New CEO Philipp Navratil said: “The world is changing, and Nestlé needs to change faster.”
He added: “This will include making hard but necessary decisions to reduce headcount over the next two years. We will do this with respect and transparency. Along with other measures, we are working to substantially reduce our costs, and today we are increasing our savings target to CHF 3 billion by the end of 2027.”
The planned global headcount reduction will take place over a two-year period. It includes around 12,000 white-collar professionals across functions and geographies, will drive annual savings of CHF 1 billion by end of 2027.
The further c.4,000 headcount reduction in manufacturing and supply chain will be part of ongoing productivity initiatives in the business, it was revealed.
The company said it would also increase focus on operational efficiency, including leveraging shared services and automating processes.
Strategically there would also be an “increased ambition” on innovation and a broadening of approach, including a step change in consumer insights and marketing capabilities.
Navratil said the company must do more to accelerate growth momentum. He added that the actions would secure Nestlé’s future as a leader in the industry and will enable it to improve its overall performance and deliver shareholder value.
“As Nestlé moves forward, we will be rigorous in our approach to resource allocation, prioritising the opportunities and businesses with the highest potential returns,” Navratil continued.
“We will be bolder in investing at scale and driving innovation to deliver accelerated growth and value creation. We are fostering a culture that embraces a performance mindset, that does not accept losing market share, and where winning is rewarded.”
In September Nestlé fired CEO Laurent Freixe with immediate effect following an investigation into an ‘undisclosed romantic relationship with a direct subordinate’.
The food and drink giant recently named a new chief executive for its coffee brand, Nespresso.
