WEST SACRAMENTO, Calif. — Raley's here eliminated over 150 positions from its corporate offices on Friday, one week after it said it was eliminating five of its top executives. In a message to Raley's employees, Michael J. Teel, president, said, "This restructuring process has concluded."
In announcing the cutbacks, Teel said he elected to take a 50% decrease in his own salary "because I believe that organizational change must begin at the top and that leadership should not be immune to its impact."
The positions being eliminated run throughout the company, including operations management, sales and merchandising, information technology, finance, human resources, real estate and construction, asset protection, marketing and advertising, and legal and risk management. Raley's is also consolidating eight districts down to six.
Teel told SN Raley's is not in a financial crisis. "Cash flow is very strong, and these moves are strategic, to pre-empt a crisis," he said.
Teel said he was making the cutbacks so Raley's can react more quickly to competition, to make the chain more competitive by reducing corporate overhead, and to transform the way it does business "to be lean, swift to move and innovative."
"Achieving these goals will not be easy, and it could not be done with our current organizational structure," Teel said in his message to employees. Streamlining the workforce was "the last and perhaps most painful step in this restructuring process. This was one of the most difficult business decisions I have made, and I would never take this action lightly if I didn't believe it was absolutely necessary for the longterm sustainability of our business."
Teel said he plans to post an "open mike" forum to give Raley's personnel a channel to share their thoughts and their input.
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