Samsung Electronics may make its org chart very flat

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Samsung Electronics may make its org chart very flat

Employees enter Samsung Electronics' headquarters in Seocho District, southern Seoul. [NEWS1]

Employees enter Samsung Electronics' headquarters in Seocho District, southern Seoul. [NEWS1]

 
Samsung Electronics says it is trying to reform its rigid corporate culture, which is seen hampering productivity and constructive discussion, with big changes to its job ranking and performance evaluation system.
 
The tech company since Monday has been holding workshop sessions with its Change Agents (CAs) — employees who focus on improving corporate culture — and executives. The sessions were held to discuss the company’s organizational overhaul.
 
A system reform was announced by the company on Nov. 11 through its online bulletin board. The announcement said it will change the performance evaluation and promotion system.  
 
Changes aren’t finalized yet, but the company plans to put an end to traditional top-down culture.  
 
Hierarchical job ranks will get a big re-do. Samsung Electronics currently has a four-tier Career Level (CL) ranking system. It divides employees below the director level into four levels — CL1 (assistant), CL2 (professional), CL3 (senior professional) and CL4 (principal professional) — being higher in rank as the numbers increase. After the new change, the number of job ranks will be cut to two or done away with altogether.
 
The last time the company simplified its job ranks was in 2017, cutting the number of ranks to four from the previous seven.
 
Young employees mostly had to refer to their seniors using job titles such as “bujangnim” or “chajangnim” to show respect, but everyone will soon start referring to each other with "pro," as in professional, or the Korean honorific suffix of “nim,” to maintain a horizontal corporate culture.
 
To prevent employees continuing to refer to each other using job titles, other ways to find out people's years of experience will be entirely cut. Employee ID numbers, which can be used to identify when the person started working in the company, and job ranks will no longer be shown on the company’s intranet.  
 
“We won’t have to worry about what title to refer other employees during business meetings with the change, and we will be able to freely exchange opinions on equal footing,” said an anonymous Samsung Electronics employee.  
 
Rather than getting evaluated by bosses for the end-of-year performance evaluation, three peers that the employees worked with will be evaluating them.  
 
The so-called “base-up” program — increasing salary by a set minimum percentage every year — will be abolished. This year's base-up rate was 4.5 percent. Employees will get pay raises based on their performance evaluation, giving more incentives to employees who work well.
 
The electronics maker’s new plans are similar to those recently implemented by Samsung Electro-Mechanics, which is 23.7 percent owned by Samsung Electronics.
 
Since October, the company abolished all position titles of employees, excluding Group Leader and Section Leader. Employees now refer to each other with the suffix “pro.” Job titles can't be found at all on the company’s intranet, email system or internal messenger app.  
 
List of employees receiving end-of-year promotions aren’t disclosed. Employees all use honorifics to talk with each other regardless of their age or years of experience.  
 
Samsung Electronics plans to talk with its labor unions, division heads, CAs and other employees and finalize the policies. The company spokesperson said they “can’t explain the reforms in detail before the changes are finalized.”
 
 

BY CHOI EUN-KYUNG, LEE TAE-HEE [lee.taehee2@joongang.co.kr]
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