JY Lays the Foundation for the ‘New Samsung’

Chairman Lee Jae-yong to Visit Gwangju Plant and Local Partnerships on 28th
"We Will Build a Company Loved by the People"
Will New Business Be Promoted Using Strengths of Global Network?
Business Community Expects Vice Chairman Lee-ASML Meeting Next Month

Samsung Electronics Vice Chairman Lee Jae-yong is greeting employees during his visit to the Samsung Engineering Dos Bocas refinery construction site in Mexico last September.
[Photo by Samsung Electronics] [Image source=Yonhap News]

[Asia Economy reporters Han Yeju and Kim Pyeonghwa] With Lee Jae-yong, Chairman of Samsung Electronics, being promoted for the first time in 10 years, the business community's attention is focused on the ‘New Samsung’ that is set to undergo a major reorganization. While the late Chairman Lee Kun-hee drastically changed the way of working through ‘New Management,’ Chairman Lee’s style is to concentrate capabilities on leading fields and boldly challenge new businesses. As seen in his ambition expressed immediately after his inauguration on the 27th, "Let’s create a truly world-class company beyond today’s Samsung," Chairman Lee is expected to take extensive domestic and international actions to overcome the current crisis. Following his focus on semiconductors and bio sectors just before his inauguration, Chairman Lee began his official schedule on the 28th by visiting the Gwangju plant and local partner companies.

Chairman ‘JY’ Quietly in a Humble Position

The first official schedule after inauguration was to check on the business sites. Chairman Lee chose the Gwangju plant and local partner companies as his first destinations that day. This signifies his intention to continue the ‘coexistence with society’ he has emphasized so far by supporting the home appliance business, which is currently struggling due to weak demand, while also promoting win-win cooperation with partners.

The Gwangju plant produces home appliances such as refrigerators, washing machines, and air conditioners. It is one of the largest plants in the Gwangju area, with about 3,000 regular employees and annual sales reaching 5 trillion won. Chairman Lee is known to have inspected the site, listened to difficulties, and reviewed the set (finished product) business, which has recently shown poor performance. Analysts interpret this move as reflecting Chairman Lee’s usual philosophy that to pioneer new future markets and expand the super-gap, it is necessary to ‘walk together’ not only with small and medium-sized enterprises but also with partner companies.

During the visit, Chairman Lee also visited the Samsung Youth SW Academy (SSAFY) education site located within the Gwangju plant. In 2019, he also visited the SSAFY education site and said, "Nurturing software talent is essential to expand the IT ecosystem base," adding, "Even if it is difficult, we must plant seeds now for the future. Let’s all challenge ourselves to realize bigger dreams."

Earlier, on the day of his inauguration, Chairman Lee quietly attended the trial for unfair mergers and accounting fraud of affiliates held at the Seoul Central District Court in Seocho-dong, Seoul, fulfilling his scheduled commitments. He judged that planning a noisy event was not efficient in a situation where overcoming the global economic downturn crisis is urgent. After the trial, he immediately held an evening meeting with the Samsung Electronics board of directors to discuss innovation plans for the ‘New Samsung.’ It is expected that he concretized crisis breakthrough measures under the ‘Lee Jae-yong system’ by gathering with key executives and board members.

Active Utilization of Greatest Strength ‘Global Network’ Expected

Chairman Lee is expected to expand his global network capabilities, considered one of his greatest strengths, to increase business opportunities. Given the significant challenges in the core semiconductor sector, it is anticipated that Chairman Lee’s capabilities will create synergy on a global scale.

Park Yong-in, President of Samsung Electronics LSI System Business Division, said to reporters at the ‘15th Semiconductor Day’ event held the day before, "The next year will see significant changes in the semiconductor business. We need to collaborate extensively overseas, and with Chairman Lee’s inauguration, I think we can take a more leading role," adding, "He will serve as a focal point going forward."

In the business community, it is anticipated that Chairman Lee will meet with ASML, a Dutch semiconductor equipment company, during their visit to Korea next month. ASML produces extreme ultraviolet (EUV) lithography equipment essential for advanced semiconductor processes and is highly sought after by major semiconductor companies. ASML CEO Peter Wennink and other executives are visiting Korea for the groundbreaking ceremony of a semiconductor cluster being established domestically, and they may meet with Chairman Lee. Chairman Lee previously visited ASML’s headquarters in the Netherlands during his European trip in June and met with CEO Wennink to strengthen business cooperation.

There is also speculation that Chairman Lee will promote new businesses based on his global network. Just as he met with various companies such as Qualcomm, Google, Amazon, and Pfizer during his U.S. trip last year to seek cooperation, he is expected to accelerate related activities centered on diverse networks in the future.

Chairman Lee reaffirmed his determination by posting an internal notice titled ‘Challenge for the Future’ the day before. In the notice, he stated, "Now is the time to be more bold and challenging," and added, "We must invest in technologies that do not yet exist. Our survival depends on future technologies."

The business community is paying attention to whether Chairman Lee will introduce new businesses in the future, as he did in the past by actively pursuing mergers and acquisitions (M&A) to launch new technologies such as SmartThings and Samsung Pay.

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