Supervalu Restructures Enterprise Merchandising Teams; Divests India IT Unit to Tata

In the wake of an internal restructuring of Supervalu’s enterprise merchandising department, approximately 74 positions will be eliminated and approximately 50 new positions will be created, according to company spokesman Mike Siemienas.

“Associates who hold positions that are being eliminated are encouraged to apply for these newly classified positions,” Siemienas told Progressive Grocer, adding that the “decision was made only after careful evaluation. By better aligning our resources with our business plans and thoughtfully allocating those resources across our enterprise merchandising department, we can proceed more efficiently and effectively within the current operating environment.

Siemienas said the Minneapolis-based retailer/distributor would offer displaced associates severance pay, outplacement assistance and continuation of health insurance benefits.

The restructuring plan was first revealed last week in an -email to associates from Steve Jungmann, Supervalu’s EVP of merchandising, which read in part: “As we drive forward to meet our goals, it is essential Enterprise Merchandising is able to move more quickly to effectively meet business needs. After a careful evaluation of our business strategy, needs and organizational structure, we have identified several opportunities to simplify our business, clearly define roles and responsibilities and drive more clear accountability across our Enterprise Merchandising teams. By addressing these opportunities, we are able to gain critical efficiencies while increasing associate autonomy, better defining career pathing and reducing costs.”

Jungmann continued that as a result of this strategy, “[a] layer of management across the center store, fresh, health & wellness and merchandising strategic initiatives teams will be eliminated…[including] all the business development manager (BDM) roles,” which were originally created to be the “touchpoint between corporate and banners – to be strategic drivers of category plans and sales.”

In recent years, Jungmann wrote, the BDM role “has become one of execution vs. strategy as originally intended. By eliminating this layer, we are able to speed decision-making within our merchandising team.”

Category director (level I and II) positions, additional business support managers (BSMs) and business support specialists (BSSs) will assume the responsibilities formerly held by the enterprise BDMs, while current merchandising directors will take on the new category director title.

The changes, according to Jungmann, “will help us streamline work flow, increasing efficiencies in decision-making and speed to market, improve communication to our banner teams and vendor partners, and ensure accountability for category financial metrics with one point of responsibility.”

In other company news, Supervalu is selling its India information technology and corporate services unit to Tata Consultancy Services (TCS). Terms were not disclosed, but Supervalu said about 600 of its employees currently working in its India unit will become part of Mumbai-based TCS.
Wayne Shurts, Supervalu’s CIO, said the move would enable the company “to improve operations, freeing up funds to invest more aggressively in our customers. We have many talented associates at Supervalu India, and an added benefit of this arrangement is that they will continue to play a key role in the future success of the company.”

Formed in 2007, Supervalu India provides a variety of IT infrastructure, applications, business and corporate services for the grocer. As part of the agreement, more than 600 Supervalu India associates will become part of TCS. The deal is expected to close by the end of October.