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Volume 3 Issue 7
February 13, 2006
CEO Message
Point Compass to Customers to Find Blue Oceans
To succeed in Blue Ocean management, our culture
must be based on making customers our first
priority. To achieve this, I will also take on
the role of Chief Marketing Officer (CMO) and
plan on strengthening LGEs marketing competency.
I would ask that all of our leaders overseas also
pursue customer-oriented marketing.
CEOs Keynote Address, GMM 2006
Vice Chairman and CEO LG Electronics
LGEs Blue Ocean
Blue Ocean System
Blue Ocean Systems Boost Efficiency, Productivity
The fourth key method for implementing the Blue
Ocean Strategy at LG Electronics is a Blue Ocean
System. This is a system which makes it possible
to increase work efficiency and create
outstanding results. A Blue Ocean system must be
well-thought out in purpose, design, and
implementation to
produce these great results. Oftentimes, people
forget to think through how a system is to be
implemented. But a system is only successful to
the extent
people understand and use it. One example of a
good Blue Ocean system can be the DMS (Digital
Manufacturing System) system, which has combined
development, production, and supply into one
module method. Stated simply, this system links
all three of these areas of a products life
together to create the most efficiency in the
long-term perspective. Through the DMS system, LG
Electronics
increased manufacturing productivity by 30 over
three years, while reducing investment capital
and logistics costs, as well. If we can create
and support the Blue Ocean Systems in the work we
do then LGE will be able to enter the Global Top
3 by 2010.
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LGE Pride
LGE Targets No. 1 with Improved Time Machine TV
LG Electronics announced plans to expand its line
of time-machine TVs. The plan, which received
heavy press coverage last week, including from
the Wall Street Journal, is part of LGEs goal to
become the top TV maker in the world by 2010,
with sales of US10 billion. LG Electronics is
currently the No. 2 TV maker worldwide (in terms
of units sold). The time machine TVs, which
allow the
user to pause TV by recording it on a hard disk
for up to 2 hours, have been very popular,
prompting LGE to expand the size of the hard disk
and launch the improved TVs in new markets
worldwide. LGE plans on equipping PDP or LCD TVs
over 37 inches in size with a 250 gigabyte hard
drive, allowing users to record 21 hours of HD TV
and 92 hours of regular TV. We anticipate that
the TV will shed its past image of being a simple
on/off appliance and become more interactive. We
will modify our lineup accordingly, said Simon
Kang, the Korean Marketing Davison Head. .
Change Challenge
Case Study Changing the NFL for a TV Touchdown
A
s employees of LGE, we need to look in diverse
places for examples of how to change to match
customer desires while maintaining core
values. One such example can be found in sports.
As once again shown by the recent Super Bowl,
which was the second most watched TV program
ever (only No. 2 to the final episode of
M.A.S.H., a U.S. TV sitcom), the National
Football League (NFL) has become the powerhouse
of televised sports in the U.S. The league earns
the most money from TV networks, fetches the
highest prices on advertising and sponsorships,
and has the largest viewing audience and this in
a country that calls baseball the national
pastime. The NFL has accomplished
this by focusing on their core values of
providing an entertaining football game, while
changing to match customer needs and adapt to
technology,
such as TV. This is especially important to LGE
currently as we maintain our core values as
explained in the LGE WAY and change to find new
Blue Oceans. This type of change occurred for the
NFL as well. Before the 1950s, football was not
very popular, but with the popularization of TVs,
football rose to become the top TV program
because it adapted to the TV advertising format.
Also, the NFL has allowed changes to please fans,
such as playback reviews on disputed calls by
referees. Other sports have been slow to adopt
these new changes. Because of its strong ability
to change,
the NFL claims eight of the top 10 TV programs
ever, not to mention billions of dollars in
revenue. By studying the NFL, LGE employees can
understand the importance of keeping core values
while adapting everything else to match the
market. If we can do this at LGE, we will create
GCGP.

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LGE WAY Knowledge Quiz
What does the 2 in our Blue Ocean Slogan,
2BY10, stand for?
Published by LG Electronics / Corporate Culture
Group Please refer questions, comments, and
suggestions on content to lgeway_at_lge.com