The role of semiconductors has become increasingly relevant than ever before with the acceleration of the Fourth Industrial Revolution. Global Sales & Marketing (GSM) of SK hynix is tasked with an important job of designing the future of SK hynix, while paying keen attention to transforming the industrial environment and segmented voices of customers.
Jonghoon Oh, Executive Vice President and Chief Marketing Officer (CMO) is leading GSM at SK hynix. Throughout the interview, he listened attentively to the questions and replied with much enthusiasm and care, as if treating his customers.
Business Designer Responsible from A to Z of the Value Chain
GSM is an organization that seeks to grow together with customers by leading commercial and technical partnerships while enhancing customer value. Internally, its role is to present the highest level of competitive product portfolios and roadmaps based on a product-oriented business system. Moreover, in addition to capturing the changes of the external environment one step ahead and proactively reflecting customer needs, GSM is also responsible for identifying new opportunities and preparing for business innovation to ensure a sustainable growth for SK hynix.
In particular, due to Covid-19, communications with customers have been restricted on many fronts, resulting in a range of factors affecting GSM’s operations. However, GSM is a significant contributor to the successful performance of SK hynix based on its long-standing trusted relationship built with customers.
“The reason why SK hynix is performing well despite pandemic is thanks to the efforts made by all SK hynix members who have remained committed to continued development and production to maintain the highest level of product and quality competitiveness. In addition, a strong relationship built between GSM and customers over a long period of time have also been a great support. This trust could be built because all GSM members put customer convenience first and did not neglect communication even under contact-free environment. All SK hynix members, including GSM, deserve to be proud to have delivered their promise to the customers.”
Oh defined the recent semiconductor industry environment as the “age of hyper uncertainty” in which unexpected issues such as the prolonged Covid-19, global trade disputes, fire and power outages, and water shortages can occur at any time. Accordingly, he explained that he is mobilizing efforts to improve understanding of the overall industrial ecosystem to which customers belong.
“All industries, including semiconductors undergoing “the age of hyper uncertainty”, have experienced that the global supply chain (GSC) can be disrupted at any time. In the future, companies are expected to shift their appropriate inventory level management policies from a “just in time” to “just in case” approach. However, in the semiconductor memory industry, it is difficult to increase production in a short period of time even if large-scale investments are made, and it is not easy to identify customers’ exaggerated demand. There is also a lot of uncertainties in terms of demand because IT devices such as smartphones, PCs, and servers cannot be produced if there is a lack of other components even if memory is sufficient in the market. So, GSM is focused on increasing not only “market intelligence” but also “eco intelligence” of the overall customer ecosystem.”
He also explained that GSM is working hard to strengthen sales and marketing capabilities to proactively respond to market changes.
“Sales focuses on customer’s voice and works on the bottom-up delivery of such information, leading the business strategy to work. Marketing works to deliver a top-down view of the market and customers, supporting and checking sales activities while trying to seek a balance.”
“In addition to clearly understanding the requirements and pain points of the customers, GSM plans to take a step further to boost its sales capabilities to create social values with customers and create examples of win-win growth. In order to improve marketing capabilities, GSM supports activities that can improve data-driven predictability. Moreover, we are working hard to expand marketing-driven activities that actively create market demand based on our product strategy from the product planning stage. Promotions to expand the high-capacity Dual In-Line Memory Module (DIMM) and Multi-Chip Package (MCP) markets and co-marketing based on DDR5 partnering with CPU companies are meaningful outcomes.”
Oh went on to stress the importance of stepping out of the comfort zone and increasing “business agility” across the company and presented the on-going changes taking place at SK hynix.
“Will strengthening our sales and marketing capabilities alone help us rise above the wave of “hyper uncertainty”? I don’t think so. We need to strengthen our sales/marketing capabilities, but also further strengthen our enterprise-wide “business agility” and “collaborative competitiveness”. In fact, we are leveraging these capabilities as driving forces to overcome many challenges. It is very difficult to change the product portfolio and efficiently manage components inventory at SK hynix, which has a complex product system. In particular, if the product mix changes, it takes a certain amount of time to implement it. Amidst the said challenges, GSM was quick to change its mix based on prompt judgment, and all organizations in the company responded quickly by flexibly coordinating production/development/investment operations according to revised sales plans. Given the fact that the global production system is spread across Icheon-Cheongju-Wuxi-Chongqing, it is indeed a very proud achievement.”
However, we will continue to expand the semiconductor production facility (FAB) such as Yongin Cluster in South Korea. As products and solutions diversify, the wave of change ahead of us will continue to rise, just like the number of components needed. As a result, GSM intends to advance G-SCM (Global Supply Chain Management) and further develop and evolve “business agility”. G-SCM is SK hynix’s unique operating system in which we enter a sales plan according to customer and market demand forecast and, accordingly, obtain an optimal supply plan based on a company-wide production capacity. To this end, we are strengthening cooperation with existing sales/marketing organizations after incorporating GPO (Global Planning Office), which is the implementation arm of G-SCM operation, into GSM this year. We expect that this will enable us to establish and implement a production/inventory strategy based on market forecasting and sales strategies and develop a coherent production/investment plan.”
