Coca-Cola to cut jobs leveraging investment in digital transformation

Coca-Cola announced the formation of Platform Services — led by chief information and integrated services officer Barry Simpson — as part of the strategy to improve efficiency and cut jobs of thousands of workers in response to the coronavirus crisis.
Coca-Cola FEMSA digital transformationCoca-Cola’s Platform Services is an organization that will work in service of operating units, categories and functions to create efficiencies and deliver capabilities at scale across the globe. This will include data management, consumer analytics, digital commerce and social / digital hubs.

Coca-Cola said Platform Services is designed to improve and scale functional expertise and provide consistent service, including for governance and transactional work. This will eliminate duplication of efforts across the company and is built to work in partnership with bottlers.

Coca-Cola will be offering voluntary deals across its businesses and promising to halve its number of operating units.

The company is offering voluntary redundancy to 4,000 workers in the United States, Canada and Puerto Rico and would offer similar deals in other markets, while also signaling other layoffs were likely to follow.

The voluntary program is expected to reduce the number of involuntary separations, the world’s largest beverage maker said, adding that the global severance programs would incur expenses of about $350 million to $550 million.

The company, battling a hit to sales from closures of bars, restaurants and cinemas where it normally sells heavily, said it would have nine operating units that would sit under four geographical segments, along with global ventures and bottling investments divisions.

Its current model includes 17 business units.

The plan to cut jobs come at a time when the number of Americans filing new claims for unemployment benefits hovered around 1 million last week, with the government confirming that the economy suffered its sharpest contraction in at least 73 years in the second quarter, Reuters reported.

Coca-Cola last month reported a 28 percent slump in sales in the “most challenging” quarter of the year due to coronavirus-triggered closures of restaurants, theaters and sports venues.