"R&D Management Leading the 'Green Innovation' of Former Refining Company SK Innovation"

SK Innovation R&D Management 40th Anniversary
Analysis by Professors Song Jaeyong (Seoul National University) and Lee Jihwan (KAIST)

"It is exemplary for domestic and international companies that SK Innovation, which was once an oil refining company, has continuously pursued research and development (R&D) for 40 years while aiming to be a 'Green Portfolio Designer and Developer'" (Professor Lee Jihwan, KAIST)

An analysis has emerged that the reason SK Innovation was able to grow from an oil refining company to a global green energy company beyond comprehensive energy is due to 'R&D management led by strong leadership from top management.'

Professor Lee Ji-hwan of the Department of Management Engineering at KAIST is giving a presentation at the 'SK Innovation R&D Management 40th Anniversary Research' conference held on the 28th at the SK Seorin Building.

This is the result of a joint analysis of 'SK Innovation's 40 years of R&D management' by Song Jaeyong, a Korean corporate management expert and professor at Seoul National University’s Business School, and Lee Jihwan, a professor at KAIST’s Business School. The two professors announced these findings on the afternoon of the 28th at the SK Seorin Building.

The professors explained that SK Innovation's 'R&D management' began in 1983 with the establishment of the Technology Support Research Institute. It then grew and developed with the formation of the Daedeok Research Complex in 1995, and in 2021, with the launch of the Environmental Science and Technology Institute, it is transforming the paradigm of R&D.

In particular, R&D management made a decisive contribution to developing and commercializing SK Innovation’s core current businesses such as chemicals, bio, lubricants base oil, separators, and batteries, based on the diverse technological capabilities secured by strengthening competitiveness in the refining business. This foundation also enabled independent management.

The professors derived SK Innovation’s unique R&D management model, 'SKinnoWay Research & Business Development (R&BD),' and presented the 4E innovation model: Management Philosophy (Entrepreneurship), Strengthening Existing Business Competitiveness (Exploitation), New Business Development (Exploration), and Technological Capability (Expertise).

They emphasized that strong leadership driving R&D, which requires long-term investment, was above all important. The late Choi Jonghyun, former chairman of SK, emphasized the importance of R&D management immediately after acquiring Korea Petroleum Corporation (Yukong) and declared the transition to a comprehensive energy company in 1982. He then established the Technology Development Research Institute, laying the foundation for R&D management.

Professor Song Jaeyong of Seoul National University Business School is giving a presentation at the 'SK Innovation R&D Management 40th Anniversary Research' conference held on the 28th at the SK Seorin Building.

Additionally, the professors noted that SK Chairman Chey Tae-won has continuously emphasized the importance of R&D management, asserting that "R&D is the hope for the future, and without technological leaps, business leaps are impossible." Under this management philosophy, SK Innovation transformed the Technology Innovation Research Institute into the Environmental Science and Technology Institute and secured about 1,800 researchers, more than three times the number in 2016.

Professor Lee cited separators and lubricants base oil as representative successful R&D cases. He explained, "The separator R&D case is the only case within the SK Innovation group to have received the SK Group’s SUPEX Pursuit Award," and added, "Lubricants base oil is also an excellent case, having succeeded in developing Group 3 lubricants ahead of other companies and achieving the number one global market share in this field."

Professor Song said, "Domestic companies are facing competition with countries like China, but the way to win is through innovation via R&D, not through economies of scale or labor cost competition," and added, "SK Innovation has steadily continued its R&D efforts over a long period and serves as an example that highlights the importance of R&D in traditional industries."

Professor Lee Jihwan of KAIST Department of Management Engineering (from the left), Lee Seongjun, Head of SK Innovation Environmental Science and Technology Institute, and Professor Song Jaeyong of Seoul National University College of Business Administration are posing for a commemorative photo at the 'SK Innovation R&D Management 40th Anniversary Research' conference held on the 28th at the SK Seorin Building.

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