• The Korean Journal of Air & Space Law and Policy
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• v.35 no.2
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• pp.247-280
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• 2020

For customs-free and liberalization on the trade of aircraft parts, the WTO Agreement on Trade in Civil Aircraft was separately concluded as plurilateral trade agreement at the time of launching WTO in 1995, and currently 33 countries including the United States and the EU are acceded but Korea does not. Major details of the Agreement on Trade in Civil Aircraft include product coverage, the elimination of customs duties and other charges, the prohibition of government-directed procurement of civil aircraft, the application of the Agreement on Subsides and Countervailing Measures, and the consultation on issues related to this Agreement and dispute resolution. Article 89 paragraph 6 of the current Customs Act was newly established on December 31, 2018, and the tariff reduction rate for imports of aircraft parts will be reduced in stages from May 2019 and the tariff reduction system will be abolished in 2026. Accordingly, looking at the impact of the Agreement on Trade in Civil Aircraft on the aviation industry, first, as for the impact on the air transport industry, an tariff allotment of the domestic air transport industry is expected to reach about 160 billion won a year from 2026, and upon acceding to the Agreement on Trade in Civil Aircraft, the domestic air transport industry will be able to import aircraft parts at no tariff, so it will not have to pay 3 to 8 percent import duties. Second, as for the impact on the aviation MRO industry, if the tariff reduction system for aircraft parts is phased out or abolished in stages, overseas outsourcing costs in the engine maintenance and parts maintenance are expected to increase, and upon acceding to the Agreement on Trade in Civil Aircraft, the aviation MRO industry will be able to import aircraft parts at no tariff, so it will reduce overseas outsourcing costs. If the author proposes a policy direction for the trade liberalization of aircraft parts to ensure competitiveness of the aviation industry, first, as for the tariff reduction by the use of FTA, in order to be favored with the tariff reduction by the use of FTA, it is necessary to secure the certificate of origin from foreign traders in the United States and the EU, and to revise the provisions of Korea-Singapore and Korea-EU FTA. Second, as for the push of acceding to the Agreement on Trade in Civil Aircraft, it would be resonable to push the acceding to Agreement on Trade in Civil Aircraft for customs-free on the trade of aircraft parts, as the tariff reduction method by the use of FTA has limits. Third, as for the improvement of the tariff reduction system for aircraft parts under the Customs Act, it is expected that there will take a considerable amount of time until the acceding to the Agreement on Trade in Civil Aircraft, so separate improvement measures are needed to continue the tariff reduction system of aircraft parts under Article 89 paragraph 6 of the Customs Act. In conclusion, Korea should accede to the WTO Agreement on Trade in Civil Aircraft to create an environment in which our aviation industry can compete fairly with foreign aviation industries and ensure competitiveness by achieving customs-free and liberalization on the trade of aircraft parts.

• Journal of Global Scholars of Marketing Science
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• v.17 no.2
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• pp.31-54
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• 2007

