The changes continue at Diageo. The Guinness owner is amid a turnaround that includes a huge amount of cost-cutting, as chief executive officer Dave Lewis seeks to right the ship, as it were.
Since taking the top job at the start of the year, Drastic Dave, as he is known, has moved quickly. The company has kicked off a plan to save about $1 billion (€870 million) and take an axe to some departments.
Reuters reported in July that some teams were to be cut by as much as a third. Diageo’s annual report published in August showed the company had about 2,000 fewer staff than a year earlier. Lewis had identified what he called “massive duplication” in parts of the business, leaving ample room for job cuts.
The other side of the turnaround plan includes price reductions and big investments in some of its brands, most notably Guinness – something no doubt welcomed in St James’s Gate.
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And the changes keep coming. Diageo named Joanne Wilson as its next chief financial officer on Wednesday. She will join “some time in 2027″ – a notably vague timeline for the arrival of someone so senior.
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Her appointment took analysts by surprise. The current finance boss Nik Jhangiani had been interim chief executive until Lewis formally started and had also been a big player in presenting the turnaround plan to investors barely a month ago.
While Wilson, who is joining from advertising giant WPP, has drinks industry experience, having been finance chief at Britvic, Jhangiani was well known in the market, having joined Diageo from Coca-Cola.
Indeed, Wilson’s main attribute may have been the fact that she is an alumna of Tesco, where Lewis made his name as a successful chief executive.
“Dave has been refreshing and streamlining the executive management team at Diageo, and notably adding several former Tesco executives to the ranks over the last few months,” Goodbody analyst Fintan Ryan wrote in a note to clients on Wednesday.
Wilson is no doubt good at her job, but one wonders whether a strategy of bringing in a slew of lieutenants from one company will succeed in the long term. It takes a lot of work and time to fundamentally change a company culture. Will Drastic Dave manage to do it?
