LG Hausys hosts the 2017 LG Techno Conference Holds briefing sessions to help secure talented R&D personnel from overseas

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1 LG Hausys hosts the 2017 LG Techno Conference Holds briefing sessions to help secure talented R&D personnel from overseas Our company hosts the 2017 LG Techno Conference together with LG Electronics/LG Display/LG Innotek/LG Chem/LG Uplus/LG CNS at Marriott Marquis Hotel in New York on April 15, LG Techno Conference is an event held every year since 2012 to secure talented individuals in R&D from both Korea and in the United States. LG executives including LG Group Vice Chairman Koo Bon-Joon attended this year s event in the US to introduce LG s latest technology trends and new growth businesses and explain the Group s R&D human resource development plans to about 300 R&D personnel in the Americas. In this year s Conference, our company s briefing session focused on introducing our company s business areas and current research featuring automobile parts, building decoration materials, and high-performance materials. The briefing session was followed by Talk Space, a talk concert in which our researchers and the participants were able to communicate freely. Researchers participating in the event as panel members, including R&D Center Director Lee Min-Hee, also spoke with the participants on a variety of topics ranging from expertise in research to personal goals and visions. In the following HR Session, CHO Kim Jang-Sung introduced our company s systems and plans for developing R&D personnel. With his welcoming address, President Oh Jang-Soo talked about his management philosophy and our company s vision to communicate with prospective R&D personnel attending the Conference. 1/10

2 LG Hausys participates in Auto Shanghai 2017 From April 21 to 28, our company participated in Auto Shanghai 2017 held at the Shanghai International Expo Center in Shanghai with LG Electronics/LG Display/LG Innotek to showcase LG s technology in automobile parts to participants from all over the world. More than 1,000 automobile and parts companies from around the world participated in this year s Auto Shanghai. In particular, the event featured 113 new automobile models, including 83 Chinese brands and 30 global brands, which were launched for the first time in Asia or around the world. Our company, together with other LG affiliates, set up a 542 m2 joint exhibition booth and introduced lightweight parts and interior products. Our company introduced a variety of products including Soft PVC Leather, TPO Foam Sheet which offers excellent moldability, an interior component called the Superfine Real Printing (SRP), roof racks, underbody covers, seat back frames, airbag housings, and the CFT-Full Charge Bumper which is one of the main products for the Chinese market, earning good reviews from numerous customers. 2/10

3 LG Hausys acquires two New Excellent Technology (NET) certifications for lightweight automobile components Our company obtained New Excellent Technology (NET) certifications for our Knee Protection Panel and Seat Back Frame products at the inaugural 2017 New Excellent Technology Awards Ceremony held on April 19 at The K Hotel Seoul in Yangjae-dong, Seoul. NET certification is a national certification system through which the Ministry of Trade, Industry and Energy certifies newly developed technology or innovations to existing technologies in Korea as new technology. Our Knee Protection Panel, which received its NET certification at this year s event, was developed with Hyundai Motor and Hyundai Mobis. By using what is called a Continuous Fiber Thermoplastic (CFT), a lightweight material developed exclusively at our company, we were able to slash weight by 55% compared to incumbent steel products. Also, by changing the design of the Knee Protection Panel s structure, our company improved the capacity to absorb collision energy on the driver s seat and the passenger s seat to ensure better safety performance. Meanwhile, the Seat Back Frame was developed with Hyundai Motor. It uses approximately 30% less weight than conventional steel materials by using CFT and Long Fiber Thermoplastic (LFT) materials. In addition, it has excellent strength and *rigidity compared to existing products, minimizing frame deformation in collisions, and securing passenger safety. The Knee Protection Panel featuring our new technology will be available from June this year, and the Seat Back Frame will be mass produced from 2019 and supplied to domestic automobile makers. * Rigidity The propensity of an automobile s body to resist deformation from external forces 3/10

