[Edaily Reporter SOYEON KIM ] On the 13th, former SamsungElectronics Chairman Kwon Oh-hyun addressed the conflict surrounding SamsungElectronics’ N% performance-based bonus tied to operating profit, stating, “This situation arose as a result of a poorly designed evaluation system,” and added, “We need to create a system that envisions the future five or ten years down the line and evaluates employees accordingly.”

Speaking at a special roundtable discussion during the KoreaInformation&Communication Technology Promotion Association (KAIT) Digital Insight Forum held that day at the Chosun Palace Hotel in Gangnam-gu, Seoul, former Chairman Kwon pointed out, “The person with the most power must be the one to transform the most,” adding, “Among the employees, the executive team, the secretariat, and the board of directors, the entity that must innovate with a future-oriented mindset is the one that holds the highest authority and decision-making power.”

This implies that if an organization is to change in the age of artificial intelligence (AI), the changes must begin with those who hold the greatest authority. Drawing an analogy to a family, former Chairman Kwon said, “Can a son in elementary school fix problems at home? It’s the same with an organization. The father, who holds the most power, must change.” He continued, “We must take the lead in reforming for this new era, and the person who holds the highest authority and decision-making power is the most important,” adding, “If the department with the most power does not transform, nothing will change.”

As recently as two years ago, there were significant concerns about SamsungElectronics’ poor performance and weakening competitiveness, but recent forecasts suggest the company will post an annual operating profit of 400 trillion won, riding the wave of the AI memory supercycle. Former Chairman Kwon, however, expressed caution regarding this rebound. “Although things seem to be improving now, if we don’t create the conditions to push forward, we’ll enter another period of decline,” he said. “It’s like bungee jumping. When you hit rock bottom during the fall, you have to create the conditions to bounce back—and that comes down to the system.”

Former Chairman Kwon joined SamsungElectronics in 1985 and spent over 30 years with the company, serving in roles including CEO and Vice Chairman as he led the firm. After leaving SamsungElectronics, he reportedly reflected on the company’s crisis, asking himself, “Why did that happen?” He said, “I did everything I wanted to do at SamsungElectronics, but I regret that I was unable to change the personnel evaluation system and related policies,” adding, “I felt it was a lack of systems and a lack of leadership.”

He also believed that changes were needed in SamsungElectronics’ organizational structure. In particular, he pointed out that combining the Semiconductor (DS) division and the Consumer Electronics (DX) division into a single organization was not appropriate from the perspective of management efficiency. “Since their natures are completely different, it’s unreasonable to put them in the same basket,” he said. “DS is business-to-business (B2B), while consumer electronics is business-to-consumer (B2C). The attributes of these two businesses are different.” He continued, “As the scale grows, inefficiencies can arise in decision-making,” emphasizing that “from a management perspective, they should be separated.”

Regarding the semiconductor industry, he predicted that the growth trend would continue for at least the next 10 years. He analyzed the recent boom in the memory market as a result of new demand generated by AI.

Former Chairman Kwon said, “The memory market has experienced a boom on a scale I didn’t anticipate, and I don’t think the rest of the world did either,” adding, “This is the effect created by the AI boom.” He continued, “New sources of demand for semiconductors—such as physical AI, humanoids, and autonomous vehicles—continue to emerge,” adding, “It is a growth industry in terms of volume itself, and I can confidently say that semiconductors will remain a growth industry for at least the next 10 years.”

However, he pointed out that the competitiveness of domestic companies cannot be guaranteed by the growth of the semiconductor market alone. In the AI era, he argued, companies must move beyond the traditional approach of following advanced firms and instead create new markets and business models on their own. Former Chairman Kwon remarked, “Our journey from being one of the poorest nations after liberation to the threshold of a developed nation was a case of success through a ‘first-follower’ strategy—copying others,” adding, “We have never created and nurtured a new business model that didn’t exist in the world before.” He went on to emphasize, “Why is TSMC respected? It’s because it was the first to create a new business model—the foundry.”

He also pointed out the need to fundamentally change Korea’s growth model. Former Chairman Kwon asked, “What transformations have taken place in companies over the past decade? What about the government and educational institutions? “While the quality of education has improved, the methods remain the same as in the past,” he said, adding, “We are under the mistaken belief that the ‘fast follower’ success model will continue to be valid.” He continued, “The world has changed, and we must become first movers,” urging, “We need to reflect on whether we are still under the illusion that the old ways are better.”

He emphasized that not only companies but also the nation and the education system must redefine their goals. Former Chairman Kwon pointed out, “Companies, the nation, and academia all lack clear objectives and goals, and they are unable to find their reason for existence.”

He argued that labor market systems must also be reformed to align with future industries. “The biggest problem in our country is that there is zero flexibility in dismissing employees,” he said. “Every organization has underperformers, but there is no way to let them go. Under these circumstances, organizational productivity cannot improve.”

He also believed that regulations regarding the 52-hour workweek should be relaxed in areas such as research and development and the creation of new businesses. Former Chairman Kwon said, “In businesses that create new concepts or in research and development (R&D), the 52-hour workweek regulation needs to be relaxed,” adding, “It wouldn’t be a problem if other countries had the same law, but they don’t.”

He continued, “Even if we acknowledge the negative effects of overwork in the past, we shouldn’t create new systems merely to solve past problems; we must also consider whether they will pose problems when applied in the future,” emphasizing, “We are competing with the world, and we must survive in this environment.”