My fellow members of Samsung Engineering,
I would like to begin by extending my deepest appreciation to you all as we commemorate the 38th anniversary of Samsung Engineering. 

Our domestic and overseas customers who have believed in our vision and competencies, Members of our worldwide vendors and subcontractors, who are our global win-win partners, Last but not least, directors and staff of Samsung Engineering who have generated unrivalled achievements at domestic and overseas project sites, I want to say thank you to all of you. 

You have made Samsung Engineering one of world-class EPC players. 

You have helped us build at our worldwide operation the world of creativity and challenge where no lights go off.

Though our accomplishment is no less than outstanding, we will never be complacent. We are about to set sails on a new journey towards the sea of bigger potential and value-added market. 

As we look back, Samsung Engineering’s history was a history of value expansion. 

Since our foundation in 1970, we have aggressively extended our value chain and business horizon in every direction, while bravely exploring new market worldwide. 
Our global project delivery capabilities has gained momentum since 2003 as we went through Innovation Phase I and II, and we will keep this impetus to continuously explore ever-shifting global business environment. 

Consequently, Samsung Engineering will, without fail, emerge as a world’s leading comprehensive engineering company with 8000 worldwide employees generating USD12.5bn in revenue by 2015. 

My fellow members of Samsung Engineering,
Our voyage toward this vision and sustainable growth cannot stop. Once that happens we may face the risk of running aground. 

From this day forth, all of us must completely transform and set a new paradigm by arming ourselves with four strong drives of business spectrum expansion; creative marketing skill enhancement; different and unique competitive advantage attainment; and organizational competencies improvement.  

The world market conditions are changing rapidly to greater extent. 

Energy, infrastructure and water-related markets are growing exponentially, while focus on investment is moving from petrochemical plant to LNG, gas and refinery plants. 

As market globalization is gaining pace, it is ushering in an era of collaboration rather than competition, and an age of creative capitalism that underscores humanism. 

An age of knowledge and information is giving way to an age of image, integrating all values. 

In this new paradigm, the ability to generate new values with imagination will be the key determinant of competitiveness.  

From business perspective, this change calls for planning that is much comprehensive, much systematic, much dynamic and much longer term of 10 or 20 years into the future.  

Each and every one of us has to be a business leader, who is equipped with keen insight into the market and future and understanding of entire value chain to generate and explore new area of business.

I promise to those who aspire to be one that they will be guaranteed with unrestricted growth potentials and opportunities. 

Also I will support them to be able to endlessly widen their individual vision, capabilities and values. 

What comes as the foremost quality of a business leader is creative marketing.  

A business leader must be capable of reading changing trend in market, customer and product and finding and putting together hard-to-spot management elements therein into a cohesive business. 

Whenever we have this capability, we can exert mutual partnership over our customers, markets and business partners, and secure competitive edge that no one has. 

We have to consider what talents, skill-set and resources are there in the world for us to leverage, and think hard and analyze in advance the needs of our markets and customers from their angle.  

If we can creatively combine our skill-set, product and service and take it to the next level, we can create limitless new business chances.  

This process can raise the standards of living and make its benefits go to everyone in the region or country that has been marginalized in economic development.  

This is the best creative management, the best value management we can deliver.   

My fellow members of Samsung Engineering,
Now it is time for us to arm ourselves with the enthusiasm for expansion, leadership and marketing of entirely new dimension. 

Integration leadership, communication skills and globalization strength can bud and blossom under the culture of voluntary participation, challenge and action and in speedy organization. 

Let’s take a step for new takeoff with our vision and action.
Let’s take the world by surprise with our strong and powerful energy.    

Lastly, let’s go back to the mindset that we had when we first started and always be transparent and humble to the community, global market, customer and shareholders.

I wish for health and happiness for all of you here. 

Expanding Your World!

Thank you very much. 

April 25th, 2008

Yeon-Joo Jung,
President & CEO
Samsung Engineering Co., Ltd.

Shifting from “Management” to “Leadership”  

Currently Samsung Engineering is standing at a turning point where the focus is moving away from “Management” to “Leadership.” At this juncture, it is of great importance that we change our work process accordingly. That is, we must decide whether we will “manage” or “leave to leadership-based voluntary acts.” In other words if we suppose that 100 points are given to someone capable of completing a given task solely on voluntary efforts, it means that a person with 90 points can be induced to perform a task voluntarily. The ones who score around 30~70 points needs to be “managed” based on our pre-set standards.

Their points or level can be enhanced to reach 90 points by providing education and encouragement. We must be able to decide whether to “manage” or “induce leadership” and choose appropriate measures. Then education system, incentive schemes, etc. can be used to make it more effective.  

Measuring the Communication Level
It is imperative to construct an index to measure the level of communication. It may not be as complicated as it first appears to be. To provide an example, we could assess the understanding level of LCC (Leadership, Challenge and Client) of all employees at Samsung Engineering. It is achievable if we measure where it first originated from (where the initial understanding began) and with the assistance of IT, it would be easier to achieve. If we can create an organization where intangible assets could be passed on in real time to be shared amongst the employees, Samsung Engineering would be the epitome of a strong organization.

Promoting Localization 

Localizing overseas operations is the most desirable and to this end a list of feasible, partially feasible and unfeasible operations should be made. Once localization is correctly achieved, there will be no concerns even in cases of M&As. Local operations must also be conducted by “integration leaders.” 

