Nestle has formed a “business excellence” unit as the world’s largest food manufacturer looks to benefit from its scale.
Paul Bulcke, Nestle’s CEO, said the Swiss food group wanted to “better leverage our scale” through the new division, which will have representation at board level.
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The unit will help Nestle “serve its markets and businesses more effectively and cost efficiently”, the company said.
“While always privileging a decentralised structure to stay close to the local consumer and keep agility in execution, we are increasing our efforts to better leverage our scale. We are looking into how our company is organised and operates to keep an optimal balance between category and geographic focus. By taking these steps, we are building our company for continued growth and performance,” Bulcke said.
Chris Johnson, the Nestle executive vice president in charge of its business in the Americas, will take charge of the new division.
Kepler Cheuvreux analyst Jon Cox argued he read Nestle’s claim the formation of the unit would better leverage its scale “as a euphemism for restructuring that goes beyond what many have seen or anticipated”.
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By GlobalDataCox said today (29 September): “We suspect the slowdown, which has lasted for 24 months, but which the market has shrugged off because of Nestle’s defensive characteristics – and a new buyback programme – is more pronounced than feared.”
Johnson’s role in the Americas will be taken by Laurent Freixe, the head of Nestle’s business in Europe.
Nestle has also rejigged the markets its regional divisions cover. The company wanted to ensure the divisions “have the necessary balance between the emerging and developed market trends, as well as the different socio-economic consumer dynamics”.
The company’s operations in the Middle East, north Africa, Turkey and Israel will now come under its Zone Europe unit, which will be renamed Zone EMENA.
Luis Cantarell, president and CEO of Nestle Health Science and head of Nestle Nutrition, will head the enlarged business.
Greg Behar, who joined Nestle in July from pharma group Boehringer Ingelheim, will succeed Cantarell as CEO of Nestle Health Science.
Heiko Schipper, global business head of Nestle’s infant nutrition unit, will take Cantarell’s responsibilities at Nestle Nutrition.
The redefined Zone Asia, Oceania and Africa unit will continue to be led by Nandu Nandikishore.
