The Korea Times: Samsung CEO calls for new growth engines

Kwon Oh-hyun
Samsung Electronics CEO

The chief executive of Samsung Electronics has called for its executives and employees to find new growth engines to ride out of the rising economic challenges in the coming years.

“If you are satisfied with what you have achieved so far, then we will fall down suddenly. For a bright future, Samsung shouldn’t stop its vigorous efforts to find the next cash generators,’’ Kwon Oh-hyun, Samsung Electronics vice chairman, told executives and employees Thursday.

His comments came at an internal event to mark the industrial kingpin’s 43rd anniversary of its foundation. Samsung Electronics Chairman Lee Kun-hee missed this year’s event as he was in Japan, according to a company spokesman in Seoul but mobile chief Shin Jong-kyun and consumer electronics business head Yoon Boo-keun were in attendance.

“The economy is expected to see another slow year of recovery in 2013. The consumer electronics industry is at a major crossroads. This is a new trend that Samsung hasn’t experienced. No evolution means no future,’’ the CEO said.

The warning signs match the firm’s passive outlook in key businesses for the last quarter of the year, said Samsung officials contacted by The Korea Times.

The Suwon, Gyeonggi Province-based outfit admitted that the company’s fourth quarter profit will fall from the third quarter’s historically-high level as it sees intensified competition between Apple and Chinese budget smartphone makers during the year’s peak sales season.

Samsung officials said costs for promotional campaigns for flagship consumer devices like TVs and smartphones will increase. The company also plans to cut investment in key facilities such as flat screens and memory chips next year, though company spokesman Shin Young-june declined to comment on investment plans for 2013.

In a related note, Kwon stressed the need to hire more qualified human resources and the formation of a creative organizational structure.

“Samsung wants to become a market creator in a real sense not just as a fast follower. There are two key pre-conditions; building up distinctive software platforms and eco-system,’’ said the chief executive.

“I want to transform Samsung as the right spot to house more proven and qualified human resources. Samsung should become the podium for employees to realize their dreams by exchanging fresh ideas and sharing them freely. I will lead the way.’’

Samsung Electronics was established in 1969. At that time, it only had 30 employees. It recorded sales of 37 million won with an operating loss of 7 million won that year.

From 1988, the company began expanding through its semiconductor business. That year, the firm employed 40,000 employees with 3.02 trillion won in annual revenue and saw operating profit of 174 billion won.

In 2011, the nation’s most-influential conglomerate posted sales of 154.6 trillion won with 17.3 trillion won in operating profit and 16.15 trillion won in net profit.

It is the top smartphone manufacturer in the world after overtaking its biggest corporate foe, Apple. It also leads the global market in televisions, while it is the world’s dominant supplier of components such as flat screens and memory chips.


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