Bloomberg reported Jan. 24 that consumer products giant Unilever plans to cut thousands of managerial positions in a move aimed to speed the company’s decision-making. The company confirmed that report later the same day in a statement that said Unilever would restructure around five business groups: Beauty & Wellbeing, Personal Care, Home Care, Nutrition, and Ice Cream. Each group is to be fully responsible and accountable for their strategy, growth and profit.
Unilever said the job cuts reduce its senior management positions by about 15 percent and its junior management roles by 5 percent. London-based Unilever has approximately 149,000 employees worldwide.
The company doesn’t expect factory teams to be impacted by the changes.
The news follows weekend reports that said activist investor Nelson Peltz’s Trian Fund Management LP had acquired a stake in Unilever, and came days after the company retracted its $68 million bid to acquire GlaxoSmithKline’s consumer products business after the latter pushed back on that price.
It’s been a tumultuous past week for Unilever. Besides the aforementioned news, it acknowledged in a Jan. 18 filing with the U.S. Securities and Exchange Commission that the company’s go-forward strategy would be to reposition its portfolio into higher-growth categories and expanding its presence in Health, Beauty and Hygiene.
“These categories offer higher rates of sustainable market growth, with significant opportunities to drive growth through investment and innovation, and by leveraging Unilever’s strong presence in emerging markets,” the company said in the SEC filing.
Notably missing from those categories is Unilever’s food and refreshment brands, which include: Ben & Jerry’s ice cream, Hellmann’s mayonnaise, Magnum ice cream, Bango soy sauce, The Vegetarian Butcher plant-based meats, Knorr dehydrated soup and meal mixes (Germany) and Wall’s sweets and ice cream (Europe and Australia).
Unilever didn’t specifically mention Food and Refreshment as one it plans to divest, but that is the industry-wide expectation. However, the inclusion of Ice Cream in the company’s Jan. 24 statement suggests the company plans to at least hang on to the Ben & Jerry’s brand.
“The board also concluded that major acquisitions should be accompanied by the accelerated divestment of intrinsically lower growth brands and businesses,” Unilever said in the filing. “This would provide funding and enable separation dis-synergies to be offset by acquisition synergies.”