In addition to increasing internal operational efficiency, Oh is going at great lengths to prepare for the future. As part of such effort, the Memory Systems R&D organization was integrated into GSM last year, contributing to increase synergy with the existing product planning organization.
“Memory Systems R&D is a group of technology experts capable of understanding systems and cloud solutions from customers’ perspective. It is expected to complement the strength of the product planning organization viewing system changes from a memory perspective, to observe changes in memory from a system perspective, and to create synergies by contemplating the value of memory or its solutions.
Whereas the product planning organization looks ahead three to five years, Memory Systems R&D looks further ahead and expands the role of semiconductor memory into the realm of artificial intelligence (AI) and data analytics solutions. It is also expected to actively partner with outside players to become a pathfinder in seeking new growth opportunities and a pioneer in driving open innovation while achieving high performance.”
Mem4EST, a “Cartographer” Envisioning Memory-Centric Future
In order to present the direction and vision of the organization and remind the members of how valuable and important their work is, Oh recently defined GSM’s identity as a “leader developing business and technological cooperation with global customers.”
In addition, he defines the roles of GSM members as follows and presented clear tasks thereof: △ “Enterprise business leaders” building company-wide consensus on business strategy and leading its implementation △ “Outposts for business competitiveness” presenting product/customer-centric business systems and development roadmap △ “Pathfinder and pioneer” identifying the future changes and leading the markets.
In particular, Oh believes that the current computing environment will evolve into a “memory-centric system” in the near future and explained that he is closely monitoring the changes in market and technological trends as pathfinder and pioneer in preparing for the future growth.
“An explosion of data has opened up the data era, and there is a repeated cycle of massive amounts of data being processed and reproduced. Today, it has become increasingly important to analyze data and create values. If such trends continue, they will inevitably lead to changes in computing architecture, which is likely to significantly transform the role of systems and memory.”
“The more data you have to store, the more it becomes impossible to store all data in the conventional memory. This introduces a new layer of memory, such as Storage-Class Memory (SCM) and Capacity Memory, to minimize the performance degradation of existing memory. The frequency of use or the value of ownership determines in which tier the data will be stored. Data security technology also becomes important. As transferring vast amounts of data itself will require an unnegligible amount of time and energy consumption, there will also be demand created for memory expansion layers that provide adequate performance and high capacity. Furthermore, there will be a trend of processing or analyzing data in memory or storage itself.”
“The current CPU-centric computing method is being differentiated into xPU-based computing methods such as GPU (Graphic Processing Unit), DPU (Data Processing Unit), ASIC (Application Specific Integrated Circuit), and FPGA (Field Programmable Gate Array), etc. The fiercer the competition among xPU companies, the greater the role of memory solutions that can provide differentiated performance competitiveness. I think this will ultimately open up the memory-centric era.”
At the core of such transformation, Oh proposed “Mem4EST initiatives” as GSM’s new vision based on its commitment to “protect the environment and continuously develop society through technological innovation.” “Mem4EST” stands for Memory for E (Environment), S (Society), with Technology (T) or can also be interpreted as “Memory Forest,” referring to a single ecosystem or forest consisting of semiconductor memories.
“Memory Forest represents how different layers of memory form a computing architecture, just like a forest, where everything from the bottom like the ground, grass to dense trees, fulfill their respective roles to form a huge eco-system. Forests are generally, from bottom to top, divided into forest floor, understory, canopy layer, and emergent layer.1 These layers are naturally comparable to those of the computing architecture such as SSD (Solid State Drive), SCM (Storage-Class Memory), high-capacity memory (Capacity Memory), main memory and IPM (In Package Memory).”
“In other words, at the very bottom of Memory Forest, there is data lake, a group of raw data located in SSDs. It is also where SK hynix’s pledge to significantly reduce carbon emissions by replacing HDDs is delivered. On top of that, CXL (Computing Express Link)-based Storage Class Memory and main memory such as DDR5, and IPMs such as HBM (High Bandwidth Memory) are sequentially located.”
“Among others, we anticipate that there will be significant opportunities for solution products that have recently enabled memory expansion and acceleration, using a recently standardized protocol interface called CXL. As such, in each area, it is possible to implement a variety of memory products based on performance, capacity and add-ons, which will not only increase the size of the memory business, but also create a market of NDP (Near Data Processing) where the needed computing functions will be executed on the storage device where the data is located. Eventually, diverse semiconductor memories will play their respective roles in each layer and grow together to develop an ecosystem called ICT forests.”
