Samsung overhauls personnel system to nurture young leaders

A worker is seen behind a door carrying a Samsung logo at the Samsung Electronics building in Seoul in this file photo. Korea Times file

By Yi Whan-woo

Samsung Electronics said Monday it will fully overhaul its personnel management and employee evaluation system to pave the way for young, talented workers to get promoted to higher positions regardless of age and rank.

To that end, the tech giant will adopt a "peer review" system to better evaluate performances of employees, a move aimed at reforming the top-down management structure and creating a more merit-based culture to make the organization more agile in responding to changes.

In a statement, the company said it will introduce the Samsung Talent Exchange Program (STEP), which will allow its businesses in and outside the country to exchange young, skilled workers for a certain period of time.

The program is designed to foster a pool of "next global leaders" by sharing and developing competencies, ideas, working methods and business culture worldwide.

"We believe the reform measure will create more chances for young people to become top managers, such as executives in their 30s and CEOs in their 40s," a Samsung official said.

Effective from January, this is the company's largest overhaul of its corporate hierarchy in five years.

The measure, according to officials, implicitly demonstrates a greater sense of urgency for enhancement as repeatedly highlighted by Samsung Electronics Vice Chairman Lee Jae-yong amid rapidly-changing business trends worldwide. Lee has been stressing the significance of fostering talented employees to build on mid- to long-term visions.

The statement said the overhaul will contribute to forming "a future-oriented corporate culture," adding "We will pay more attention to our employees and continue developing a better management structure for Samsung to mark its centenary."

The reform mainly centers on performance evaluations, shifts in work assignments and the promotion system.

The peer review will supplement shortcomings in the current evaluation system, under which a team leader compares members' performances and rates them in one of five grades ― excellent, very good, good, bad and poor.

Such a system was seen as unfair as it encouraged the grading of team members proportionally under the five ratings, inevitably leaving some individuals receiving low grades although they performed reasonably well.

For a fairer judgment, the peer review will have each team member describe in written words how their peers performed.

In relation to shifts in assignment, the company expects STEP to be effective in helping targeted individuals build extensive knowledge through "a wide range of experiences."

Under a similar program, employees who worked for five years or longer in the same division will be eligible to ask their managers to move them to other divisions.

To speed up the transition from a rigid, vertical organizational structure to a flexible, horizontal one two executive titles under CEO or president ― vice president and executive vice president ― will be scrapped as part of efforts to simplify the promotion system.

The two will be merged to just vice president instead.

Monday's change also included a plan to scrap the minimum time required, typically eight to 10 years, for employees to advance to the next highest position in a multi-level job ranking system.

Each position additionally has been divided into four smaller levels, namely Career Level 1 to 4, to better assess how close employees close are to being promoted.

As time spent in a certain position does not guarantee how experienced individuals are, Samsung will adopt a new advancement system that will judge individuals' expertise using various factors.

Job titles and other information that identifies an employee's rank will no longer be disclosed on the firm's intranet.

Also, all employees regardless of their age and title will be asked to use polite speech to one another.

Other reform measures announced by the company include a "senior track" designed to flexibly hire employees even after retirement and "re-boarding" aimed at helping working mothers to continue their careers when they return from maternity leave.


Yi Whan-woo yistory@koreatimes.co.kr

Top 10 Stories

LETTER

Sign up for eNewsletter