LG Group, one of South Korea’s top 10 conglomerates, plans to bring new air into the group by rationalizing the executive level organization and promoting senior-level officials based on performance not by working years during its year-end personnel reshuffle.

According to a source from the group on Thursday, LG Group Chairman Koo Bon-moo who has been emphasizing the importance of innovation recently said that LG Group needs to consolidate some management roles to raise efficiency and have younger people on management.

Executive-level officials at LG Group totaled 820 as of the first half of this year, relatively small compared to Samsung Group (2,100) and Hyundai Motor Group (1,100). While Samsung has one manager out of 100 employees, LG has one out of 150. The source elaborated that Koo did not mean to cut the number of managers, but to redeploy some redundant roles at the senior level of management to enhance efficiency.

In particular, the group will likely realign managers at departments engaged in manufacturing and technology development on view that fractionalized divisions interfere with flow in product development and quality check.

LG Group is likely to streamline some layers of management in development and manufacturing departments and redeploy them to other departments that need more managers such as administrative units.

Additionally, the group is expected to promote more young talents to managerial positions by moving away from its traditional seniority-based promotion system and giving more opportunities to high-performing young employees in this year’s personnel change. Such a change is expected to entice more competition among employees and reinvigorate the group.

Each top management of the group’s affiliates has a one-on-one meeting with Koo around early November every year to report their year-end performance reviews and plans for next year. The personnel move in senior level is expected to come at the end of November.

By Lee Seoung-hoon

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