Recently, as the government has emphasized the social responsibility of large corporations and win-win of cooperation between large and SM (small/mid-sized) corporations, the interest in win-win cooperation is rising. The fact-revealing and precedent studies on win-win cooperation imply the following : First, a win-win cooperation project requires a large corporation, which is the subject of the project promotion, to recognize the necessity of the project and promote autonomously according to its own management ideology. Second, it is important to secure self-support ability through development of capacity of SM corporations. Third, the participation of SM corporations is necessary. Fourth, the increase of the role of the union is necessary.
In order to promote win-win cooperation, it is necessary to examine precedent cases of win-win cooperation conducted so far, and review the project promotion process, achievements, and limitations. However, win-win cooperation projects are led by large corporations and the SM corporations are receiving, so it can be useful to first examine the awareness of the large corporations on necessity of win-win cooperation project and examination of the project execution program. In this study, the case of LG Electronics, which has promoted the win-win cooperation project for a relatively long time, is reviewed from this critical mind. LG Electronics is one of the representative companies in electronics industry of Korea which has continued steady development in digital industry area since its foundation in 1958. First, being a large corporation in electronic industry, it has many SM corporations as partners, so it has a relatively greater need to develop win-win cooperation projects. Second, LG Electronics has long been interested in win-win cooperation projects with the management ideology of Jeong-Do Management. Third, LG Electronics has received an external evaluation regarding win-win cooperation so that project verification can be possible.
LG Electronics has established the ‘sustainable management principle’ to systematically practice social responsibility, which includes mutual development with a partner with high relativity with win-win cooperation, and a collection of the opinions of related personnel. The major win-win cooperation projects of LG Electronics are as follows : First, LG Electronics operates the program for diverse communications with the partner, utilizing it as the path to strengthen mutual trust, to motivate the partners, and to listen to their difficulties. Second, LG Electronics has announced the conclusion of the first ‘subcontract fair trade agreement’ in the country in October 2007, and renewed it in November 2008 and is known as the leader in this area. Third, LG Electronics has the objective of fulfilling the duty of a responsible business partner and operates the human resource support program as one of the partner support systems. Fourth, LG Electronics is operating the partner education support program. Fifth, LG Electronics is directly providing funds to the outstanding partners or the partners deemed to have potential by appropriating a budget of 9 million dollars every year, and they are paying 100% cash for subcontract partners. Sixth, LG Electronics is exercising management that utilizes internal/external consultants for innovations of quality, productivity, cost-reduction, and process of the partners, and supports 6Sigma consulting.
The win-win cooperation project of LG Electronics has the following major characteristics : First, the win-win cooperation of LG Electronics is a project autonomously promoted with the economic necessity of joint growth to secure a competitive edge, and the management-ideological background of Jeong-Do Management. The fact that the win-win cooperation of LG Electronics was autonomously executed according to its own management principle and economic necessity implies the necessity that future win-win cooperation projects should be conducted according to the independent needs of the corporations. Second, the win-win cooperation projects of LG Electronics focuses on securing a competitive edge through developing the capacity of the partners. This is the extension of the economic necessity that joint growth with partners is necessary to be competitive in win-win cooperation projects. Third, the win-win cooperation program of LG Electronics utilizes various means and processes to draw the participation of the partners. The win-win cooperation is not a unilateral project execution of LG Electronics, but the opinions of others are incorporated through various communication processes with the partners. Such characteristics show that the major implications from the precedent studies and fact-findings on the win-win cooperation projects, that is, the necessity of autonomous promotion, necessity to secure competitiveness through development of capacity of SM corporations, and the necessity of participation of SM corporations are well present.
