Marks & Spencer (M&S) is set to enter into consultation with employees to make significant changes to its UK head office structure.
The department store group said the move follows ‘a detailed review of the organisation and an analysis of its processes – and do not impact on M&S store employees’.
The proposals are centred on plans to reshape and redefine the organisation by reducing the number of head office roles by a net reduction of about 525 roles and the number of roles permanently based in central London by about 400, across IT and Logistics, as part of the retailer’s strategy to work more simply and more efficiently. The net reduction would be achieved through a combination of fewer contractors, natural attrition and redundancies for M&S employees.
M&S said that should the proposals go ahead, they would deliver significant cost savings. It is expected that annualised operating cost savings would be about 1% of the UK cost base. Cost growth guidance for the current year remains unchanged at about 3.5%. There would be a non-underlying cost of about £15m which includes the changes to the senior management team that have already taken place.
M&S ceo Steve Rowe said: “M&S has to become a simpler and more effective organisation if we are to deliver our plans to recover and grow our business.
“It is never easy to propose changes that impact on our people, but I believe that the proposals are absolutely necessary and will help us build a different type of M&S – one that can take bolder, pacier decisions, be more profitable and ultimately better serve our customers.”
“We remain committed to investing in store staffing and improving our customer experience and therefore our store colleagues are not affected by this proposal.”
The review highlighted that M&S has become too complex and inefficient and the proposals aim to address this by removing duplication, driving accountability and establishing clear, consistent processes; which in turn will strip out unnecessary costs.
M&S will be entering in to collective consultation with its employees with regards to these proposals via its network of independently elected employee representatives, the National Business Involvement Group, which will give consideration to any alternative proposals.