Lg Group Developing Tomorrows Global Leaders Management Essay

Lg Group Developing Tomorrows Global Leaders Management EssayBased on the basic management philosophy ofCompetition from a global perspectivePursuit of best value for node, employees and shareholdersBecome the worlds best business group by means of management by principleAnd contribute to social development as a good corporate citizen,Bon Moo Koo as a chairman of the LG Group, ace of the three largest Korean chaebols, announced LEAP 2005 as vision of the future. It has a goal of increasing revenue to US$380 billion by 2005 with 50% culmination from international sales. Leap 2005 centered on employees and this new vision would lead LG to develop the most rewarding workplace for employees.Mr. Y.K. Kim as the head of the LG Human imaginativeness (HR) team was charged with the task of identifying and developing high potential individual and the global leading that LG would need in the future. He worked closely with Dr. Michael Lee, Managing director of LG academy (LGA). They estim ated that LG would need approximately 1,400 new global leaders by 2005 with about half would be Korean and the rest would be non-Korean.By 1987, LG had businesses and industries in chemicals, communications, energy, electronics, pay, insurance, machinery, metals, sports and trade. scour though LG was strong in Korea, it was not an international technology or quality leader in any of its business segments, especially relative to initiatory foreign competitors.A new corporate identity program was launched in 1995, Lucky-Goldstar Group officially miscellanyd its name to the LG Group. The logo was throwed to symbolize five anchor concepts The world, The Future, Youth, Humans and Technology.Top management and HR team needed to create global working environments that include both Korean and non-Korean leaders in company to achieve the objectives of Leap 2005.Strategic analysis using 7s frameworkStrategyLow toll dodging (1947 1987)Focused on competing through small-scale cost man ufacturing but also strongly emphasized high production volumesUnder pricing competitors with products of acceptable, although not superior, qualityIt established Lucky-Goldstar brand as a low cost and acceptable quality products manufacturerValue strategy (1987 1995)Korean consumers were increasingly aware of and demanding higher quality products because of the standard of living increased the ability to afford higher quality products and servicesKorean government began to relax trade barriers that made it easier for foreign companies to compete with LG in KoreaThe cost competitiveness of Korean began to slipStrategic orientation of LEAP 2005Focused on strategic markets that expected with economic growth and size, also the extent of business opportunity in that marketTechnological revolution through innovation to be produced faster or more cost efficientlyInvestment for the greatest possible cash in ones chipsCustomer satisfaction as a key measure of supremacyStructureCentrali zed decision making and a wind-down management physical processIn 1987, LGs various affiliated companies were divided into 21Cultural Units consists of multiple Strategic Business Unit (SBUs)SystemsDepartments were separated and sequentially handing off projects from product research to product design to engineering to manufacturing to marketing to salesManagers had to develop a new perspective on time based competition thus speed had to be a central value that permeated the groups cultureShared ValuesFocused on valuing employees and contributing to social development through good corporate citizenshipIn 1987, concentrate on creating customer valueValuable components from old culture stability, harmony and respectEstablished and reinforce four new cultural elements challenge, speed, simplicity and boundarylessness agencyIn 1980s, the new management approach management by self-control for greater decision making autonomyCultural value of respect, translated into a top down manag ement style and emphasis on hierarchyLeap 2005 required LG to change course to a global setting, leadership development emerged as one of the biggest challengesStaffManagers focused on producing high volumes and getting per unit as low as possible rather than finding out what customer wanted, developing high quality products or expanding marketing capabilities.SBU heads were given full profit and loss responsibility for their unitsWithin SBUs, middle managers were charged with reviewing and reengineering business processes to project efficiency and effectivenessCultural Unit presidents focused on integration and coordination across SBUsNeed more global leaders because LG had a domestic orientation in the past included both Korean and non-KoreanPeople from different disciplines and geographies increasingly needed to work together to analyze problems and figure out solutionsSkills legion(predicate) managers were lack experience with decision autonomyNeed hundred of world class manage rs to achieve its target with more sophisticated knowledge in financeRecommendationsCharacteristics of the tender organization that would help LG achieve Chairman Koos LEAP2005 vision of the futureFirst, HR should be held responsible for defining an organizational structure. It should