Deloitte plans major restructuring to cut expenses, will cut down to 4 business units from 5, says report – Industry News

Deloitte has launched the biggest restructuring of its global operations in a decade in order to save expenses and reduce the organisation’s complexity ahead of an anticipated market slowdown, a report by Financial Times stated. 

Under this restructuring plan, Deloitte’s main business units will be cut from five that the firm has had since 2014, to four – audit and assurance; strategy, risk and transactions; technology and transformation; and tax and legal, the report added. According to a person familiar with the plan, the reorganisation will reduce costs across the firm but a figure had not yet been put on savings. It’s not certain if the restructuring will involve job cuts. One former partner told Financial Times, “This is not about the junior grades. The biggest effect will be felt at partner level. Partners will be taken out of management positions.”

Deloitte’s global chief executive Joe Ucuzoglu is spearheading the restructuring process 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.

Deloitte’s global revenues increased 15 per cent to $65 billion in its last financial year, taking it to the top position as the largest of the Big Four. However, the company is braced for a tougher 12 months on the backdrop of difficult economic conditions in key markets. According to a report which includes inputs from the Big Four, the UK consulting market will fail to grow this year for the first time since 2020.

The decision to restructure the business follows Ucuzoglu’s rejection of the possibility of separating its audit and consulting businesses the previous year. EY has, however, already tried to engineer a break-up of the firm before it decided to abandon the attempt in April last year. 

As part of the changes, Deloitte’s advisory businesses, which advise companies on everything from technology to dealmaking and also includes its tax and legal unit, will be cut to three divisions from four. Its audit and assurance arm will remain as a standalone unit, stated the FT report. 

The new structure is expected to be in place by June 2025, with member firms starting to implement it as soon as June, according to the email to partners, said the FT report.


Leave a Reply

Your email address will not be published. Required fields are marked *