As reported first by Financial Times earlier this week, Deloitte is undertaking an ambitious change-up in its global operations that’s expected to take a year. The restructuring will see Deloitte trim its five main service lines down to four. The change was “a fairly divisive topic internally” according to one former partner who spoke to FT.
FT:
Under the plan, Deloitte’s main business units will be cut to four — audit and assurance; strategy, risk and transactions; technology and transformation; and tax and legal — from the five the firm has had since 2014.
The reorganisation will reduce costs across the firm, said one person familiar with the plan, but added that a figure had not yet been put on the savings.
Deloitte’s global chief executive Joe Ucuzoglu is spearheading the shake-up that will take a year to implement across the more than 150 countries the firm operates in.
In an email sent to Deloitte’s partners on Monday, Ucuzoglu said the plan would reduce the firm’s “complexity” and “free up” more of them to work with clients rather than manage staff internally. Deloitte employs about 455,000 people globally.
Sounds like some delayering will be going down.
From what FT was able to glean from the email sent to partners, assurance will remain as it is; consulting, financial advisory, and risk advisory will be condensed into two new units — strategy, risk & transactions (which includes M&A advisory), and technology & transformation. Tech and transformation will include engineering, AI, data, and cyber.
The important bit staff should know:
In an attempt to eliminate silos, some staff will be transferred to an expanded audit and assurance arm, including those working on environmental, social and governance.
Tax and legal will remain a standalone business within the new structure as Deloitte tries to wring benefits from the decision to keep its audit and consulting businesses together.
If the “Deloitte is restructuring” story sounds familiar, it should. Deloitte UK cut about 100 people from its financial advisory business — including partners — last month for the same nebulous reason. “The Big Four firm is planning to restructure its corporate finance advisory business,” wrote FT at the time.
It popped up before that in September when Deloitte laid off about 800 people. Said Deloitte UK CEO Richard Houston in a statement last September, “Today we announced some targeted restructuring across our businesses, which may — subject to consultation — put some roles at risk of redundancy. This follows a slowdown in growth, which, combined with the ongoing economic uncertainty, means we have to consider the shape of our business.”
Deloitte bragged last year they were using AI “to evaluate existing staffers’ skills and map out plans that would shift employees away from quieter parts of the business and into roles that are more in demand” so perhaps a mass restructuring is just that on a much bigger scale. We’ll have to wait and see.
