Koo Kwang-mo, chairman of LG Group, emphasized to the heads of subsidiaries that they must have a sense of urgency and shake off the inertia of the past, as well as the discrepancies between strategy and execution.
On the 27th, Chairman Koo held the first meeting of this year for the heads of subsidiaries at the LG Human Resources Development Center in Icheon, Gyeonggi Province, and made these remarks. He pointed out, "In some businesses, we focused on quantitative growth and the logic of organizational survival, which led to a decline in competitiveness and failed to produce the expected portfolio enhancement; this has been the inertia we have experienced so far."
He continued, "Change is no longer a matter of choice but something that must be done for survival," adding, "The golden time is running out."
This meeting of executives, held on the 78th anniversary of LG's founding, was attended by over 30 top executives from major subsidiaries, including LG Electronics, LG Display, LG CHEM, and LG Energy Solution.
The executives recognized that in addition to the uncertain domestic and foreign business environment, LG is facing a structural crisis. They reached a consensus that management must take the lead in specifying alternatives and should not stop at simply what can be done, but instead focus on what must be done to drive substantial change.
During the meeting, Chairman Koo shared the 2017 New Year’s message of the late Chairman Koo Bon-moo. He said, "At that time, like this year, the inauguration of the Trump administration marked the beginning of a restructuring of the economic order," and "The late chairman noted that in order to sustain competitive advantages and create results, it was necessary to enhance the portfolio through selection and concentration, and that fundamental changes in business structure and methods were required."
He remarked, "Looking back on the changes over time, while changes in the business environment occurred much more rapidly than expected, there are areas where our business structure changes were not properly implemented."
Chairman Koo urged, "It is a reality that we cannot excel in all businesses," adding, "Therefore, it is even more important to choose and concentrate." He stated, "We must prioritize sustainable competitive advantages and the establishment of barriers to entry, aligning the priorities for capital investment and execution. This also applies to research and development, which is the source of future competition."