[Editorial] Big shoes to fill
- PUBLISHED :October 27, 2020 - 05:30
- UPDATED :October 27, 2020 - 05:30
Samsung Chairman Lee Kun-hee, who died Sunday at the age of 78, was an innovative businessman who led Samsung to the top of the world.
In the second half of the 20th century, South Korea belatedly started industrialization and struggled to catch up with the advanced economies of the West. Products made in Korea were seen in the global market as cheap second- or third-class imitations.
When he took the helm of Samsung Group at the age of 45 in November 1987 after his father, the founder of the group, passed away, the conglomerate had little presence in the world market, though it was third-largest in Korea. Lee built it from a little-known electronics manufacturer in a developing country into a top-notch global business.
His best-known aphorism, “Change everything except your wife and children,” sums up his iron will to spearhead innovation. His “Declaration of New Management” in Frankfurt in 1993, where he made that statement, was an inflection point for Samsung to take a quantum leap and become a global business leader.
Samsung’s successful performance in overseas markets encouraged other Korean companies to step up their overseas advances. He not only built Samsung into a global giant but also led the way for others.
A famous anecdote in 1995 shows an aspect of his tenacious pursuit of quality. He visited a Samsung Electronics plant in Gumi, North Gyeongsang Province, after a batch of its cellphones was found to be defective. He gathered thousands of plant workers and held a ceremony where 150,000 phones were smashed and burned under a banner that read “Quality is My Pride.”
Emphasizing that Samsung was at a life or death crossroads, he instilled a sense of crisis and shifted the priority of management from quantity to quality. His passion and his determined spirit made Samsung the world’s No. 1 player in semiconductors, smartphones and televisions.
Samsung might not have existed as an electronics giant if not for his do-or-die pursuit of quality, his decisiveness about investing heavily in semiconductors when others shook their heads, and his foresight ahead of the advent of the mobile internet era.
Now his son, Vice Chairman Lee Jae-yong, has big shoes to fill. His biggest duty is to continue his father’s distinguished accomplishments and keep up Samsung’s growth momentum in an ever fiercer competition. He should present new visions for high-tech industries and widen Samsung’s technological lead further.
The Korean economy is now caught up in a whirling vortex of change. Korea has not kept up with Japan in the semiconductor materials, parts and equipment industries, while China is hot on Korea’s heels. This “sandwich crisis,” which the late Chairman Lee warned of 13 years ago, is looming large. To make matters worse, the US-China trade war and the COVID-19 pandemic have darkened Korea’s export prospects.
In this situation, the entrepreneurial spirit shown by Chairman Lee is urgently needed. Not only Samsung but all Korean companies must remember his three key phrases: the spirit of challenge, innovation and creative management.
However, corporate changes alone are not enough to propel companies to the top of the world. Their business environment must change, too. Chairman Lee said 25 years ago, “Korean companies are second-rate, the government third-rate and politics fourth-rate.” Politicians and the government must reflect upon whether they are stalling corporate growth and demotivating businesses. Companies can take off only when they are free from the shackles of anti-business regulations.
Chairman Lee is gone, but he has left a lesson behind: The indomitable pursuit of world-class excellence is the only way to survive and thrive. Crises have befallen Korean companies on many occasions, but the “Lee Kun-hee spirit of innovation,” which overcame times of crisis, is needed now more than ever before.