LG Group turns bold un­der new lead­er­ship

The Korea Times - - FRONT PAGE - By Nam Hyun-woo [email protected]­re­atimes.co.kr

LG Group is tak­ing an in­creas­ingly bold stance in deal­ing with its ri­vals un­der the lead­er­ship of Chair­man Koo Kwang-mo, ac­cord­ing to in­dus­try of­fi­cials, Tues­day.

In the past, Korea’s fourth-largest con­glom­er­ate steered clear of con­tro­ver­sies and avoided caus­ing prob­lems even if its in­ter­ests were un­der­mined. But now it is not shy­ing away from crit­i­ciz­ing Sam­sung and other com­peti­tors, and does not hes­i­tate to re­sort to the courts when the com­pany’s in­ter­ests are threat­ened.

The of­fi­cials at­trib­uted this change to Chair­man Koo’s drive to spur the con­glom­er­ate’s units to be more ac­tive and ag­ile in protecting their tech­nolo­gies, as com­pe­ti­tion be­tween com­pa­nies here and over­seas be­comes harsher.

“Con­glom­er­ates are run­ning their busi­nesses in a flood of le­gal bat­tles that are be­ing used as a tool to pro­tect them­selves,” a busi­ness ad­min­is­tra­tion pro­fes­sor at a Seoul-based univer­sity said.

“What’s no­tice­able in LG re­cently is that the group is tak­ing the war pub­lic. LG had the rep­u­ta­tion of be­ing a har­mo­nious and friendly com­pany in the past, but now the group seems to be un­afraid of dis­putes.”

Cur­rently, sev­eral LG com­pa­nies are in pub­lic dis­putes with ma­jor ri­vals.

LG Chem is in a le­gal bat­tle with peer elec­tric ve­hi­cle bat­tery maker SK In­no­va­tion in the U.S. In April, LG Chem filed a pe­ti­tion with the Delaware District Court against SK In­no­va­tion, claim­ing the lat­ter stole con­fi­den­tial busi­ness in­for­ma­tion through em­ployee poaching.

As SK In­no­va­tion coun­ter­sued LG Chem last month, claim­ing the LG unit has vi­o­lated its patents, the two bat­tery gi­ants have since been ex­chang­ing harsh rhetoric, with the lat­ter de­mand­ing the for­mer ac­knowl­edge its fault and pay com­pen­sa­tion. LG Elec­tron­ics is also ramp­ing up its at­tacks on Sam­sung Elec­tron­ics.

At the IFA trade fair last week, LG Elec­tron­ics Executive Vice Pres­i­dent Park Hy­oung-sei crit­i­cized Sam­sung, say­ing its 8K TVs did not com­ply with cri­te­ria set by an in­ter­na­tional or­ga­ni­za­tion that de­vel­ops dis­play per­for­mance mea­sure­ment stan­dards. Sam­sung dis­play busi­ness Pres­i­dent Han Jong-hee de­nounced the claim as “dis­re­spect­ful,” and com­mented, “It is hu­man na­ture to try to im­i­tate and speak ill of the leader.”

Prior to this, LG Uplus, filed a pe­ti­tion with the Fair Trade Com­mis­sion against SK Tele­com and KT in July, claim­ing the two ri­vals pro­vided il­le­gal subsidies to sub­scribers. In June, LG House­hold & Health Care filed a pe­ti­tion with an an­titrust body against e-com­merce firm Coupang. In­dus­try of­fi­cials said the new chair­man’s lead­er­ship high­light­ing prag­ma­tism as well as tougher com­pe­ti­tion be­tween com­pa­nies has af­fected each group’s de­ci­sion.

“In the past, com­pe­ti­tions in dis­play or other busi­nesses were about new growth op­por­tu­ni­ties. How­ever, it has be­come a mat­ter of sur­vival,” an of­fi­cial at an­other lo­cal con­glom­er­ate said. “In such an en­vi­ron­ment, com­pa­nies have to be ag­gres­sive and ac­tive in protecting their tech­nol­ogy and mar­ket share, and LG un­der Koo’s lead­er­ship is ag­ile in do­ing so.”

An LG Group of­fi­cial said the dis­putes and law­suits were an out­come of each re­spec­tive unit’s de­ci­sion, as their CEOs thought they were nec­es­sary for their sur­vival.

“The group lets its re­spec­tive units’ CEOs make im­por­tant de­ci­sions and all of these moves just hap­pened to come at the same time as com­pe­ti­tion is heat­ing up across all of our busi­ness do­mains,” the of­fi­cial said.

LG Group Chair­man Koo Kwang-mo

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