Pandora lays off 180 staff due to reorganization
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Danish jewelry giant Pandora has announced a new company structure that will eliminate an organizational layer between the global headquarters and local markets with the aim of getting closer to the customer and speeding up the execution of marketing campaigns and product launches.
Effective April 2, Pandora will close its three regional organizations (Americas, EMEA, and Asia Pacific) and group the 100-plus markets where it operates into 10 clusters, each headed by a GM.
The GMs, based in the largest market in each cluster, will report to a newly established chief commercial officer position, who will report directly to Pandora’s president and CEO, Alexander Lacik, and be part of the executive leadership team.
The three current regional presidents will step down from the executive leadership team and 180 employees from regional offices and markets will leave the company.
The total cost of the reorganization is expected to amount to around US$197 million, with one-off costs of around $30 million, primarily related to severance payments, additional consultancy support, extraordinary recruitment costs and other costs of closing down the regional offices.
David Allen, currently president of Pandora EMEA will stay with Pandora and support the company’s turnaround plan, Programme Now, while Sid Keswani, current president of Pandora Americas, will become president of the North America cluster.
Kenneth Madsen, current president of Pandora Asia Pacific, will leave the company.
The cost reductions from the redundancies of 180 employees are expected to be largely offset by costs related to the further strengthening of the global organization, limiting the net cost savings.
Lacik said in a statement that the new structure would ensure feedback from customers was incorporated into new designs more quickly.
“The reorganization will reduce organizational complexity, enable Pandora to execute with more speed and agility, and add critical capabilities required to support growth,” he said.
Questions & Answers
Q.What is the main objective of Pandora's new company structure?
What is the main objective of Pandora's new company structure?
The aim is to get closer to the customer and speed up the execution of marketing campaigns and product launches. It will also ensure customer feedback is incorporated into new designs more quickly.
Q.How many employees will be leaving the company as a direct result of this reorganization?
How many employees will be leaving the company as a direct result of this reorganization?
180 employees from regional offices and markets will leave the company due to the new structure. The three current regional presidents will also step down from the executive leadership team.
Q.What is the total estimated cost for Pandora's reorganization?
What is the total estimated cost for Pandora's reorganization?
The total cost of the reorganization is expected to be around US$197 million. This includes one-off costs of approximately $30 million for severance, consultancy, and other expenses.
Q.Will the cost reductions from the redundancies significantly reduce the company's overall expenses?
Will the cost reductions from the redundancies significantly reduce the company's overall expenses?
The cost reductions from the 180 redundancies are expected to be largely offset by costs for strengthening the global organization. This will limit the net cost savings.