Samsung Electronics on Thursday shook up its corporate paradigm, becoming yet another company to pursue the co-CEO model. Samsung now has three CEOs.
The largest memory -chip and smartphone manufacturer revealed that its consumer electronics and telecoms division president will jointly run the company, but under the guidance of Kwon Oh-hyun, the chairman of the board and the chief CEO.
Yoon Boo-keun, president of Samsung's consumer electronics division, and J.K. Shin, president of the company's telecoms division, are now officially chief executives. Kwon, who heads Samsung's components business, is the ultimate CEO and will also continue overseeing the components business.
"Under President Yoon, Samsung's TV business maintained and solidified its global leadership position after becoming global No. 1 in 2006. Under President Shin, Samsung's mobile business posted significant growth and attained global No.1 position in smartphones in 2011 and in overall mobile phones in 2012," the company said in a statement.
Blueprint to a Billion
"Today's announcement from Samsung to move to a multiple CEO system will have little impact on the company's management as Mr. Yoon and Mr. Shin had already been taking full control of their respective divisions," Sanford C. Bernstein analyst Mark Newman, told Fox News. "In the longer term...due to sheer size and potential conflict with its customers, it will have to split up, but this move doesn't necessarily mean that it's imminent."
And executive recruiters say co-CEOs are a good idea. We talked with Dora Vell, CEO of Vell Executive Search, which specializes in technology industry executive placements. She pointed to the popular business book Blueprint to a Billion, which says that no products company grew to over $1 billion without two people at the helm, regardless of what you call it.
"SAP has it with one being a go-to-market person and the other being an engineering/development person. RIM grew exponentially, before having significant issues with two co-CEOs, again with the same split in responsibility," Vell told us. "The people need to have complementary skill sets -- i.e. Mr. Outside and Ms. Inside or Engineering and Go-To-Market -- are combinations that I have seen work. They need to have the same values and there needs to be a huge amount of trust between the parties."
A Three-CEO Show
As Vell sees it, what's unusual in Samsung's case is that there are three CEOs now. She told us two new CEOs are apparently joining the existing CEO that's been in place since 2012, who seems to be an engineering/semiconductor expert with a technical bent.
"The three skill sets seem to be complementary from a high level. Once you add too many people with responsibility, however, sometimes no one has it. I don't know how they plan to run this and whether this is a battle for the top spot or a collaboration amongst equals that have the same values and bring different skill sets. Very unusual," Vell said.
"Note that this is all happening as Google's Android head is stepping out of the role. He has been unhappy for a while. Samsung is taking Android's open source and making it proprietary. Google execs are debating what to do as Samsung clearly outsmarted them here."