The exchange between buyers and sellers in the industrial market is changing from short-term to long-term relationships. Long-term relationships are governed mainly by formal contracts or informal agreements, but many scholars are now asserting that controlling relationship by using formal contracts under environmental dynamism is inappropriate. In this case, partners will depend on each other's flexibility or interdependence. The former, flexibility, provides a general frame of reference, order, and standards against which to guide and assess appropriate behavior in dynamic and ambiguous situations, thus motivating the value-oriented performance goals shared between partners. It is based on social sacrifices, which can potentially minimize any opportunistic behaviors. The later, interdependence, means that each firm possesses a high level of dependence in an dynamic channel relationship. When interdependence is high in magnitude and symmetric, each firm enjoys a high level of power and the bonds between the firms should be reasonably strong. Strong shared power is likely to promote commitment because of the common interests, attention, and support found in such channel relationships. This study deals with environmental dynamism in high-tech industry. Firms in the high-tech industry regard it as a key success factor to successfully cope with environmental changes. However, due to the lack of studies dealing with environmental dynamism and supply chain commitment in the high-tech industry, it is very difficult to find effective strategies to cope with them. This paper presents the results of an empirical study on the relationship between environmental dynamism and supply chain commitment in the high-tech industry. We examined the effects of consumer, competitor, and technological dynamism on supply chain commitment. Additionally, we examined the moderating effects of flexibility and dependence of supply chains. This study was confined to the type of high-tech industry which has the characteristics of rapid technology change and short product lifecycle. Flexibility among the firms of this industry, having the characteristic of hard and fast growth, is more important here than among any other industry. Thus, a variety of environmental dynamism can affect a supply chain relationship. The industries targeted industries were electronic parts, metal product, computer, electric machine, automobile, and medical precision manufacturing industries. Data was collected as follows. During the survey, the researchers managed to obtain the list of parts suppliers of 2 companies, N and L, with an international competitiveness in the mobile phone manufacturing industry; and of the suppliers in a business relationship with S company, a semiconductor manufacturing company. They were asked to respond to the survey via telephone and e-mail. During the two month period of February-April 2006, we were able to collect data from 44 companies. The respondents were restricted to direct dealing authorities and subcontractor company (the supplier) staff with at least three months of dealing experience with a manufacture (an industrial material buyer). The measurement validation procedures included scale reliability; discriminant and convergent validity were used to validate measures. Also, the reliability measurements traditionally employed, such as the Cronbach's alpha, were used. All the reliabilities were greater than.70. A series of exploratory factor analyses was conducted. We conducted confirmatory factor analyses to assess the validity of our measurements. A series of chi-square difference tests were conducted so that the discriminant validity could be ensured. For each pair, we estimated two models-an unconstrained model and a constrained model-and compared the two model fits. All these tests supported discriminant validity. Also, all items loaded significantly on their respective constructs, providing support for convergent validity. We then examined composite reliability and average variance extracted (AVE). The composite reliability of each construct was greater than.70. The AVE of each construct was greater than.50. According to the multiple regression analysis, customer dynamism had a negative effect and competitor dynamism had a positive effect on a supplier's commitment. In addition, flexibility and dependence had significant moderating effects on customer and competitor dynamism. On the other hand, all hypotheses about technological dynamism had no significant effects on commitment. In other words, technological dynamism had no direct effect on supplier's commitment and was not moderated by the flexibility and dependence of the supply chain. This study makes its contribution in the point of view that this is a rare study on environmental dynamism and supply chain commitment in the field of high-tech industry. Especially, this study verified the effects of three sectors of environmental dynamism on supplier's commitment. Also, it empirically tested how the effects were moderated by flexibility and dependence. The results showed that flexibility and interdependence had a role to strengthen supplier's commitment under environmental dynamism in high-tech industry. Thus relationship managers in high-tech industry should make supply chain relationship flexible and interdependent. The limitations of the study are as follows; First, about the research setting, the study was conducted with high-tech industry, in which the direction of the change in the power balance of supply chain dyads is usually determined by manufacturers. So we have a difficulty with generalization. We need to control the power structure between partners in a future study. Secondly, about flexibility, we treated it throughout the paper as positive, but it can also be negative, i.e. violating an agreement or moving, but in the wrong direction, etc. Therefore we need to investigate the multi-dimensionality of flexibility in future research.

• Asia-Pacific Journal of Business Venturing and Entrepreneurship
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• v.9 no.5
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• pp.83-94
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• 2014

