Management Duo Leading Samsung Growth

Lee Gi-tae (58), president of Samsung Electronics` information and communication division, and Hwang Chang-gyu, president of Samsung Electronics` semiconductor business, are the core managers of Korea’s leading industry, Samsung Electronics.

The two are rivals. Both advanced to vice president in 1999 and as president in 2001. Placed in charge of the two main industries of Samsung Electronics, mobile phones and semiconductors, they have developed their products into globally competitive brands. Lee is five years older than Hwang.

Currently directing Samsung Electronics, CEO and Vice Chairman Yoon Jong-yong became CEO and president in January 1997 and CEO and vice chairman in January 2000, and displayed the ‘Yoon Jong-yong system’ for close to ten years, leading to speculations about the ‘post Yoon Jong-yong’ era. In this instance the two most likely candidates are Lee and Hwang, and the two seem to realize this competition.

Displaying parallel results, Lee and Hwang are locked in competition. With competition and cooperation, their steps towards Samsung Electronics’ development have been kept busy.

Cash Cow vs. Future Engine of Growth-

A subtle atmosphere of competitiveness exists between Lee and Hwang.

When Lee was asked last month at Jeju’s 4G Forum, “What do you think of Hwang,” his response was measured, stating, “We are in completely different fields, so how can I assess him?” When asked “are you friends with Hwang,” he answered “we’re not close enough to be either friends or enemies.”

Hwang recently expressed at a private gathering, “The mobile phone market led by Lee is competitive, and the company can be placed in a difficulty at any time,” and added, “We possess our unique memory electric circuit technology in the semiconductor area, which enables us to lead the market.” It was an expression of confidence that the semiconductor technology is a tier above the mobile phone area.

Samsung’s records in the cellular phone and semiconductor area last year reflect the characteristics of the two areas.

Sales in the mobile phone area were 18.83 trillion won, exceeding semiconductor sales (18.33 trillion won), but sales profit margins were higher for the latter (30 percent) than the former (12 percent). The semiconductor area invested 6.33 trillion won in infrastructure, while the cell phone area invested 270 billion won.

A source at Samsung Electronics stated, “The mobile phone area is a cash cow in that it contributes to Samsung Electronics’ cash flow, while the semiconductor area requires large-scale investment, and is considered the company’s future crop.”

Audacious Tenacity vs. Rational Intellectual-

Lee and Hwang are both electrical engineers, who value the importance of technology development. Both are known to have exemplary business skills.

There are also differences between the two.

After graduating from the department of electrical engineering at Inha University and entering Samsung Electronics in 1973, Lee was known to be a tenacious character that devoted himself entirely to telecommunications. With decisive driving force, he has led Samsung Electronics’ mobile phone miracle, and is described to be both frank and tenacious.

Having graduated from the department of electrical engineering at Seoul National University and obtaining his doctorate degree at the University of Massachusetts, Hwang is an eloquent rational-intellectual type. He is also one of the high-tier CEOs that Samsung Electronics recruited and cultivated as overseas talent by promising over-the-top incentives.

A source from Samsung Electronics described, “In our company we say that by mixing the characteristics of Lee and Hwang we would have the perfect combination of Samsung Electronics’ next-generation leader. The good-faith competition between the two people is contributing greatly to the company’s advancement.”