Posted on the 06-27-2019
BASF says it will cut 6,000 jobs, almost 5% of its workforce, by the end of 2021, as part of previously announced plans to reshape its organization by simplifying structures and processes. BASF says it will streamline its administration and sharpen the roles of services and regions. The plans should result in savings of €300 million ($342 million), generating an additional €2 billion/year of earnings from the end of 2021, the company says.
The planned job reductions will result from organizational simplification and from efficiency gains in administration and services, as well as in BASF's operating divisions, BASF says. In addition, central structures are being streamlined in the context of planned portfolio changes. BASF has not specified in which regions or businesses the jobs will be lost
Customers to experience a "new BASF"
"We will set up the new organization with a clear focus on leveraging synergies, reducing interfaces, and enabling flexiblity and creativity," says BASF chairman Martin Brudermüller. "We want our customers to experience a new BASF. To achieve this, we have to live a new BASF. We will therefore continue to develop our organization to work more effectively and efficiently."
Customer-focused operating divisions, service units, and regions, as well as a lean corporate center, are the cornerstones of the new organization. The corporate center will consist of less than 1,000 employees and support BASF's board in steering the whole company. This includes central responsibilities in areas such as strategy, finance, legal, human resources, and communications.
About 29,000 employees will be working in cross-functional service units, under the new structure. These include a newly established unit, Global Business Services, which will form a worldwide network of about 8,000 employees providing end-to-end services. They will support the business units with services including from the areas of finance, human resources, communications, and supply chain. Marc Ehrhardt, currently head of the finance division, will lead the Global Business Services unit. Other service units include Global Engineering Services and Global Digital Services, which in future will offer their services for individual sites or worldwide for business units. Meanwhile, the Global Procurement unit will make purchasing more effective, BASF says.
The first of the planned changes will take effect on 1 January 2020.
BASF, meanwhile, says it has agreed with employee representatives at the company's Ludwigshafen, Germany, complex to open negotiations early on a new site agreement. The current site agreement is valid until the end of December 2020. The goal is to sign a new agreement in the first half of 2020
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