Having personnel spread out around the country can be both a good and a bad thing for a large organization. On the plus side, multiple office locations can position a company in closer proximity to assets that are around the operating area, allowing for a better understanding of regional differences in operations. As for the negative aspects, companies often experience higher costs and greater confusion when determining the company's overall focus and direction.
To address some of these issues, Devon Energy (NYSE:DVN) has decided to move its Houston-based office under the same roof as its corporate headquarters in Oklahoma City, Okla. The announcement came yesterday and is expected to be all but wrapped up in the first half of their FY2013.
Cost savings will be felt upon completion of the move and are expected to be around $80 million annually. The charges associated with the reorg should total $125 million and be spread over the coming fourth quarter and the first half of 2013. On top of the cost savings, Executive Vice President of Exploration and Production Dave Hager said operational efficiency and focus will also be improved.
Joel South has no positions in the stocks mentioned above. Taylor Muckerman has no positions in the stocks mentioned above. The Motley Fool owns shares of Apache and Devon Energy. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.