DRAM Top Contributor Kwon Oh-hyun: "Samsung Needs Owner Leadership" (Comprehensive)

The Pioneer Behind the World's First 64MB DRAM Development, Kwon Oh-hyun, Samsung Electronics Executive Advisor
"Vice Chairman Lee Jae-yong's Role Is Crucial to Maintaining Semiconductor Superiority"

[Asia Economy Reporters Changhwan Lee and Dongwoo Lee] Kwon Oh-hyun, Honorary Chairman of Samsung Electronics and former Chairman of the Comprehensive Technology Institute, who led the world's first development of 64-megabit DRAM, emphasized on the 28th that strong leadership and decisive action from top executives are essential to maintain a technological gap in semiconductors.

This means that in the face of fierce challenges such as the COVID-19 pandemic crisis, as well as competition from TSMC, Intel, and the Chinese semiconductor industry, active leadership from the head of the company is necessary for swift and bold decision-making.

In an internal broadcast interview ahead of the anniversary of the production of the 64-megabit DRAM prototype (August 1), Honorary Chairman Kwon said, "At that time, Samsung engaging in the semiconductor business itself was like nonsense," adding, "Chairman Lee Byung-chul declared the semiconductor business, and although there were difficulties afterward, Chairman Lee Kun-hee's continuous investment became the driving force."

He continued, "The semiconductor business is a high-risk venture due to the rapid pace of technological advancement and large-scale investments, but the decision-making of Chairman Lee Byung-chul and Chairman Lee Kun-hee during critical moments made success possible," emphasizing, "In the future, the semiconductor business will require the top executives' decisive leadership and courage to make bold decisions during risky moments."

The 64-megabit DRAM, developed first in the world by Samsung Electronics, became the starting point for South Korea to lead the global memory semiconductor market. At that time, Korea's semiconductor industry, which lagged behind Japan and the United States, began to dominate the global market from this milestone. Recognizing its contribution to the Korean semiconductor industry, Samsung's 64-megabit DRAM was registered earlier this year as Korea's first important scientific and technological material at the National Science Museum.

Samsung Electronics has developed the world's first 64-mega DRAM (Photo by Samsung Electronics)

Honorary Chairman Kwon recalls that the decisive action and drive of top executives made this possible. In fact, around 1987, when Chairman Lee Byung-chul passed away, Samsung Electronics faced a crisis with mounting deficits and a global recession. While some voices called for abandoning the semiconductor business, Chairman Lee Kun-hee once again demonstrated strong leadership, which led to today's Samsung Electronics.

Honorary Chairman Kwon reiterated that in the 'post-COVID' era, strong leadership from top executives and dedicated efforts from employees are necessary to lead the market. This is interpreted as meaning that the head of the company needs a long-term vision and bold investment to overcome the fierce challenges Samsung Electronics faces both inside and outside the company.

Samsung Electronics has recently performed well despite the COVID-19 crisis, with improving results, but overseas competitors are also rapidly overcoming challenges. Samsung Electronics is estimated to have earned operating profits in the 5 trillion KRW range from its semiconductor business in the second quarter.

During the same period, Taiwan's TSMC, a foundry (semiconductor contract manufacturing) competitor, recorded operating profits of about 5.2 trillion KRW, and the U.S. company Intel earned about 6.8 trillion KRW. Samsung Electronics was ranked first in global semiconductor performance for two consecutive years in 2017 and 2018, but this year it is likely to fall to third place behind Intel and TSMC.

To overcome this crisis, bold investment by a CEO with a long-term perspective is necessary, and Honorary Chairman Kwon explained that Vice Chairman Lee Jae-yong's continuous leadership is very important at this time.

Commemorative photo of Samsung Electronics' mass production shipment of 64MB DRAM in 1994 (Photo by Samsung Electronics)

He specifically mentioned Vice Chairman Lee's announcement last year of the vision 'Semiconductor 2030,' aiming to become number one in the system semiconductor field by 2030, saying, "Based on past experience, the most important thing during difficult times is strong leadership," and added, "Decisions must be made quickly and promptly, so smooth communication and discussion between professional managers and top executives are essential."

In April last year, Vice Chairman Lee unveiled a blueprint to invest 133 trillion KRW by 2030 to become number one globally not only in memory semiconductors but also in system semiconductors, including foundry.

At that time, Vice Chairman Lee stated, "Until now, semiconductors have been called the rice of the industry, but now, in the data-driven Fourth Industrial Revolution era, they are a small engine that moves the vast world and an essential driving force to open our future." He expressed his determination, saying, "Following memory, we will definitely become number one in the system semiconductor field, including foundry." Since then, Vice Chairman Lee has continuously emphasized semiconductor investment.

In May this year, he announced an investment of about 10 trillion KRW in Pyeongtaek, Gyeonggi Province, to build an extreme ultraviolet (EUV) foundry line, emphasizing, "We must not stop investing in the future, especially in difficult times." To achieve the goal of becoming number one in the system semiconductor field as Vice Chairman Lee declared, Samsung must surpass the competitor TSMC, which requires bold investment.

Honorary Chairman Kwon said, "In the past, Samsung's ability to surpass Japanese semiconductor companies was partly due to the competitive advantage derived from Korea's unique corporate culture of 'owner management.'" He explained that Japanese semiconductor companies, which pursued a 100% professional management system, could not make bold investments during industry downturns, whereas Samsung was able to make bold decisions in difficult situations.

He added, "From the perspective of professional managers, it is not easy to propose investing several trillion won when the business is running at a loss or the market is in recession," emphasizing, "In this regard, the roles of top executives and professional managers need to be clearly defined." Honorary Chairman Kwon also said, "We need to create a new culture suitable for the new era, not just continue the old ways," and "Besides working hard, we must carefully observe world trends and then work hard."

This content was produced with the assistance of AI translation services.