The green image of the forest is also associated with eco-friendliness. “Mem4EST (Memory Forest)” also reflects the commitment of SK hynix to establish itself as an eco-friendly company in the semiconductor industry, thereby focusing more on creating social values.
“Until now, we have focused on selling memory products to customers and taking responsibility for quality issues within the warranty period, so we lacked understanding as to how the sold products are used and disposed once their life cycle ends. However, in order to become an eco-friendly leader in the semiconductor industry in the future, it is important to understand a product’s life cycle and minimize wasted or discarded products. If we can collect products used by customers and partially recycle them rather than simply discarding them, we will be able to delay the construction of new facilities and save investments in facilities.”
“There is also an idea to reduce waste of manufactured products and create recycling opportunities. As memory layers branch out, not all IT devices require the highest quality DRAM produced at high yield rate. Capacity Memory Extension (CME), which is somewhat slower than highly-performing DRAMs, but are relatively inexpensive per bit and deliver high capacities, can be a reasonable alternative. MDS (Managed DRAM Solution) with defect bit relief capability may allow for the use of partially defective or potentially defective products. As such, technological innovation can play a big role in raising both economic and social values simultaneously. Mem4EST also embodies such commitment to continue to identify similar applications and deliver ESG values.”
Oh is currently focusing on sharing this vision with the colleagues and building a consensus. Once the process is completed, Oh plans to align “Mem4EST” with the company-wide financial story and brand it.
“Navigator” Sailing Towards Growth and Happiness of Members Around the World
Oh joined Hyundai Electronics in 1987 as a DRAM design engineer. He helped the company to successfully develop 4Mb (Megabit) DRAM for the first time by using in-house design. Since then, Oh worked as product planning director, head of DRAM design division, head of DRAM development business, and is currently leading SK hynix’s transformation and innovation as vice president of GSM and an in-house board director.
What motivated Oh to become so successful for a long time and remain one of the leaders driving SK hynix’s growth? He cited “initial commitment” and “passion” as his secret.
“At every major inflection point in my career, I always renewed my resolution and plans amidst expectations and concerns about new changes. That is my initial commitment, and whenever I faced difficulties or challenges, I thought of my initial resolutions and plans. Every time I did that, I was filled with passion again. This act of awakening my “initial resolution” has been a key enabler for sustaining passion.”
He also mentioned that it was a shame to have less opportunities to communicate directly with overseas employees due to Covid-19 and saluted their hard work.
“GSM has many members who are thriving in overseas branches across the United States, China, Hong Kong, Japan, Singapore, India, Germany, and the United Kingdom. It’s a pity that I cannot meet and encourage them in person who are struggling in various parts of the world. I would like to take this opportunity to thank the members of overseas branches for doing their best to support customers with perfection while protecting their health and that of their families in the unprecedented working environment of Covid-19. I look forward to seeing them more often once the pandemic will be over soon. I would also like to thank the in-house Covid-19 TF for not forgetting to tend to the needs of branches abroad.”
When asked what kind of leader he would like to be, Oh answered, “a leader who leads by example.”
“I believe that every leader’s goal is to become a role model for his members by leading by example. There is a saying that comes to mind whenever I face difficulties. It’s “the devil is in the detail”, which means that problems arise from very small and specific matters, so we always have to look into things more closely. The phrase is used to emphasize a situation where things may seem simple at first, but in fact requires a lot of time and effort than expected. Semiconductors is quite an honest field in that its outcome equals the accumulated sum of input time and capability. Therefore, leaders in the semiconductor industry should achieve success by demonstrating their “never give up attitude” and “relentless challenging spirit” to the members.”
“Another virtue of a true leader is to have a “mid-to long-term vision”. A leader should think strategically about investing in the 30 years of their employees rather than his/her own 3 years, driving the company’s mid- to long-term transformation and laying the foundation for its future growth.”
Oh also confides that at times he can lose his calm and get too paranoid about work as he strives to lead by example as a leader. And it makes him wonder whether he is requiring too much discipline for the leaders working in affiliated organizations.
“I am always concerned that I might be seen as a cold and difficult leader because I always try to be a very responsible and accountable, striving to become best-in-class in my field. Pandemic has taught me once again about the importance of my colleagues. Going forward, I would like to be warmer and more compassionate toward other members as their mentor and peer.”
Lastly, Oh proposed a keyword he wanted to emphasize to stakeholders.
“I’d like to point to “pursuit of happiness through win-win strategy”. As Head of GSM, I dream about the future of SK hynix in which it grows together with customers rather than growing alone. Going forward, SK hynix will continue to do its best to build more trust as customers’ friend, partner, and collaborator.”
1A forest consists largely of an underground space with plant roots, a forest floor with plants less than 0.15 meters high, an understory with plants less than 5 meters high, a canopy layer with trees over 5 m high forming the roof of the forest, and an emergent layer with a very few high trees, which is formed after protruding from the canopy layer.
