Hyundai AutoEver has recently gained a reputation as the company that attracts the most 'external talent' in the IT service industry. This is largely due to the recruitment of many executives from Samsung Electronics, Amazon Web Services (AWS), and NAVER Cloud since CEO Kim Yoon-goo took office in March last year. Analysts suggest that Hyundai AutoEver's external recruitment efforts, which have deviated from its previously strong bloodline tradition, align with the Hyundai Motor Group's software-defined vehicle (SDV) strategy.
According to Hyundai AutoEver, since CEO Kim Yoon-goo's appointment, about 40% of the company's executives have been filled by external candidates. By last month, a total of 10 key talents had been brought in from outside.
Recently, Hyundai AutoEver recruited cloud expert Lee Kyung-soo, who has experience from Samsung Electronics and AWS, as the head of the cloud infrastructure center. In December of last year, it appointed Yang Seung-do, who worked for 27 years at AWS, Google Cloud, VMware, and Oracle, as the head of the cloud business division. This is seen as a move to strengthen its cloud business, which has emerged as the 'growth engine' of the IT service industry.
Earlier, Hyundai AutoEver established a Digital Experience (DX) Center in January of this year and appointed Kim Ji-hyun, who is from Samsung SDS, as the inaugural center director. In March of last year, it hired Ryu Seok-moon, former Chief Technology Officer (CTO) of SOCAR, as the head of the software development and quality institutional sector, and in April, it installed Kim Sun-woo, an Enterprise Resource Planning (ERP) expert from Samsung Electronics, as the ERP center director.
In July, the company appointed Choi Won-hyuk from NAVER Cloud and Ji Doo-hyun from SOCAR as the Chief Information Security Officer (CISO) and head of the software development center, respectively. In August, it recruited Park Sang-soo from A.T. Kearney as the head of the innovation strategy convergence division and Jang Yeon-se from POSCO DX as the head of the SDx center.
This is part of a project aimed at improving the company's structure and strengthening its competitiveness, which has been promoted since CEO Kim Yoon-goo's appointment. Kim noted, "I hope that bringing in leaders with abundant experience and expertise will serve as an important turning point to promote innovation in the company's core technology fields."
Industry analysts view the company's bold appointments across various fields including security, software, and cloud as related to Hyundai Motor Group's long-term software strategy. Hyundai Motor Group has announced plans to transition all vehicle models to software-defined vehicles (SDVs), and Hyundai AutoEver is expected to play a significant role in handling a large portion of the related software in this process.
Hyundai AutoEver, an IT service affiliate of Hyundai Motor Group, is engaged in businesses such as automotive software, navigation, and cloud services that can be applied to global automotive corporations, including Hyundai Motor. As of last year, the proportion of internal transactions accounted for 92%, indicating the company's heavy reliance on sales and operating profits from the Hyundai Motor Group affiliates. For Hyundai AutoEver, the high proportion of internal transactions is considered a 'double-edged sword,' as it serves both as a growth driver and a limitation.
As a solution to overcome these structural limitations, the company has opted to discover future growth drivers and enhance its technological capabilities through securing excellent human resources. It plans to manage the increasing volumes from the Hyundai Motor Group while simultaneously expanding its scope to include software, cloud, digital transformation (DX), security, robotics, and overseas business in order to reduce dependency on its affiliates.
Hyundai AutoEver's aggressive recruitment of external talent aligns with Hyundai Motor Group's shift away from a bloodline-based hiring philosophy towards a performance- and ability-based recruitment system. Kim, who is a former head of Hyundai Motor's human resources department, continues the 'breaking of the bloodline tradition' that has persisted since the appointment of Chairman Chung Eui-sun, according to industry insiders.
In addition to Hyundai AutoEver, the IT service industry has been successively recruiting external talent in line with the expansion of AI and cloud businesses. As the role of AI and cloud in corporate performance continues to grow, there has been an increasing need for related experts.
Samsung SDS appointed cloud expert Lee Ho-jun, a former Accenture executive, as head of its cloud business division in February, while LG CNS has brought in Min Se-hoon, an AI consulting expert from Bain & Company, as the head of its Entrou consulting division. SK C&C recruited a significant number of external experts last year, focusing on AI, cloud, and digital factory businesses.
However, it remains to be seen how much the 'recruitment of external talent' will actually contribute to growth. In the case of Hyundai AutoEver, while it achieved the highest quarterly revenue in the first quarter of this year, operating profit decreased, resulting in worsened profitability. Revenue for the first quarter increased by 13.9% year-on-year to 833 billion won, while operating profit fell by 15% to 26.7 billion won. Operating profit has returned to the level of the first quarter of 2022 (22.4 billion won).
Delays in revenue recognition related to automotive software and increased expenses due to the recruitment of external talent are cited as causes for the decline in profitability in the first quarter. A representative from Hyundai AutoEver stated, "The decrease in operating profit is a temporary phenomenon, and profitability is expected to recover in the second quarter."