Bayer newly appointed CEO, Bill Anderson, has reportedly unveiled plans to streamline the companys management structure in a bid to expedite decision-making processes. This marks the first step in a broader effort to transform the embattled German company, which has been under pressure from investors to consider restructuring.

Anderson, who assumed leadership in June, is determined to demonstrate rapid improvements to investors while buying time to unveil more comprehensive restructuring plans in the coming months, cite sources familiar with the matter.

The former executive at Roche, Anderson emphasized in August that excessive bureaucracy, along with the companys debt burden and legal issues related to products like weedkiller Roundup and PCB chemicals, were hindering Bayers ability to capitalize on opportunities.

He also indicated his intention to transition from annual to 90-day budgeting cycles and to empower teams closer to customers to make business decisions, eliminating unnecessary layers of management.

Notably, Bill Andersons appointment as CEO was well-received by shareholders, as he was seen as a qualified leader to spearhead Bayers transformation efforts, replacing Werner Baumann, whose leadership had faced criticism for not adequately addressing capital market concerns. However, Andersons window of opportunity to present concrete strategic proposals is likely to be relatively short.

The primary objective of the CEO is to revitalize Bayers stock price, which has lagged behind competitors due to ongoing expenses related to U.S. weedkiller litigation. He emphasized that he was open to exploring all options as part of his review of the companys strategy and structure, promising an initial update in the coming months and detailed plans in early 2024.

In an unscheduled statement last month, the company projected a more significant decline in earnings and zero free cash flow, which some analysts interpreted as Andersons effort to quickly address negative financial news and pave the way for a fresh start.

Anderson is expected to present initial proposals for cutbacks during an upcoming internal strategy meeting, with a particular focus on middle-to-upper management positions. These changes may result in one-off costs related to severance packages for departing employees, although the exact number of job cuts and the timing of the announcement remain undisclosed.

Credit source: https://www.reuters.com/business/bayers-new-ceo-plans-cut-management-jobs-prelude-overhaul-2023-09-14/