Tag Archive for Korea consulting franchise

Everything Korea, June 29 Episode: the Gap in Norms

Outside my day-to-day support of Korean facing business and clients, I am drawn to ponder on issues and drill deep. I other words research, investigation and then providing commentary on the direction of Korean business from trends inside Korea to Korea-facing international operations.

 

An example of this process, several years ago I coined the term K-lobalization (Globalization with a K for Korea) as I saw the trend when Korean firms boldly promote their own unique management style and corporate culture internationally and across many markets. A recent manifestation is organization-wide, corporate-directed mandates…. from core value, vision, and management training directives to most recently how they should brand or even target specific consumers in local markets. Usually these programs are expected to be unchallenged and accepted without question by overseas teams—at times not in the best interest of the local operation.

 

This said, a new topic, which has my interest, was touched upon in May 11 edition of Everything Korea… there I argue a key challenge in Korean success with startups and innovation was “culture.”  I would like to expand this perspective more broadly to be the “culture” needed to foster the Creative Process in general. In fact, this is the first of three commentaries on the topic.

 

Let me explain. What has evolved in America regarding startups, tech, and innovation is they tend to hub in cities with diversity and strong counter-cultures like Boulder, Colorado, San Francisco, Austin, TX, and NYC, although more and more scenes are emerging in Nashville, TN or here in Golden, CO…

Screen Shot 2015-06-29 at 10.25.40 AM

 

Nuff said…Edgy Austin and Jack Kerouac

Within these communities I have witnessed an amazing synergy not only in day-to-day interactions and dialogue, but also in resources. Actually spending an hour and listening to the chats and even pitches for Angel Funding in edgy Caffe Centro on a South Park Street in San Francisco (the couple of blocks once referred as the Tech Ground Zero and where concepts like Twitter were launched and well as scores of tech companies and startups now call home) one quickly sees why locating in one of these scenes is key. In fact, showing how widespread, I frequently hear similar coffee shop launch pitches in Golden, Colorado.

Let me explain more in detail.

As academic Richard Florida points out in The Rise of the Creative Class, creatives as a group reflects a “powerful and significant shift in values, norms, and attitudes.” He clusters this attitude to be:

1) Individualism

2) Meritocracy

3) Diversity and Openness (which can translate to gender, sexual preference, race and my favorite “personal idiosyncrasies”.)

Of course those familiar with the Korean workplace and by this I don’t mean only the larger organizations but even most progressive firms, recognize there is a huge disparity from these “creative” norms.

For example, in contrast to the individualism within the creative class, in Korea we find deeply rooted collectivism where the group is the primary unit of reality and the ultimate standard of value.

In collectivistic societies, group goals take precedent over an individual’s objectives. This view does not deny the reality of the individual, but, ultimately, collectivism holds that one’s identity is determined by the group(s) with which one is affiliated.

Collectivistic cultures also require that individuals fit into the group—and “conform.”

Noting this, outside values, norms and attitude, perhaps the gap between US and Korea that also occurs is in “risk mindset.” Today the American entrepreneurs, angel investors and VC who launched Facebook, Twitter, Instagram, Linkedin, Square and now Super continue to look for, invest and provide mentorship and guidance to what they hope will be the next success story…. In most cases they are investing resources in multiple ventures….

This said they know and accept that failure is part of the process…. As Biz Stone (co-founder of Twitter, and an early investor in Square, Medium…and a bunch more) said at SXSW on his most recent work… “the failure of one venture, Jelly, led to success at a venture, Super.me ”

So getting back to Korea the real challenge is not in lack of ideas or topnotch talent, but in allowing and fostering a culture of Diversity and Openness, an acceptance of failure, and tolerating and even embracing non-conformity.

The good news…. I would not give up on Korea and a creative culture. More of my thoughts on this in the next episode of Everything Korea. I even will propose a roadmap for grooming creatives in Korea.

