Reuters Splits Nag Administrative Staff From Sales Group

Reuters Holdings PLC has eliminated the administrative department supporting its New York-based National Accounts Group, which handles sales to the vendor's 20 largest U.S. clients. The restructuring, which involved the loss of 15 jobs, acknowledges the failure of the group to make a big impact on sales to the firms it catered to.

NAG itself remains intact. But the group's salesmen will be relocated to Reuters' Midtown and Downtown Manhattan sales offices at a later date.

The NAG reorganization comes as all of Reuters holds its breath for a wider-ranging restructuring that's expected to be announced by Peter Job, who took over as managing director of the company a year ago (IMD, July 22). But sources familiar with the NAG reshuffle say Job had no direct input on the move.

NAG was set up with an initial budget of $5 million, according to sources close to the group. Reuters had hoped to leverage more sales from the group. But sources say no new profit has been generated during its two years of operations.

The group is responsible for Reuters' biggest U.S. clients. These include Bankers Trust Co., Bear Stearns & Co., Chemical Bank, Citicorp, Goldman Sachs & Co., Merrill Lynch & Co., J.P. Morgan & Co., Morgan Stanley & Co., Salomon Brothers Inc. and Shearson Lehman Brothers Inc.

A Reuters spokesman confirms that the administrative staff that processed orders generated by NAG has been split away from the NAG. Half of the administrative group's 30 personnel have been let go, the remainder reassigned to other posts at Reuters.

The spokesman describes the reorganization as a tactical rather than strategic one. But sources say the overhead of the NAG's administrative staff had hampered the group's ability to make money.

The administrative staff handled such functions as order- processing and accounts payable. These functions will now be handled by administrative staff at the Midtown and Downtown sales offices, which are headed by Will Kennedy and Michael Mazzola, respectively.

The NAG will continue as a sales group. Jim Gregory will continue to head the group, but will move from NAG's offices at the Bankers Trust building on Liberty Street in New York to the Downtown sales office at 61 Broadway. Gregory reports to William O'Shea, head of New York region sales. Reuters has around 400 sales and sales administration staff in the New York region.

The NAG's sales staff will eventually be split between the 61 Broadway office and Reuters' 52nd Street office in Midtown. According to the Reuters spokesman, the NAG sales staff will be relocated to the office closest to their client. Presumably, the allocation of administrative functions between the two offices will be handled the same way. The bulk of the NAG's current customers have offices in Downtown Manhattan.