LG Electronics (LG), a global innovator in technology and consumer electronics, a leading manufacturer of consumer and commercial products, a well-known brand name around the world, recently declared its bold vision to transform into “Smart Life Solutions Company”, from its current position as a top global home appliance brand. This would allow LG to connect and expand customers’ diverse experiences while they drive for global annual revenues of KRW 100 trillion, by 2030.
LG bold vision “Smart Life Solutions Company”
William Cho, CEO of LG Electronics gave a landmark speech at the LG Sciencepark in Seoul, South Korea, outlining the bold vision built on three growth engines:
- Pursuing new platform-based service businesses through advancement of business portfolio
- Accelerating business-to-business (B2B), and
- Exploring new business areas such as electronics vehicle charging and digital health
CEO Cho identified the key reflection points that LG will focus on to achieve rapid mid to long term growth from these three growth engines:
- Electrification
- Servitization
- Digitalization
“LG will continue to pursue its bold vision to transform and leap forward as a smart life solutions company that connects and expands on customers’ spaces and experiences, rather than resting on its current position as the best home appliance brand that provides quality products,” said CEO Cho. “We will establish a brand-new LG by reinventing the way we work and communicate while progressing towards this goal.”
CEO Cho also highlighted on the company’s financial objectives.“We will achieve Triple 7, which encompasses an average growth rate and operating profit of 7 percent or more as well as enterprise value to EBITDA ratio of 7,” said CEO Cho. “With the goal of raising sales from KRW 65 trillion last year to KRW 100 trillion by 2030, we will establish ourselves as a company that is properly recognized by the market and our customers.”
Focus areas for growth, expansion and investment
CEO Cho elaborated on how LG will focus on the following three pillars:
- Transition to the platform-based service business model
- Acceleration of B2B areas
- Procurement of new growth engines based on competitive edge
These are the three pillars to focus on customer experience. By 2030, the proportion of these three pillars in sales and operating profit is expected to increase to more than 50%.
LG plans to invest more than KRW 50 trillion by 2030 for the qualitative growth of the business, including the advancing of the business portfolio led by the three new growth engines. This includes a Research and Development (R&D) investment of more than KRW 25 trillion, facility investment of more than KRW 17 trillion and strategic investment of KRW 7 trillion.
LG is also accelerating the expansion of its B2B business. They have a deep understanding of its customers, and the know-how to communicate and empathise with their B2B customers – accumulative from their B2C business, which has seen continuous innovation over the past 65 years – will be fully expanded to commercial, mobility and virtual spaces.
In addition, CEO Cho also highlighted on how LG is accelerating company-wide changes from corporate culture to brand communication at every customer contact point with the ultimate goal of becoming a brand that that warms the hearts of customers and puts smiles on their faces while enabling customers to feel the value and philosophy of Life’s Good. The company is also focused on driving ESG management activities to fulfil its responsibilities as a global corporate citizen.
* Information and pictures courtesy of LG Electronics Singapore and APRW *