[Running Toward the Future of Business ⑤] Folding Mobile, Betting the Future on 'AI and Robots'

LG Group
Organizational Restructuring Under COO
Recruiting Foreign External Talent to Discover Future Growth Engines
Dedicated Teams for Electronics and Robotics Established
Investments in Chemicals and Eco-Friendly Materials

Koo Kwang-mo, Chairman of LG Group, is delivering a greeting at the Youth Hope ON Project meeting held in October at LG Science Park in Gangseo-gu, Seoul. Photo by Hyunmin Kim kimhyun81@

[Asia Economy Reporters Choi Dae-yeol and Lee Hye-young] LG Group's holding company, LG Corp., divided the Chief Operating Officer (COO) organization into the Management Strategy Division and the Management Support Division in its year-end organizational restructuring. The LG Group COO is considered the second-in-command overseeing the entire group business and is known as a close aide to Chairman Koo Kwang-mo. The newly established Management Support Division handles the holding company's core duties, such as coordinating business among its subsidiaries.

The other pillar, the Management Strategy Division, primarily focuses on discovering new businesses and is led by President Hong Beom-sik, who was recruited shortly after Chairman Koo's inauguration in 2019. Earlier this year, Executive Director Kevin Cho, who joined LG Chem and oversaw investment projects, joined as head of the Future Investment Team within the Management Strategy Division.

Both Division Head Hong and Team Leader Cho were previously employed at foreign consulting firms, and their external recruitment to discover future growth engines suggests that Chairman Koo will take a much more proactive role in new business development. In his fourth year since taking office, he has shown decisiveness by boldly discontinuing unpromising businesses and generously investing in promising fields. As this is the time to complete the blueprint he envisioned and move to the next stage, it is expected that he will carefully select among the various new businesses currently being pursued.

Each major affiliate is also accelerating investment in future businesses. LG Electronics, where President Cho Joo-wan, who was responsible for major business strategies as Chief Strategy Officer (CSO), has become the new head, is expected to push for more aggressive innovation centered on future businesses such as automotive components and robotics.

First, the automotive components business is expanding its scope around the 'triangular axis' consisting of the Vehicle Components (VS) Business Division, the automotive lighting subsidiary ZKW, and LG Magna e-Powertrain, an electric vehicle powertrain joint venture launched in July. Although the automotive components division has been operating at a loss through the third quarter of this year, it is expected to turn profitable by the first half of next year.

LG Electronics, which has accumulated robotics technology through mergers and acquisitions, has strengthened its business restructuring by establishing a dedicated 'Robot Center' within the Business Solutions Division and a 'Robot Advanced Research Institute' under the Chief Technology Officer (CTO). The role and importance of the LG AI Research Institute, which unveiled the massive AI 'Exaone,' are also expected to increase. To eliminate uncertainties in these new growth engine businesses, LG Electronics has upgraded its Supply Chain Management (SCM) office to 'SCM Department' and newly established semiconductor development and procurement teams as well as a semiconductor supply response task force.

Shin Hak-cheol, Vice Chairman of LG Chem (center), is visiting the Chemical Electronic Materials (CEM) plant in Cheongju, touring the production site and encouraging employees.

When he was recruited in 2019 as the first external CEO in the company's history, Vice Chairman Shin Hak-cheol of LG Chem announced plans to invest 10 trillion KRW over the next five years to completely restructure the business focusing on eco-friendly and advanced materials. He emphasized that eco-friendly materials cover sustainable businesses such as bio, recycling, and renewable energy, while advanced materials have sufficient growth potential as an extension of the battery business supply chain, including cathode materials and separators. The Advanced Materials Business Division, launched shortly after Vice Chairman Shin's appointment, consolidated scattered battery materials businesses earlier this year and last month also incorporated the chemical and electronic materials business acquired from LG Electronics.

Nam Cheol, who was promoted to Vice President in this year's year-end personnel reshuffle and heads the Advanced Materials Business Division, is also a former foreign consulting firm professional skilled in strategy, planning, and business development. He has been tasked with expanding the business scope, including deciding to build a separator joint venture plant with Japan's Toray and Europe in October. As demand increases with the spread of electric vehicles, LG Energy Solution, whose value has risen, appointed Kwon Young-soo, a key figure in the group and former COO, as its CEO.

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