New CEO Takes Charge at LG Electronics

Vice Chairman Koo B.J. shuffles top managers and calls for the recapture of honor and market dominance

Vice Chairman and CEO Koo Bon-joon of LG Electronics Co. reshuffled the top managers in charge of the company’s business headquarters as soon as he took office on Oct. 1 in what could be seen as a lightning move. He took over from Vice Chairman and CEO Nam Yong, who resigned recently to take responsibility for the company’s operational setback in the global hand phone market.
The new CEO, a brother of Chairman Koo Bon-moo of the LG Group, replaced the heads of the company’s cell phone and TV business headquarters, the two business divisions that have been hit hard lately with reductions in worldwide sales, while launching the new growth engine technology and PC business headquarters.
Vice President Kwon Hi-won was named to head the Home Entertainment Headquarters and Vice President Park Jong-sok was appointed to run the Mobile Communications Business Headquarters.
President Kang Shin-ik, formerly head of the Home Entertainment Headquarters, has been named to take charge of Global Marketing, one of the newly-formed units when the new CEO took charge of the company. President Ahn Seung-kwon, formerly in charge of the Mobile Communications Business Headquarters, was transferred to take charge of the entire R&D activities for the company as its CTO. President Paik Woo-hyun, the former CTO, was named to head the New Growth Engine Technology Headquarters.
CEO Koo in his e-mail messages to executives and staff of the company said, “Let’s all begin from the basics,” and, “Let’s take back the honor with our own hands.” Many in the company thought the CEO stressed speedy management for the company and that a personnel reshuffle would take place later in the month.
He replaced the Home Entertainment Headquarters and Mobile Communications Business Headquarters heads, the two major business units hit hardest in sales, to “blow a new wind” as well as to freshen up the sluggish atmosphere of the company, business sources speculated.
They also assumed that the appointments of vice presidents to run the business headquarters meant that the CEO himself will take charge of running those key headquarters.
Vice Chairman Koo in his inaugural speech also stressed speedy management, saying that the trouble for the hand phone business arose from the rules of the game that you can easily be overtaken by someone if you relax. He said, “You have to put your new products on the market before anyone else does in order to change the market patterns, and those products have to be revolutionary to be able to dominate the market,” again stressing the need for speedy management.
Other points he emphasized included the continuous development of revolutionary products, securing top quality, business strategies based on customers, nurturing talented personnel, and autonomy and creativity as the top five matters to be pushed during his reign as CEO.
Koo also said the company has been put in a difficult position due to the sluggish sales of its new cell phone and the only way to recapture the company’s dominant market position is to uphold the “just road” management so that everyone at the company will be upright ethically and the company will have healthy growth. He stressed again that the company will pursue the five large tasks outlined above to take back their dominant market position as soon as possible.
The new CEO again made his point that product quality is the most critical part of winning customers and is a condition that never can be negotiated with customers.
He said everyone at the company should always have customers in their minds and create customer value to achieve the company’s dream to be the number one company both at home and overseas.
Koo is expected to make additional personnel moves now that the heads of business headquarters have been reshuffled. What draws special attention to the personnel move has been assigning President Kang Shin-ik to take charge of global marketing and President Ahn Seung-kwon to take over as CTO, no longer in charge of the two main sectors of the company’s operations and directly reporting to the CEO.
The foreign vice presidents such as those in charge of human resources and global marketing strategy are also expected to be reshuffled in the projected structural reform. nw

Vice Chairman Koo Bon-joon takes over the helm of LG Electronics Co. on Oct. 1 replacing Vice Chairman Nam Yong as CEO.