab-hailing company in October was Gaurav Aggarwal. As per his LinkedIn profile, he is a research scientist at Google right now.
According to a former Ola employee who asked to remain anonymous, “the cab company has been stagnant and has a high cash-burn in addition to losing significant market share to Uber.” Because Ola has been pursuing a public listing, there was tremendous pressure to get that back on course.
Edited by Prakriti Arora