"Samsung, Closed Attitude and Excessive Pride Hinder Innovation" [Samsung Crisis Diagnosis] ①

Former Minister of Science and ICT Lee Jong-ho, Seoul National University Professor
"Excessive Security Severing Internal Collaboration"
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"Must Give Confidence That 'The People Are Behind Samsung'"

Professor Lee Jong-ho, former Minister of Science and ICT and a faculty member of the Department of Electrical and Computer Engineering at Seoul National University, is being interviewed by Asia Economy on the 17th at his laboratory in Seoul National University. Photo by Heo Young-han

When Professor Jong-Ho Lee of the Department of Electrical and Computer Engineering at Seoul National University was appointed as the first Minister of Science and ICT under the Yoon Suk-yeol administration, the semiconductor industry expressed great expectations. Having dedicated his life to the semiconductor field, he co-developed the world's first 3D Bulk FinFET in 2001 with KAIST, playing a key role in elevating Korea's semiconductor industry to a global level. Bulk FinFET is now the standard technology adopted by major semiconductor companies worldwide; U.S. company Intel paid substantial patent fees to implement it, and Samsung Electronics also utilizes it. After completing his term as minister and returning to academia, we met him on the 17th at his Seoul National University office. Professor Lee emphasized the need for external collaboration, stating that "a closed attitude and excessive pride are hindering innovation" in response to the crisis narrative surrounding Samsung Electronics. The following is a Q&A with Professor Lee.

- How do you view the crisis at Samsung Electronics?

▲ Samsung Electronics is a world-class company, but excessive pride can become a barrier to communication with the outside world. Overemphasizing security can lead to communication breakdowns even internally, making cooperation with external parties even more difficult. Interestingly, competitors have already thoroughly analyzed Samsung’s products, yet Samsung’s heightened security measures have made it difficult to share information even within universities or government research institutes. This situation is similar to Korea’s overall context. Rapid development has somewhat diminished foresight into the future. U.S. conglomerates recognize universities and public research institutes as partners and collaborate closely, but such relationships are lacking in Korea. Treating partners sincerely encourages them to fully engage in cooperation.

- Why has the gap widened between Samsung and Taiwan’s TSMC foundry?

▲ TSMC operates based on a customer-centric philosophy. For example, when Apple experienced defects due to design errors, TSMC did not point fingers but instead dispatched dozens of engineers to the U.S. to solve the problem together. In contrast, Samsung’s closed structure has become a problem. TSMC’s founder, Morris Chang, recognized and purchased technology from small and medium enterprises if it was excellent, regardless of their size. This created a virtuous cycle allowing SMEs to reinvest in R&D. Taiwan pursues continuous growth through the Taiwan Semiconductor Research Institute (TSRI), established in cooperation between TSMC and the government. Korea attempted similar efforts but faced various difficulties.

- There is an opinion that the foundry should be spun off to revive it.

▲ Internal personnel and funds are better understood by the members themselves, so it is appropriate to follow their judgment. Generally, it is difficult for one company to handle everything, requiring capital and manpower. It seems that after considering various conditions internally, the decision was made not to spin off. Samsung tried to handle everything from equipment to packaging, but TSMC apparently judged that this approach would not lead to victory.

- Industry-academia-research collaboration seems important in the semiconductor industry.

▲ Korea is focusing on Gate-All-Around (GAA) FET technology at the 3nm technology node but needs to improve yield. The Korean semiconductor industry has grown rapidly through a ‘fast follower’ strategy. Now, it must pioneer a new path as a ‘first mover.’ However, this is by no means easy. Communication and collaboration among industry, academia, and research institutes are more important than ever to solve immediate challenges and pursue ambitious research. Especially in advanced packaging, conducting preliminary research on 300mm wafers requires enormous costs and trial and error. Trying to solve this solely within companies is inefficient; collaboration with industry, academia, and research institutes, including SMEs, is essential. There has been a lack of strategic investment and systematic approaches in preliminary research, which is regrettable. Now, rather than overanalyzing complex conditions, companies must find and implement the optimal way to grow.

