As Samsung Electronics' Business Support Division approaches its one-year anniversary, it is set to evaluate its performance through upcoming executive appointments this month. The division has successfully managed significant mergers and acquisitions (M&A), organizational restructuring, and large-scale shareholder returns, according to industry insiders. However, resolving internal conflicts stemming from compensation disparities and enhancing accountability for leadership remain ongoing challenges.
According to industry sources on November 3, the Business Support Division will celebrate its first anniversary on November 7. Following the dissolution of the Future Strategy Office in 2017, Samsung operated the Business Support Task Force (TF) as an emergency organization for eight years before transitioning it into a permanent structure last year. Under the leadership of President Park Hak-kyu, the division began with three teams focused on strategy, management diagnostics, and personnel, later establishing an M&A team led by President Ahn Jung-hyun, who was involved in the acquisition of Harman. The management diagnostics team, previously under Samsung Global Research, was also transferred to the Business Support Division.
With the expansion of the organization, the executive team has also grown. According to the semi-annual report, the Business Support Division now includes 24 executives, comprising three presidents, 14 vice presidents, and seven senior executives. This marks a significant increase from 17 executives, including one vice chairman and one president, reported in the first half of last year.
Notable management achievements have followed. Within a month of the Business Support Division's establishment, Samsung Electronics acquired the advanced driver assistance systems (ADAS) business from Germany's ZF for approximately 2.6 trillion won through Harman in December. This marked the first large-scale automotive M&A in eight years since the acquisition of Harman in 2017.
In April, Samsung SDS secured an investment of 1.22 trillion won from global private equity firm KKR, a deal reportedly facilitated by the Business Support Division's behind-the-scenes negotiations. This effort extended beyond individual affiliates, coordinating major investment strategies at the group level to attract global capital and networks.
The management diagnostics function of the Business Support Division has led to actual business restructuring. After conducting assessments of the TV (VD) division and the robotics business, the head of the VD division, President Yong Seok-woo, was replaced by President Lee Won-jin, a former Google executive, in May. In July, a new Robotics Experience (RX) business promotion office was established.
Alongside management efficiency, a substantial shareholder return policy has been initiated. Benefiting from a recovery in the memory market, the division is pursuing a shareholder return plan valued between 90 trillion and 110 trillion won this year. Following a decision on September 29 to distribute approximately 30 trillion won in cash dividends for the third quarter, significant stock buybacks and retirements have also been announced.
However, several challenges remain. This year's wage negotiations were dramatically resolved just an hour before a planned strike in May, but conflicts over performance bonuses among different business units persist. The Samsung Electronics labor union, centered in the mobile and consumer electronics (DX) division, plans to hold a rally at the Suwon headquarters on November 5 to demand resolution of the bonus issue and joint negotiations for next year.
Strengthening accountability for Chairman Lee Jae-yong is also seen as a medium- to long-term task. At the regular shareholders' meeting in March, Lee did not propose a return to the board of directors, remaining the only non-registered executive among the heads of the four major groups. While the Business Support Division assists the chairman outside the board, it is expected to play a role in establishing a responsible management system, given its substantial influence over the group's investments, personnel, and capital allocation.
Previously, Lee Chan-hee, chairman of Samsung's Compliance Committee, emphasized that "the operation of the system is more important than its name," asserting that a control tower is essential for enhancing corporate competitiveness.
* This article has been translated by AI.
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