Radical shake-up for Unilever chiefs
Thursday 14 March 1996
Unilever, the Anglo-Dutch consumer products giant, yesterday announced a shake-up of its Byzantine management structure designed to separate strategy from operational functions and make its managers more accountable.
The shake-up includes the abolition of the group's long-standing three- man special committee which used to combine both strategic and operational responsibility. Instead, a new seven man special committee will look after strategy while operational decisions are pushed down to 14 new business groups.
It is the first part of an organizational review being conducted by Niall FitzGerald, who will succeed Sir Michael Perry as chairman in September.
Sir Michael said he had considered demerger but decided that common functions such as brand marketing and research and development meant the group was better left together.
The shake-up received a cautious welcome in the City which had been concerned that Unilever's rigid "top down" structure hampered its ability to move into new markets such as China and the Far East. The shares rose 20p to pounds 12.28 though there were concerns about further restructuring charges as some head office job losses seem likely.
One analyst said: "It is a step in the right direction as Unilever's structure has remained pretty much the same since the 1930s. But what we really need from this company is growth."
The new seven-man committee comes into effect in September and will be led by the two chairmen Morris Tabaksblat and Mr FitzGerald, together with the finance director, personnel director and three category directors.
The presidents of the 14 business groups will be directly responsible for profitability and the execution of strategy in their own markets.
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