DSM Reorganizes to Cut Costs and Strengthen Focus
Life sciences and materials sciences company DSM has announced a reorganization plan that will result in the loss of 900-1,100 full time jobs by the end of 2017. Roughly half of the job losses will be in the Netherlands.
The changes will save the company between €125-150 million by the end of 2017. One-off restructuring charges, including severance costs, are estimated in the range of €150-175 million before tax.
Feike Sijbesma, CEO and chairman of the managing board, said: “In an increasingly global and fast-paced business environment we need to adapt our organizational and operating model to service our customers even better. With the adjustments announced today, we become more agile, focused and cost-efficient. Businesses fully focus on growth, while at the same time we become more competitive by leveraging our global support functions.”
DSM’s support functions will be provided on a global basis to capture scale-benefits and perform at lower cost. Processes will be further standardized and duplications eliminated resulting in a more efficient pooling of resources. DSM said the optimized support functions will enable the business groups to increase their business and market focus and enhance their operational agility.
The new organizational model will apply to the following departments: finance; human resources; legal; IT; business services; indirect sourcing; communications and corporate as well as the regional centers. DSM will also implement efficiency measures in its major R&D centers worldwide.
In addition, a business (growth) improvement and efficiency program is being developed for the Nutrition business. DSM said it will provide more details on November 4.
An executive committee will be established to increase focus on developing the business, innovation and people, DSM said. The members of the committee will be the managing board members Feike Sijbesma, Geraldine Matchett (chief financial officer), Stephan Tanda (Life Sciences) and Dimitri de Vreeze (Materials Sciences). They will be joined by Chris Goppelsroeder (Nutritional Products), Philip Eykerman (Strategy and M&A), Rob van Leen (R&D and Innovation) and Peter Vrijsen (Human Resources).
