Business

GraceKennedy cuts 70 jobs in restructuring exercise

Thursday, July 19, 2018

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Conglomerate GraceKennedy Limited yesterday announced the separation of 70 employees as it embarks on a restructuring process aimed at improving the group's performance for its 100th birthday.

In a statement to shareholders on the Jamaica Stock Exchange, GraceKennedy also disclosed that it has engaged change management partner Prosci to provide the company with a “structured process and the necessary tools to successfully manage the people side of these major changes”.

The food and financial services conglomerate began a round of restructuring activities earlier this month after contracting the Mexico-based consultants to address overall organisational design, cost structure, and business processes.

Ultimately the company wants to hit $100-billion in annual revenue before 2020 from growth in both its local and overseas markets. However, five-year performance of the conglomerate shows that growth has been slowing, from revenue growth of 9.6 per cent in 2013 to only 4.8 per cent last year, with total $92 billion.

According to GraceKennedy, the restructuring exercise is aimed at not just improving key performance metrics, such as profit before tax and revenue growth rate, but also to streamline processes that will allow for a better work experience for employees, while fulfilling the company's obligation to remain profitable and sustainable.

“We have the privilege of being one of the region's most well-known and respected companies, and we remain very proud of our successes to date, but also have an obligation to all our stakeholders — staff, investors, shareholders, pensioners, and customers — to ensure that we remain relevant and achieve our goal of becoming a global consumer group,” Group CEO Don Wehby said.

GraceKennedy's restructuring process is being rolled out in phases and began with a review phase in early 2018. The company said it has now entered the implementation phase of the process, and at each step the company has involved team members in ongoing dialogue and this will continue.

“In this stage, some positions have been rationalised, a number of roles expanded, and a few new positions created as the company repositions itself for future growth.

“Approximately 70 persons were separated, with a number of persons redeployed across the group. Affected persons have been provided with support services in the areas of financial planning, career counselling and résumé writing, in addition to severance packages,” GraceKennedy noted.

Wehby reasoned that while change is never easy, it is necessary if GraceKennedy is to remain relevant in a changing global environment which has seen shifts in consumer behaviour, fluctuating economies, and disruptive technologies.

He highlighted strategic priorities identified for the company, to include: embedding lean management practices for increased efficiency; facilitating empowered and autonomous subsidiaries to foster entrepreneurship; maintaining strong corporate social commitments through the foundations; consistent pursuit of innovation and new growth opportunities; and fostering a customer-centric culture throughout the group.

“GraceKennedy has been a Jamaican-owned business and community icon for the last 96 years, and while we have been very successful, we realise the need to change. We are embarking on a journey that will give us a competitive advantage for the next century. This change will keep us at the forefront in the food service and financial markets around the world. We will always be guided by our core values, as we work together in building a stronger GraceKennedy,” the Group CEO said.

—Karena Bennett

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