👉 Background: Westpac is the third largest of Australia’s big four banks with 13 million customers across its main brand, Bank of Melbourne, St. George Bank and BankSA. Despite its size, Westpac been the slowest kid in the banking class when it comes to costs - with the highest cost ratio among the 4 major banks.

👉 What happened: Now, Westpac’s new CEO has announced plans to cut another 5% of the workforce, which is about 1,700 jobs across the bank. This is in addition to over 900 jobs that were already cut last year. It’s the biggest redundancy Westpac have seen in the last decade - or as Westpac likes to call it, a ‘business simplification program’ with the chirpy name ‘UNITE’.

👉 What else: The new CEO Anthony Miller is putting his foot on the gas to deliver the cost savings he promised investors... and he’s cutting jobs to make it happen.

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What's the key learning?

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💡When a new CEO steps in, big changes usually aren’t far behind. A fresh leader brings their own vision, so that often means reshaping the business to fit the new strategy. And in a publicly listed company, the pressure is dialed up by 100.

💡New CEOs often move fast to stamp their authority on the business and give investors confidence that change is on the way. This might involve changing the exec team, shifting business priorities, or in Westpac’s case, cutting costs through redundancies.

💡We’ve seen this happen before in 2023, when Qantas welcomed a new CEO, Vanessa Hudson, after copping a ton of heat from customers and investors. Hudson made changes to the exec team, reset the business direction and invested an extra $80 million in customer service to recover lost trust after ghost-flight-gate. Since then, profits have bounced back to better than pre-pandemic levels.