Another Layoff in Tata Group After Firing 12,000 Employees in TCS? Tata Digital To Reduce 50% Workforce?

The phase of layoffs within the Tata Group, one of India's largest corporate conglomerates, shows no signs of slowing down. Following the earlier announcement of 12,000 job cuts at TCS, reports now indicate that Tata Digital, the group's e-commerce and digital arm, is planning to reduce its workforce by more than 50% in its super-app Tata Neu as per ET report.

Another Layoff in Tata Group After Firing 12,000 TCS Employees? Tata Digital To Reduce 50% Workforce?

Tata Digital is undergoing a significant transformation under its new CEO, Sajith Sivanandan. As ET reported, the company is shifting from a broad "do-everything" strategy to a more profit-focused model. This change includes a potential workforce reduction of over 50% in its consumer e-commerce division, Tata Neu, as part of efforts to streamline operations.

Sivanandan, who previously led Jio Mobile Digital Services, took over as CEO in September. He is the third person to hold this position since Tata Digital's inception in 2019. Under his leadership, the company is moving away from a growth model driven by gross merchandise value (GMV) towards integrating at the group level.

Restructuring Across Tata Digital Units Including BigBasket, Croma and Tata Neu

The restructuring is not limited to Tata Neu. BigBasket and Croma, also part of Tata Digital, are undergoing significant strategic changes. BigBasket is concentrating on strengthening its fast-delivery BB Now model, aiming to compete more effectively with companies such as Blinkit, Zomato, and Swiggy Instamart.

Croma, on the other hand, is closing loss-making stores to solidify its offline presence while scaling back attempts to compete with e-commerce giants like Amazon and Flipkart.

Future Focus Areas for Tata Digital

According to reports, Tata Digital will now focus on three core areas: financial services, marketing services, and a unified loyalty engine. The company aims to leverage the Tata Group's brand value more effectively, centralise digital marketing efforts, and create a single rewards system for all Tata brands. This strategic focus is expected to improve operational efficiency and better align the company's digital initiatives with its overall corporate objectives.

Tata Digital Financial Performance and Challenges Ahead

Tata Digital reported a 13.8% decline in revenue, falling to Rs 32,188 crore in FY25. However, the company also managed to narrow its net losses from Rs 1,201 crore to Rs 828 crore. Despite this improvement, the new management faces the challenge of stabilising the business, improving its financial position and establishing a sustainable and scalable model for long-term growth.

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