EY Hanyoung New Year Economic Outlook Seminar "In the Pivot Era, Prepare for the Future with Confidence"

Global accounting and consulting firm EY Hanyoung announced on the 23rd that it held this year's New Year economic outlook seminar online under the theme ‘The Era of Pivot: Prepare for the Future with Confidence.’ The seminar introduced corporate response strategies aligned with this year’s economic outlook and current business discourse, with over 800 executives and employees from major domestic companies attending.

Park Yong-geun, CEO of EY Hanyoung, explained the purpose of the seminar in his opening remarks, saying, “This year is expected to mark a ‘pivot era,’ entering a new phase different from the past in terms of economy, technology, and geopolitical factors. We organized this seminar to provide insights that enable companies to boldly design their future with confidence.”

Former Financial Services Commission Chairman Ko Seung-beom stated, “Most advanced and emerging countries, except the United States, will continue to experience low growth. While interest rate cuts and technology diffusion will drive growth, downside risks such as policy changes in major countries and intensified global trade conflicts still exist.” Regarding the domestic economy, he expressed concern that “amid an expected slowdown in export growth, domestic demand stagnation will persist due to recent political uncertainties.”

He went on to explain key economic issues that executives should pay attention to, including the U.S. Federal Reserve’s interest rate cut outlook, the possibility of a soft landing for the Chinese economy, the rise and impact of India, and domestic and international financial market instability. He also conveyed a mixed situation of upside factors such as accelerated commercialization of artificial intelligence (AI) semiconductors and falling oil prices, alongside downside factors like expanded low-cost supply from China and intensified global trade conflicts.

Former Chairman Ko emphasized, “Domestic companies this year must strengthen their ability to respond flexibly to the ever-changing environment, as this capability directly translates into performance, adopting the mindset of Eunghyeongmugung (應形無窮). They should enhance rapid decision-making and flexible response capabilities,” and proposed the 4D (Detect, Decide, Deploy, Drive) strategy to overcome economic uncertainties. This strategy involves ▲proactively detecting market changes (Detect), ▲making swift and accurate decisions (Decide), ▲optimizing resource allocation (Deploy), and ▲immediate execution and promotion (Drive).

In the following presentation, Kwon Young-dae, Director of EY Hanyoung Industrial Research Institute, analyzed why companies must have confidence in the pivot era and the success factors of confident companies. He presented three key factors related to this: ▲portfolio rebalancing focused on core businesses, ▲business model transformation aligned with market changes, and ▲proactive resource acquisition in preparation for the future.

He said, “The pivot era presents new challenges to companies while opening opportunities for innovation. Confident companies proactively respond to market changes, boldly establish and execute strategies based on confidence, and lead the market. This approach can lead to differentiated performance in a pivot environment.”

EY Hanyoung proposed five response strategies necessary for companies in the pivot era. These include strategy-based value creation strategies such as ▲executing divestiture strategies, and technology-based value creation strategies such as ▲AI-driven monetization, ▲expansion of autonomous supply chains, and ▲advancement of cybersecurity.

Shim Chang-yong, Partner at EY-Parthenon, explained the strategy-based value creation strategy, stating, “By divesting and splitting non-core businesses, companies can simplify their business areas and strengthen core businesses through portfolio restructuring. Along with enterprise-wide collaboration, bold identification of big themes, and meticulous execution management, operational innovation at the survival level can enhance corporate value.”

Finally, Lee Chang-ho, Partner at EY Consulting, explained the technology-based value creation strategy. He said, “AI is a core technology that not only reduces costs but also generates financial performance for companies,” and proposed measures to maximize efficiency through transitioning to customized solution subscription models and automating logistics and inventory management. He also emphasized that autonomous supply chain optimization using big data and generative AI provides flexibility in increasing sales, reducing costs, and responding to market volatility. Additionally, he highlighted the importance of cybersecurity during AI implementation and discussed ways to strengthen business capabilities and create value by utilizing AI itself in cybersecurity.