Samsung to overhaul rigid bureaucracy system
Top conglomerate aims to have more responsive structure
By Kim Yoo-chul
Samsung Electronics is aiming to change its decades-long hierarchical system to adapt to the rapidly changing business environment.
“Samsung Electronics is considering simplifying position titles,” an official said Monday. “Such changes won’t come immediately, but the company has been consistent in pursuing speedy decisions to actively respond to market changes.”
The firm has five distinct ranks of employees, each of which comes with a prescribed title.
A graduate employee receives a “sawon” title. After more than four years of experience, they are awarded the “daeri” title. “Kwajang” is the title usually given to workers in their late 30s and early 40s with seven or more years’ experience.
An employee with more than 10 years or less experience is entitled to the title, “chajang,” which is a deputy team leader. “Bujang” is just below an executive position. Usually, “bujang” handle some key tasks and report daily to executives.
A spokesman declined to comment on what type of position systems would be introduced.
But according to sources, the company may introduce four distinct ranks _ sawon, seonim, checgim and suseok _ the ranks that are now being implemented in Samsung Electronics’ engineering and research-based business divisions.
“It’s too early to say that Samsung will scrap the five-tier system, immediately,” the official said. “The firm is reviewing lots of options to improve its corporate structure to match global standards.”
The company said it would hold an event at its technology compound in Suwon, Gyeonggi Province, March 24, to discuss ways to improve to its structure.
The “Startup Samsung Culture Innovation Announcement” is expected to include plans in accordance with the ongoing moves. Samsung declined to say more.
Over the past few years, Samsung Electronics has been accelerating efforts to cut back-office functions, affecting staff in communications, labor, human resources and marketing.
“Attention is divided about whether Samsung’s moves will succeed,” said another official.
Officials at the company’s management supporting groups moved to the Suwon compound, ending an eight-year stay in the Seocho Samsung Tower, southern Seoul.
Research and design teams had already moved to a new research center in Umyeon, southern Seoul.
But some say that even though the rigid structure has been cited as the biggest reason for numerous problems, such as stopping creativity and discouraging people, the old system is still efficient enough to help big Korean companies move quickly and succeed on given missions.
Samsung Group is on track to streamline its business structures, led by Vice Chairman Lee Jae-yong. It recently exited the defense and chemical businesses and is reportedly restructuring other unprofitable businesses.