These restructurings will introduce new sub-regional groupings for the EMEA organization, improved set-ups for catalog development and a variety of measures intended to streamline and globalize company functions.
Magnus Brännström, CEO and president of Oriflame Cosmetics, said: “These initiatives will make Oriflame a more agile, entrepreneurial and professional organization and will enable us to meet market demands and, ultimately, enhance sales.”
Adapting to local needs
The company's restructuring will include dividing existing EMEA structure into four new sub-regions: Central Europe, Western Europe, Turkey and Africa. Catalogue creation and production will also be relocated to the new regions, in order to allow the firm to respond more efficiently to local needs.
Oriflame previously introduced the system in the CIS region in the first quarter of 2013, where it created improved results from the previous corporate structure.
A spokesperson said: “The EMEA is a very big region with at least 25-30 markets, so it is important to adapt the catalog to different conditions rather than trying to do it centrally.”
“Moving out from the structure of development so that it’s closer to the market allows us to be more responsive to local needs.”
The brand's corporate strategy is heavily based around expanding into emerging markets, including developing EMEA regions such as sub-Saharan Africa which are predicted to become much higher income over the next 10 years.
Methods of improving efficiency
In addition to dividing regions into better-organized groups, Oriflame will introduce a number of changes to improve efficiency in sales and operations.
The company have compiled and clarified the roles and responsibilities which come with different positions at global, regional and local levels.
They have also further globalizing the purchases related to indirect spending on activities such as travel, offices, support and marketing, allowing them to reduce costs. Their direct expenses for sales are already centralized.
Finally, they have implemented the Global Shared Service concept in IT, Finance and HR, which will enable them to create a more efficient back-office organization.