Exodus at Samsung as sales falter

Tags: News
At a time when the consumer durables industry is battling a deep slowdown, the nation’s leading player, Samsung Electronics, has seen an exodus of its key executives across divisions. Most of them quit their stable jobs to start new ventures or moved on to other sectors.

The executives who left over the past four months include Rahul Saighal, chief marketing officer; Ranjiv Kapur, director-sales of mobiles division; Ruchika Batra, director of corporate communications; and Mahesh Krishnan, head of home appliances business. Some other officials, including the head of mobile and digital imaging, are also on their way out, according to at least three company officials.

The exodus signals the increasing unrest and stress in Samsung Electronics. Since 2011, Samsung Electronics posted its slowest profit growth in the fourth quarter, as Apple and Lenovo lured high-end customers. Its net earnings for the October-December 2013 period dropped 11 per cent from the third quarter.

Hence, the top executives are scouting for more interesting opportunities, according to analysts. While Saighal has started his own venture, Kapur has joined as chief executive of Concord Motors. Krishnan has joined financial services consultancy Geosansar as CEO.

When contacted by Financial Chronicle, these officials confirmed their exit, while Batra declined to comment on her future plans. A spokesperson from Samsung, however, said, “Samsung follows a strict privacy policy with respect to all current and ex-employees. Due to this while we are unable to provide any details, we can confirm that all the employees mentioned by your publication have resigned due to personal reasons.”

With sales of refrigerators, washing machines and microwave ovens slowing dramatically, consumer durables players have been hard-pressed to maintain their growth tempo. High inflation and peaking raw material prices have also pressured the companies to resort to consistent price hikes.

“Samsung is mainly dealing with issues such as increasing competition in too many segments,” said Faisal Kawoosa, senior manager of CyberMedia Research.

In the previous year, Samsung’s rival LG Electronics saw the exit of some its senior employees such as Amitabh Tiwari, head of business excellence, and Prasoon Kumar, head of sales channel strategy, sellout management and rural marketing.

Neeta Linz, manager at LG Electronics told Financial Chronicle that the company has not seen any exit for almost a year now. When asked about specific top-level departures in the past six months, LG Electronics did not reply to an email from this reporter.

Another major player Haier said that some top executives might be leaving companies for greener pastures. “We have not seen any exit at Haier. However, some top executives are quitting companies for better opportunities. Also, the industry is dealing with tremendous pressure to deliver,” said Eric Braganza, president of Haier.

Sunil Nayyar, senior general manager at Sony India too said the company has not seen any exit in recent times.

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