LG Electronics attempts to be less hierarchical

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LG Electronics attempts to be less hierarchical

LG Electronics will overhaul a corporate culture based on hierarchy to emphasize individual talents and group assignments, its vice president in charge of human resources announced Thursday.

The new systems will be enforced early next year after a pilot operation this year, vice president Hwang Ho-geon said through an internal communication.

Under the current structure, which is the norm in Korean companies, employees obey a hierarchy from entry-level worker to deputy manager, manager, managing director and CEO. Those who do not meet certain requirements such as receiving positive performance assessments are not promoted.

Following the reforms, promotions will be based on years of service. Instead, specific assignments of employees will become more important.

“The new system will allow a deputy manager who excels to become a team leader and have his or her bosses as team members,” Hwang said.

Korea’s second-largest consumer electronics producer will also reform its employee assessment system. Currently, it assigns scores such as S, A, B, C and D depending on performance, and each score has a set proportion of employees. That system will be made more flexible.

Workers will be given a lot more leeway to use their holidays, up to two weeks during the summer. And one day each month will be declared “team leader-free” day.

The changes came after employees made proposals on an internal web board that Hwang started this year to promote new ideas within the company.

Some other conglomerates have been experimenting with similar systems to ease rigid corporate hierarchies since the mid-2000s. At SK Telecom, all workers under the level of department head refer to each other as managers regardless of seniority. At Samsung’s advertising arm, Cheil Industries, all workers are called “pros,” short for professionals.

BY SEO JI-EUN [seo.jieun@joongang.co.kr]
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