LG Chairman Koo: Acquiring Foreign Companies Will Improve Brand Power

LG Group Chairman Koo Ja-hong thinks that a top priority should be to improve brand power of LS group.

He said, “In Korea, brand is not that important, because affiliates are not the companies that produce consumption goods. But the same cannot be said of foreign countries. We will take bold actions to acquire great overseas companies in sectors of key potential.”

“In particular, LS Cable, LS Industrial Systems and LS Nikko Copper are operating teams for overseas company acquisition,” he added.

He also said that he will not recklessly pursue acquisitions and quoted the remarks made by Jack Welch, the former chairman of GE.

“If management starts new projects based on misjudgment, shareholders and the management alike will suffer a pain like hell. Pushing ahead with projects mainly based on the preference of a chairman can be a recipe for disaster.”

He said that the acquisition of Zenith, a U.S. affiliate of LG Electronics is a “painful case of M&A,” even though the company has now become a well-performing one. Chairman Koo was CEO of LG Electronics for nine years before taking charge of the LS group.

“I had to visit Chicago once a month for three years in order to get Zenith back on track. The team, which was formed to normalize Zenith, was called the “Diehard team,” and members of the team sometimes get together even now.

“Personal aspect is more important than the role of manager”-

His management style is characterized by “mutual respect.” He believes that the duty of managers is to enable his colleagues of the LS group to work pleasantly.

His management philosophy is applied to his relationship with his brothers and younger cousins.

LS group is managed by sons of honorary chairmen, Koo Tae-hwoi and Koo Pyong-hwoi, who are the third and the fourth younger brothers of the late Koo In-hwoi, the founder of LG group.

Chairman Koo, Koo Ja-yeop, vice-chairman of Gaon Cable, and Koo Ja-myeong, vice-chairman of LS Nikko Copper are sons of Koo Tae-hwoi, honorary chairman. Koo Ja-yeol, vice-chairman of LS Cable, and Koo Ja-yong, chairman of E1 are sons of Koo Pyong-hwoi, honorary chairman. Koo Bon-moo, chairman of LG group is a nephew of his.

“The issues of the group are often discussed in a family gathering which occurs every two months. Love and understanding are essential to good management.”

“Mental discipline” is need when in hurry.

Families of LG group do not want female family members to stand out. However, Chairman Koo does not share this thought. He actively supported his daughter Jin-hui when she drew up a plan for a meditation business.

Koo’s family members became interested in meditation in 1999. Chairman Koo was first introduced to the meditation center “Dohwajea” in Songpa-gu, Seoul. Since then, for six years he practiced mental discipline routines that alleviated his shoulder ache and abdominal obesity. Other family members also gained mental and physical health.

Jin-hui insisted that the meditation center should be built in Cheongdam-dong.

“The wealthier you get, the more obsessed you get. I hope that influential people have mental peace and spread it to other people.”

The Ahyun meditation center opened last month and 40 people have already subscribed to it. They include well-known CEOs, self-employed businessmen, doctors, designers and university students.

Jin-hui, a graduate of Esmod fashion design school, designed training clothes and cushions for the center. She even plans to start a clothing business under the brand “Ahyun.”

Chairman Koo said he feels “assured” when he thinks of his daughter.

When parting after dinner, he said to his daughter, “See you later.” Mr. and Mrs. Koo close their day by practicing mediation in Ahyun at 10:00 p.m. on weekdays.

Im-Sook Ha artemes@donga.com