Samsung Moves to Establish Future Response Strategy Immediately After Vice Chairman Lee Jae-yong's Europe Business Trip (Comprehensive)

Following the Executive Meeting on the 20th
Global Management Strategy Meetings by Division Begin from the 21st

Samsung Electronics Vice Chairman Lee Jae-yong is returning to Korea on the 18th through the Seoul Gimpo Business Aviation Center in Gangseo-gu, Seoul, after completing an 11-night, 12-day business trip to Europe. Vice Chairman Lee reportedly visited Germany, the Netherlands, and France, meeting with strategic partners specializing in semiconductor equipment, electric vehicle batteries, and 5th generation (5G) mobile communications to discuss ways to strengthen cooperation. Photo by Kim Hyun-min kimhyun81@

[Asia Economy Reporter Park Sun-mi] As Samsung Electronics Vice Chairman Lee Jae-yong returned home after an 11-night, 12-day business trip to five European countries, Samsung Electronics will hold an executive meeting on the 20th and divisional management strategy meetings on the 21st to establish future response strategies. It is expected to be a venue where executives from each business division share the sense of crisis over supply chain disruptions caused by the Russia-Ukraine war and the importance of advanced technologies such as semiconductors and batteries, and discuss countermeasures.

◆JY Emphasizes Crisis Response, Technology, and Talent After European Trip=From the 7th to the 18th, Vice Chairman Lee visited customers, partners, and research institutes in five countries?Hungary, Germany, the Netherlands, Belgium, and France?engaging in broad cooperation and discussions on next-generation semiconductor technology, batteries, and Samsung’s future growth engines. He visited the Samsung SDI battery plant in Hungary and then moved to Germany to visit BMW, one of Samsung SDI’s customers, and Harman Kardon, an automotive electronics parts company.

At the meeting with BMW executives, it is likely that discussions were held on expanding electric vehicle battery supply and establishing a battery joint venture. Efforts were also made to secure advanced semiconductor technology. In The Hague, Netherlands, he met with Dutch Prime Minister Mark Rutte to discuss cooperation measures to resolve global semiconductor supply chain issues and visited the headquarters of semiconductor equipment maker ASML to talk about ensuring smooth supply of EUV lithography equipment essential for fine process implementation.

In the latter part of the trip, he visited imec, Europe’s largest comprehensive semiconductor research institute located in Belgium, to observe cutting-edge semiconductor process technology as well as research and development sites in advanced fields such as ▲Artificial Intelligence (AI) ▲Bio and Life Sciences ▲Future Energy. In Paris, France, he met with sales and marketing staff of Samsung Electronics’ local subsidiary to hear about on-site difficulties.

What Vice Chairman Lee emphasized during the European trip were three main points: crisis response (to uncertainty), technology, and talent. Immediately after returning home, he told reporters, "There is a lot of confusion, change, and uncertainty in the market, but what we need to do is bring in good people and create a flexible culture so that the organization can adapt to predictable changes." He added, "And no matter how much I think about it, first, second, and third is technology."

◆Samsung Convenes Executive Meeting on the 20th=As soon as Vice Chairman Lee returned from his European trip, Samsung Electronics and its affiliates’ executives gathered in one place. This was to share awareness of rapid changes in advance and establish response strategies to thoroughly prepare for the future ahead of the global strategy meetings by business division starting on the 21st.

On the 20th, Samsung announced that it held an executive meeting at the Samsung Human Resources Development Center in Yongin, Gyeonggi Province, chaired by Vice Chairman Han Jong-hee and President Kyung Kye-hyun. Twenty-five executives from Samsung Electronics affiliates, including Vice Chairman Han Jong-hee, President Kyung Kye-hyun, Samsung SDI President Choi Yoon-ho, Samsung SDS President Hwang Sung-woo, Samsung Display President Choi Joo-sun, and Samsung Electro-Mechanics President Jang Deok-hyun, attended the meeting, which lasted over eight hours in a 'marathon meeting.'

The executives reviewed global risk factors such as inflation, supply chain shocks, and sharp declines in IT product demand related to technology development, while broadly discussing measures such as developing next-generation technologies that can lead future markets and strengthening supply chain stability. In particular, it is known that the executives devoted much time to discussions related to 'next-generation technology development.'

Vice Chairman Han mentioned the rapidly changing international situation, industrial environment, and global market conditions, emphasizing the need to read the flow of change with a long-term perspective and especially to prepare new growth engines well to develop capabilities that can lead the future. He also urged breaking through limits with technology to seize the future, ensuring no gaps in securing outstanding talent, and focusing on fostering a win-win ecosystem to grow together with small and medium-sized enterprises.

In the business community, there is speculation that Samsung’s affiliates will enter 'emergency management' to overcome the global economic crisis, given that an executive meeting was convened immediately after Vice Chairman Lee’s return from Europe and global strategy meetings by each business division are scheduled afterward. A business insider said, "Since Vice Chairman Lee has emphasized 'preparing for the future through technology,' Samsung may accelerate strong innovation and nurturing of future growth engines comparable to the late Chairman Lee Kun-hee’s 'New Management,' and actively embark on building a 'New Samsung.'"

◆Global Strategy Meetings Also Begin on the 21st=Accordingly, at Samsung Electronics’ first half global strategy meetings starting on the 21st, broad discussions are expected on ▲supply chain disruptions ▲consumer sentiment contraction due to inflation ▲advanced technology competitiveness ▲talent and organizational culture improvement.

From the 21st to the 23rd, the DX (Device Experience) division, responsible for IT, mobile, and consumer electronics, will hold its first half strategy meeting, followed by the DS (Device Solutions) division, responsible for semiconductors, from the 27th to the 29th. Since only one strategy meeting was held at the end of the year after the COVID-19 pandemic, this marks the resumption after three years since 2019. Although Vice Chairman Lee will not attend in person, as the meeting is held after emphasizing three major areas?crisis response, technology, and talent?during the European trip, it is expected that executives will share awareness and prepare countermeasures.

Especially in the DX division, which faces impacts on sales of home appliances and mobile products due to supply chain disruptions and economic downturn and flexible operation of production lines, discussions on difficulties faced by global subsidiaries and response strategies are likely. In the DS division, a core area emphasized by Vice Chairman Lee’s 'technological prowess,' it is expected that the second half semiconductor market changes and outlook, progress on investment in the second foundry in Taylor, Texas, and the third plant at the Pyeongtaek campus will be reviewed.

Meanwhile, other large corporations have also recognized the global crisis situation and started strategic meetings for response.

SK Group Chairman Chey Tae-won ordered a reconstruction of the management system at the ‘2022 Expanded Management Meeting’ on the 17th. He pointed out the need to improve the corporate constitution to ‘SK Management System 2.0,’ which is directly linked to corporate value amid an uncertain management environment such as the global economic crisis. Hyundai Motor Group will also hold a meeting next month to review regional and global overall strategies. Earlier, LG Group has been holding strategic reporting meetings for about a month since the 30th of last month under the chairmanship of Chairman Koo Kwang-mo.

An industry insider explained, "Since the global crisis situation applies to all domestic companies, most of the strategic meetings to be held this time will be venues for discussions on crisis response."

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