Case of LG Electronics

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Why is it important?

LG Electronics (LGE) is the third in the rank of three largest chaebols after Hyundai and Samsung in South Korea. LGE has got more than 70 subsidiaries in 40 countries. The thrust of LGE was on home appliances, PC related multimedia products, electronic products and telecommunication products such as handsets, mobile systems and network system. LGE aimed at attaining top position in digital TV and telecommunication equipments in the world. It also aimed at strengthening its core competency as ‘Digital Leader’ in electronic products and equipment in this digital era. Bon Moo Koo, after taking over as Chairman of LG group in 1995, has adopted “Leap 2005” as the basic philosophy of LGE group. According to the principle of “Leap 2005”, LG group was to grow from around US $38 billion in 1994 to US $380 billion by 2005 with 50% coming from international sales. LGE has adopted a differentiation strategy to concentrate on the high end of the entire products segment it enters. It cultivated an image for both technology and quality. Globalisation and innovation were the major strategies of LGE through mergers, acquisitions, divestures and alliances.