Story of a Big Player from Gangnam

Chapter 672: External Audit Report (2) - Part 1

Artist Choi objected to having a helper at home at first, but she agreed to it with one condition.

"If you are determined to have a helper at home, then have one after you spend your full 21 days from the day when you delivered the baby. You want to wait until the baby's immune system becomes more developed. That's why grandpas and grandmas usually visit their newborn grandchild for the first time after 21 days."

Since her 21st day would soon come, Young-Eun decided to follow her aunt's advice. Young-Eun's aunt told them that she would have to make a trip to her home in Yangpyeong District, and she would spend only one day there to take care of things.

It was March.

GH Mobile began to supply auto parts to H Group. It was not an exclusive supplier, but three supplier companies would provide auto parts to H Group. However, the volume of the product order was significant since GH Mobile was now H Group's first vendor company. The product unit cost was 3,000 won, and GH Mobile was supplying 50,000 pieces of that product to H Group. It would bring an additional monthly revenue of 150 million won. And, since H Group ordered three different products with the same unit price and the same number, GH Mobile was making 450 million won per month for the products that they were supplying for H Group alone.

President Song was making a report to Gun-Ho about this new product order from H Group.

"Even though a monthly sales revenue of 450 million won takes up only 4.5% of our entire monthly sales revenue, we have to keep in mind that this is just a start. They will keep increasing the volume of their product orders from us."

"Hmm, really?"

"Our production department used to have a meeting once a week, and now Director Jong-Suk Park is holding the same meeting every day."

"How many managers are there at the production department including Team 1 and Team 2?"

"There are 2 senior managers with another 2 mid-level managers. And they have five low-level managers."

"So, we have ten managers in the production department including Director Jong-Suk Park, right?"

"Yes, sir. Those ten managers get together every morning to have their daily meetings. If we include the whole management personnel including the team leads and supervisors, there are thirty of them, and they are currently managing more than 400 production workers."

"We have a little bit over 500 workers in GH Mobile. So, 400 of them are production workers, and only 100 of them are those in the research center and other departments, huh?"

"That's correct, sir."

"I see the production workers make up the greatest portion in our company."

"That's normal since we are a manufacturing company."

"I believe that the managers in the production department are older than Director Park. Hasn't it caused any problem?"

"I haven't seen any problem so far. Most of the managers started their careers as an office worker, meaning that they don't really have hands-on work experience in the production field. In that aspect, Director Park is superior to them."

"But his paperwork is a bit…"

"It is true that Director Park is not excellent at handling paperwork in the office. That's why he is striving to learn it by taking night classes in college. He works during the daytime and takes classes at night, and things seem to be working fine in the production department."

"Mr. President Song, can you talk to the managers in the production department to make sure that they provide their full support to Director Park?"

"I actually talked to them once about it. They all like Director Park, and they are more than willing to work with him. Director Park is a pleasant person to be around, and his approach to the managers is very friendly and amicable. He doesn't do nagging either."

"Hmm, I see."

"As a matter of fact, Director Park is popular among team leads and supervisors who work directly with the production workers on a daily basis. Whenever they encounter a problem, the first person who they go to is Director Park. He is the most knowledgeable and experienced person in the production field. If a machine stops working or requires a repair, they always come to Director Park."

"There are 400 workers who he needs to manage along with the large production system that we currently have. I want him to focus on effectively managing the entire facility, workers, and the production system rather than focusing on repairing a machine…"

"He is aware of his weakness, sir, and he is trying hard to overcome it. I think you don't have to worry about it. He is handling it very well."

President Song continued after taking a sip of the tea that Secretary Hee-Jeong Park brought to him.

"I have a question for you, sir, if you don't mind me asking. I was wondering if you have any personal relationship with A Electronics' CEO."

"No, I don't know him personally. I got to know him strictly from the business."

"I will take your words, sir, but the people in A Electronics are wondering if you have anything to do with their CEO. The plant manager in their factory in Dangjin City asked me the other day if I know anything about the possible special relationship between you and their CEO."

"Oh, he did? I don't understand why he would care about it. We just need to provide them with good quality products without any defects. That's the deal that we made. Isn't that what he wants?"

"That's true. The thing is that the plant manager has recently been told by his superior that they will place another product order for us for an assembly work on their entire A302 home appliance product. Of course, they justified the additional large volume of order by saying that GH Mobile has been providing quality products on time. But, the Danjing factory's plant manager is not perfectly convinced with that reason for an additional huge product order that they are about to make."

"Why is he not convinced?"

"Because there are a lot of other vendor companies that have been providing quality products without any defects."

"Well, tell him that I have no idea why his superior made such a decision."

"Haha, yes, sir. I will tell him that if he asks me again about it. If we start supplying their A302 appliance assembly work, it will bring us an additional 3 billion won sales revenue. We will assemble the entire door for their home appliance product, and it takes 12 different parts to complete the door. And the unit price is exceeding 30,000 won. Moreover, their A302 home appliance is being exported abroad. I'm sure they will order at least 100,000 of them."

"Is that right?"

"Our annual sales revenue will increase by 36 billion won. Our goal has been set to 150 billion won by next year, but if we take that assembly work, we will safely generate 180 billion won. If we are lucky enough to receive a product order from H Group as well, our projected sales revenue at the end of this year will be 200 billion won."

"Well, let's try to make it happen. Also, our cost of sales to revenue ratio has been more than 80% for the past two years in a row. We want to lower it below 80% this year."

"Understood, sir. I will think about an innovative way to reduce our product cost."

"Well, if you don't have anything further to talk with me, I will leave for Dyeon Korea now."

After Gun-Ho left the office heading to Dyeon Korea, President Song sit there, and he was thinking,

'A company can't grow this fast. There has to be something that could explain all this. Even though President Goo denies, there has to be something with A Electronics. A Electronics is a major subsidiary company of A Group, and A Group's chairman is the father-in-law of Minister Jin-Woo Lee who presided over President Goo's wedding. The person— Mr. Beom-Sik Lee— who now has 15% of ownership of this company must be related to Minister Jin-Woo Lee.

Is Mr. Beom-Sik Lee a relative of Minister Jin-Woo Lee? Probably not, because a relative is not a close person when it comes to money. There could be always a dispute over money between relatives. I bet he is Minister Lee's father. Even if something happens to his father, he is the legal heir. Well, I understand that President Goo can't reveal anything about his relationship with A Electronics.

Maybe I should stop asking President Goo about the possible relationship with A Group. Asking about something that he can't disclose can upset him. I don't want to upset him. I'd better keep my mouth closed.'

President Song stood up from his seat and went back to his office. He then asked the management people, who were holding a position above the supervisor, to come to the meeting room after lunch. They would have a meeting among the management people.