4 LG Hausys becomes the first to acquire the Environmental Product Declaration (EPD) certification for PF insulation products Our company s PF insulation product, a high-performance building insulation material, became the first in the industry to acquire Environmental Product Declaration (EPD) certification. (*EPD: Environmental Product Declaration) The Environmental Product Declaration is an environmental information disclosure system operated by the Korea Environmental Industry and Technology Institute under the supervision of the Ministry of Environment. It covers all processes from production to distribution, consumption, and disposal of products. The environmental impacts of these processes are assessed using six indicators including carbon footprint/ ozone layer influence/ acidification/ eutrophication/ photochemical smog/ resource footprint. PF insulation minimizes the effect on the ozone layer by using eco-friendly foam gas in the manufacturing process and is also effective in reducing the energy consumption of buildings thanks to top-tier insulation performance (0.019W/mk). To date, various products from industrial materials to general consumer goods have been given the EPD certification in Korea. However, our company is the first to earn EPD certification for building insulation materials with our PF insulation product. According to the newly amended Green Building Certification, developers will be able to enjoy additional points when using EPD certified materials in their buildings. * Environmental Product Declaration certificate (EPD: Environmental Product Declaration) The Environmental Product Declaration system quantifies the environmental impacts of all processes including the procurement of raw materials, production, transportation, distribution, the use and disposal of goods and services in order to improve the environmental performance of those goods and services. Criteria for granting additional points in the Green Building certification process when the building features EPD products were newly established in September /10

5 LG Hausys launches new automobile fabric Real Quilting Our company recently launched Real Quilting, a new type of automobile fabric product. Real Quilting uses fabric made from leather processed to display a *quilted pattern, and it helps create a luxurious atmosphere inside vehicles. Real Quilting will be mainly used for seat covers, door trims, etc. The new Real Quilting product adds a quilt pattern to artificial leather. Quilt patterns were previously applied to natural leather materials only. Compared to natural leather, it can reduce the production cost by 30%, and it can be applied not only to high-end vehicles but also to small and medium-sized vehicles. In particular, Real Quilting is unique in that the perforations (applied to reinforce air flow) and the stitches can be varied depending on preference. * Quilting pattern A pattern made by backstitching an exterior layer of fabric with perforations (fine holes) on top of soft and yielding materials like sponges or polyurethane (PU) 5/10

6 LG Hausys launches new patterns for ZEA fresh wallpapers Our company launched new patterns for ZEA fresh, our eco-friendly wallpaper line. 'ZEA fresh' is a wallpaper product that uses PLA(Poly Lactic Acid) made from natural derivatives on the surface layer and applies our company s eco-coating technology to enhance its air filtration performance. The newly launched patterns are designed with various age groups in mind. Customers can create different atmospheres depending on the wallpaper they choose. Mono modern emphasizes a clean and sophisticated look with different shades of gray, Planterior reminds people of nature with leaf motifs, and Soft pop adds animal patterns - children s favorite - in pastel tone colors. Meanwhile, ZEA fresh has been recognized for its eco-friendliness and safety. Specifically, it has earned Class I status under the OEKO-TEX Standard, the Environmental Product Declaration by the Ministry of Environment, and has been recommended by the Korea Atopy Association. 6/10

7 We can find all of our answers in the field and from customers! The Most Outstanding Team, First Quarter Action Management: Window Frame-Cheongju-Profile Technology Team Our company s Z:IN window products are leading the market as the no. 1 product in the domestic window industry thanks to excellent performance and design. But it is never easy to satisfy all of our customers. Unexpected defects may occur and products may not work properly or adequately depending on the situation out in real life. The Window Frame-Cheongju-Profiling Technology Team (hereinafter referred to as the Profile Technology Team ) is responsible for detecting defective elements in our current window products and redesigning them as windows with even better performance. Sometimes they do get upset from harsh customer feedback, but they continue to meet customers on the front lines with the motto, We can find all of our answers in the field and from customers. I. Mindset. Strong determination to achieve We need to control matters before, not after, the fact! Profile Technology Team members spend more than half of their working hours in the field instead of in their seats. But meeting with customers is not always a pleasant thing. When the Profile Technology Team visits a site, most of the customers are those who think that defects in their windows have not been solved despite repeated requests. So, even if they solve the technical problem, some bad feelings remain at times. That s why the Profiling Team decided to focus on proactive management to visit clients, find out and solve the problem first, rather than engaging in following-up issues after the problem has occurred. They set up a working principle of Let s discover defects in products from our customers, solve problems with our customers to improve, and give our customers feedback on the results of those improvements and started implementing Action Management initiatives. 7/10

