British Airways Cuts Management Jobs
November 30 2005 - British Airways has announced plans to re-structure the business and cut 35% (357) of its 1,715 management jobs by March 2008.
- A 50% reduction in senior managers - from 414 jobs to 207
- A proposed 30% reduction in middle management jobs - from 1,301 to 911.
According to Willie Walsh, BA's new chief executive: "I said when we reported our second quarter financial results last month that our costs were up in most areas and that, as a result, we need to re-energise our efforts to deliver a competitive cost base.
"We must lower our costs so that we can fund future investment in our business. Today marks the start of a renewed effort to deliver our goal of a 10% operating margin. I am confident that these measures, however difficult, will help to build a robust British Airways and one that will benefit from sustained profitability. This action will enable us to carry out the investment we need to make in our business in the coming years in order to deliver a more competitive and efficient airline."
The proposed management job reductions are intended to reduce BA's costs by £50 million as part of its £300 million cost reduction programme by March 2007.
The reduction in the number of senior managers will be phased:
- 94 of the top executives (23%) will leave the business by March 31, 2006.
- More jobs will go the next two years with the 50% target to be achieved by March 2008.
- Full proposals and a timetable for achieving the planned 30% reduction in middle managers will be developed and communicated by March 2006.
Willie Walsh added: "We are re-structuring the airline to remove duplication, simplify our core business and provide clearer accountability. Managers will have greater accountability for making decisions, delivering results and leading the business.
"The decision to embark on a major reduction in management numbers is not one I have taken lightly. We have extremely talented managers and they have led the way in transforming our company during the last four years since the tragic events of 9/11.
"But it is essential that we streamline our business further and I believe it is right that we have started by looking closely at the number of senior managers we need to deliver a sustainable, profitable future."
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