KOSPO Sets Its Sights on
Posting 5 Tln Won in Sales by 2011

To push for continued innovations

Korea Southern Power Co. (KOSPO) aims to become a "clean company"that takes the lead in the global energy market with the goal of chalking up 5 trillion won in sales by 2011.
KOSPO President and CEO Kim Sang-kab has unveiled the company's long-term vision, pledging to put more energy into the diversification of its business portfolio, a push for importing liquefied natural gas directly from LNG exporters and the development of overseas projects in order to secure future growth engines.
KOSPO's success story unfolds..
The electricity company posted 2.717 trillion won in sales in the first ninth months of this year, a 7.5 percent increase over the same period of last year. KOSPO ranked fourth in terms of capacity among the five power companies that were spun off from Korea Electric Power Co. in 2001. However, KOSPO placed first for the past six years in terms of such electricity management factors as power generation, capacity factor, the ratio of the net electricity generated for the time considered to the energy that could have been generated at continuous full-power operation, and thermal efficiency during the same period.
KOSPO has established itself as a power-generation leader as it has achieved top-rated marks in management performance indexes including sales, operating income and labor productivity.
During 2006, KOSPO chalked up record net profits on 3.808 trillion won in revenues. KOSPO became the first power company to shatter the 3 trillion won sales mark.
Namjeju Thermal Power Units 3 and 4, which went online this past May, are responsible for supplying 46 percent of the total electricity consumption on Jeju Island.
KOSPO's brilliant performance was a result of the implementation of the management innovation model, dubbed "V-KOSPO"under the stewardship of CEO Kim and its entry into new and renewable energy businesses. The management innovation model was developed by KOSPO by combining its existing innovative activities and GE's Workout, a revolutionary approach for busting bureaucracy. Staff participation and discussions constitute core parts of innovative activities.
Kim said, "Last year, all 1,700 staff members participated in the innovative drive and translated about 240 innovative tasks into action to bring about management improvements worth approximately 35 billion won. A system for suggesting ideas designed to revamp work and invigorate the organizational system has resulted in reducing costs by some 58 billion won."Some of KOSPO's innovative practices include the development of a combined heat and power emission-reduction system, the delegation of about 40 percent of its current work to lower echelons, the introduction of a new materials management system based on RFID and a halving of its decision-making process.
KOSPO became the first power company to open an in-house MBA course designed to foster a better educated workforce, setting a good example for the industry.
PROMINENT PRESENCE IN NEW AND RENEWABLE ENERGY BUSINESSES.
KOSPO is becoming a prominent figure in the wind power sector as part of its new and renewable energy business development strategy.
Hankyung Wind Power Plant Phase I with a capacity of 6MW has already been put into commercial service on Jeju Island. Hankyung Wind Power Plant Phase II with a capacity of 15MW and the 20MW-class Seongsan Power Plant, also on Jeju Island, as well as the 20MW-class Taebaek Wind Power Plant in Gangwon Province are under construction.
Kim said, "KOSPO plans to solidify its leading position in the wind power sector and we are seeking to construct a 20MW-class wind power plant in the Pyeongchang area in Gangwon Province."KOSPO also plans to turn its attention to the development of new and renewable energy businesses, including photovoltaic power and fuel cells as well as small-sized hydroelectric power.
Kim said, "KOSPO needs to diversify its businesses and aggressively undertake overseas projects to brace for a decline in electricity demand and a lower economic growth rate."He said KOSPO will carry out overseas projects by capitalizing on synergistic effects arising from its collaboration with Korea Electric Power Corp. and other power companies.
Kim received the 2007 Korea Management Grand Prize from the Korea Management Association Consulting (KMAC) on Sept. 15. KOSPO also won the top prize in the overall category from KMAC for the second straight year. Kim, three years in office as KOSPO CEO, has been recognized for showing his leadership and management capability to attain inside innovation and value improvement. He was praised for having raised KOSPO's competitive edge through flexible operations and management based on the protection of human rights. nw

KOSPO President and CEO Kim Sang-kab