8 II. Systemize. Automatic action system Analyzing possible defect types using a logic tree, and deciding on issues that require immediate improvement. Windows are exposed to a wide range of problems thanks to their inherent complexity that features various parts, work processes, and installation processes. That means, people need to prepare thoroughly in advance to discover every issue a window may have without missing any. The Profile Technology Team first listed parts that go into windows to analyze the type of defects that can occur using the logic tree technique. Then, the Team created an easy and simple survey that customers could respond to, visited various customers in pairs, and conducted in-depth interviews to draw up 16 issues that required urgent improvements. One of those sixteen tasks derived from the customer surveys was that there were a lot of scratches on the window handle. Originally, once window frames are made, the handles were wrapped and protected in vinyl. But since these vinyl covers were not tough, they easily peeled off, creating a lot of scratches. As such, the Profile Technology Team tried to replace the vinyl with a plastic cover that was harder to peel off. But they began to question, is this a way to solve the problem fundamentally? and looked at the entire work process again. As a result, they found that the problem was caused when a building s interior was being worked on after the window frames were installed in place. The Profile Technology Team used a new wrapping method to ensure the covers did not come off the window handles until the end user, therefore reducing customer complaints on scratched handles significantly. Also, the Team reinforced customer feedback where they explained what was causing the problem and the current situation. The Profile Technology Team Manager often accompanied staff members to explain the details directly to the customer. Thanks to these efforts, customers have been very impressed with LG s strong willingness to act and change their attitude towards customers. Our company was also able to form a virtuous cycle in which feedback and other improvements were proposed. <Detailed analysis of product defects using the logic tree technique> <Customer survey> 8/10

9 III. Self-Motivation. Motivated from the heart Competing with each other in a productive way using puzzle maps Profile Technology Team members receive a puzzle sticker for their puzzle map each time they solve tasks that require improvement. Anyone who collects 16 puzzle maps first will receive a reward from the Team. This makes it easy to understand the progress of each improvement task, and completing the puzzle that is the Team makes working feel like a game. It brings out their competitive nature in a positive and natural way which accelerates work performance. <Detailed Schedule Calendar> Issue 1 Issue 2 Issue 3 Issue 4 Refining issues that require improvement Establishing improvement plans Executing improvement initiatives Customer feedback <Example of a puzzle map at the Profile Technology Team> 9/10

10 IV. Leading by example through leadership. Setting an example/leadership What s most important is to live and breathes with team members! Profile Technology Team Manager Im Sa-Jin is always smiling. Even in harsh situations, like meeting customers to handle claims, it never shows up on his face. Above all, he is famous as the Team Manager who always smiles and praises his team members. Sometimes I have tough customers and I do get tired. One day, my Team Manager sent me a letter, telling me what I did well and what my strengths were in detail. It was a letter to encourage me. I was grateful knowing that he is interested in his team members that much and that he really thought about what our strengths were. Thanks to his unexpected gesture, I think I completely forgot what I was having a difficult time for that day. (Nam Bo-Ra, Assistant Manager) The overall attitude towards customers and work at the Profile Technology Team took a positive turn thanks to its Action Management initiatives in the first quarter. The Team says they have been able to boost synergy among team members compared to before because of efforts to approach problems with products in a proactive way rather than following them up, and because of an environment where people encourage and compete positively. We support the Profile Technology Team, the Team that continues their battle to find all the answers in the field and in their customers, and hope they continue to achieve great results by working enthusiastically with one another. 10/10

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