CJ Logistics "2.5 Trillion Investment by 2023... Towards Becoming an Innovative Technology Company"

Declaration of Transition to an Innovative Technology Company on the 91st Anniversary
Expanding Converged Fulfillment Infrastructure to 8 Times the Current Scale by 2023
Doubling Research Institute Size and Securing 800 Top-tier Experts

[Asia Economy Reporter Yu Je-hoon] CJ Logistics, which will celebrate its 91st anniversary on the 15th, has unveiled a blueprint to transform into an 'innovative technology company' by making a large-scale investment of 2.5 trillion KRW by 2023. This move has attracted attention as a follow-up measure from a major affiliate following the recent announcement of CJ Group's mid-term strategy.

According to CJ Logistics on the 14th, CEO Kang Shin-ho stated in the 91st anniversary commemorative speech, "CJ Logistics, which has grown alongside South Korea's economic development, must now transform into an innovative technology company that grows together with customers based on advanced logistics technology."

CEO Kang first pointed out that the comparative advantages CJ Logistics has built in the current logistics market do not directly guarantee future success. He said, "Our past strengths such as large land areas, big warehouses, and experience-based operational capabilities may help maintain a comparative advantage in the market for a while, but in the future, even survival cannot be guaranteed by these methods."

He continued, "The logistics industry is rapidly shifting from a labor-intensive, experience-intensive structure to a digital-intensive structure. We must secure advanced technologies for future growth, build infrastructure that can provide the best value to customers, and pursue innovative growth through talented individuals who can read trends and lead change."

Following this declaration as an innovative technology company, CJ Logistics plans to invest 2.5 trillion KRW by 2023 to expand e-commerce and parcel delivery platforms, secure advanced technologies centered on robots, artificial intelligence (AI), and data, and recruit 800 top-tier professionals for innovative growth.

In particular, to become an innovative technology company, CJ Logistics will focus on nurturing platform businesses such as e-commerce, parcel delivery, and new last-mile delivery, which are future growth engines. Platforms are one of the four major growth engines presented in CJ Group's mid-term vision. Accordingly, CJ Logistics will expand its integrated fulfillment infrastructure to eight times the current scale by 2023 by additionally establishing key e-commerce hubs in the metropolitan area and three temperature-controlled fulfillment centers.

This new fulfillment infrastructure will form a nationwide 'e-commerce matrix' network by linking with the already operating Gonjiam, Yongin, and Gunpo fulfillment centers, parcel delivery hubs, and new last-mile delivery. The integrated fulfillment infrastructure will be reborn as a platform leading future logistics by adding automation through autonomous robots and AI and big data-based predictive operation capabilities.

The parcel delivery business will dramatically increase handling capacity through multi-point (MP) sorting facilities for small items and leap to a higher level market leader through optimization using AI and big data. At the same time, it plans to establish an innovative new last-mile delivery system that surpasses consumers' existing experiences and provide integrated fulfillment services to more e-commerce platforms, sellers, and consumers. CEO Kang emphasized, "We will strengthen data-based digital capabilities and become a total solution company that provides integrated consumer goods and e-commerce logistics and value-added services domestically and internationally."

CJ Logistics plans to strengthen structural competitiveness and accelerate its transformation into an innovative technology company through investments in future intangible assets such as advanced technologies and securing professional talent. This is because the logistics industry's paradigm is rapidly shifting from labor-intensive and experience-intensive to digital-intensive structures, making the acquisition and commercialization of advanced technologies essential.

To this end, CJ Logistics plans to more than double the size of its research institute by 2023 and secure about 800 top-tier professionals for the company's overall innovative growth. It will also actively pursue synergy creation with technology startups and the introduction of new technologies through open innovation and other open innovation initiatives.

Organizational culture and personnel systems will also undergo major reforms. CJ Logistics plans to simplify the rank system, which is currently divided into more than seven levels, and revise the personnel system so that anyone with capability, regardless of age, can become a leader of the organization. It will guarantee diverse opportunities and fair competition and provide exceptional rewards for performance to link individual and organizational growth. To eliminate barriers between generations, departments, and ranks and strengthen horizontal communication, it will further activate the already underway 11 major organizational culture innovation programs.

CEO Kang said, "The core driving force for growing CJ Logistics into an innovative technology company is top talent and a first-class culture," adding, "Based on a fierce, dynamic, and cohesive organizational culture revolution, we will create a corporate culture that can be recognized as a '91-year-old but youthful company.'"

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