Saipem board approves strategic plan - 800 jobs to goNews // October 27, 2016
The Board of Directors of Saipem has approved its Strategic Plan, which identifies a series of measures that will allow the company to face more challenging market conditions. Refocusing the company's business portfolio, de-risking operations, optimizing costs, making processes more efficient, and emphasising technology and innovation, are reaffirmed as the basis of the group's strategy.
To achieve these objectives, it has been decided to adopt a new, leaner, more effective and more efficient organizational model, aimed at entrusting individual businesses with greater responsibility for project outcomes and performance. This will allow for increased decision-making agility, greater consistency between responsibility for results and attribution of decision making levers, complete autonomy in the identification of priorities, and greater focus on project execution.
Five divisions/companies will be created for the following sectors: Offshore Construction; Onshore Construction; Offshore Drilling; Onshore Drilling, and a new entity dedicated to high added value engineering activities and services, aimed at improving the offer in a structured way and bring the company ever closer to its clients’ needs.
As well as generating greater efficiency in its European based facilities, Saipem says new, leaner operating processes will lead to better deployment of human resources competences within the group. 800 fulltime posts are to be cut as a result of the strategic plan, which also includes rationalization of the company's asset base, mainly concerning a number of vessels and rigs in the drilling and offshore E&C sectors, in addition to several yards operated by th company.
Stefano Cao, Saipem's CEO, said: "In the first nine months of 2016, we achieved results that are both encouraging and in line with expectations, thanks to solid performances by both the offshore E&C and drilling sectors, the latter still benefiting from long-term contracts.
"In the third quarter, alongside our commitment to continuing our already planned efficiency measures, we saw a positive downtrend in net debt, the completion of the inaugural bond issue and a strong performance in terms of new contract awards. This has enabled us to confirm the guidance previously provided for 2016. The downturn in our sector, which is lasting longer than initially expected, has affected market prospects and requires reduction in the value of the company’s asset base. The strategic plan that we have approved aims to respond to these challenges through the adoption of a new organizational model."