Diageo faces purchasing re-jig

3 August 2005
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04 August 2005 | Rebecca Ellinor

Drinks firm Diageo is to cut its purchasing team as part of a company-wide reorganisation.

A switch from a predominantly country-based to a regional approach in Europe, North America and internationally, could lead to several job losses.

Diageo said "no figure had been given on the number of displacements". But SM understands 10 per cent of procurement posts, or 15-20 staff, are likely to be lost.

The changes come as part of an effort to improve the company's performance in Europe and to allow it to "seize new opportunities", a spokeswoman said.

Paul Walsh, Diageo chief executive, has described the consumer market in Europe as difficult and said last month "we are reorganising to face challenges there".

As part of an announcement in July about financial results, Diageo said it had a "number of initiatives that will drive greater cost efficiency across the business". Restructuring is understood to be one of those initiatives.

Phil Boyd, who led a major part of procurement for the global supply business, is now head of procurement for Europe. He reports to Allan Burns, who, among other responsibilities, is head of global procurement.

Those close to the company, which makes premium brands such as Smirnoff, Baileys and Guinness, expect a number of senior people to accept different jobs or to leave.

Boyd said it was not yet clear who would hold which roles in the future.

Ron Jarman, who also held a number of procurement roles during his seven years at the firm, became global head of procurement for Reuters last month (see News, 21 July).

Diageo's procurement function was last subject to changes two years ago (see News, 3 July 2003).

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