LG kicks off massive game of management musical chairs

With a new CEO, CFO and CSO, as well as new Presidents for the Home Entertainment and Mobile Communications units, the LG management team is looking very different.

LG is a company which has always maintained a relatively strong position in the global technology markets, though it hasn’t really pushed forward in recent years. Its always been there or there abouts, but perhaps a refreshed management team and strategy will generate some momentum. With more shuffling than a suspect youth on a street corner during the witching hours, LG are not doing anything by halfs here.

Starting at the top, Brian Kwon has been promoted from his position as President of the Home Entertainment business to Group CEO. Having worked for the business for more than 30 years, Kwon has most recently been managing the successful Home Entertainment unit. In the most recent quarterly reports, this group grew 3.5% year-on-year, the latest in a string of positive results.

Elsewhere at the top-table, Bae Doo-yong assumes the role of CFO having spent seven years slaving away in the tax team, while the newly-created position of Chief Strategy Officer will be taken by William Cho. Cho, who was head of the North American business, will be tasked with overseeing the on-going digital transformation initiatives at LG.

With Kwon taking the CEO role, Park Hyoung-sei will assume responsibility for the Home Entertainment division, while in Mobile Communications, Morris Lee will take the top job. Lee perhaps has the most difficult task of the newly-appointed executives, as LG’s mobile division continues to toil.

While LG was once a prominent brand in the mobile world, this is no-longer the case. The division is haemorrhaging cash, the third-quarter financials saw a 24.5% year-on-year decline in revenues, as new players are stealing the thunder. The likes of Huawei, Xiaomi, Oppo and Vivo are perhaps capturing market share in the mid-tier markets LG formerly enjoyed.

Alongside all of these changes¸ the team has also said it will invest more significant in ‘future core and common technologies’. In more accessible language, this means more money for R&D in AI, software and robotics.

The company has stated it would like to usher in a new era for the company, bringing a more youthful edge to the management team. All new appointments will assume their roles on January 1, 2020.

Records profits and new leadership at Samsung – busy week

Only a couple of weeks after the resignation of CEO Oh-Hyun Kwon, due to an ‘unprecedented crisis’ at the company, Samsung now has more CEOs than it knows what to do with.

Samsung might have lost one CEO, but it is gaining three. Kim Ki-nam is now in charge of the components business, Kim Hyun-suk will be heading up the consumer electronics side of things, while Koh Dong-jin is running the mobile and IT unit. For the moment, it is not clear whether any one of the CEOs will have an elevated role, or perhaps they will try to emulate Huawei and put in place a CEO carousel.

“The next generation of leaders are well suited to accelerate the pace of innovation and address the demands of the connected world,” said Kwon. “They have proven track records with extensive experience and outstanding expertise in their fields.”

Another move at the top table will concern Sang-Hoon Lee, currently serving as President and CFO, who will now become the new Chairman of the business. Interestingly enough, this is the first time the CEO and Chairman roles have been separated. Considering the number of scandals which have hit the business in recent years, perhaps separating two important positions such as CEO and Chairman is a sensible move.

Such changes might have proved to be a distraction to some businesses, but this does not seem to be the case if you look at Samsung’s quarterly earnings. Scandals are increasingly proving not to have a lasting impact in the technology world, and this has only been reinforced by record profits at Samsung.

Over the last three months, Samsung recorded total revenues of roughly $55.4 billion, with profits sitting quite nicely at around $13 billion. This is the highest profit Samsung has ever recorded over a quarterly period.

The winner here was the semiconductor business, as has been the case quite often recently, but the mobile team also recorded a win. The global rollout of the Galaxy Note 8 posted some very positive numbers for the group, but profitability did take a slight dip due to increased sales of lower-end models taking a greater proportion. The semiconductor business accounted for roughly one third of the total revenues, and almost two thirds of the profit for the quarter.

Over the next quarter, Samsung anticipates another strong quarter for its memory business, partly owing to increased demand for servers and mobile devices (cynics can comment on possible underhand tactics if they wish), while the strong performance of the Galaxy Note 8 is expected to continue.

This momentum is expected to continue through to 2018, with high-density, high-performance NAND leading the way for the memory business. The team also expect positive growth in the DRAM market which it has attributed to the big data and AI euphoria.