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Leadership change

Samsung reshuffles three major CEOs, combines mobile and consumer electronics units

Its biggest leadership change in four years comes as the company takes on TSMC and Apple

By Dec 07, 2021 (Gmt+09:00)

4 Min read

Han Jong-hee, Samsung's new vice chairman and co-CEO
Han Jong-hee, Samsung's new vice chairman and co-CEO

Samsung Electronics Co., in a surprise move, has merged its mobile and consumer electronics businesses into a single unit, and replaced chief executives at its three major units in the tech giant’s biggest leadership change in four years.

The sweeping move comes as the world’s largest memory chip and smartphone maker faces growing competition against bigger foundry rival TSMC and tech giants such as Apple Inc., and amid legal uncertainty surrounding Samsung Vice Chairman and de facto leader Jay Y. Lee, who’s on trial for his involvement in a bribery case related to a former South Korean president.

Samsung, Korea’s most valuable company, announced on Tuesday it has promoted Han Jong-hee, 59, head of its visual display business, to vice chairman and co-CEO of Samsung Electronics.

In his new role, he will run the combined mobile and consumer electronics unit as well as the current visual display business.

A veteran of Samsung’s TV business, he has played a major role in Samsung maintaining its top position in global TV sales for the past 15 years, the company said.

Having majored in electronics engineering at Inha University in Incheon, Han joined Samsung in 1988 and has since worked mostly in TV research and development.

Kyung Kye-hyun, Samsung's new semiconductor business chief
Kyung Kye-hyun, Samsung's new semiconductor business chief

Kyung Kye-hyun, 58, currently chief executive of Samsung Electro-Mechanics Co., has been named co-CEO of Samsung Electronics and will lead the device solutions (DS) division, which includes its mainstay semiconductor business.

A chip design expert, Kyung previously headed Samsung Electronics’ flash product and technology team as well as part of its DRAM design team.

Having studied control and measurement engineering at Seoul National University, Kyung joined Samsung in 1988 and has since produced a number of “world’s first” products, including the direct Rambus DRAM chip in 1997, the 3D V NAND flash in 2013 and solid-state drives equipped with 128-layered 3D NAND chips.

Vice Chairman Kim Ki-nam, currently in charge of Samsung’s DS division, will move to run Samsung Advanced Institute of Technology as chairman.

Samsung has kept the three top executives in their current posts since 2017.

Samsung said the latest leadership change is aimed at “the next phase of the company’s future growth and to strengthen its business competitiveness.”

Kim Ki-nam, the new chairman of Samsung Advanced Institute of Technology
Kim Ki-nam, the new chairman of Samsung Advanced Institute of Technology

HARSH REALITIES

Among high-profile promotions is the ascension of President Chung Hyun-ho to the vice chairmanship and head of Samsung’s business support task force, which analysts say is a central business coordination unit for major decision-making in Samsung Electronics and its affiliates.

The latest reshuffle comes as a surprise because many industry watchers expected Samsung to keep its current leadership largely intact to ensure a stable management environment for the tech giant, particularly at a time when Lee, the de facto leader, faces an ongoing trial.

Currently, he’s on parole after spending several months in prison following a court ruling in January that sentenced him to two-and-a-half years in jail during a retrial of a bribery case involving former South Korean President Park Geun-hye.

However, he recently hinted at a drastic restructuring of the group, saying he had a “heavy heart” to see the heated competition and harsh realities of the global market as he returned from his US trip last month.

Last week, Samsung took a set of drastic steps to reduce bureaucracy and hierarchical management to attract and retain young talent.

Chung Hyun-ho, Samsung's new vice chairman and head of its business support task force
Chung Hyun-ho, Samsung's new vice chairman and head of its business support task force

The company said it is abolishing its seniority-based top-down approach and decades-long requirements such as a minimum period of years to serve in a certain position before being promoted, allowing talented employees to move up the corporate ladder regardless of age and work experience.

Analysts said Samsung’s unprecedented combination of its two backbone businesses – mobile and consumer electronics – comes in that context as the company strives to keep global rivals such as Apple in check.

Apple is widely viewed by the market as one of the most successful companies leading the convergence of various technologies to provide multi-device experiences.

UPPING THE ANTE

Samsung is the world’s top memory chipmaker by revenue, but in the contract chip manufacturing sector, also known as foundry, it lags far behind TSMC.

The Korean electronics maker aims to overtake TSMC as the world’s No. 1 foundry player by 2030 by investing about $150 billion into the logic chip business.

Late last month, Samsung chose Taylor, Texas as the site of a planned $17 billion US chip plant, coinciding with Lee's first business trip to the US in five years.

In Tuesday’s management change, Samsung promoted Park Yong-in, head of its system LSI sales and marketing, to take charge of the entire System LSI business as its president.

Samsung's latest smartphone, the Galaxy Z Fold3
Samsung's latest smartphone, the Galaxy Z Fold3

Park Hark-kyu, the DS division’s corporate management chief, was named as Samsung Electronics' chief financial officer.

In a separate reshuffle, Jeon Young-hyun, chief executive of battery-making Samsung SDI Co., was promoted to assume the vice chairmanship. Choi Yoon-ho, Samsung Electronics CFO, will succeed Jeon as Samsung SDI’s new CEO.

Jang Deok-hyun, vice president of Samsung Electronics System LSI, was promoted to replace Kyung Kye-hyun as the CEO of Samsung Elecro-Mechanics.

Write to Hyung-Suk Song, Shin-Young Park and Su-Bin Lee at click@hankyung.com
In-Soo Nam edited this article.
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