identify the model of the companys means of doing business. The well known 7s framework distinguishes seven components in a companys architecture. LG Human resources Team should also used a change model to guide a transformation process at the company began by asking Who, Why, What and How. This model helps an organization identify the key success factors for change and assess the organizations strengths and weaknesses regarding each factor. As change agent, HR professionals do not themselves execute change, but they make sure that it is carried out. The hardest and most important challenge facing LG in that era was ever-changing their culture. In helping to bring about a new culture, HR must follow a four steps processIt must mold and clarify the concept of culture changeIt must articulate why culture change is central to business successIt must define a process for assessing the current culture and the desired new culture, as well as for measuring the gap between the twoIt must identify election approaches to creating culture changeHR strategies, policies, programs or practices translating the Chairmans vision into humankindKey needed capabilities of LGs future global leadersManagers had to change their mindset from flawlessly slaying orders to determining strategic directionManagers are required to have a clear idea of what customer needs, values and preferencesWorld class managers that have capabilities for success and growth strategiesLG needed a cadre of managers with more sophisticated knowledge of financeTo challenge and think differently and to come up with breakthrough innovationsglobalization they must be more literate in the ways of international customers, comme rce, and competition than ever before therefore LG should increase their ability to learn and get together and to manage diversity, complexity and ambiguity.Profitability through growth they must also become more focus, more in touch with the fast changing and disparate needs of their customers.Technology the challenge for managers is to make sense and good use of what technology offers. They will need to figure out how to make technology a viable, productive part of the work setting.Intellectual Capital The challenge for organizations is making sure they have the capability to find, assimilate, develop, compensate and retain such talented individuals.Change, change and more change LG must be able to learn rapidly and continuosly, innovate ceaselessly, and take on new strategic imperatives faster and more considerablyHow to identify, attract, select and hire, train and develop, motivate, appraise and reward to perform at peak level, and retain the global leaders with the needed co mpetencies and capabilities?The establishment of a development strategy is an important first step in the recruiting process. The second is achieving a fit between it and the rewards that an organization offers. A good fit must exist in in order to attract and motivate effective performance. The issue that needs to be considered when recruiting individuals relates to their motivation to perform. Attracting and recruiting the right talent is a critical part of managing valet capital and an integral element of the designing process in organizations.Companies are starting to evaluate their employees not only by objectives but also by the competencies they develop. One possible procedure is what is known as the balanced scorecard. Under this procedure indices of competencies are added to indices of results, and a weighted average is calculated to obtain a final index, which tends to be tied to variable pay.Every company must decide what competencies it needs to develop in its managers in order to achieve its particular proposition goals. The competency profile it chooses is a clear and precise expression of the culture it wants to promote, and can therefore be used as a tool for cultural change.Core competence of the corporationCollective learning in the organization, especially how to coordinate diverse production skills and integrate multiple streams of technologiesHarmonizing streams of technology, organizing work, and delivering valueComplex harmonisation of individual technologies and production skillsCould the team take the same approach with the Korean and non-Korean managers?Yes, as long as managers have some strategic competency as follows business vision, problem solving, resources management, customer orientation, effective networking and negotiation. And also leadership capacity with following basic competencies communication, organization, empathy, delegation, coaching and teamwork.QuestionsWhat do you consider as the desired characteristics of the h uman organization that would help LG achieve Chairman Koos LEAP2005 vision of the future?If you were a member of Mr. Y.K Kims LG Human Resources Team, what HR strategies, policies, programs or practices would you recommend to translate the Chairmans vision into reality?What were the key needed capabilities of LGs future global leaders?How would you identify, attract, select and hire, train and develop, motivate, appraise and reward to perform at peak level, and retain the global leaders with the needed competencies and capabilities?Could the team take the same approach with the Korean and non-Korean managers?