So until next time…

Links

The Rise of the Creative Class

http://www.amazon.com/Rise-Creative-Class-Revisited-Anniversary-Revised/dp/0465029930/

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The Beat Museum http://www.kerouac.com

Biz Stone’s Super.me https://super.me

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Questions and Comments?   questions@koreabcw.com

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Everything Korea, June 22 Episode— a Singular Message

I was recently interviewed by Fortune.com—I often contribute to the media. They were looking into the success of Korean car brands Kia Motors and Hyundai Motor in the wake of the latest J.D. Power’s Initial Quality Survey (IQS). To the surprise of many, Kia ranked #2 just below premium brand Porsche and Hyundai ranked 5th, both well above longtime and formerly top ranking Japanese brands.

With much of my work over the past decade supporting Korean global business, especially Hyundai and Kia, and more so, the Korean carmaker has long been a topic of my research, study, writings and media commentary…. My answer on why the Korean brands have achieved such success is simple. Quality has been an almost singular career message by the carmaker’s chairman, Chung Mong Koo.

To share some insights…. I quote from my book Hyundai Way: Hyundai Speed.

By 1999, Chung Mong Koo had assumed control of HMC in addition to his leadership role at Hyundai Precision [today known as Hyundai MOBIS]. Adding to his responsibilities, HMC had also acquired Kia Motors—an early casualty of the Asian financial crisis that ripped across the Korean economy. Having experience in the Hyundai Motor’s after-sale service early in his career, Chung Mong Koo was not without insights into the car division.

Since its founding in the mid 1970s, HMC had focused solely on growth. Indicative of Korea industry at that time, this focus was to produce as many cars as possible—as fast as possible. In turn, product quality and customer satisfaction suffered. From his experience working with consumers at Hyundai Motor’s After Sales division, Chung Mong Koo knew the damage shoddy products could bring to the Hyundai reputation, not to mention the high cost of warranty repairs.  

When Chung Mong Koo began sharing his intention to turn Hyundai Motor Company into a top-five automaker, few outside the company took him seriously.

Hyundai, like many family-controlled Korean companies, was hierarchical and at times slow to change if there was a perceived risk. More significant, managers rarely cooperated with one another and division chiefs ran their operations as personal fiefdoms. It was a company of silos. “When a problem occurred, each division would blame other divisions,” says Lee, Hyun Soon, former Hyundai-Kia Motors Vice Chairman and Chief Technology Officer.

Chung Mong Koo’s first step was to replace the former top management with engineers and those with whom he had worked closely at Hyundai Precision. He formulated a strategy to challenge Toyota for quality. Extensive work with a number of top global consulting firms (e.g. J.D. Powers) and benchmarking of the world’s best automotive companies followed. He also sent teams to America to study weather, road conditions and driver habits. Quality control staff increased tenfold to 1,000 and they reported directly to him.

 Employees were encouraged to offer suggestions and were rewarded. For example, one worker reported the Sonata and XG350 Grandeur sedans had differently designed spare tire covers. Sharing a common cover saved Hyundai about $100,000.00 per year.

Chung Mong Koo quickly earned a reputation for an obsession with quality. For example, several years ago a new Sonata launch in Korea was delayed for two months with 50 issues that senior management wanted addressed. Employees in the Asan factory worked feverishly to correct these items.  

One was a tiny error in the size of the gap between two pieces of sheet metal near the headlight. The problem was not visible to the human eye and was narrower than 0.1 millimeter. However, numerous managers and employees worked on the problem for 25 days before it was solved.

This obsession with quality continues today with the Chairman relentlessly reinforcing the quality mandate to management and teams globally as they strive for zero defects.

All said, for my work I drill deep. I look for and then share with clients the reasons behind Korea facing business, while over time mentoring, coaching and steering teams and C-level leadership to solutions.

