OpenText Corp.’s OTEX-T chief executive says the company plans to shed about 1,200 roles as part of a business optimization plan.

In an open letter to stakeholders, Mark Barrenechea says the move is meant to place the right talent in the right places, fund growth and innovation and deliver higher productivity, lower costs and expanded margins.

He says the Waterloo, Ont.-based software company’s job reduction will come with one-time costs of about $60 million but will generate about $150 million in savings per year.

The move will be combined with plans to create 800 new roles in sales and engineering and comes as the company is ushering in a new chapter.

The new chapter it calls OpenText 3.0 will focus on cloud, security and artificial intelligence innovations.

In the cloud segment of the business, Barrenechea says the company will finds ways to automate and drive productivity for workers, and in the AI portion, it will seek out ways to transform business processes.