WPP boss Mark Read has unveiled the group will undergo a “radical evolution” as part of its three-year plan which will see it continue to simplify the business with the aim of becoming a “creative transformation company”.
The business has stated it will spend £15m a year investing in new creative leadership, hiring 1,000 staff mostly in North America. But reports suggest that the overhaul will lead to 3,500 jobs being axed worldwide, meaning the net job losses would total 2,500.
Under its plans, WPP will also sell under-performing businesses and close “unsustainable operations”. It is understood that it will shut 80 offices globally and merge the operations of a further 100 in locations where business is slow.
The changes will incur a £300m restructuring charge over the next three years. WPP said it would ultimately save £275m annually by the end of 2021, half of which would be reinvested in the business.
“WPP has become too unwieldy, with too much duplication. As a result it is not always as focused or as fleet of foot as it needs to be to satisfy the needs of all our clients around the globe,” the company said.
It confirmed it would sell a large stake in data business Kantar, retaining a minority holding, and insists it has received “numerous unsolicited expressions of interest”.
Read said: “We are fundamentally repositioning WPP as a creative transformation company with a simpler offer that allows us to meet the present and future needs of clients.
“The restructuring of our business will enable increased investment in creativity, technology and talent, enhancing our capabilities in the categories with the greatest potential for future growth.
“We describe our approach as ‘radical evolution’: radical because we are taking decisive action and implementing major change; evolution because we will achieve this while respecting the things that make WPP the great company it is today.”
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