Hynix's Great Future Plan

Ex-MOCIE Vice Minister Kim vows to make Hynix Semiconductor a top global chip maker

Kim Jong-kap, who was vice minister of the Ministry of Commerce, Industry and Energy, is the first high-ranking bureaucrat to take over the CEO position of a major private company. He also knows the significance of the unusual personnel move better than anyone else. The new CEO bought 1,000 shares of Hynix to show his confidence in the chip maker, especially, in its future outlook, to the company's major shareholders, most of them banks in particular.
The new chairman and CEO feels that he should prove to the world that former public servants can make outstanding CEOs and do their parts for the well-being of the companies they work for.
Kim was having a successful government career, regarded as a person with a rational charisma by those who worked with or for him at various levels of his long government career. He has been known to have made rational decisions and by not buckling under all kinds of temptations including bribery offers during his government career.
After a while, the people came to understand that he is a straight man and no one can do anything to change him to be an average bureaucrat. He made it through with his public career without being touched by scandals and by not being manipulated by the influence of peddlers.
When he landed the job as the CEO of Hynix, the second largest semiconductor company in the country after Samsung Electronics, those at the Ministry of Commerce, Industry and Energy were surprised because he had a number of places to go to if he wanted in the government-run companies under the ministry but chose to take a job in the private sector.
Rumors said Kim got the Hynix job through a scout and no one said anything publicly about his new job, because the company is out of the range from MOCIE as a private company and no one from the ministry could have used influences to get him the job at the company.
The former MOCIE vice minister, like, every other applicant for the job had to go through job interviews and four out of the six creditor companies, all of them banks, including the Korea Development Bank, the major creditor, chose Kim for the top job at Hynix.
During a media interview, the Hynix CEO said managing the private company is like being in a war zone, in comparing his life in the private sector with his times with the government. He said decisions should be made faster, although government decisions are not made in such fashion because they deal with the entire country. He also said the evaluation of the CEOs accomplishments is based on numbers.
But he said he will rather work on drawing up mid-to-long-term strategies for the company to keep the company running even after hundred years. He said he will focus on manpower training and the development of technology, although he cannot afford to pay a lot of attention on management results based on numbers.
The new CEO said Hynix has been focused on making profits so far, at the expense of reform. The company should shift its mode of operation from profit-oriented one to that for long-term growth.
The company reached 2 trillion won in sales last year, which slowed down its reform effort, Kim recalled. Stepping up cooperation with other chip makers is another issue that Kim plans to push harder. He said Hynix is strong in chip production, but lags in R&D activities on core technology development, requiring extensive cooperation with R&D centers in chip technology in the United States and Asia.
He also sees cooperation within the chip industry also key to upgrading the chip production technology since the industry is projected to face a crucial period in 2011 or 2012 in terms of chip technology.
Kim meets and talks with all kinds of people both in and out of the company, including even foreign chip industry people to grasp first-hand information on what's going on in the industry both at home and abroad.
Kim concluded that D-ram chip market is sluggish now but will improve toward the end of the year due to the Window Vista effect.
Betting on the rosy projection, Hynix will invest 4.4 trillion won in facilities, which is up for major shareholders'approval, most of them banks holding 36 percent of the stake. The company has invested 4 trillion won in production facilities last year. He ruled out restructuring of the company due to the sluggish tone of the chip market around the world, saying that the company would need more people when its Chungju plant comes on stream in the future. nw

Chairman Kim Jong-kap of Hynix Semiconductor Co.