What is the future of the telecommunications industry? Lee Sang-chul, the new CEO of the unified LG Telecom, seems to know the answer to this tough question. According to Lee, LG Telecom will be the “eye of the storm” in the telecommunications industry in 2010, the Year of the Tiger. During a meeting with reporters in early January, Lee added that to achieve this goal LG Telecom will expand beyond its traditional telecommunications borders. “The Korean telecommunications industry is at a critical time. We will create and seek new business models to expand future growth,” said Lee. Lee was chosen as first skipper of the unified LG Telecom which absorbed LG Dacom and LG Powercom.
Vowing to create and develop new tele-communications business, Lee said LG would lead the change in the telecommunications industry and create innovative value. Although the telecommunications market is saturated, the situation is seen as an opportunity for LG Telecom to take the initiative in the telecommunication market.
LG Telecom is already reviewing approximately 20 innovative projects that will go beyond the telecommunication industry and aims to launch them by the end of this year, with a task-force team already formed. In addition, Lee suggested a vision to turn LG telecom into a personal value provider (PVP), offering customized and differentiated services to every LG Telecom customer.
This means the integrated LG Telecom will lead the market and have its value well recognized despite its sales not being high. For example, Google of the U.S. ranked 117th in the U.S. in terms of sales last year. However, its market value was ranked 9th in the world. In the future, LG Telecom will make its services thoroughly customer-oriented, and offer differentiated services that give more value to customers. By doing so, the company is planning to grow into a more customer-friendly company.
In particular, Lee changed the company’s service-based structure into a customer-based one and even organizations names into new ones based around customer value. This massive restructuring expresses the new CEO’s desire to take the lead in the telecommunications market in the future.
LG Telecom will renew not only services for individuals but also those for corporate customers, allowing them to offer more value to customers. The company is also planning to make the mobile virtual network operators (MVNO) business offer more than a simple network. The MVNO business will be promoted via strategic ties with companies in different business sectors. Accordingly, customers of LG Telecom will be able to enjoy customized services, thereby increasing customer satisfaction regarding telecommunication services.
“LG Telecom, SK Telecom and KT spend too much money as subsidies on attracting customers. This kind of competition should be stopped, and instead the three should develop new telecommunication services that can offer innovative value to customers,” Lee said. In addition, Lee called for the government to devise policies that benefit people. “LG Telecom will cooperate with the government to make Korea an advanced IT leader,” Lee said. If Lee’s suggestion is realized, consumer marketing competition in the telecommunication market will be reduced, while remaining resources will be utilized to offer practical benefits to customers. In this manner, telecommunication players will be given the opportunity for new growth in what is now a saturated market.
Furthermore, the telecommunications industry can create a new telecommunication genre, by combining telecommunications and IT in business. This plan will promote the development of technologies and services that can improve people’s lives, such as smart grids and u-City, thereby activating an ecosystem in the IT industry.
Lee urged LG Telecom employees to take part in realizing the vision, both actively and voluntarily, and place customer satisfaction as the No.1 priority. Lee also promised to promote a culture of openness and communication in order to encourage and expand the voluntary participation of all employees.
Making LG Telecom a good and happy workplace is another important goal of Lee. “I will turn LG Telecom into a workplace where employees have fun and work with free and creative ideas,” Lee explained. During the first half of this year, LG Telecom will devise more detailed business plans to become the “eye of the storm” in the telecommunications market as a personal value provider via smart services. With the launch of the integrated LG Telecom, the telecommunication industry is expected to undergo a strong wind of change.