RM swings the axe as public sector spending cuts bite

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RM swings the axe as public sector spending cuts bite

Simon Quicke

Education specialist RM is to trim its staffing numbers by a fifth as a result of the impact of public spending cuts on its business concluding a strategic review which has been running over the past few months.

The vendor has started a redundancy programme that will reduce headcount by 13% of the July 2011 levels and on top of previous plans would take 23% off the numbers of staff that were employed this time last year.

The firm is also revising its business structure trying to reduce its over reliance on the learning technologies division by establishing four groups that will have similar business models - education technology, managed services, education resources and education software.

In parallel the vendor has also looked to reduce its risk overseas and is disposing of assets in both America and Australia and is looking to put more business through its Indian subsidiary.

In a statement accompanying the announced changes RM gave a sobering outlook for the prospects in the UK education market.

"RM has recently undertaken primary market research into the outlook for the UK education market, specifically the expenditure expectations of head teachers in primary and secondary schools in the coming year. In both primary and secondary categories approximately 70% of schools are anticipating reductions in capital expenditure," it stated.

Although the figures were not as bad in terms of revenue expenditure, particularly in primary schools, the over all expectations for next year's budgets was downbeat.

"In terms of IT spend approximately 40% of both primary and secondary schools are expecting a reduction in the year ahead," RM's statement added.
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