Samsung Electronics is streamlining its structure to make it less bureaucratic and more meritocratic, removing the minimum number of years needed for promotion and merging two senior positions into one.
The dramatic move puts the company at the forefront of structural reform for large Korean companies looking to become more competitive in cutthroat global markets, though it falls somewhat short of its original plan, which would have removed most of the ranks.
The decision, announced on Monday, is expected to come into effect in January.
Under the new system, it will be possible to grant promotions more quickly to the top performers.
The largest company in Korea, has four career level (CL) levels: CL1 (assistant), CL2 (professional), CL3 (senior professional) and CL4 (senior professional).
To move up through the ranks, you need at least eight years of service in a rank.
This minimum length of stay has been abolished and replaced by tests. In the new system, an employee in his thirties could become a manager, which is above CL4.
With 280,000 employees, Samsung Electronics is Korea’s largest employer. It will test performance reviews by peers with the aim of obtaining more objective and structured reviews.
He will also merge two ranks – Executive Vice President and Senior Vice President – into the position of Executive Vice President to simplify the organizational structure.
Designing a new structure, the electronics maker held workshops with Change Agents (CAs) – employees who focus on improving the corporate culture – and executives for weeks on end.
Reference to colleagues by job title will be discouraged and rank markers will be abolished. Employee ID numbers, which can be used to identify when the person started working for the company, and job ranks will no longer be displayed on the company intranet.
Employees will all use honorary titles to talk to each other, a break from the practice that only subordinate workers would do so for those higher than them in the organizational structure.
In October, the company abolished all employee job titles except for the group leader and section leader. Employees now refer to each other with the suffix “pro”. Job titles cannot be found on the company’s intranet, email system, or internal email application.
BY THE EUN-JEE PARK [[email protected]]