Word: kim
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...Kim is infusing LG's other businesses with the same vigor. Called a "commander in the field" by executives, he storms about LG's factories and offices poring over details, issuing commands and spurring on the staff by giving them what he terms "stretch goals," or aggressive targets. Awake at 5:30 each morning for a brisk walk, he openly prefers "morning people" and holds 7 a.m. breakfast meetings with top executives. "I don't like the expression 'nice,'" Kim says. "I don't want LG to be perceived as nice. None of the great companies in the world...
...Kim is backing up his tough talk with a strategy to augment the company's design and technology prowess. For instance, LG.Philips announced in March it would invest $22 billion with its suppliers in new flat-screen production facilities over the next 10 years. Kim is recruiting engineers at a furious pace, aiming to increase research-and-development teams to 60% of LG's total payroll by 2005, from 40% today. One recent afternoon at the LG Electronics Corporate Design Center in Seoul, young Koreans in jeans and hip black sweaters were packing up plastic models of computer monitors...
...Kim build LG into a global titan? Hurdles abound. LG still sometimes cuts prices to drive sales, softening both profit margins and its brand image. For example, LG sees 5% profit margins on its mobile phones; Samsung earns in excess of 20%. Nor does it help that LG Electronics is a member of one of South Korea's mammoth, family-controlled conglomerates, called chaebols, which are infamous for mysterious and convoluted business practices. In February the company broke a promise to investors and pledged $130 million to buy bonds of a nearly bankrupt affiliate, credit-card issuer LG Card. Kim...
Still, in Asia, LG has taken on the world's best and proved it can hold its own. In China and India, LG has become a preferred brand. In China, which Kim calls the "toughest marketplace in the world," sales last year rose 40%, to $2.8 billion. In India, LG has beaten out Sony and Samsung to claim the No. 1 market share in everything from TV sets to refrigerators to CDMA phones...
...Kim can take LG to the top only if he manages to solve that pesky branding problem. Its rival did it: four years ago, few in the electronics industry could have predicted the growing dominance of Samsung, despite its solid technology and financial clout. Samsung's surprise was its savvy at brand building. "In terms of the ingredients, LG has everything--the quality, the packaging, the global marketing reach," says Nam Park, an analyst at HSBC Securities in Hong Kong. "What's missing is the magic. It's missing that je ne sais quoi." If Kim finds...