The Coca-Cola Company has announced a major global restructuring effort, which will see the business streamline its operations into nine operating units and establish five ‘global category leads’.
The company’s current business model includes 17 business units under four geographical segments, plus the Global Ventures and Bottling Investments unit. Moving forward, the company will now operate nine business units that will sit under four geographical segments, while the Global Ventures and Bottling Investments unit will remain.
Coca-Cola states that these nine units will work with five new marketing ‘category leads’ in an attempt to drive growth across global, regional and local brands. These five ‘category leads’ will be:
The Coca-Cola brand
Hydration, Sports, Coffee and Tea
Nutrition, Juice, Milk and Plant
A new division called Platform Services has also been established, which will provide the operating units with data management, consumer analytics, digital commerce and social/digital hubs across global markets.
The restructuring comes as the company seeks to revitalise growth in the wake of falling revenues due to the Covid-19 pandemic. Coca-Cola reported a 28% decline in its second-quarter net revenue, due largely to a significant fall in the out-of-home sector, which typically accounts for half of the company’s annual sales.
The company has also announced that 4,000 employees across the US, Canada and Puerto Rico will be offered voluntary separation packages. There are likely to be further job cuts across the company’s global operations, as the company confirmed that a similar programme will be offered in many countries internationally.
Coca-Cola estimates that the total cost of the global severance programmes will be between $350 million-$550 million.
Coca-Cola’s chairman and CEO James Quincey said: “We have been on a multi-year journey to transform our organisation.
“The changes in our operating model will shift our marketing to drive more growth and put execution closer to customers and consumers while prioritising a portfolio of strong brands and a disciplined innovation framework.
“As we implement these changes, we’re continuing to evolve our organisation, which will include significant changes in the structure of our workforce.”