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Just fifteen years back, if someone were to tell us that two Korean companies with no idea about local culture would be ruling the Indian consumer durables market one day, we would have called it plain balderdash. Today, that’s an inevitability. Neha Saraiya of 4Ps B&M does an incisive insider – with exclusive interviews from inside LG, Samsung and competitors too – on how the audacious Korean companies reached the top, and which one of the two has it to stay there!

Circa March 1997: The top brass at LG sent their best man, K.R Kim (now the Vice Chairman and CEO, Videocon Industries) to spearhead their Indian operations. It was like the Wild West for LG at that time - full of potential but with no precedents of success. The South Korean Headquarters showed a great deal of confidence in Kim, who was then serving in the Panama office of the company. The challenge at hand for Kim was double edged. Firstly he had to pull the company out of the shackles of two prior failed attempts (one with Bestavision and second with Chandra Kant Birla). And the second Herculean task was to convert the dwindling LG into a force to reckon with. Not only did Kim quickly go about inculcating his new business lexicons like “cultural competence”, “cultural fit” and cultural compatibility” into the organization, but he also earmarked an ambitious plan for setting up of the first phase of LG’s sales offices across India within just one month of its launch. Thus by burning the midnight oil (literally!), Kim managed to activate five sales branches of the company on May 12, 1997. (Surprisingly this day is still marked as LG’s birthday in India!). And today, after thirteen years of existence, this South Korean brand has converted into a behemoth worth more than $2.75 billion.

The story of another Korean giant, Samsung is also not so dissimilar. In March 1994, when Ravinder Zutshi (Deputy MD, Samsung India) conducted a research to study the possibilities of a joint venture between the Korean brand and the Indian giant – Videocon – little would he have known that a toddler at that time taking a few shaky steps to establish itself in India would transform the competitive landscape so phenomenally. Well the anecdotes are placed simply to prove one single point – the success stories of these Korean giants will continue to provide management lessons on the Indian market for years on, as they succeeded when others either failed or didn’t even dare to try. As Moon Bum Shin, MD, LG India reminisces the tough years, he shares with 4Ps B&M, “Over the years, we have learnt that no control is the best control. Setting up a new management system is extremely difficult but if local people manage it then it becomes sustainable. Also we have invested a great zeal in a network of sales service and logistics with a strong discipline. Because of all these issues we have been able to sustain our growth over the years.”

 





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