Samsung launches new growth engine control tower at mobile division

Samsung Electronics Co., the world’s largest maker of memory chips and smartphones, has created a business control tower within its Digital eXperience (DX) division to spearhead its new technology development projects and search for new growth engines.

The flagship unit of South Korea’s top conglomerate launched its New Business Development Group at the DX division, which oversees Samsung’s mobile business, home appliances and video displays, industry sources said on Monday.

The new business group will be led by Vice President Baek Jong-su, also in charge of the new business task force within the DX division.

Three sub-units under the DX division – mobile, home appliance and video displays – will also have similar organizations tasked with new business development, sources said.

The corporate restructuring comes as the Korean tech giant grapples with growing uncertainty amid a global economic slowdown.

Samsung has seen its mainstay semiconductor business losses snowball for most of this year. Its smartphone business, except for some high-end foldable Galaxy series, has also struggled this year.

FUTURE BUSINESS PLANNING

Last month, Samsung Electronics, as part of its year-end C-suite executive reshuffles, appointed Jun Young-hyun, vice chairman of battery affiliate Samsung SDI Co., as the head of the Future Business Planning division, newly launched under the direct control of Chairman Jay Y. Lee.

The future business planning unit is tasked with working out Samsung Electronics’ growth strategy and seeking merger and acquisition targets.

Samsung, Korea’s most valuable company, said it maintains the current two-CEO system to ensure stability amid an uncertain business environment.

The “New Samsung” under Executive Chairman Jay Y. Lee, whose Korean name is Lee Jae-yong, is still in its early stages. Lee took the helm of the company last year.

Vice chairman and Co-CEO Han Jong-hee continues to serve as the chief of the DX division while Kyung Kye-hyun, another Samsung Electronics co-CEO, is in charge of its Device Solutions (DS) division, which oversees its semiconductor business.

In August, Samsung Electronics established the Future Technology Secretariat under the DX division to develop new technology and products. Kim Kang-tae, vice president and head of the technology strategy team at Samsung Research Center, is leading the secretariat.

RECORD R&D SPENDING

Samsung has been looking for new growth drivers as its rivals are actively pursuing promising businesses such as artificial intelligence, robots and biotechnology to stay ahead of the competition.

“Our future depends on how fast we can develop new technology that can put us ahead of our competitors,” said Chairman Lee.

Samsung Electronics spent 7 trillion won ($5.3 billion) on research and development (R&D) projects in the third quarter after spending 13.8 trillion won in such funds in the first half. Full-year R&D spending is said to have surpassed last year’s 24.9 trillion won, an all-time high.

Industry officials said that this year’s facility investment has also likely reached a record 53.7 trillion won, including 47.5 trillion won for semiconductors and 3.1 trillion won for displays.

Write to Ik-Hwan Kim at lovepen@hankyung.com

In-Soo Nam edited this article.