Before economical crisis in 1997, domestic company focused on increasing the size of outward experience which including organization. The result of increasing outward experience without substance was economical crisis, so after that time, many companies have been changing their focus from insourcing to strengthen the core competence to secure global market. This is becoming a cause of following that companies are reducing their outward experience. Especially, to process tasks more effectively and to cope with rapid change of business environment, such as incoming raw material from overseas/high raising of salary/rising property prices, many companies decided outsourcing method. At most of hypothesis, the result was that outsourcing can affect positively to the business. First, introducing of outsourcing during focusing on core competence can be positive effect for company performance such as business management /productivity /procurement /administration /product competitiveness /technology. Second, the result that analyzed based on a point of view of population statics after outsourcing was positive effect at the most of research. Third, result of effectiveness for every outsourcing type classified by 4M was also can be positive at the most of research. Fourth, the characteristic of population statics can be positive effect at the most of category when select outsourcing companies. Research result of outsourcing was various based on the goal of outsourcing. It is revealed by investigation of domestic/overseas treatise that there are opposite two opinions. In this research, there is no consistent result that the outsourcing can give effects on business performance, but most of hypothesis indicates that outsourcing can give positive effect on the business performance.In this research, based on the outsourcing intensity, mutual relation was analyzed. The assumption of the reason of outsourcing is economical and organizational. First, sampling numbers of research was too small so it is too difficult to get significant business performance result. (Sampling : 150, Replied : 106, Rate of Reply : 71%) Second, tried to compare significant differences of outsourcing methods which were divided based on 4M, but the there is gaps between the number of Cell and too difficult to make replier understand. Third, it is tried to find the degrees of effect that the point of view of popular statics can effect on business performances and selection of outsourced companies.

• Journal of the Korea Academia-Industrial cooperation Society
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• v.17 no.6
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• pp.527-536
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• 2016

This study aims to generate baseline data for vitalizing the sales of functional cosmetics through an Importance-Performance Analysis (IPA) of the selection attributes of functional cosmetics. From the analysis of consumers' selection criteria, the study will assist functional cosmetics companies in reflecting consumer demands and therefore securing competitiveness. For this, general consumers aged over 20 years were surveyed for 5 weeks from Feb 23 through Mar 30, 2015, and 447 empirical data (response rate 88.9%) were processed through SPSS WIN 21.0 program for analysis. To conduct gender difference analysis on the IPA of the selection attributes of functional cosmetics, 17 selection attributes were categorized into 4 factors: functionality, labeling, popularity, and product. Cronbach's alpha for all factors was 0.5, proving the internal consistency and reliability of the survey. The survey results showed that while the entire average came out significantly higher for females (5.89/7points) than for males (5.66/7points) (p<0.001), the selection attributes 'anti-wrinkling', 'whitening function', 'functionality', 'expiration date', 'full ingredient labeling system' and 'various promotional events' showed significant gender differences. IPA results pertaining to gender showed 'price', 'functionality', 'spreadability' and 'full ingredient labeling system' as 2nd quadrant attributes, whereas female consumers selected 'price', 'whitening function', 'anti-wrinkling', 'functionality' and 'full ingredient labeling system' as attributes. Results show that businesses in the field of cosmetics and related areas need to prioritize improving the following factors that received low satisfaction from all consumers: 'price', 'functionality', and 'total labeling.' In particular, the 'price' aspects are considered to require reasonable and affordable pricing.

• Journal of Intelligence and Information Systems
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• v.21 no.4
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• pp.93-110
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• 2015

