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LG Class Presentation

LG was founded in 1947 and initially produced cosmetic products, later diversifying into plastics and electronics. In the 2000s, LG reorganized into separate business units and pursued a blue ocean strategy to create new demand through product innovation. This included focusing on high-quality, high-end products in mobile phones, TVs, and appliances. LG's blue ocean approach helped make it a leader in markets like plasma TVs and helped the company grow globally.

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rudraksha sharma
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86 views

LG Class Presentation

LG was founded in 1947 and initially produced cosmetic products, later diversifying into plastics and electronics. In the 2000s, LG reorganized into separate business units and pursued a blue ocean strategy to create new demand through product innovation. This included focusing on high-quality, high-end products in mobile phones, TVs, and appliances. LG's blue ocean approach helped make it a leader in markets like plasma TVs and helped the company grow globally.

Uploaded by

rudraksha sharma
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Name : - Rudraksha Sharma (st20149954)

Batch : - BABM 7
Strategic Management (BSP6000)
Module leader : - Brig. GPS Cheema
Topic : - Blue Ocean Strategy - LG
About the Company
LG was founded in the year 1947 as Lucky Chemical Industrial Corporation (LCIC), initially
the company use to manufacture a cosmetic cream called Lucky Cream.

LCIC became the first Korean Company to enter the plastic industry in 1952 to make
cosmetics containers. As the plastic business was expanding, it also established an
electronic company, called GoldStar in 1958.
The Government supported the electronic industry and with that support the company
showed decent growth in 1970s. GoldStar also started large plants across the nation to
improve and maximize the production.
In 1977, GoldStar’s sales were over 100 billion and the export volume reached 100 million
USD in 1978 .
.
Diversification

Commenced business with cosmetic cream : 1947

Diversification to plastic business.

Electronic company : 1958

LG Chem (Solar) : 1980

Commercial Laundry Business : 2006


Strategic Alliances

LGE-LGIC MERGER LG-JBL PARTNERSHIP: BROAD LGE-PHILIPS PARTNERSHIP 2001.


RANGE OF ELECTRONIC PRODUCTS.
Company restructuring Strategy
Globalization, innovation and new product development was adopted by LGE to grow and
penetrate global market.

Strengthening the R&D activities of the company.

Reorganized LG into Four separate companies in the year 2001.

Long term strategy was to maximize the cash flow through sustain growth of cash cow
business.

In 2002, LG electronics was recognized into a holding company structure in which their
business operations and investments were separated.
BLUE OCEAN STRATEGY

Blue ocean strategy creates new demand. Companies develop uncontested


market space rather than fight over a decreasing profit pool.

Creating a blue ocean, there is a huge opportunity for growth and is


profitable.

LGE, wanted to implement Blue Ocean Management to make competition


irrelevant.

Focusing on High quality product: Focus shifted from volume to value.

LG focused on system air conditioners.


Mobile communication
The LGE shifted its focus from volume to value through high-end product innovation.

The mobile communication division of LG was responsible for selling CDMA (without sim
card slots) and GSM (with slots) handsets.

With a huge range of products, the company was growing rapidly and was showing its
global presence in 3G handsets.

The company had a global sales of $9.9 billion.

In 2005 they released a cell phone named as Chocolate phone in South Korea. It was
super slim and had a camera and a music player. This product gave a boom to the
company.
Digital Display
The goal of this division was to become market leader and dominate the display market.
Blue ocean strategy helped in giving a breakthrough.

Plasma TVs

As a leader in the Plasma TV industry, the digital display division had to set a standard
by making the 60”, 71” and 102” full HD Plasma TV.

LCD TVs

LG created worlds first 55-inch LCD TV, which attracted the whole world and gained
them global attention. The company ranked 5th in LCD TV segment.
Digital Appliances

The Digital Appliances division was doing good and was ruling the home appliance
products like air conditioner, vacuum cleaner, washing machine, refrigerator, etc.

Being successful in the home appliances the company was trying to expand its business
in new innovative products like kitchen appliances, commercial air conditioners.

The company planned to increase their air conditioner system production capacity and
so they opened new production lines in India, China, Turkey and Brazil.
Evaluation and Conclusion
LG electronics is one of the market leader in technologies, digital product and this
shows its growth and market dominance. The company has relied on innovation for its
success and market leadership, and it has also helped the firm to gain competitive
advantage in the market.

It is important for the company to continue employing new and innovative brains in
the organization who can create value for the customers.

The company should invest much more in their R&D sector and do a lot of market
research so that they know the current trend.

Example: Nokia phones vs Asus ROG phone.


HANK
YOU

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