Business in Korea


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Interview : Didier Chenneveau, Chief Supply Chain Officer for LG Electronics

What is your role at LG Electronics ?

My role is to be the Chief Supply Chain Officer for LG Electronics, a 48 billion USD company reporting to the CEO. Supply chain includes    logistics, supply demand matching, network and distribution, systems and processes related to supply chain, manufacturing footprint around the world.

Which additional value does a French Business School background like yours bring to a Korean company like LG Electronics ?

No specific advantage. I was not hired because I was French or Swiss or did my MBA in France but because I had relevant experience in running large scale operations in global companies and successful track record in HP. Most of my career was done in the US, not in Europe.

As a former executive at Hewlett-Packard how would you compare the corporate culture of this American Company with the corporate culture of LG Electronics a Korean Company ?

Very different, of course.  Korean companies tend to be more top down, with great respect for seniority and  authority. Koreans work extremely hard and are very dedicated to their company with a huge degree of loyalty. Experiencing both is a huge asset for me.

What is the main competitive advantage of LG Electronics on the mobile phone market at the moment ?

Our design, our price positioning. We are a very refreshing brand offering cutting edge technology in a great design. Please take a look at our “Secret” phone to see what I mean.

On the Korean mobile market Nokia, RIM, Sony Ericsson and Apple are already or will become LG Electronics competitors soon, to which extent do you consider theses companies as a threat ?

Competitors are always a threat and we respect but fear all of them.  But we try to out-smart them by putting the best possible processes in place, hiring the best talent and collaborating with the best partners. It is what I call the 3 P’s of Supply Chain (We are not as smart as Marketing guys so we could not find 5 P’s..:)! So we have Best Process, Best People, Best Partners as our motto for Supply chain.

As LG Electronics Chief Supply Chain Officer, how would you describe the supply chain in your company ?

Too long to describe in a email interview. Let me just say that it is huge and complex. 250’000 40″ Foot Containers send around the world each year,  from 30+ factories in 9 Countries with product ranging from smallest cellphone box to car-size air conditioners or double door refrigerator!

Now, as a Board member of EPC Global would you briefly tell us the purpose of this organization and its recent achievements ?

EPC is part of GS1, an organization setting standards for electronic commerce such as barcodes. EPC focus on RFID and how to set global standards so the technology can be rolled out to the world. Lots of success has been achieved. For example, the Wal-Mart roll out of this technology to their entire US supply chain is based on EPC standard. HP, LG, Procter, Sony, and hundred of other corporations are adopting the EPC standard as the way to implement RFID technologies.

Which applications of RFID do you think will become the most popular in Korea in the near future ?

There are many applications already in Korea such as ticketing, toll collection, payment system using RF. The big application will be the replacement of barcode on consumer packaged goods. Price of tags still need to come down before every barcode is replaced but the time will come. Already tags are used on large items in the US or pallets. The implementation has gained lots of momentum in the past year but like any technology , adoption has some cycle!

What do you think are Korean’s economy main strengths compare to other countries in Asia ?

Korea is a smaller economy than China and Japan but compete aggressively in technology by marrying advances in technology thanks to a very strong education system and advance in design. Most of the people working for me are Masters in Engineering or PhD, many with a MBA to top it off. Korean place a great deal of emphasis on education. And it shows in the results of the companies. We now need to make them global leaders in the world and it is one of my role at LG.

The Korean government just announced a 5 years plan to inject 3.5 trillion won in Technologies with the development of RFID as a priority, will LG Electronics benefit from this plan ?

Yes, absolutely. But obviously, I cannot give you the details. But I am involved in this project.


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