LG 2000 Annual Report Download - page 12

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Efficiency and transparency in the procurement process have been enhanced with diverse and innovative
on-line systems. For example, in 2000, LGE launched the warehouse management system and the Internet
purchasing system (IPS). Also introduced in 2000 were Web GISVAN and X-Net, on-line systems
providing information to orders, shipping, and settlement for domestic and overseas suppliers. Through the
standardization of electronic components and the initiation of an Internet electronics mall (E2open),
transparency in procurement was enhanced even further and relations with suppliers improved.
E-SCM fundamentally enhanced the internal processes of LGE, from the purchase of materials to the
delivery of finished products. The GPSI system enabled LGE to manage its inventories in real-time around
the world while the M-project assisted in the efficient management of overseas resources.
With the launching of LG Nara (an Internet shopping mall) and Premier Page (LGE's customer information
site), LGE has made efforts to establish closer relations with its customers. Premier Page was designed to
offer diverse information regarding LGE's new products, delivery schedules, and after-sales services to its
major customers.
In 2001, LGE will operate its e-business with focus upon business-to-customer relationships. E-CRM shall
be promoted, a new e-HR (human resources) systems shall be established, and LGE will advance e-
procurement. E-CRM will be comprised of an e-sales system and e-service networks while e-HR will
include e-recruitment and e-academy, a cyber education program.
R&D Activities
The essence of LGE's innovation are its research and development activities. There are currently 25
domestic and 13 foreign-based technology institutes and research centers. The research network supports
all LGE operations in the development of production technologies, core electronic parts, design concepts,
and next-generation product lines. Current projects also include research to improve fundamental
technologies, product quality, and customer satisfaction.
LGE believes that, in order to achieve the world's best technology, it is necessary to sufficiently invest
capital and workers in R&D activities. Presently, LGE's 7,200 researchers at home and abroad comprise
22.9 percent of LGE's total staff. In 2000, LGE's investment in R&D activities totaled W705.7 billion,
increasing from W419.3 billion in 1999. On an increasing level, LGE will invest W950.0 billion in R&D
in 2001, 55.2 percent of total investment.
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