Return After a Month... Shin Dong-bin Boosts Execution Power of 'New Lotte'

Next Week's Mid-Year Executive Meeting to Review New Business Status
Full-Scale Execution Ordered to Achieve Subsidiary Goals
Spreading Fair Organizational Culture Where Talented Employees Can Excel

Shin Dong-bin, Chairman of Lotte Group, has returned from a business trip to Japan. It has been a month and a half since he signed off on last year's groundbreaking personnel plan and departed for Japan. With Shin's return, Lotte Group will review the status of new businesses through the first half president-level meeting (VCM) scheduled for next week. Chairman Shin is expected to order concrete execution plans to achieve the goals.

Shin Dong-bin Orders 'Execution Power' through VCM

According to Lotte Group on the 12th, Chairman Shin will preside over the first half VCM on the 20th. About 70 executives, including Song Yong-duk and Lee Dong-woo, co-CEOs of Lotte Holdings, representatives from all affiliates such as food, shopping, hotel, chemical, construction, rental, and holding company executives, will participate via video conference to discuss major issues by affiliate and ways to create group-level synergies.

Chairman Shin is expected to emphasize 'execution power' to achieve each affiliate's goals through the VCM. In the second half meeting last year, he stressed the advancement of the group's business portfolio for future growth engines and urged, "Prioritize high value-added businesses to discover new businesses and strengthen core business competitiveness," so a thorough review of the current status is anticipated.

The affiliates are actively moving. Lotte Department Store recently declared 'strengthening expertise' through organizational restructuring by separating the department store and outlet and detaching the food division to place it directly under the CEO. They also announced goals to subdivide major business divisions such as fashion and promote experts by promoting S-level talents at the team leader and deputy general manager levels to division head positions. The new CEO, Jung Jun-ho, produced a video explaining and requesting support for the purpose of this organizational restructuring directly to employees.

Lotte Mart introduced the 'Zeta Flex Jamsil Branch' reflecting a new store renewal strategy at the end of last year, and plans to rebrand the existing warehouse discount store Big Mart as 'Lotte Mart Max' later this month. Lotte Foods invested over 100 billion KRW in the home meal replacement (HMR) business last year to secure production lines and will intensify research and development (R&D) and brand marketing this year. Lotte Rental is also entering the urban air mobility (UAM) business, aiming to build an integrated mobility platform connecting air and ground and conduct demonstration flights.

"A Company Where Young People Want to Work"

Chairman Shin made a major decision last year with large-scale restructuring and external talent recruitment. Lotte Department Store and Lotte Mart conducted the first-ever voluntary retirement program targeting employees with over 20 years of service to transform into younger organizations, and recruited many external talents to lead key affiliates such as shopping and hotels.

Internally, the organizational system was also adjusted. From this year, Lotte Group integrated the ranks of general manager (S1) and deputy general manager (S2), allowing promotion to executive as early as the fifth year. To minimize internal talent loss, they introduced 'InCareer,' an in-house job platform, enabling group members to manage their careers independently and move between affiliates to build expertise.

In the case of the Lotte E-commerce division operating Lotte On, a 'career level system' was introduced for all job categories. Except for team leaders and members, all other titles were removed to operate a horizontal system, while assigning growth indicator levels to each employee so they can gauge their position within the organization.

Lotte Group's active adoption of a fair organizational culture recognized by merit reflects the sense of crisis due to deteriorating performance. Last year, all major sectors including the group's two pillars, chemical and distribution, as well as hotel and food, struggled, and the group was evaluated to have fallen significantly behind competitors due to slow response to market and industry environment changes.

Accordingly, Chairman Shin emphasized in his New Year's address earlier this year that "a fair organizational culture must be established so that the best talents can demonstrate their capabilities regardless of seniority, gender, regional or educational background."