Kingfisher centralises IT and management structure

A new management structure will see DIY retail giants Kingfisher centralise its IT operations as it seeks greater efficiencies. Announcing its year-end results the company controversially cut the dividend it will pay to its shareholders in order to make large-scale investments.

Kingfisher, which owns the B&Q DIY store brand, is to embark on a new management structure of three divisions for its three main markets, the UK, France and International. Currently the company has a management structure based on its retail brands. “A new senior team will have collective responsibility for overall Group delivery of results,” the company said in its results. IT will join property and staff management, as well as purchasing and brand development as centrally managed resources.

Kingfisher said it has historically “followed a decentralised management approach” based on the retail businesses operating independently. The new management structure will set up systems for business performance measurement.

A cut of 50 percent has been made to the dividend paid to Kingfisher investors and it expects to make a similar cut to its forthcoming interim dividend. Peter Jackson, chairman of Kingfisher said Group Chief Executive Ian Cheshire and his team were going to “bring about a major improvement in the performance of the Group” but he warned shareholders, “to do so it will need to continue investing”.

Cheshire described the new management structure and its central approach to IT and assets as “tightening our use of capital and driving out higher cash returns from our businesses”.

Last year B&Q, the main Kingfisher brand in the UK, re-launched its e-commerce offering, which can now deliver 35,000 products to customers. Brico, the French DIY chain, implemented SAP.

Pre-tax profits for Kingfisher in the year ending February 2, 2008 fell by 12 percent to £395 million. Its sales were up by eight percent on the previous year to £9.36 billion.

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