What's Happening?
SK Telecom is reportedly planning to reduce its executive workforce by 30%, with the first wave of the restructuring expected to be announced by the latter half of next week. This reduction is part of a larger organizational reshuffle across the SK Group.
An undisclosed number of C-level executives at SKT have already resigned, and the telecom operator has begun notifying executives targeted for retirement. The restructuring comes after SKT suffered a massive loss due to a data leak earlier this year, resulting in a net loss of 167 billion Korean won and a 91% decrease in operating profit. The company posted a revenue decline of 12.2%. The AI CIC, an in-house company within SKT, has also seen significant executive reductions.
Why It's Important?
The restructuring at SK Telecom is significant as it marks one of the most substantial organizational changes in the company's recent history. As SKT is a major player in the telecom industry, these changes could impact its operational efficiency and market position. The data leak that precipitated these changes highlights the importance of cybersecurity and data management in maintaining corporate stability. The broader reshuffle within the SK Group could lead to shifts in strategic priorities and resource allocation, affecting stakeholders and potentially influencing market dynamics in the telecom sector.
What's Next?
The SK Group is expected to speed up its year-end executive reshuffle, with the Supex Pursuit Council planning to cut its workforce by 40%-50%. Execution responsibilities are reportedly being transferred to affiliates, and personnel changes at SK Group companies are expected to proceed sequentially. Personnel appointments are anticipated in early December, which could lead to further strategic adjustments within the group.
