I am proud that labor and management have become a body. It has been a general phenomenon that most of the enterprises’ labor and management show extreme confrontation with bands on their head in order to accomplish their requirements when its time comes every year. Then, only the SK chemicals has shown even no trivial confrontation as well as confliction with bands on the head since established in 1969. From our company’s point of view, it is very natural, but it is a rare example in the industry. No confliction has been possible like this because both of the labor and management have made a reliable relationship by opening their mind.

Let’s take some examples to see how the trust relationship was. There was a few times of heartbreaking restructuring in the SK Chemical as well. Of the total 3,650, 1,250 employees were laid off in 1996. It was the first dismissal in the financial world. Our company not only did its best to maintain employment of employees to the maximum as far as possible, but also made every effort to give proper compensation to colleagues laid off. And all of the related backgrounds and information were made public. Thereafter, the company has realized transformation such as new establishment, division, merger, sale, withdrawal, etc. endlessly, and now labor and management could be able to talk about better tomorrow together.

That’s right. SK chemicals was a textile enterprise representing Korea from 1970s to early 1990s. Then, now as you see from the company name, its main core is changing to fine chemistry and life science from early 2000s. Changes are not simple ones. Those are drastic changes.

It is just a chemical fiber business that has disappeared in a day although it was motive power of Korean growth. SK chemicals was the same case as well. All the southeast Asian nations as well as China, which had been our market, changed into competitors with cheap labor power at the head, so we have lost our stage. In 1990s, SK chemicals noticed the change and then promoted some changes.
Eventually, it was successful. At that time, most of the big chemical fiber companies went through bank management or bankruptcy procedures. Only SK chemicals could be alive. Of the 2 trillion won of revenue, the revenue related to fibers was reduced to 5% or lower levels, and growth power has been changed into fine chemistry and life science.

British historian Arnold Toynbee presented a ‘challenge and response’ logic in his book . SK chemicals has transformed successfully as a result of a proper response to the challenge from external environments. Our challenge and response are continuing endlessly.

If it was the history of SK chemicals that was introduced before, then now I can tell you about our present and future.
SK chemicals, bringing up fine chemistry and life science industry, has 11 affiliates. If I introduce our fine chemistry part first of all, there are 4 business places overseas. Those are SK Eurochem(Poland), SK Keris(Indonesia), SK Qingdao and SK Suzhou(China). There are 5 affiliates such as SK Petrochemical, SK Utis, SK NJC, SK Cytec and HUVIS. Next, a life science part is SK Beijing Medicine Science and Technology(China). And it incorporated SK Construction as its affiliate by increasing its share into 58.03% at the end of 2006.
A little different kinds of businesses for the entire SK chemicals such as petrochemistry, pharmaceutics, construction, etc. are mixed directly or as an affiliate type, so it can be said that width of diverse strategic movement has broadened such as ‘mother company division into affiliates.’
Overseas affiliates can be summarized by regions into 1 company at Poland(SK Eurochem), 3 companies at China(Qingdao, Suzhou, Beijing) and 1 company at Indonesia(SK Keris). <see the table>
80% of the 2 trillion won of whole company revenue are obtained from export or all overseas business places. SK chemicals is no more a domestic enterprise. It is a global enterprise. So there are diverse factors affecting management environments and growth motive power. Actually, there are many big and small external change factors such as factors pursuant to regional features, etc. as well as big ones such as oil price change, exchange rates, regional confliction, natural disasters, etc. Because of it, it is true that there are many chances.

A problem of talent upbringing for growth is a question I am asked often as a manager. It is said that talent upbringing is a key to the ups and downs of business. This question is the one I ask to myself for 24 hours in 365 days.

I am focusing on ‘ability development.’ My generation was the one that was supposed to recklessly follow the work flamed by my superiors with foreknowledge and leadership. Doing one’s best passionately by setting a simple goal clearly could result in an outcome.

Now it is much different. It is a time when it is difficult unless one has really a big ability. One should have deep knowledge and wisdom as well as deep thinking power, fast intuition and clear decisiveness. One is prepared for limitless competition in the globalized world for the first time only after preparing all things such as selection, concentration, balance and harmony. In the end, motive power to carry out these things is eventually arriving at talent upbringing. So I am very emphasizing ‘ability development.’

<Built to Last>, a book analyzing enterprises that have continuously grown for over 100 years by professor James Collins, shows explanation for this well. Continuously growing enterprises have invested resolutely in talent development and ability development even though they are not directly connected with present revenue along with present growth. Harmony between present growth and future investment was optimized.

So I am emphasizing education and ability development whenever I have a chance. I am allowing employees to participate in things related to ability development and education such as overseas MBA, duty education, seminars, etc. without omission.

This year, some of officers are supposed to make efforts to develop their ability by participating in GEP(a preliminary manager course for officers) education. Besides, multiple junior executives are taking overseas MBA and special courses. Currently, 15% of entire members including officers are allowed to participate in education every year. Global management is difficult with past knowledge. One should consistently learn new knowledge as well as languages. I am fully supporting this part. In connection with this, we are getting a big effect in improving work ability by positions by establishing an education system by position.

I want to emphasize ‘executing today urgently like dying tomorrow and preparing tomorrow like being alive forever.’ And I am asking employees to raise their level of agony to the level of upper officers or top managers, not their position.

Everyone is in agony and practicing it, but I think that not all of them are enjoying their outcomes. I mean that it should not be a simple agony. I mean that one should in urgent agony like seeking water in a state with thirst sinking deep in his tongue after marching in the Gobi Desert. One should promote work ghastly like standing at the edge of a cliff in order to get an outcome. Even the God will be having a mind to help with emotion if he sees a person who is making a desperate effort with an urgent mind to do nothing but succeed. Now, I am in agony about how I can contribute to the nation and society as a businessman.

First of all, I am appreciating all people around me. I don’t think that today’s SK Group and SK chemicals could be realized by only current members who are in the company. It was possible owing to the nation’s infrastructure, and grow was possible because of considerations of customers, their families and society surrounding SK.

today’s SK. So enterprises also got to have a thought to give pleasure, appreciation and happiness beyond the pursuit of profits in the past. People who want to give happiness will be feeling happiness more first than others.