In a statement released today, GMG said: "As a result of this review, GNM will develop its current weekend offering and introduce a greater degree of integration between the editorial teams of the Guardian and Observer."
The announcement confirms at least one area of GMG where staffing levels will be cut, though no specific details are yet being released, with staff and unions expected to be consulted over the coming weeks.
Yesterday, Tim Brooks, managing director of Guardian News & Media, warned staff to expect redundancies saying GNM was looking at "everything -- literally everything -- that we do, to see how we can economise, and we will do whatever we can to keep the impact on staff to a minimum. However, because the biggest portion of our costs is people's salaries, we have to review staffing levels."
And today, Alan Rusbridger, editor-in-chief of Guardian News & Media, sent staff a memo detailing a number of changes. Rusbridger said the Guardian was not alone in reviewing its operations due to "recession" and "digital transition".
But he added: "As a result of the review we will be publishing a formidable weekend package - with two papers that complement each other, each retaining a distinctive tone and voice."
Carolyn McCall, chief executive of Guardian Media Group, said: "GNM is looking to the future and making sure it's in good shape to deal not only with recession but also the profound changes in media that are not going to disappear when advertising markets recover. By taking the right action now we serve the long-term interests of our journalism."
Liz Forgan, chair of the Scott Trust, put in place to safeguard the future of The Guardian, said: "In this changing media world it is right that the Trust and the company ask the most difficult and searching questions as we consider how best to maintain the health of our journalism. The Trust fully supports the company's thorough and clear-eyed review of its operations."
The strategic review is being conducted as part of a three-year planning cycle at GNM and today's announcements were to inform staff of the state of that review.
GMG said readers had responded well to the new look Observer and the increased integration would "continue a process that began before the two titles moved to a common home at Kings Place".