Evonik, a specialty chemicals company, announced plans to restructure as part of an effort to reduce costs by around €400 million annually after the program’s completion in 2026. With the aim to become leaner, faster, and have a significantly reduced cost structure, up to 2,000 jobs will be cut worldwide, including management positions. The majority of these adjustments, around 1,500 jobs, will be made in Germany. Around 80 percent of these savings will derive from personnel reductions, the rest will come from lower material costs. First effects of ‘Evonik Tailor Made’ should materialize in the current year.
 
Evonik reported a net loss of €465 million in 2023 due to exceptionally high impairments and burdens from structural measures, most of which occurred by September 30. In the previous year, Evonik reported a net income of €540 million. According to the company’s forecast release, Evonik does not expect an economic recovery during 2024.
 
Having completed the first phase of ‘Evonik Tailor Made’, all structures and processes of the company have been analyzed. Based on this analysis, Evonik will design and establish a new organizational structure by the end of 2026. Evonik aims to do without administrative activities that do not directly support its businesses. At the same time, key tasks will be consistently bundled in the new structure. The number of hierarchical levels below the Executive Board will be reduced to a maximum of six, while review and approval procedures will be significantly accelerated. Group-wide, managers will then lead a median of seven direct reports, compared to the current span of control of one to four.