The win-win cooperation of LG Electronics requires improvements in the following : First, it is necessary to find the role of the labor union and enhance it. Among the implications in the fact-finding and precedent studies, the necessity to enhance the role of labor unions is not well handled. In case of LG Electronics, the relationship of union and management is fair and the union actively participates in the management and assumes an important role, so it is possible for the union to take part in the win-win cooperation as well, yet in reality it does not have a clear role, which can be said to be the limitation of LG Electronics win-win cooperation project. Second, it is necessary to further strengthen the competitiveness of the partners. Currently, the win-win cooperation program conducted by LG Electronics has the characteristics that most are partner support programs. This is meaningful, yet in the mid and long-run, there is the concern that it may not reach the level of securing competitiveness through the self-supportive ability of the partners to propagate. To overcome this, it is necessary to develop in conjunction with the partners the programs to enhance the quality by raising the ability of the partner to propagate. Various forms of partner participation methods can be useful in this process. Third, the unified integral win-win cooperation organization system is inadequate. LG Electronics win-win cooperation project has an inadequate company-wide organization system that integrates and controls the related tasks, so that redundancies are occurring due to different win-win strategies and support from different headquarters, and status monitoring is weak. It is necessary to establish a unified company-wide strategy in charge of the win-win cooperation and strengthen the integrated win-win cooperation organization in the purchase department. Also, the projects conducted in each department should be developed as strengths by training experts in each department, and it is necessary to construct a system that integrates and manages the system to aim for synergy effects.
Through the case of LG Electronics, the following practical implications could be drawn : First, the LG Electronics case suggests the necessity to review in detail a win-win cooperation method that can actually help the SM corporations. Considering that the junior executive resources relocation system or education support system has received positive responses among win-win cooperation projects conducted by LG Electronics, it can be seen that the support to strengthen the capacity of SM corporations in the mid and long-run is necessary beyond the financial support that appears outward. Second, it is necessary to search for a method to have the SM corporations participate in the win-win cooperation projects. In case when the SM corporations which are the beneficiaries participate in the win-win cooperation projects, the actually needed projects can be promoted along with motivation, so there would be a great degree of effectiveness. How the win-win cooperation program of LG Electronics utilizes various means and processes to draw out the participation of partners and its effort to incorporate the opinions of not only the partners, but also various related personnel, can be good examples. Third, it is necessary to provide support and find methods so that labor unions can participate in win-win cooperation projects. LG Electronics is a business establishment with a good labor and management cooperation, but the role of the labor union is limited regarding win-win cooperation. This is because the means to have the labor union to participate in the win-win cooperation project has not been found. Not only should this be found, not only in that company and union, but also the government or government-affiliated organizations need to provide a detailed plan through searching for exemplary cases and researches. Also, it is necessary to review the institutional support for the operation of a consultative body with labor and management of both the large corporation and the partner.
LG Electronics win-win cooperation case study has the following limitations : First, this study deals with an individual case so that it has the limitation that it is hard to compare to other corporate cases. It is impossible to find out what characteristics this outcome has compared to the win-win cooperation projects of other corporations or whether the performance is better or not, but it is limited to just the evaluation that it has improved compared to the past within LG Electronics itself, so it is difficult to actively interpret the performance evaluation. Secondly, this case study focuses on the large corporation of LG Electronics, and thus lacks the perspectives of SM corporations. The win-win cooperation project is promoted centering on the large corporations, so the necessity to preferentially examine large corporations is acknowledged, but the study is incomplete in that it does not reflect the positions and actual performance of SM corporations who are the beneficiaries of the win-win cooperation project. Third, this study fails to examine the influence of the environmental characteristics of electronic industry regarding the win-win cooperation project, and practical restraints or limitations for being at a disadvantage in terms of resources for win-win cooperation resources since LG Electronics has a strong competitor within the electronic industry.
To overcome such limitations and achieve advancements in research, additional research for individual cases is necessary. Especially, it is necessary to compare and evaluate the win-win cooperation project viewed from the large corporation through studies on actual performances with the pros and cons of win-win cooperation projects from the perspectives of the SM corporations. Also, it is necessary to examine the interrelationship with government policies. LG Electronics has promoted win-win cooperation autonomously according to its own management principle before government policy has materialized, but may have been influenced by the win-win cooperation policy of the government. Also, considering that the promotion of win-win cooperation policy the government is preparing preferable conditions in promotion of win-win cooperation projects for individual corporations and the evaluations of win-win cooperation by SM corporations are changing, it is necessary to examine the interrelationship with government policies.
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