Samsung's New Strategy: 'Inject A Sense Of Crisis ... To Overcome Crisis' With 6-Day Executive Workweeks

Samsung Group, based in South Korea, is implementing a six-day workweek for its executives across all units as an emergency measure to address business uncertainties exacerbated by currency depreciation, rising oil prices and high borrowing costs.

This decision follows disappointing results in 2023, especially in Samsung Electronics Co. Ltd (OTC:SSNLF), prompting a need to reevaluate business strategies in light of geopolitical risks like the Russia-Ukraine conflict and tensions in the Middle East.

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According to The Korea Economic Daily, an executive from Samsung Group stated: "Considering that performance of our major units, including Samsung Electronics Co., fell short of expectations in 2023, we are introducing the six-day workweek for executives to inject a sense of crisis and make all-out efforts to overcome this crisis."

Executives from various divisions such as Samsung Display Co., Samsung Electro-Mechanics Co. and Samsung SDS Co. will adopt the new workweek as early as this week. Financial services firms under Samsung Group are likely to follow suit soon.

While executives from certain units have been voluntarily working six days a week since the start of the year, non-executive employees will maintain a five-day workweek.

In 2023, Samsung Electronics reported a significant operating loss in its semiconductor business, which accounts for about 80% of its earnings. Despite this, the company signaled a potential turnaround with a substantial surge in preliminary operating profit in the first quarter of this year.

Challenges do persist, including currency depreciation, rising oil prices and competition from domestic rivals like SK Hynix Inc. in the high bandwidth memory market.

The decision to shift to emergency mode aligns with a broader trend among South Korean conglomerates, as seen with SK Group reintroducing Saturday gatherings for chief executives in January. Other conglomerates such as LG Corp.’s (OTC:LGCOF) LG Chem Ltd. and Lotte Chemical Corp. are also undergoing restructuring efforts to navigate industry downturns.

The outcomes of recent general elections raise uncertainties about proposed business-friendly measures, highlighting the need for proactive strategies to navigate evolving economic and political landscapes.

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