Improving productivity of Construction Work 

Taking one more step from recruiting the winner of “International Vocation Training Competition,” we need to undergo a research on occupations dealing with technical work required in the site operation (ex. carpenter, painter etc) that may lead to greater construction productivity. Then we should take the next step to recruit and utilize those talents in our work. It may also be possible to utilize talented workers of our subcontractors under collaboration (such as by forming “technical productivity improvement T/F,” etc.). We should share the Company vision with the winner of the Competition who newly joins Samsung engineering. Moreover by providing various benefits such as college entrance support, we can create an environment where he can realize his full potential at this company.  

Treatment of Foreign Employees at Head Office 

Employees of foreign nationals working at the Seoul head office shall not be treated differently. By measuring their level of capabilities, we can induce them to improve their skills and expertise or reward them for having the required level of skills. We must inform these matters to the employees of Samsung Engineering to make it transparent.  

Pursuing Higher Value and Expansion  

In the stage of system implementation, it is crucial that management coordinators study and reflect lessons learned in their work. The person actually in charge of the process must be given high level questions and high quality tasks. For instance, for a certain country’s water-related business, numerous questions can be raised regarding supply & demand, infrastructure, organization, participation of private companies, government organization, interviewer, required skills, roadmap, qualified contractors, procurement company, subcontractors, local content, outsourcing level, competitive factors and so on.

Through these activities, comprehensive information can be acquired and even the ones who do not have first-hand experience of the work will be able to easily access the high level information. Hence, all employees at Samsung Engineering will become businessmen, achieving the notion of “killing three birds with one stone”  

When I receive reports from the heads of branch offices and local subsidiaries, I plan 5 steps ahead through deep consideration. However, unfortunately there is not a single person that suggests what we should do next nor give comments. I would like to strongly emphasize that this is not a job only confined to those who are stationed in our overseas offices. A person at the Seoul head office can also conduct research on overseas markets only if he has enough interest.  

Promoting the expansion of the company is what employees must keep in mind at all times while working. Still there is not yet a corporate culture where individuals voluntarily create value and pursue scaling up of the company. I do not see people creating a value chain and applying it to their work. For Samsung Engineering to leap forward to become a Global leading company, not only those in charge of certain work but also related departments and supporting divisions need to have a full understanding of the work.

We should all be interested in identifying our clients and studying their characteristics and logistics of the country our clients operate in. Enterprise-wide participation is required to market our company and make it a Global leader.  

Thank you. 

Personal Change and Nurturing Talents

We cannot deny the fact that the company has undergone dramatic changes since my inauguration at Samsung Engineering in 2003. However, if we are to measure the Company's capabilities from the beginning phase to the completion phase and call it from stage 1 to stage 9, I believe Samsung Engineering is currently placed on the stage 3.

During the first stage, our company was far below the beginning level where we all found much differences and gaps between our thoughts and negative opinions and communication barrier was vastly noticed among ourselves. I would say that it is better than the past but to my desire, I would like to pull our company to stage 8-9. However there is still lack of speed and momentum.

We should accelerate our speed of change to enhance capabilities of individuals and the company within a short period of time.  We believe that every one of us went through big changes and now is the time to measure our level compared to that of the past.

However there are still many of those who have not made any improvement in their capabilities since 2003. We cannot expect much from these people even after many years. On the other hand, there are those who achieve big changes. Through our measuring system, we should find these people and nurture them as next generation leaders in business. 

Value Chain and Learning

Ever since taking office, I have been constantly emphasizing the importance of "Value Chain". Although we have seen enormous improvements over the past few years, it has not yet become truly "ours". Situation could have been very different if the Leaders of each organization had thought about the value chain and drawn a map of their own.

My comments and speeches are not improvised. I constantly think to come up with ideas and take time to arrange my thoughts.We should draw a business value chain in our minds and continuously think about how other related businesses are structured and organized and how the cost is passed down within the business chain. Then, we need to think carefully to clarify the lacking points so that we can fill in the gaps.

Creation does not happen over night simply by reading books.

By making continuous efforts to search and study value chain, new ideas can be created. We have to approach from a marketing perspective.

Differentiation

A while ago, I had a meeting with one Korean construction company and felt that it was paying great attention to our company. That is, it wished to collaborate with us, thinking that we were well-prepared and have a lot of lessons to offer. Also other domestic competitors are keeping a close eye on our company, researching and learning from us.However, we need not worry as long as we keep running faster than others thereby making it impossible for them to catch up with us. In fact some of our competitors are recognized as a bigger and better company.

However when we take a closer look into those companies, we will realize that this is not true.

Thanks to our preparation and efforts, our capabilities are strong enough to compete with the Japanese competitors. However we cannot be satisfied knowing that there is a long way ahead of us. We must set ourselves further apart from others.

Differentiation can be achieved by seeking and nurturing talents capable of changing and improving quickly. These talents, regardless of nationality and position, hold great potential for the growth of our company.   

Growing Expertise of the Organization

Each department should become No.1 expert in its field. Their expertise must be enhanced to a level that would enable them to sell their work as an attractive product.

There is not an exclusive or special road leading to the position of a CEO. Becoming the top expert in your field of work itself will lead you to the field of management and become a CEO.   

Research and Report

Every research and report should not be limited solely on current condition. You should recommend the alternatives by observing the causes.Cause & Effect in every work-scope need to be checked and make it into a habit to look from micro perspective for causes within cause and cause before cause so that you will be able to expect what's to come and perfectly answer the substantial question being asked.  

Thank you