Financial Times

Management crisis at Reckitts?

Multinational Reckitt Benckiser has been rocked by a severe management crisis, following the resignation of 12 of its senior managers including its CEO in the space of three months.

Company sources said that its Marketing, Supply Chain and Finance sectors have been severely affected, as a result of these unprecedented resignations. Although the exact reason for these resignations is not known, sources say that the dominant role played by the Indian directors in policy planning had led to a rift between the Indian and Sri Lankan managers, which eventually led to the spate of resignations.

Reckitt's Sri Lanka Chairman Lalith de Mel refuted these allegations and said that the Indian Directors of Marketing, Human Resource and Sales had nothing to do with the sudden resignation of senior managers. De Mel said that there was no reason to be alarmed since resignations are part and parcel of a business. "People come and people go, but companies must move on," he said.

However, De Mel did concede that the resignations may have come about as a result of the recent company policy decision, taken in accordance with the global trade policies of its headquarters, to move to cash sales instead of cash and credit sales. He said that companies across the globe were moving towards a cash-based sales trend, in order to avoid the burden of heavy debts and the cumbersome and costly debt collection procedure. "When a company makes such a change, it invariably causes disruption in the company's sales volume, which naturally creates a bit of opposition," he said, adding that such opposition was 'perfectly understandable'.

Reckitt Benckiser is still to appoint a company CEO, after former CEO Ravi Fernando resigned in the third week of March this year to join MAS Holdings. Following Fernando's resignation, Category Manager for Pest Control Products Rishan Fernando, Senior Brand Manager for Mortein Shehan Fernando and Mortein Brand Manager Asanga de Silva also left the company in search of greener pastures.

Stifling global trade policies adopted by the multinational also saw an end to Srihan Fernando's stint in the company, in which he rejoined Unilever Ceylon Limited, after serving as the Director of Finance at Reckitt Benckiser for only two months. Sources said the management crisis was not yet over, with many more senior managers expressing their desire to leave the multinational company. Reckitt Benckiser is a popular brand name across the globe, specialising in manufacturing pharmaceutical and healthcare products such as Disprin, Dettol, Harpic and Mortein. (Suren)