Is management shake-up just the start for Metro?

Metro Group has announced a shake-up of its leadership and unveiled a new corporate logo ahead of its 2009 results conference. The shuffling of senior management mainly affects the trade group’s Metro Cash & Carry division, and reflects a significant structural change there.

The operation is to be split into two separate divisions: a Europe, Middle East and North Africa unit will be led by corporate management board member Joël Saveuse, and Asia and New Markets will be headed by fellow board member Frans Muller.

The company also announced that other management and administrative functions of Cash & Carry are to be integrated with the group’s central corporate functions.

The changes are in line with the group’s programme to drive both customer centricity and operating efficiencies. Shape 2012, as the programme is dubbed, will centralise strategic leadership, governance and financial control of the group operating divisions in order to reduce costs, while at the same time freeing up and decentralising other functions, such as buying, to enable each division to become more responsive to the needs of their individual customer bases.

The change of corporate logo to one that closely resembles that of its Cash & Carry division was stated to reflect the increasing importance of that operation within the group. Together with the integration of management functions, the logo change may also indicate that the break-up of the diversified retailer has been pushed back up the agenda.

After spinning off its Praktiker home improvement chain in 2005, Metro Group divested its Adler clothing retail operation in 2009 and has made no secret of the fact that it regards its Galeria Kaufhof department store operation as non-core. Plans to float the Media Saturn electronics superstore division were initially shelved due to the economic downturn, but with the announced changes and the expected recovery of the capital markets, the group may be preparing the ground for an IPO once again.

The 2009 results for the Real hypermarket division were described as “robust”, but may not be enough to save the operation after it was given an ultimatum

of two years to turn around its fortunes in 2008. Such streamlining of the group would free up resources for Metro Cash & Carry to pursue its internationalisation strategy, currently one of the most successful drivers of the business.