Professor Lee Jong-ho, former Minister of Science and ICT and a faculty member of the Department of Electrical and Computer Engineering at Seoul National University, is being interviewed by Asia Economy on the 17th at his laboratory in Seoul National University. Photo by Heo Young-han

- Samsung’s 5th generation High Bandwidth Memory (HBM) product failing Nvidia’s test is also seen as a problem.

▲ In the early history of HBM, Samsung Electronics developed the 2nd generation HBM first based on manpower and good facilities but did not focus on mass production research. In contrast, SK Hynix concentrated on HBM with a future-oriented vision. At that time, SK Hynix CEO Seok-Hee Lee’s insight stood out. Recognizing the importance of AI development, parallel processing, and wide bandwidth memory, they continued HBM development. Despite internal opposition, excellent engineers like Dr. Myung-Jae Park joined, creating a technical breakthrough. They cultivated insight and foresaw the future.

- Can Vice Chairman Young-Hyun Jeon change Samsung Electronics?

▲ The changes AI will bring are significant. Nvidia, which used to make graphics cards for gaming consoles, achieved great success by riding the AI innovation wave. Samsung Electronics is next in line to benefit from AI. Vice Chairman Young-Hyun Jeon must seize this opportunity well. AI is shaking up the industry and providing opportunities. This makes industry-academia collaboration even more important. If researchers feel they receive nothing in return, world-class achievements will not emerge due to human nature. Like Morris Chang, payment and recognition for technology are necessary. Korea, as a capitalist country, can make such a system work effectively.

- Do you think rebuilding a control tower and registering Chairman Lee Jae-yong as a registered executive are necessary?

▲ I do not agree with the opinion that reviving the Future Strategy Office or Chairman Lee Jae-yong’s return as a registered director will solve Samsung’s problems. Returning as a registered director is merely a formal procedure. The most important thing is personnel authority, which Chairman Lee already holds. What Samsung needs is change as a first mover. Organizational innovation is more important to achieve significant change.

- What kind of innovation are you referring to?

▲ One of the phrases I often used as minister was "We can be wrong." Superiors often find it difficult to improve system problems due to promotion pressures. Korea’s corporate management system, influenced by cultural background, makes it hard for individuals to change things alone. To solve problems, a systematic approach like plugging leaks is necessary, along with comprehensive judgment. Senior executives should listen to field opinions with the mindset that they could be wrong, discuss with wise people, and continuously study.

- Samsung Electronics is celebrating its 50th anniversary in semiconductors this year. What is the future direction?

▲ To leap forward as a leader, the ability to read the future based on insight is necessary. Like the saying, "It doesn’t matter whether the cat is black or white, as long as it catches mice," the core is not the source of technology but how useful it is. Even technologies from small universities or lesser-known research institutes should be carefully selected and boldly invested in if they have value. A culture that values practical contribution over reputation and is open and pragmatic must be established for technological innovation. Instead of criticism, a positive driving force to support companies is needed. Companies should not be neglected, and it is important to instill trust overseas that "behind Samsung is the Korean people."

Interview by Kwang-Ho Lee, Head of Industrial IT Department

Compiled by Seoyoon Choi, Reporter

Editor's NoteProfessor Jong-Ho Lee is regarded as a world authority in semiconductor research. He graduated from the Department of Electronic Engineering at Kyungpook National University and earned his master's and doctoral degrees in electronic engineering from Seoul National University Graduate School. He has served as a professor at Wonkwang University and Kyungpook National University, a visiting researcher at the Electronics and Telecommunications Research Institute (ETRI), and a postdoctoral researcher at MIT Microsystems Technology Laboratories in the U.S. Since 2009, he has been a professor at Seoul National University and served as director of the Seoul National University Semiconductor Joint Research Center in 2018. In 2016, he became an IEEE Fellow, a distinction awarded to less than 0.1% of members worldwide. From May 2022 to August this year, he served as Minister of Science and ICT. He received the Young Engineer Award from the National Academy of Engineering of Korea in 2015, the Order of Green Stripes, and was selected in 2017 by the National Academy of Engineering of Korea as one of the top 100 technologies and leaders to lead Korea by 2025.