Fonterra Plans Job Cuts and Outsourcing in Efficiency Drive
Source: The DairyNews
Fonterra, New Zealand's leading dairy cooperative, is considering significant job cuts at its Waikato headquarters as part of an operational overhaul that includes outsourcing certain financial services to overseas partners. This decision is aligned with the company's strategy to enhance operational efficiency and financial performance for its farmer shareholders.
Andrew Murray, the incoming Chief Finance Officer at Fonterra, detailed the proposals during a meeting with finance staff at the central Hamilton office last week. He explained that the changes are intended to optimize transactional work by co-sourcing with partners located in Bangalore, India, and Manila, Philippines.
"These adjustments are focused on refining our core operational processes to better support the entire business and deliver greater value to our shareholders," Murray stated.
The move has sparked concerns among local stakeholders, including the Waikato Federated Farmers. Matthew Zonderop, the dairy chairperson for the group, expressed reservations about the impact of outsourcing on local employment. "While I understand the intent to enhance shareholder returns, outsourcing jobs overseas is not the most community-supportive approach," Zonderop remarked.
Zonderop also highlighted the potential for utilizing new technologies to retain these roles within New Zealand, suggesting alternatives such as artificial intelligence and other digital tools that could allow the cooperative to maintain its financial operations domestically.
The proposals also extend beyond the headquarters, with Fonterra planning to close four plants in the region by October, affecting 51 roles at the Waitoa and Te Rapa sites. While some positions are currently vacant, the company plans to redeploy affected staff where possible.
Fonterra has opened consultations on these proposals, which are set to conclude on Friday. The cooperative's restructuring plans are part of broader efforts to streamline operations and improve profitability amid a challenging global dairy market.
"These adjustments are focused on refining our core operational processes to better support the entire business and deliver greater value to our shareholders," Murray stated.
The move has sparked concerns among local stakeholders, including the Waikato Federated Farmers. Matthew Zonderop, the dairy chairperson for the group, expressed reservations about the impact of outsourcing on local employment. "While I understand the intent to enhance shareholder returns, outsourcing jobs overseas is not the most community-supportive approach," Zonderop remarked.
Zonderop also highlighted the potential for utilizing new technologies to retain these roles within New Zealand, suggesting alternatives such as artificial intelligence and other digital tools that could allow the cooperative to maintain its financial operations domestically.
The proposals also extend beyond the headquarters, with Fonterra planning to close four plants in the region by October, affecting 51 roles at the Waitoa and Te Rapa sites. While some positions are currently vacant, the company plans to redeploy affected staff where possible.
Fonterra has opened consultations on these proposals, which are set to conclude on Friday. The cooperative's restructuring plans are part of broader efforts to streamline operations and improve profitability amid a challenging global dairy market.
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