Lee Yong-kyung 1943–
President and chief executive officer, KT Corporation
Nationality: South Korean.
Born: June 11, 1943, in Anyang, South Korea.
Family: Married (wife's name unknown); children: two.
Career: University of Illinois at Chicago, 1975–1977, assistant professor; Exxon Enterprises, 1977–1979, senior researcher; AT&T Bell Labs, 1979–1991, senior researcher; Korea Telecom, 1991–1994, chief, Line Research Center; 1993–1994, head of R&D team; 1995–1996, head, Wireless Communication Development Team; 1996–2000, director, R&D Group HQ; KT Freetel, 2000–2002, chief executive officer; KT Corporation, 2002–, chief executive officer.
Address: 206 Jungja-dong, Bundang-gu Songnam, Kyonggi 463-711, South Korea
■ Ken Lee, as Lee Yong-kyung is known to his American friends and colleagues, spent some 24 years in the United States as a student and research scientist. He returned to Korea in 1991 to join Korea Telecom, where he oversaw the state-owned company's research and development (R&D) program. He was head of R&D for another nine years before becoming CEO of KT Freetel (KTF), a wireless subsidiary of the KT Corporation.
Korea Telecom, spun off from the government in 1981, was a state-owned monopoly that controlled the country's fixed-line telephone and broadband services. The Korean government
began privatizing Korea Telecom in 1993, and by August 2002, after a protracted denationalization procedure, KT emerged as a fully private telecommunications behemoth. That same year Ken Lee was designated to be Lee Sang-chul's successor after the latter was named as South Korea's information and communication minister. Ken Lee was later confirmed as president and CEO of KT for a fixed, three-year term at an August shareholders' meeting.
In 2004 KT Corporation was Korea's largest telecommunications service provider with more than 22 million subscribers. It accounted for 97 percent of the fixed-line telephone market and carried 48.6 percent of the nation's broadband Internet traffic. Its closest broadband rival, Hanaro, had a market share of 26.5 percent. Korea had the world's highest broadband Internet penetration in 2004, with up to 75 percent of house holds using the high-speed, always-on Internet access. In comparison, the United States had a broadband penetration of only 13 percent of total households, and service was several times slower.
SEEING THE FUTURE FROM THE FIBERS: AN EDUCATION IN RESEARCH
Ken Lee spent most of his career as a research scientist. At AT&T Bell Labs he conducted studies on semiconductor lasers and optical communications. His other areas of research, pursued while at both Exxon Enterprises and Bell Labs, included thin-film and fiber optics, semiconductor laser and optical interconnections, R&D management and planning of telecommunications technologies (network planning and operation management), high-speed transmission, access networks, various multimedia services, and wireless communications.
Lee's background as a scientist at the cutting edge of a number of exploding and converging fields made him uniquely placed to understand and exploit new research advances at a time when electrical engineering was undergoing one of the most revolutionary periods in its history. In fact, his career mirrors many of the historical developments that occurred with the introduction of satellite telecommunications in the 1970s and the World Wide Web in the 1990s: a progression from fixed-line to broadband to wireless and then, after market saturation, to their integration to create new value and new markets.
The best word to describe Lee's career was "network," a term taken from the technological and conceptual advances that created a new science at the turn of the 20th century. His entire career was devoted to elucidating the mechanical and technological principles of networks and the efficient and economical implementation of those principles for financial and ultimately social benefit.
KTF: KOREA UNWIRED
While Lee had ample experience managing research projects, researchers, and research departments, it was at KTF where he learned the most about managing a company, including both technical and nontechnical personnel, and developing a market strategy. Lee was appointed to be CEO of Freetel in the year 2000 in a move that reflected a shift in emphasis from the bottom line to next-generation technologies. The highly competitive and swiftly moving mobile phone market required an agile, forward-thinking CEO who could anticipate what the next "big thing" would be. To profit from this product, however, it had to be conceived of and produced in-house.
As a researcher who understood the technology well and who appreciated both what it could and could not do, Lee was an ideal candidate for the post. Capitalizing on his habit of always thinking ahead, Lee established teams for new product development and research standardization. These groups were devoted to developing next-generation technologies and new applications for existing technologies.
KTF adopted the phrase "Mobile Life Partner" as its company slogan after its merger with Hansol M.com. This marketing ploy demonstrated that Lee understood the consumer's perspective; moreover, Mobile Life Partner neatly complemented the company name, Freetel, the provider of a liberating technological convenience for the individual customer.
The merger with Hansol M.com was the largest in the history of the domestic securities market. It also made KTF the second-largest domestic mobile phone provider, with some 8.7 million subscribers and a market share of 32.6 percent. Then-KT chairman, Lee Sang-chul, pointed out that the merger was in keeping with the trend toward larger companies as a step toward integrating worldwide communication service providers. Shortly after the deal was completed, Ken Lee announced his ambition to propel KTF into the global top 10 by 2005 in terms of number of subscribers and turnover.
Consistent with his earlier ambition at KTF, Ken Lee's principal goal during his tenure as CEO was to transform the KT group into one of the world's top 10 "telcos" and to establish a lasting foundation for the company that would guarantee its survival into the 21st century. To achieve that goal, he instituted a number of both hard and soft measures aimed at restructuring and reforming the formerly state-owned institution's heavily bureaucratic organization. Hard measures involved reducing costs by cutting jobs from a peak of 60,000 employees in 1996 to 38,000 in 2003. Soft measures included reforming KT's governance structure to make it the best and most transparent in Asia.
