Reader's Digest Announces Global Reorganization

Posted on July 28, 1998

The Reader's Digest Association, Inc. Chairman and CEO Thomas O. Ryder announced a global reorganization of the company as the first step in a long-term strategy to build on the company's fundamental strengths and create new growth opportunities. Key objectives for the company, as outlined by Mr. Ryder in a letter to employees, include: broadening the customer base of Reader's Digest to include more younger customers and more products for older customers, overhauling the company's work processes and cost structure, and freeing up dollars from underperforming assets to invest in growth opportunities.

"Reader's Digest stands today as a Company with great potential," Mr. Ryder said. "However, we face very real and serious challenges as a corporation and as a competitor in the global marketplace. The most fundamental of these challenges, one on which we must focus in everything we do, is to restore growth to our company on behalf of our shareholders by creating value for our customers."

The organizational redesign, which will put in place the necessary people and structure to achieve the company's goals, includes the following key elements: -- Organizing operations into four business groups around growth opportunities the company has identified among the full range of customers it intends to serve. -- Restructuring editorial organizations to ensure editorial quality and integrity worldwide. -- Reassigning certain executives as well as adding new people with key talents. -- Establishing new reporting relationships to sharpen focus and accountability. Mr. Ryder will present the first phase of a two-part program to revitalize the company in mid-September.