Diageo is in the first year of a GBP500m efficiency drive

Diageo is in the first year of a GBP500m efficiency drive

Diageo has said that jobs at its new business centre in India will not initially come from within the company's global network.

The Bangalore-based Diageo Business Services India, which opened this week, is the Johnnie Walker-owner's fifth services hub and will handle finance and accounting. It is expected to employ about 1,000 people by the end of next year.

Diageo told just-drinks today that initial roles at the centre will be at the expense of third-party services previously handled in Kenya. Asked if future jobs at the centre will come from within the Diageo network, the company declined to comment.

The new services hub is part of Diageo's latest productivity programme, designed to save up to GBP500m (US$780m, when announced in July 2015) over the three years to the end of fiscal-2019. The programme focuses on five areas: Marketing and supply chain efficiencies, net revenue management, zero-based budgeting and operating model effectiveness. 

A media report last month said that Diageo was looking to cut just over a quarter of its workforce at its headquarters in London as part of the cost-cutting drive. Sources told just-drinks that the number could be markedly lower.

In July, Diageo posted single-digit declines in full-year sales and profits in reported terms, although organic sales in the 12 months to the end of June were up by 3%.