LG Smart Audit: An Amazon Innovation Transforming Global Factory Challenges

From 10-day manual audits to 3-day AI-powered assessments—and the birth of an spin off that turned into an accelerated startup

When LG Electronics sought to boost visibility across its massive global manufacturing footprint, the global tech company turned to CESAR Innovation Hub in Porto Digital, Brazil to solve its challenge. 

The South Korean giant’s factory audits were consuming about 10 days per site, drowning managers in manual processes while leaving critical compliance gaps that could derail operations across the tech giant’s $63 billion global empire.

The solution emerged from a partnership between LG’s Manaus Industrial Complex in the Amazon, supported by R&D resources from Brazil’s Lei de Informática (Suframa), as part of LG Electronics Brazil’s digital transformation strategy to pioneer new innovations and digital products in the Manaus Free Trade Zone. What began as a local challenge has evolved into a scalable platform that is reshaping industrial audits—from Indonesia to Tennessee.

A Multi-Billion Manufacturing Audit Problem

For multinational manufacturers like LG, factory audits represent a massive operational bottleneck that directly impacts competitiveness. The challenges mirror those faced across the global manufacturing sector, where companies struggle with:

Scale and Complexity: LG’s network spans flagship “Lighthouse Factories” across countries including China, Egypt, India, Korea and Poland. Each of those sites require comprehensive auditing across quality, compliance, and operational metrics.

The Deception Factor: Industry research shows that factory managers routinely manipulate audit conditions—from staging clean factory floors to coaching workers on “correct” responses. Some operations even maintain separate “trophy factories” for inspections while real production occurs in shadow facilities.

Regulatory Maze: With operations spanning from Europe’s stringent environmental standards to varying tax codes across Asia-Pacific, factory site audit teams must navigate an increasingly complex web of local regulations while maintaining global consistency.

Resource Drain: Traditional audits are notoriously resource-intensive. 

LG’s pre-solution process exemplified industry-wide inefficiencies:

• Manual report generation prone to human error and inconsistencies
• Fragmented data scattered across spreadsheets and email chains
• Zero real-time visibility for management decision-making
• 10-day audit cycles that disrupted production schedules

Engineering a Solution from the Amazon to Asia

The CESAR and LGE innovation team’s approach went beyond simple digitization. 

Working directly within LG’s Manaus operations—a critical hub serving Latin American markets—the team reimagined the entire audit ecosystem through a co-creation process that combined strategic vision, software engineering and user-centered design.

ThePlatform’s Core Innovations:

Scalable Digital Architecture: A unified system that consolidates all audit stages with real-time access and centralized data management – essential for LG’s global coordination needs.

Applied Artificial Intelligence:

• Automatic generation of technical reports to ensure clarity and standardize across all sites
• Real-time translation of auditor comments into multiple languages to solve communication barriers across LG’s international teams
• Intelligent action plan generation, including specific guidance for post-audit improvements

Enhanced Auditor Experience: Dynamic forms with intuitive interfaces and integrated evidence capture. The platform enables auditees to submit contextual evidence a week before audits, dramatically improving transparency and preparedness.

Agile Development Framework: Multidisciplinary teams from CESAR and LGE’s Innovation Center (DX Center)—including designers, full-stack developers, QAs, and senior data scientists—worked in continuous collaboration with LG stakeholders, ensuring rapid adjustments and technical robustness.

“”When I took over our joint innovation project with LG, our goal was to deliver tangible value and deepen mutual trust. The Smart Audit FI-11 project quickly gained prominence, receiving internal awards and becoming one of the most recognized solutions among managers. This transformed our relationship with LG into over three years of continuous collaboration focused on innovation.” — Augusto Menezes, CESAR Project Manager

Meaningful Results That Crossed Continents

The digital transformation is a work in progress that has focused on cultural change across the globe. . 

Audit completion times dropped from 10 days to just three, freeing auditors for strategic analysis rather than administrative tasks. Reports and action plans now generate automatically, dramatically reducing human error while providing management with real-time operational indicators.

The impact was so significant that the solution received LG’s BP Gold – Best Practice award, a HQ recognition for initiatives with global replication potential. The solution rapidly expanded from its Manaus origins to LG subsidiaries worldwide, including implementation across Indonesian operations.

“It was an above-average experience compared to other partners, especially regarding deadlines and documentation. The project team included senior-level professionals, meaning we had even greater development capacity. The main positive aspect was communication—we had daily contact with project management and the development team, and everything could be adjusted and aligned within a short timeframe.” — João Nunes, Project Owner at DX Department Smart Center

From Client Solution to Market Venture

The success of the platform catalyzed something unprecedented: the transformation of a client solution into a standalone business. The project evolved into a spin off, marking a significant milestone as the first startup accelerated by CESAR Ventures in Northern Brazil.

This development reflects broader trends reshaping Brazil’s innovation landscape: 

As capital becomes increasingly scarce, Brazilian startups are finding strategic partnerships with established corporations more attractive than traditional VC funding. For example, Itaú Unibanco recently launched a $500 million corporate venture capital fund, while companies across sectors seek to drive innovation through direct startup collaboration.

The platform was founded with the mission of extending the platform beyond LG to serve industries across multiple sectors. Its intelligent audit solutions have broad applicability across industries — from manufacturing to logistics and beyond. For CESAR, it represents the materialization of its core mission: transforming technology into real market impact while strengthening industrial competitiveness both domestically and internationally.

The Future of Industrial Intelligence

As manufacturers worldwide grapple with increasingly complex global operations, the LG | CESAR R&D partnership demonstrates how strategic collaboration between multinational corporations and regional innovation hubs can generate solutions with significant global impact.

The success of the collaboration extends beyond operational efficiency. It showcases how Latin America’s most mature innovation ecosystem can serve as a launchpad for technologies that compete on the world stage—from the Amazon rainforest to Indonesian factory floors.

For LG, this case represents a significant leap in their digital transformation journey. For the broader manufacturing sector, it offers a blueprint for how AI-powered solutions can transform critical but traditionally analog processes into competitive advantages.

Ready to transform your industrial operations? 

CESAR’s proven track record in converting complex challenges into scalable solutions positions them as the ideal partner for manufacturers seeking Industry 4.0 transformation.

Connect with CESAR’s experts to discover how your critical processes can be transformed into competitive advantages.