Namco Bandai to cut 10% of workforce

Namco Bandai Games is to decrease its workforce by 10 per cent - a move that will equate to job losses of around 630 staff - as part of a Restart Plan detailed by the company today.

Following the start of a three-year business plan begun in April 2009, the company said that it had re-examined the challenges it faced in achieving future growth in a "prolonged and severe business climate."

"Since the management integration, the Bandai Namco Group has focused on bolstering its Group foundations through organisational restructuring and other efforts to achieve fusion as a new group as quickly as possible," said the company.

"While the consolidation of administrative tasks and other streamlining and cost-cutting efforts at key companies have yielded some results, the Group lost speed on the operational side. We determined that our inability to fully deliver products and services that responded flexibly to the changing market environment and user preferences led to declining profitability."

In response, the Restart Plan - to be launched in April 2010 - will integrate the Group's Games Contents SBU (strategic business unit) with its Visual and Music Content unit, to form a new Content SBU.

Two virtual organisations - the Production Group and Publisher Function - will work to deliver content for platforms in "a speedy fashion", said the company, completing a structure that will allow for enhanced creative functions and increased flexibility.

Specifically, the Publisher Function will enable fast and flexible sales and marketing for content outlets in Japan and overseas, for game software, arcade game machines, mobile contents, video and music software packages and on-demand distribution.

The Namco Bandai Games' Group personnel restructuring plans will take place between now and the third quarter of fiscal 2011, with around 10 per cent of its 7000 staff expected to go. The move will be managed primarily through voluntary retirement, said the company, and is expected to reduce consolidated personnel expenditure in the next fiscal year by approximately ¥3.5bn ($38.6m / £24.2m).

Additional Group-wide cost reductions amounting to ¥8bn ($88.2m / £55.3m) are also expected, through streamlining initiatives and reviews of indirect operations.

Ahead of the Restart Plan, the company also said it planned a review of the structure of its directors to clarify the responsibility of the management.

In order to enhance cooperation across the Group and speed up decision making, the president and representative directors of Bandai Namco Group's three core companies - Bandai Co, Namco Bandai Games and Namco Limited - will serve concurrently as directors of the Group's holding company, Namco Bandai Holdings.

The move comes as Namco today posted losses of ¥11.7bn (£81.3m / $129.5m) for the nine month period ending December 31.