InformationWeek

Kim Tae Keuk, LG Electronics

LG Electronics certainly has the numbers and scale to justify its ambition to become one of the world's top three "electronics and information communications" companies: It's a $48 billion-a-year maker of consumer electronics, mobile phones, and home appliances with 82,000 employees in 110 offices in 39 countries working within 83 global subsidiaries. But along with that size, reach, and rapid growth came a snare of proprietary systems, mismatched databases, inconsistent business processes, and a lack of timely and reliable visibility into inventory, production, revenue, and other vital areas. In fact, during those times, LG might have been hampered by too much visibility: it ran multiple instances of a legacy ERP application around the world, and many of its subsidiaries operated their own "versions" of one of those disparate systems. LG ended up with lots of very different versions of the truth and of what was and was not visible.

Enter CIO Kim Tae Keuk, who before joining the IT-management ranks had spent 10 years as a business consultant focused on understanding and optimizing business processes. He and his team, along with LG's CEO and CFO, decided in 2005 to install a global single instance of Oracle's E-Business Suite R12 because LG believed some of its new features would give the company a competitive edge. Kim began the process by rebuilding and integrating 440 business processes across LG's business-value chain -- an effort that took 18 months but allowed Kim and his team to understand LG's sprawling, end-to-end processes across R&D, procurement, manufacturing, marketing, and supply chain.

"A lot of CEOs want their CIO to be a business partner, not just a master technician," Kim says. "One way to do that is to become true experts at the company's business processes and then help innovate those processes -- as that happens, CIO can come to mean chief innovation officer."

Externally, that knowledge and insight can be a huge value to customers, Kim says, because "now that we have become very competent with collaborative planning, forecasting, and replenishment, lots of our customers [major global retailers as well as smaller shops] expect us to help them with inventory control, management, and forecasting." That was possible only after the team rebuilt the 440 global business processes across LG's 83 subsidiaries, giving the entire company a single instance of the truth -- and along the way letting Kim's team "work much more proactively with business partners on external process changes and innovations, which is where the IT profession should be headed."