Moving from consumer electronics into enterprise technology isn’t simply a matter of selling to different customers. According to Jaeseung Kim, Regional CEO of LG Electronics Asia Pacific, it requires changes that affect how a company develops technology, supports customers, and measures success.
In this exclusive interview with Frontier Enterprise, Kim discusses the differences between consumer and enterprise markets, as well as the lessons learned along the way in addressing businesses’ evolving needs.
What breaks when a consumer hardware company enters enterprise infrastructure?
The first thing that breaks is the assumption that great products sell themselves. In consumer markets, you win on specifications and price, and the relationship largely ends at the point of sale. Enterprise infrastructure demands something entirely different: a go-to-market model, service architecture, and organisational mindset built around consultation, accountability, and continuity.
What breaks first in practice is trust, or rather, the inability to build it. Enterprise decision-makers across Asia-Pacific need confidence that their technology partner will be present not just at installation, but years down the line. That is why we have invested in remote diagnostics, rapid replacement capabilities, and cross-border service coverage designed for the geographic and regulatory complexity of this region.
The returns on that commitment show up in the numbers. In the first quarter of 2026, our Vehicle Solutions business exceeded a 6% operating profit margin. Product quality is only part of the equation. Enterprise clients need confidence that their technology partner will remain present and accountable throughout the lifecycle of the relationship. The product is the starting point. The partnership is what sustains the business.
How do enterprise infrastructure economics differ from the consumer electronics model?
Consumer electronics is a volume and velocity business: thin margins, transactional revenue, and product cycles measured in months. Enterprise infrastructure inverts almost all of those assumptions. Sales cycles are longer, deal sizes are larger, and relationships span years. More importantly, revenue shifts from one-time hardware transactions towards recurring services, software platforms, and managed services.
The economics become more durable as a result. At the LG group level, the share of B2B and non-hardware businesses in operating profit rose from 21% in 2021 to around 90% in 2025. This reflects the growing importance of enterprise businesses within the group, even as hardware remains an important part of our overall business.
Across Asia-Pacific, this shift is being accelerated by urban development and smart city investment across the region. When we deploy an integrated system at a major commercial property, combining HVAC, digital signage, building automation, and energy management under a single platform, we are not simply completing a transaction. We are establishing a long-term operational relationship.
Our “Laundry Crew” smart laundromat franchise in Thailand illustrates the same logic at a different scale: each franchisee represents an ongoing platform relationship rather than a one-time sale.
What factors determine the success of large industrial digitalisation projects inside enterprises?
In my experience working with enterprise clients across Asia-Pacific, technology is rarely what determines success or failure. Three other factors tend to define outcomes.
The first is integration capability. A solution that cannot connect with existing building management systems or operational technology networks will stall. In a region where enterprises often run legacy and newer infrastructure side by side across multiple markets, this capability is essential.
The second is advisory capability. Our smart factory solutions business recorded 500 billion KRW in orders within two years of commercialisation, reflecting demand for approaches that combine manufacturing expertise with consulting support.
The third is ESG alignment, which is increasingly a baseline expectation across Asia-Pacific. Certifications and sustainability ratings are often used by enterprises as one factor when assessing whether a technology provider’s roadmap aligns with their own governance and sustainability objectives.
What capabilities do hardware manufacturers underestimate in enterprise technology?
The first is software depth. Enterprise clients do not want well-engineered devices. They want managed systems that generate useful operational data and integrate with their broader technology stack.
The second is service design. Enterprise clients expect proactive monitoring and rapid resolution, not a consumer warranty process. Delivering that across a region as geographically dispersed as Asia-Pacific requires investment in local presence, remote diagnostics, and logistics that can respond quickly across diverse markets.
The third is account management sophistication and, in Asia-Pacific specifically, cultural fluency. The way enterprise relationships are built in Japan is fundamentally different from Southeast Asia or Australia. A global playbook applied without regional sensitivity will underperform.
How can a product company adapt to enterprise platforms and services?
It requires genuine organisational transformation, not a portfolio expansion. The adaptation has to happen at three levels simultaneously.
At the offering level, you move from selling products to delivering outcomes. This often means providing integrated systems that combine multiple technologies and services under a single engagement. Our “Laundry Crew” franchise in Thailand illustrates the same principle at a different scale: Franchisees are not buying appliances, but a complete operating business ecosystem.
At the relationship level, you invest in continuity. In Asia-Pacific, where long-term commitment carries particular weight in enterprise decision-making, this is a strategic imperative.
At the strategic level, you institutionalise a different kind of ambition. This requires concentrating investment and R&D on technologies where the organisation believes it can establish long-term leadership.