The recommender system is a system which recommends products to the customers who are likely to be interested in. Based on automated information filtering technology, various recommender systems have been developed. Collaborative filtering (CF), one of the most successful recommendation algorithms, has been applied in a number of different domains such as recommending Web pages, books, movies, music and products. But, it has been known that CF has a critical shortcoming. CF finds neighbors whose preferences are like those of the target customer and recommends products those customers have most liked. Thus, CF works properly only when there's a sufficient number of ratings on common product from customers. When there's a shortage of customer ratings, CF makes the formation of a neighborhood inaccurate, thereby resulting in poor recommendations. To improve the performance of CF based recommender systems, most of the related studies have been focused on the development of novel algorithms under the assumption of using a single profile, which is created from user's rating information for items, purchase transactions, or Web access logs. With the advent of big data, companies got to collect more data and to use a variety of information with big size. So, many companies recognize it very importantly to utilize big data because it makes companies to improve their competitiveness and to create new value. In particular, on the rise is the issue of utilizing personal big data in the recommender system. It is why personal big data facilitate more accurate identification of the preferences or behaviors of users. The proposed recommendation methodology is as follows: First, multimodal user profiles are created from personal big data in order to grasp the preferences and behavior of users from various viewpoints. We derive five user profiles based on the personal information such as rating, site preference, demographic, Internet usage, and topic in text. Next, the similarity between users is calculated based on the profiles and then neighbors of users are found from the results. One of three ensemble approaches is applied to calculate the similarity. Each ensemble approach uses the similarity of combined profile, the average similarity of each profile, and the weighted average similarity of each profile, respectively. Finally, the products that people among the neighborhood prefer most to are recommended to the target users. For the experiments, we used the demographic data and a very large volume of Web log transaction for 5,000 panel users of a company that is specialized to analyzing ranks of Web sites. R and SAS E-miner was used to implement the proposed recommender system and to conduct the topic analysis using the keyword search, respectively. To evaluate the recommendation performance, we used 60% of data for training and 40% of data for test. The 5-fold cross validation was also conducted to enhance the reliability of our experiments. A widely used combination metric called F1 metric that gives equal weight to both recall and precision was employed for our evaluation. As the results of evaluation, the proposed methodology achieved the significant improvement over the single profile based CF algorithm. In particular, the ensemble approach using weighted average similarity shows the highest performance. That is, the rate of improvement in F1 is 16.9 percent for the ensemble approach using weighted average similarity and 8.1 percent for the ensemble approach using average similarity of each profile. From these results, we conclude that the multimodal profile ensemble approach is a viable solution to the problems encountered when there's a shortage of customer ratings. This study has significance in suggesting what kind of information could we use to create profile in the environment of big data and how could we combine and utilize them effectively. However, our methodology should be further studied to consider for its real-world application. We need to compare the differences in recommendation accuracy by applying the proposed method to different recommendation algorithms and then to identify which combination of them would show the best performance.

• The Journal of Industrial Distribution & Business
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• v.1 no.1
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• pp.5-12
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• 2010

The retail business of drugstore was introduced to Korea for the first time 10 years ago. Since Olive Young introduced a retail store in the name of drugstore in 1999 for the first time in Korea, new distribution channel combining drugstore, cosmetic products and dairy products, etc has been made. At initial stage, the new distribution channel grew up slowly because of low specialty and economic stagnation. However, the three big distribution channels, that is to say, Olive Young (CJ), Watsons (GS) and W Store (Kolon Well Care), etc, were established to produce new distribution system following large-scaled discount stores as well as convenience stores. The purpose of the study is to investigate ways making Korean style drugstore be new retail business in addition to traditional markets, department stores, E-Mart and other general super markets and to examine problems preventing the drugstore from being promoted and to find out solutions. The speciality retailers that is called a category killer attacking department stores as well as marts is expanding market quickly. New consumption trend that gives priority to wellbeing is being expanded in accordance with high level of standards of living life: The drugstore is thought to be new alternative of distribution because it keeps special products. Young ladies who are main customers of drugstores respond to the trend sensitively to have more buying power that is thought to be promising. And, consumers' desire has become concrete and special. This is because consumers want not only convenient shopping but also special shopping system that is current trend. These days, so called Multi-shop and Total shop and other special shops have been recently opened. Special multi-shop has been concentrated on fashion product and miscellaneous goods so far: Health total wellbeing shop shall be popular in accordance with wellbeing trends. Drugstores can play an important role. Drugstores were opened for the first time ten years ago. In particular, Olive Young succeeded in going into the black after making efforts for a long time by many persons. Drugstores could succeed in the business owing to many persons in the past as well as customers who liked drugstores. However, drugstores once lost ways and recorded poor business results. The three drugstores, that is to say, Olive Young, Watsons making efforts to go into the black and W-Store pursuing traditional drugstore shall compete each other and make effort to satisfy customers' desire. In that way, the three drugstores can be assured of present business as well as future business. The consumers' demand trend has become special at sub-division so that drugstores that can satisfy the demand can succeed in the business. Large businesses may be more interested in the 4th generation retail business to produce good income and to have bright future. Drugstore business and market are likely to expand and develop owing to large business' participation in drugstore business. Drugstores expanded shop at Seoul and Gyeonggi-do until middle of 2000. Drugstore business at station sphere in Seoul and Gyeonggi-do that have high ratio of temporary population has low customer loyalty to have limitation on continuous growth. Since 2009, drugstores have opened new shops at local towns: From the year of 2010, drugstores need to establish multiple shop strategy by accelerating business speed and to allow customers to drop in the shop anywhere in the nation and to enter consumers' life deeply, so that they can strengthen business base definitely. Drugstores need to have price competitiveness to have multiple shop opening strategy and to satisfy consumers and to supply high quality services that is future subject to solve. And, Olive Young and Watsons that are Korean style drugstore need to keep system in order and to strengthen substance as Korean style drugstore and to expand marketing, so that they can get business outcome within 5 years that was done 10 years before and they become the 4th generation retail business. The study had difficulties at collecting material from the three drugstore because of poor cooperation. And, the author had great difficulty at collecting statistical material that was made in disorder. Further effort is needed considering such problems.

