Alcatel-Lucent to centralise procurement

11 September 2012

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11 August 2012 | Adam Leach

Alcatel-Lucent is to bring a range of corporate functions, including procurement, into a new central unit to generate efficiency savings.

In an announcement to shareholders, the telecommunications company explained that it will execute a new performance programme to meet its target of saving €1.25 billion (£998.5 million) by 2013. Procurement and supply chain operations at the company will also now be overseen by Paul Tufano, who has been promoted from chief financial officer to chief operating officer.

The changes mean all back-office and business support functions will be managed by a new central administrative system. The new function will start operating on 1 January 2013.

Ben Verwaayen, chief executive officer at Alcatel-Lucent, said: “We are putting in place a simple, robust delivery mechanism for the company to ensure that Alcatel-Lucent meets its target of a total cost saving of €1.25 billion by the end of next year.”

When the company announced this savings target in July, it also explained it would be looking to exit or restructure unprofitable managed services contracts. It also announced it planned to reduce its headcount by 5,000.

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