John Lewis and Waitrose is undergoing a significant restructure that will see the two brands run as a single business from February 2020 and reduce its senior management team, including marketing, by a third.
Parent company the John Lewis Partnership says the new structure, dubbed the ‘Future Partnership’, will lead to cost savings of £100m and better position the business to “break out” from the cycle of declining returns that are seeing a number of retailers disappear from the high street.
The plan includes the introduction of a new management structure for the partnership. From next year there will be one executive team with direct responsibility for the performance and strategy of the whole partnership. This means there will no longer be divisional boards or separate managing directors for John Lewis & Partners and Waitrose & Partners.
As such, Paula Nickolds, currently managing director of John Lewis, will become executive director of brand, responsible for leading brand, digital, marketing and services across the business. She will sit on a much smaller partnership board alongside outgoing chairman Sir Charlie Mayfield and six other executive directors.
Waitrose’s managing director, Rob Collins, will step down in January after 26 years at the business, having decided there isn’t a role in the new structure that “I believe is right for me personally”.
Collins adds: “I have been closely involved in the planning of the Future Partnership programme and I’m very confident that the new structure is the right one for the future. I am certain it will enable the business to continue its long history of successfully adapting to changing times.”
It is not yet clear what will happen to John Lewis and Waitrose’s respective marketing bosses, Craig Inglis and Martin George. Nor is it clear what will happen to the structure of both brands’ marketing teams.
A spokeswoman confirms marketing is under consultation as part of the restructure. It seems likely that some marketing jobs will go as part of plans to slim down the senior management team by a third.
“In the last three years we have delivered significant innovation and driven efficiency, maintaining market leading service standards and growing customer numbers. However, the lesson of the last two years is that we need more innovation, faster decision making and bolder steps to align our operating model with our strategy. This is what the ‘Future Partnership’ is all about,” says Mayfield.
“We are confident, as a board, that when the programme is complete, the Partnership will be better positioned to break out from the cycle of declining returns that are affecting most established retailers. We will be a more modern and more unified business with a leadership team and cost structure that will enable the business to thrive in the long-term.”
There are no plans to change how the two brands serve customers, although the Partnership says the changes will mean the influence of its customer-facing staff “become stronger” in shaping its offer.
The hope is that there will be more “power” in the two brands working more closely together, especially given that eight out of 10 of the customers who account for the great sales shop across both businesses. This work has already started in marketing with the rebrand of John Lewis and Waitrose to add ‘& Partners’ and the launch of their first joint campaign last year.