Asda makes more job cuts after Mohsin Issa's botched IT upgrade

Telegraph

12-03-2025

Asda has launched a fresh round of job cuts as the grocer races to axe workers involved in a botched £800m IT upgrade that had been championed by co-owner Mohsin Issa.
More than 200 employees have been sacked without consultation at the troubled supermarket, which is battling to cut costs as part of a radical turnaround plan.
The latest departures were triggered as the retailer finally prepares to conclude a long-running process aimed at disentangling its technology systems from former owner Walmart.
Hundreds of employees were hired to work on the three-year 'Project Future', which was championed by Issa and deemed 'mission-critical' to Asda's success.
However, the project has been beset by problems and delays over the past year, recently leading Walmart to extend the completion deadline to help Asda swerve a multimillion-pound penalty.
Radical restructuring
It marks the second round of redundancies in five months under Allan Leighton, the new chairman who was presented as a 'man of the people' in an interview last week.
He swung the axe in January following Asda's worst Christmas trading performance since 2015, sacking 13 regional managers as part of an internal restructuring.
This came after he also scrapped 10,000 staff bonuses, raising concerns over the impact on morale across the retailer's workforce.
Questions may also be raised over the decision to again sack staff without any forewarning.
Asda made 500 staff redundant without a consultation period last November, fuelling criticism from union chiefs who threatened to bring discrimination claims.
Government rules typically require companies to carry out a 45-day consultation when dismissing 100 employees or more, although there is no suggestion Asda has broken any laws.
Lord Rose, then Asda chairman, insisted at the time that no employee rules had been breached, instead claiming that it was the most 'humane way' to carry out the lay-offs.
Falling behind the competition
The latest job cuts have emerged as Asda continues to lose customers to rival supermarkets. Over the past year its market share has fallen from 13.7pc to 12.6pc.
This faltering performance prompted Asda's majority owner, TDR Capital, to appoint Mr Leighton late last year.
He was credited with turning Asda into a retail powerhouse during his first stint at the company in the 1990s, and he has since pledged to restore what he calls the 'Asda DNA'.
However, he is already facing an uphill battle. The most recent trading figures from Kantar revealed sales at Asda dropped by 5pc in the four weeks to Feb 23 compared with the same period last year.
This meant it was the only major grocer to suffer a decline in sales in February.
In contrast, sales at Tesco grew by 5.8pc and Sainsbury's posted growth of 4.8pc.
An Asda spokesman said: 'The majority of our operations have successfully transitioned to new systems as part of Project Future. For many teams the work is done and so it is natural that colleagues leave the project as the specific workstreams they are working on are completed or as their contracts finish.'