[Samsung Semiconductor 'New 50 Years']① Reshaping the 'Brain Organization' and Dreaming of Recovering the 'Super Gap' in the 'New 50 Years'... "Shake the Board"

Samsung Semiconductor Business 50th Anniversary on the 6th
Expected to Pass Quietly Without Separate Events or Messages
New 'Semiconductor Employee Creed' Likely to Be Announced Next Month
Restructuring 'Brain Organization' Through Personnel and Organizational Changes
Strengthening Swift and Accurate Management Decisions
M&A and R&D Are Important... "Bold Challenges Needed"

On the 6th, Samsung Electronics quietly marked the 50th anniversary of its semiconductor business. It is known that there are no plans to hold a separate official event or to release messages from management, including Samsung Chairman Lee Jae-yong. This is interpreted as an intention to humbly accept the so-called ‘semiconductor crisis theory’ raised due to recent poor performance and weakening position in the semiconductor market, focusing on overcoming the crisis rather than celebration.

Samsung Electronics Seocho Building, Seocho-gu, Seoul Photo by Yonhap News

According to the related industry on the 6th, Samsung Electronics appears busy preparing for the ‘new 50 years’ rather than holding a 50th anniversary event. Samsung Electronics recently revealed its determination toward the future through several significant decisions. Through personnel measures and organizational restructuring, it reorganized key strategic organizations such as the Business Support Task Force (TF), Samsung Global Research (formerly Samsung Economic Research Institute), and the Device Solutions (DS) Division’s Management Strategy Office, introducing new leadership.

‘Brain’ Lineup Reorganization Born from Reflection

It is evaluated that Samsung Electronics officially announced its journey toward the new 50 years after the second trial verdict hearing on the ‘unfair merger of Samsung C&T and Cheil Industries’ held at the end of last month. Chairman Lee said, "The reality is tougher than ever," and reflected, "I spent a lot of time blaming myself for not meeting the high expectations of the public toward Samsung." He then expressed his determination to "do everything to become a Samsung loved by the people," showing a will for change and leap even amid the crisis. Since then, Chairman Lee has focused on reorganizing the ‘brain organization’ responsible for Samsung Electronics’ future and has begun substantial changes. In particular, attention was drawn as personnel from the former Future Strategy Office (FSO) were once again placed in key positions.

Choi Yoon-ho was appointed as the head of Samsung Global Research’s Management Diagnosis Office, and Park Hak-gyu moved to the position of head of the Business Support TF. Kim Yong-kwan was appointed as the head of management strategy for the DS Division, and Park Soon-chul was nominated as the new Chief Financial Officer (CFO). All of them are former members of the FSO who led Samsung Electronics’ golden era. The company expects their experience and insight to play a significant role in setting new business and investment directions.

Samsung Electronics recently strengthened its AI-related capabilities by establishing an Artificial Intelligence (AI) Center within the DS Division through organizational restructuring. Song Yong-ho, Vice President and head of the Memory Business Division’s Solution Development Office, was appointed as the new center head. This organizational restructuring appears to be a measure based on the company’s self-assessment that the current crisis stems not merely from production issues but from failures in investment and business judgment.

In particular, it is analyzed that falling behind in the High Bandwidth Memory (HBM) field was a significant lesson. This is because the company hesitated to make bold investments in HBM in the past, resulting in falling behind competitors.

New ‘Semiconductor Creed’ to be Announced Next Month

Since September, Samsung Electronics’ DS Division has been soliciting good phrases from internal members to create a new ‘Semiconductor Creed.’ Since entering the memory semiconductor business in 1983, the company has had a ‘Semiconductor Creed’ composed of 10 behavioral pledges such as "Abandon the thought of ‘it can’t be done’" and "Set big goals," which employees are encouraged to follow. The new ‘Semiconductor Creed’ currently being solicited is expected to be officially unveiled as early as January next year.

Industry experts emphasize that for Samsung Electronics to truly embrace the ‘new 50 years,’ ‘mental armament’ is important, but ‘innovative challenges’ are also necessary. Lee Kwang-hyung, president of KAIST, recently attended a forum seminar and stressed, "Samsung Electronics must shake up the industry by supporting the development of core technologies to bring out new models." Currently, the semiconductor ecosystem moves as a bundle of models, semiconductors, memory, packaging, and software (SW), centered around Nvidia, and bold challenges are needed to shake this up and create opportunities.

There is also a call for actively considering mergers and acquisitions (M&A). Samsung Electronics was passive in reviewing and pursuing M&A last year. Since acquiring Harman International, which operates in the automotive and audio business, for 9.6 trillion won in 2017, Samsung Electronics’ M&A clock has stopped. As the crisis and problems in the semiconductor business have become clearer, there is growing expectation that Samsung will actively pursue M&A to break through head-on.

Samsung continues to strengthen R&D. The scale of R&D expenditure in the third quarter of this year reached 8.87 trillion won, the highest quarterly amount ever. Furthermore, it plans to invest about 20 trillion won by 2030 to build a new R&D complex, ‘NRD-K,’ at its Giheung campus in Gyeonggi Province. This site is expected to serve as an advanced base to overcome the limits of process miniaturization and apply cutting-edge technologies. An industry insider emphasized, "Isn’t this an era where nothing can be achieved with outdated thinking like ‘just do it’?" and added, "From now on, Samsung must show bold steps under precise and agile judgment."