October 24, 2006
‘No sacred cows’ in Pfizer cost-cutting efforts: Kindler
Pfizer CEO Jeffrey Kindler said all aspects Pfizer’s business would be open to reductions under an ongoing company wide cost-cutting initiative.
“We need to look at everything that we do and find ways of doing it better, faster and more efficiently and more effectively,” Kindler said during Pfizer’s third-quarter conference call with analysts on Oct. 19. “There will be no sacred cows. Everything is on the table.”
Kindler cited a “tough” operating environment, loss of exclusivity of major products and lack of new products to offset those losses as the main factors driving the reduction efforts.
This latest plan for cuts comes on the heels of Pfizer’s Adapting to Scale (AtS) initiative announced last year. That effort aims to yield $4 billion in savings by 2008.
“We have already eliminated layers that were slowing us down and that don’t have a place in a company that needs to change as fast as we do.” Kindler said. “Some Pfizer colleagues have 14 layers between them and the top of the company. Pfizer colleagues have made it clear to me that we have to fix this. And we will.”
To streamline the company, Pfizer will not stop at one-time cost cuts, Kindler added.
“The idea here is to build a culture of continuous improvement in which every employee looks for ways to improve our productivity every day and the result is going be a more nimble organization,” he said.
Further details on Pfizer’s latest cost-cutting initiative are expected at the company’s fourth-quarter review to be held in January.
However, Kindler assured investors that the cuts will not impact Pfizer’s R&D.
The company plans to detail its product pipeline to investors at its “R&D day” on Nov. 30, Kindler said.