Six, a Swiss stock exchange company based in Zurich’s Westend, is undergoing a major overhaul under the new leadership of CEO Björn Sibbern. This initiative, known as Project “Walter,” aims to implement a significant cost-cutting strategy that could lead to the elimination of around 500 jobs by 2027, which is about one-eighth of the company’s current workforce of 4,000 employees.
Project “Walter” and Its Implications
The restructuring is intended to improve operational efficiency and enhance the company’s aesthetic appeal, as indicated by internal sources. The effects of Project “Walter” have already been noticeable, especially among older employees.
For instance, two long-serving IT managers in their late fifties have been let go, suggesting a potential risk for other experienced IT staff. Additionally, the top IT executive is considering offshoring options to India, which could further increase job losses within the organization.
Financial Challenges
Financially, Six is in a difficult situation, primarily due to substantial write-downs on its investments. The company recently reported a staggering CHF 862 million loss on its investment in the Spanish stock exchange BME, which was acquired for €3 billion five years ago.
This financial error, along with the sale of its digital payment division to Worldline, has significantly decreased the company’s share value. Analysts anticipate another large write-down in 2024, which could wipe out all profits from the previous year.
Leadership and Strategic Changes
The mismanagement of acquisitions under the former CEO and CFO has come under scrutiny, particularly regarding the overvaluation of the BME purchase. Consequently, Six’s financial health has worsened, prompting its owners—over 100 Swiss banks, with UBS holding a 35 percent stake following its acquisition of Credit Suisse—to exert more influence over the company’s direction.
The current leadership, including Thomas Wellauer, who has experience with McKinsey and Credit Suisse, is now responsible for steering the company through these challenging times. The leadership transition at Six has involved decisive actions, including the sudden dismissal of former CEO Jos Dijsselhof.
Future Outlook
Wellauer’s role in Project “Walter” indicates a strategic shift aimed at restructuring the company from the top down. This aligns with the broader trend of financial institutions seeking to streamline operations in response to market pressures.
Sergio Ermotti, the head of UBS, has previously suggested the possibility of breaking up Six, although the current restructuring appears to be a less drastic approach. As Six navigates this difficult path, the implications for its workforce and operational structure are significant.
Concerns for the Workforce
The emphasis on cost-cutting and efficiency may result in a leaner organization, but it also raises concerns about the long-term viability of the workforce, particularly for those with extensive experience. The ongoing changes at Six reflect a wider trend in the financial sector, where companies are increasingly focusing on profitability and shareholder value in a rapidly changing market environment.
As the company moves forward, it will be crucial to balance the need for operational efficiency with the retention of valuable talent. The decisions made during this restructuring phase will likely have lasting effects on both the company and its employees.
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