When Lee took office as the CEO of KT Corporation in August 2002, he told IT Korea Journal that his motto for the company was "the only way to survive is to change" (February 2004). Lee set three targets for KT's new strategy: the creation of new business models, a change to custom-oriented management, and implementation of the Six-Sigma program.
The Six-Sigma program was developed in the United States to provide a scientific and statistical basis for measuring company and employee performance and customer satisfaction. Lee was the first Korean CEO to introduce the Six-Sigma approach in that country and referred to his version of the program as "value management."
Value management depended on the "performance index." The concept of the performance index, as he explained in IT Korea Journal, reflected Lee's belief that "no measurement means no improvement" (February 2004). The index gauged performance in terms of profitability, customer satisfaction, stock value, and employee capability. To implement the index, Lee replaced the seniority-based compensation and personnel management system that existed at the time with an abilityand performance-based system. In IT Korea Journal Lee explained that "Anybody with no ability will die out" (February 2004).
Lee's reforms of KT's management structures included the introduction of a cumulative voting system to protect minority stockholders and the reinforcement of the role of outside directors in order to promote managerial transparency. KT under Lee had more outside directors than did any other Korean company. As part of his downsizing plan, Lee proposed to reduce the board of directors from 15 to 12 by cutting inside directors from six to four and outside directors from nine to eight. He also raised the bar on foreign investment from 37.2 percent of outstanding KT shares to 49 percent, but he pledged to defend the management of the company from chaebol (state-organized privately run conglomerates) and foreign investors. A stock-swapping agreement, for example, was reached with KT's archrival, SK Telecom, to defend the company against SK control.
INVENTING VALUE: INTEGRATING THE NETWORKS
Market saturation in 2004 obliged Lee to slash KT's earnings target for 2005 from his original number of 14.7 trillion won to 12.4 trillion won. In response to the slump Lee instituted a market strategy he dubbed "value networking." This strategy was the creation of added value by combining and integrating existing products. Home networking, Lee foresaw, was the next "big thing" in information technology. Home networking linked mobile wireless resources to Internet broad-band and fixed-line services, thus creating a single interface between appliances and other utilities.
In anticipation of home networking, Lee steered KT into providing high-speed digital subscriber lines (DSL) and very high digital subscriber lines (VDSL) Internet broadband services while developing its own satellite-based mobile broadcasting system. Lee explained in the International Herald Tribune, "the killer application of the Internet has been speed" (May 6, 2003). Accordingly, KT targeted specific markets, such as new apartment complexes where competition was particularly keen and the demand for bandwidth exceptionally high, with VDSL. KT and other telecommunications carriers thus began working closely with construction companies to build condominiums that fully exploited the Internet, and in 2006 KT planned to launch its own commercial satellite.
Lee summarized the new developments and future of the markets in a keynote speech at the Global Information Summit in 2003. He detailed how information technology (IT) was being increasingly combined with other technical developments to create new business models. In addition to alliances with construction companies, Lee noted that home appliance makers and automakers were developing mobile offices and predicted that the crossover between IT and other technologies would lead to the creation of a totally new social structure and culture. He used the phenomenon of "Net citizens" supporting presidential candidates over the Internet as an example.
JUMPING UP AND INTO THE FUTURE
Some analysts interpreted Lee's 2002 to 2005 mandate at KT as a stopgap measure while the chairman, Lee Sang-chul, was away serving in the South Korean government. Lee's ambitions for KT and his 100-year vision for the company might support that view. His accomplishments were nothing but impressive for such a short reign, the work of a man who knew he had much to do and little time to do it.
Undoubtedly, Ken Lee made an enduring mark on KT and the Korean telecommunications industry. He transformed an ailing and ossified, state-run company into a lithe and agile industry leader. He set a policy for KT of growth through emerging markets rather than through corporate mergers; a policy of ethical capitalism through corporate transparency and responsibility to stockholders; and a policy of corporate-driven public and social welfare projects to bridge the digital divide and social inequality.
In July 2003 the company launched a social service organization called "Jump Up" to get the poor and handicapped on-line and pledged to transform itself into an environmentally friendly corporation by funding a number of projects such as the Evergreen KT Campaign. Ken Lee's legacy could thus be described as the creation of a network of technologies, businesses, and social projects. In 2004 Lee was named as the 20th most influential CEO in Korea.
See also entry on AT&T Bell Laboratories, Inc. in International Directory of Company Histories.
sources for further information
"Interview with Lee Yong-kyung," IT Korea Journal, February 2004.
Lee Yong-kyung and Ken Belson, "The Broadband Age Makes Speed the 'Killer App,'" International Herald Tribune, May 6, 2003.
"Lee Yong-kyung 1943–." International Directory of Business Biographies. . Encyclopedia.com. (August 19, 2018). http://www.encyclopedia.com/economics/news-wires-white-papers-and-books/lee-yong-kyung-1943
"Lee Yong-kyung 1943–." International Directory of Business Biographies. . Retrieved August 19, 2018 from Encyclopedia.com: http://www.encyclopedia.com/economics/news-wires-white-papers-and-books/lee-yong-kyung-1943