In February 1993, 5 years after taking on from his father at South Korea’s Samsung Group, 51-year-old Lee Kun-hee was annoyed that he wasn’t making his mark.
He summoned a gaggle of Samsung Electronics executives to a Greatest Purchase retailer in Los Angeles for a actuality test on the Samsung model. Coated in mud, a Samsung TV set sat on a nook shelf with a price ticket practically $100 cheaper than a rival Sony mannequin.
After a tense nine-hour follow-up assembly, Lee kick-started a strategic shift at Samsung – to realize market share by way of high quality, not amount.
Lee, who died aged 78 on Sunday after being hospitalised for a coronary heart assault in 2014, was pushed by a relentless sense of disaster, which he instilled in his management groups to drive change and battle complacency. Within the mid-Nineteen Nineties, Lee personally recalled round $50 million value of poor high quality cell phones and fax machines, and set fireplace to them.
This give attention to disaster, and his typically abrasive method, helped Lee develop his father Lee Byung-chull’s noodle buying and selling enterprise right into a sprawling enterprise empire with property value $375 billion as of Might 2020 in dozens of associates stretching from electronics and insurance coverage to shipbuilding and building.
Samsung Electronics developed from a second-tier TV maker to the world’s greatest know-how agency by income – seeing off Japanese manufacturers Sony, Sharp and Panasonic in chips, TVs and shows; ending Nokia’s handset supremacy and beating Apple in smartphones.
In a 1997 essay, Lee recalled his frustration at administration inertia. “The exterior enterprise surroundings was not good … however there was no sense of hysteria inside the group, and everybody gave the impression to be eaten up with self-conceit … I wanted to tighten them up a bit and repeatedly reminded managers of the necessity to have the sense of disaster.”
In 2013, Forbes named Lee because the second strongest South Korean, ranked solely behind United Nations Secretary-Basic Ban Ki-moon.
4 months after the Los Angeles assembly, Lee known as his lieutenants to a Frankfurt lodge convention room, the place he laid out his “New Administration” plan, exhorting executives to “change every little thing besides your spouse and youngsters.”
Govt conferences proved brutal, typically stretching to 10 hours, with contributors afraid to even drink water as they did not wish to must interrupt Lee’s movement by visiting the washroom.
Lee’s enterprise acumen made him the article of countless fascination and hypothesis in Korea, however he and the empire he constructed have additionally been vilified by critics and activist shareholders for wielding such financial clout, hierarchical and opaque governance, and doubtful transfers of the household wealth.
In 2008, Lee was accused of managing a political slush fund and of serving to his kids purchase Samsung firm shares on a budget. Prosecutors did not show both cost, however Lee was convicted of tax evasion and embezzlement. He apologized and stepped down, solely to return inside two years following a presidential pardon.
He had since stored a decrease profile and delegated to a military of managers, whereas selling his son, Jay Y. Lee, to vice chairman, a grooming put up for the eventual switch of energy.
As his well being deteriorated – Lee wanted assist in strolling and was vulnerable to respiratory ailments following lung most cancers remedy – he was a much less frequent presence at Samsung’s headquarters, spending lengthy winter holidays in Japan or Hawaii.
However his maintain over the group remained undimmed. Every time he travelled abroad, not less than 4 of Samsung’s prime executives, together with firm crew and safety, can be on the airport to see him off.
At Samsung’s human assets growth middle, the tens of 1000’s of staff attending coaching periods pay a silent vigil to a mock-up of the drab Frankfurt lodge convention room – with furnishings specifically imported from Germany. As most of Samsung’s employees are of their 20s and 30s and did not expertise Lee’s managerial heyday first-hand, this homage serves to remind them of the necessity to ‘suppose disaster,” a number of individuals who have been skilled on the middle mentioned.
Lee was born in 1942 within the southern Korean village of Uiryeong, the third son of Samsung’s founder. He was despatched to Japan on the age of 11, simply after the Korean struggle ended. His father needed his sons to learn the way Japan was rebuilding from the ashes of World Struggle Two.
He has admitted to being a loner and located it powerful to make associates when he returned house to a rustic riven with anti-Japanese sentiment. He went again to Japan to check economics at Waseda College, after which enterprise administration at George Washington College in the US.
His early publicity to Japan’s superior know-how led him to ascertain the idea of Samsung Electronics by forming alliances with the likes of Sanyo, and adopting chip making and TV manufacturing applied sciences.
Lee started his Samsung profession in broadcasting, working his manner as much as group chairman by 1987, breaking with the normal Confucian observe of the eldest son taking on the reins. His older brother, Lee Maeng-hee, was initially chosen to steer Samsung in 1967 when his father retired, however his aggressive administration model brought about friction with the founder’s confidants, in response to a number of books about Samsung.
The second son, Lee Chang-hee, severed household ties by telling the presidential workplace that his father had a $1 million slush fund abroad.
Lee senior exiled Chang-hee to the US and returned as chairman himself. In 1976, identified with most cancers, he handed the enterprise right down to Kun-hee. Chang-hee died in 1991.
Kun-hee’s hunched posture, as a result of a site visitors accident, comfortable voice, spherical eyes and sometimes bemused expression had been atypical for such a strong character. Married to Hong Ra-hee, who runs a Samsung-affiliated artwork gallery known as the Leeum – a mixture of Lee and museum – Lee had a son and three daughters.
His youngest daughter died in New York in 2005, which Samsung mentioned at a automotive accident however media studies mentioned was a suicide.
Lee had been a member of the Worldwide Olympic Committee between 1996 and 2017.