• Proceedings of the Technology Innovation Conference
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• 1998.06a
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• pp.116-127
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• 1998

The Necessity of Cyber University. Within the rapidly changing environment of global economics, the environment of higher education in the universities, also, has been, encountering various changes. Popularization on higher education related to 1lifetime education system, putting emphasis on the productivity of education services and the acquisition of competitiveness through the market of open education, the breakdown of the ivory tower and the Multiversitization of universities, importance of obtaining information in the universities, and cooperation between domestic and oversea universities, industry and educational system must be acquired. Therefore, in order to adequately cope wi th these kinds of rapid changes in the education environment, operating Cyber University by utilizing various information technologies and its fixations such as Internet, E-mail, CD-ROMs, Interact ive Video Networks (Video Conferencing, Video on Demand), TV, Cable etc., which has no time or location limitation, is needed. Using informal ion and telecommunication technologies, especially the Internet is expected to Or ing about many changes in the social, economics and educational area. Among the many changes scholars have predicted, the development and fixations of Distant Learning or Cyber University was the most dominant factor. In the case of U. S. A., Cyber University has already been established and in under operation by the Federate Governments of 13 states. Any other universities (around 500 universities has been opened until1 now), with the help of the government and private citizens have been able to partly operate the Cyber University and is planning on enlarging step-by-step in the future. It could be seen not only as U. S. A. trying to elevate its higher education through their leading information technologies, but also could be seen as their objective in putting efforts on subordinating the culture of the education worldwide. UTRA University in U. S. A., for example, is already exporting its class lectures to China, and Indonesia regions. Influenced by the Cyber University current in the U.S., the Universities in Korea is willing .to arrange various forms of Cyber Universities. In line with this, at JUNAM National University, internet based Cyber University, which has set about its work on July of 1997, is in the state of operating about 100 Cyber Universities. Also, in the case of Hanam University, the Distant Learning classes are at its final stage of being established; this is a link in the rapid speed project of setting an example by the Korean Government. In addition, the department of education has selected 5 universities, including Seoul Cyber Design University for experimentation and is in the stage of strategic operation. Over 100 universities in Korea are speeding up its preparation for operating Cyber University. This form of Distant Learning goes beyond the walls of universities and is in the trend of being diffused in business areas or in various training programs of financial organizations and more. Here, in the hope that this material would some what be of help to other Universities which are preparing for Cyber University, I would 1ike to introduce some general concepts of the components forming Cyber University and Open Education System which has been established by JUNAM University. System of Cyber University could be seen as a general solution offered by tile computer technologies for the management on the students, Lectures On Demand, real hour based and satellite classes, media product ion lab for the production of the multimedia Contents, electronic library, the Groupware enabling exchange of information between students and professors. Arranging general concepts of components in the aspect of Cyber University and Open Education, it would be expressed in the form of the establishment of Cyber University and the service of Open Education as can be seen in the diagram below.

