Part 2 in a 2-part series about SK Hynix and its philosophy that the cloud is the way to make future generations happy and productive at work – to support a sustainable business. (Read Part 1.) For more customer perspectives, read the “Digital CIO” series.
As the CIO of SK Hynix, a leading semiconductor company based in Korea, Mr. Chang-rock Song is head of an organization that provides applications and services to help companies, members, and partners do a good job. To define the new approach, which entails a focus on employee satisfaction, he listened to the voices of members of the business, as well as internal members of the IT organization.
The reason for the IT team’s existence is to create systems for better user experience, he explained; yet business users asked them to stop. Why? The CIO organization looked at related systems and found that many had been introduced for leaders rather than ordinary people. As the CIO organization struggled to accommodate the needs of the business, users were unhappy, and members of CIO Song’s organization were upset. He had to address this issue.
SK Hynix had survived only by virtue of passion until it joined SK Group in 2012, he explained. It began making a little money in 2013 and grew rapidly in the second half of 2016 with the cloud market boom. “We’ve created a lot of systems and developed a lot of features for those systems, as well,” he noted. “As the number of systems increased, all systems had to be analyzed in order to develop what the business users required. Some 30% of the people who developed them had left the company, and we didn’t really know why they developed them in the first place. Development work takes a long time to be operational, and it might take nine months to repair something even if business users need it only for three months.”
This situation is fatal in the semiconductor business. The customers’ chipset lifetime was getting shorter, and IT needed to support new-product development; if not, the responsibility naturally returns to CIO Song. “We started working directly with our IT colleagues to come up with solutions and created three important frameworks,” he continued.
Creating a single data repository
“The first is the data rake. To get accurate data, we smashed the structure that went into all the systems and created one large repository: a data rake. In order to rapidly develop future apps on this basis, we established a Platform-as-a-Service (PaaS) that provides all container-based microservices. It was necessary to provide it within three months, as required by business users,” he said.
The semiconductor industry is heavily automated. Data is poured from this automated equipment while IT systems are scattered. In this environment, collecting and processing data must be done carefully to make it useful for user insights.
Thus, rather than providing graphics processing to individual users’ desktops, it was advantageous to focus on the relevant infrastructure in one place. In addition, due to the nature of the semiconductor industry, it is almost impossible to prevent internal data from going outside of organizational boundaries. That’s why SK Hynix had to build a private cloud environment.
Introducing intelligent technologies
CIO Song explained, “Big Data analytics (artificial intelligence, machine learning, deep learning) and PaaS will be connected this year, and all events are thoroughly managed 24 hours a day. You can work anywhere, anytime, by implementing a mobile environment. Various artificial intelligence tools will be introduced and managed to reduce manual effort. Together, these will support our transformation into an intelligent enterprise.”
SK Hynix currently has 29,000 members. “We’re trying to make them all Big Data analytics engineers and encourage them all to build their own microservice apps. It is up to the CIO organization to implement an environment in which you can build and use what you need. CIOs are investing in changing the environment altogether because they can’t create all the apps that members need.”
That is why SAP S/4HANA, based on an in-memory database, is so critical to SK Hynix. A semiconductor plant is an environment with no downtime. System implementation and migration have to be carried out without disruption. The infrastructure is 54 times faster with SAP S/4HANA than before, he remarked, adding that a growing number of subsidiaries are now using the SAP cloud in a public infrastructure. “You can orchestrate private and public clouds,” he explained. “Real-time processing is natural.”
SK Hynix also implemented dashboards for executives using SAP Digital Boardroom. A simple combination of API methods makes it possible to implement the features they need.
Building sustainable systems
“SK Hynix started asking questions about how to achieve the goal of not just running and keeping our business alive, but about how to build a system to support a long-lasting and successful company,” he said. “When one member can handle advanced machine learning and deep learning, it’s the cloud that will be the tipping point that can rapidly change the entire organization.”
He added, “This is a game where the first person wins unconditionally. Cloud is a happiness tool for future members, customers, and potential members, as well as current employees. I think that the one last thing our generation needs to prepare for is to consider adopting a happiness tool for people in the future.”
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