• Journal of the Korea Academia-Industrial cooperation Society
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• v.17 no.8
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• pp.236-250
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• 2016

This study was conducted to provide baseline data regarding functional cosmetics so that Inula. based cosmetics can increase its competitiveness in the market as well as to understand current trends to enable anticipation of demands for future product development. For this research, general consumers over the age of 20 residing in Seoul and the Gyeonggi district were surveyed. The results show consumers preferred serum-type products among various types of cosmetics, and that they purchased these once every 1-3 months. Consumers also preferred these products in less than 10-30ml capacity, and at costs of less than 30,000-50,000 KRW. For whitening, functional cosmetics consumers also preferred the serum type, in less than 30-50ml capacity and priced less than 30,000-50,000 KRW. Consumers preferred to purchase functional cosmetics in single units. The major purchasing location, with a high preference rate, was cosmetic stores, and the major sources of information, also with high preference rates, were 'experienced reviews from family, friends and acquaintances' and 'TV advertisements'. Respondents selected 'over 50,000 KRW' the most for all items when responding to 'Purchase Intent for Functional Cosmetics containing Inula', and responded that they were willing to pay 10%-30% more for functional cosmetics containing Inula compared to standard functional cosmetics. These results show that businesses in the cosmetics industry need to take consumer demand into account when developing new functional cosmetic products, as well as establish plans to create specialized spaces that provide better quality service and increase word of mouth effect through better utilization of various types of offline media, social media, and blogs. The study also shows a need for businesses to develop products fully utilizing the Inula flower, which has been shown to be effective as a natural skin whitener, wrinkle reducer and skin moisturizer, to appeal to the increasing number of customers interested in health and beauty.

• Journal of Fashion Business
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• v.9 no.6
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• pp.160-174
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• 2005

Despite the decrease in the number of children due to low birth rate, the domestic children's apparel market has been achieving steady growth as family income is rising thanks to more opportunities for working women, parents spend more on their children, and they prefer brand products that make their children look special. In addition, the market is suffering from hard competition as large enterprises have joined the race. The present study purposed to survey the children's apparel market in Korea, which is in a transitional period, and to contribute to the development of the market with Korean brands. For this purpose, we analyzed the characteristics of children's apparel brands in the 21st century based on the current state of the domestic children's apparel market and, based on the findings, forecasted the future trend of children's apparel brands, suggested improvements for expected problems, proposed standards for coping with changes such as diversification, high quality and differentiation in the children's apparel market, and provided consumers with information on how to purchase products. According to the result of analyzing the characteristics of children's apparel brands in the 21st century, brands are categorized largely into four types - life cultural brands, functional product brands, character brands and brands advancing to China. Life cultural brands equipped with all necessities for children are expanding, and with the deepening social problems of environmental pollution and the reduction of the child population, functional products made of environment-friendly materials are spreading widely, targeting infants and children. Furthermore, for extending age targets and diversifying products, children's apparel is using characters. The use of characters is expected to have a considerable effect on the growth of brands because children are more subjective as consumers than before and they are more easily persuaded with characters. Domestic children's apparel brands advancing to China have a high expectation of success in overcoming the limitation of the local market that has reached its peak and growing into global brands. Korean apparel makers are struggling to overcome the depressed domestic market, to recover consumers' consumption, to cope with market opening, to pursue high value of sensibility and to expand the seniors' market, etc. In this situation, future trends of children's apparel brands will be the expansion of family brands, brand totalization, quality price, niche market (pre-teen market), etc. In response to these trends, we made the following suggestions for improvement. 1. Children's apparel brands are evolving into family brands as well as into total brands through voluming. Today, however, apparel makers are advancing to the children's apparel market with the concept of adults' apparel and, as a result, children's apparel is merely adults' apparel of reduced size, having problems in design, color and materials. Thus, apparel makers must develop design considering the wide range of size and the characteristics of children's apparel, strengthen sourcing abilities to create revenues, and make thorough survey of customers to find common denominators between adults' apparel and children's apparel considering that characteristic that the target class is different from the buyer class. Furthermore, they must make active investments in human resources, develop outstanding products through advanced planning and design, and support marketing techniques and management systems to stores. 2. As the declining birth rate will continue to have a negative effect on the market, it may be difficult to expand the market size but there is still a margin for growth through high-sensibility and high-quality products. The competitiveness of brands is determined by their market shares. Accordingly, concepts should be specialized according to lifestyle, customers' diverse needs should be satisfied, and cross-coordination should be achieved within a brand. 3. Considering Korean parents who do not spare investment in their children despite shrinking consumption, functional products must be high value-added goods that can enhance efficiency. However, in the current situation of the infants' apparel industry where a textile manufacturer supply its products to multiple brands, it is difficult to develop unique products only based on materials. Thus, it is considered urgent to appeal to consumers not by relying on materials only but by finding methods of applying their own characters to children's dress.

• Journal of Distribution Science
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• v.9 no.3
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• pp.83-94
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• 2011

Most domestic companies, with the exclusion of major firms, are reluctant to implement a supply chain management (SCM) network into their operations. Most small- and medium-sized enterprises are not even aware of SCM. Due to the inherent total-systems efficiency of SCM, it coordinates domestic manufacturers, subcontractors, distributors, and physical distributors and cuts down on cost of inventory control, as well as demand management. Furthermore, a lack of SCM causes a decrease in competitiveness for domestic companies. The reason lies in the fundamentality of SCM, which is the characteristic of information sharing, process innovation throughout SCM, and the vast range of problems the SCM management tool is able to address. This study suggests the contemplation and reformation of the current SCM situation by analyzing the SCM strategic plan, discourses and logical discussions on the topic, and a successful case for adapting SCM; hence, the study plans to productively "process" SCM. First, it is necessary to contemplate the theoretical background of SCM before discussing how to successfully process SCM. I will describe the concept and background of SCM in Chapter 2, with a definition of SCM, types of SCM promotional activities, fields of SCM, necessity of applying SCM, and the effects of SCM. All of the defects in currently processing SCM will be introduced in Chapter 3. Discussion items include the following: the Bullwhip Effect; the breakdown in supply chain and sales networks due to e-business; the issue that even though the key to a successful SCM is cooperation between the production and distribution company, during the process of SCM, the companies, many times, put their profits first, resulting in a possible defect in demands estimation. Furthermore, the problems of processing SCM in a domestic distribution-production company concern Information Technology; for example, the new system introduced to the company is not compatible with the pre-existing document architecture. Second, for effective management, distribution and production companies should cooperate and enhance their partnership in the aspect of the corporation; however, in reality, this seldom occurs. Third, in the aspect of the work process, introducing SCM could provoke corporations during the integration of the distribution-production process. Fourth, to increase the achievement of the SCM strategy process, they need to set up a cross-functional team; however, many times, business partners lack the cooperation and business-information sharing tools necessary to effect the transition to SCM. Chapter 4 will address an SCM strategic plan and a case study of LG Electronics. The purpose of the strategic plan, strategic plans for types of business, adopting SCM in a distribution company, and the global supply chain process of LG Electronics will be introduced. The conclusion of the study is located in Chapter 5, which addresses the issue of the fierce competition that companies currently face in the global market environment and their increased investment in SCM, in order to better cope with short product life cycle and high customer expectations. The SCM management system has evolved through the adaptation of improved information, communication, and transportation technologies; now, it demands the utilization of various strategic resources. The introduction of SCM provides benefits to the management of a network of interconnected businesses by securing customer loyalty with cost and time savings, derived through the consolidation of many distribution systems; additionally, SCM helps enterprises form a wide range of marketing strategies. Thus, we could conclude that not only the distributors but all types of businesses should adopt the systems approach to supply chain strategies. SCM deals with the basic stream of distribution and increases the value of a company by replacing physical distribution with information. By the company obtaining and sharing ready information, it is able to create customer satisfaction at the end point of delivery to the consumer.