If these unique resources can benefit you and your company, I have blocked out some times I’m available to discuss options. Just go to http://www.meetme.so/southerton

 

For a Link to Hyundai Way: Hyundai Speed, in either Paperback or eBook.

http://www.amazon.com/Hyundai-Way-Donald-G-Southerton/dp/1495968723/

or a Complimentary PDF Copy

http://unbouncepages.com/hyundai-way/

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Everything Korea: Episode June 15, On-boarding

I truly enjoy sharing the nuances of Korean business culture—whether through my books, Vodcasts like this one, in media interview and articles, or coaching those new to the Korea facing workplace.

Long part of my core business has been On-boarding. In fact, this week I have a number of engagements scheduled in Southern California with some planned for San Francisco in the next future.

On-boarding or, organizational socialization is where new employees, from C-level staff to entry-level hires, acquire necessary knowledge, skills, and behaviors to be effective in their job. In most cases for my work this means those employed by Korean companies, but it also includes those partners that provide services to Korean global firms

A common false assumption taken by some is those new to the company or project “will get” the cultural nuances without considerable support. Nothing can be more mistaken.

I find the Struggles for non-Koreans can range from team members not dealing with matters feeling it may offend their Korea colleagues to being perplexed and frustrated why approval processes are so complex or why Finance appears to be the making final call in critical operational decisions. The later two situations covered extensively in my books Korea Facing and Korea Perspective. See link below.

All said, my role in On-boarding is to provide context and the reasons behind Korea facing business, while over time mentoring, coaching and steering teams and C-level leadership to solutions.

If coaching and mentoring is like something you and your company can benefit from, I have blocked out some times I’m available to discuss more. Just go to http://www.meetme.so/southerton

Until next time…

Link to Don’s books

http://www.amazon.com/gp/search?field-author=Donald+Southerton&index=books

 

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Everything Korea: Episode June 8—The Short Answer

I was on a conference call last week when asked how best to describe my work—and do I provide consulting for CEO and C-level management—her organization’s international development committee made up of a number of CEOs.

My short answer was that a client and long friend, then a CMO for a major company best described my practice to others as Everything Korea… I also like having been introduced as “ a high power consultant” or Don is “the guru, the guy CEOs want to have their voice heard with, “ the later shared on Seoul’s eFM tbs Koreascape.

Pondering over the weekend on the question from the conference call much of what I do is provide context and a strategy to decision-makers involved in Korean facing business projects that range into the hundreds of million of Dollars.

In particular, I provide counsel and solutions based on my years working with Korean business—a good part in the international expansion into new markets and the challenges that surface and as a client once asked “ where are the landmines he needs to be aware of and avoid.”

So this gets to why I post weekly Vodcasts, frequent media commentaries, case studies as well as books on Korea facing topics.   They all serve as channels to support and educate.

This said, in my consultancy each engagement needs to be approached on a case-by-case basis—no two situations identical.

If you feel you might benefit from my C-level insights, I’ve blocked out my availability to chat and discuss…. Just go to http://www.meetme.so/southerton

In closing:

A great book on the reshaping of the American economy and the New Order… check out Richard Florida’s The Rise of the Creative Class, Revised Edition.  I prefer the Hardcover.

And the music on Repeat Song listened to while drafting this week’s episode—Pink Floyd, “Wishing You Were Here” Re-mastered Available on iTunes.

Links:

Seoul eFM Koreascape http://www.tbs.seoul.kr/efm/koreaScape/

The Rise of the Creative Class

http://www.amazon.com/Rise-Creative-Class-Revisited-Anniversary-Revised/dp/0465029930/

Pink Floyd, “Wishing You Were Here”

https://itunes.apple.com/us/album/wish-you-were-here-remastered/id704223460

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A Global Approach: A Roadmap For Korea Management Teams

Feedback on my writings, including my most recent book Korea Perspective is  always welcome. My readers have considerable first-hand experience working for and interacting with Korea-based companies so their input is appreciated and highly valued.

Southerton Korea

The following is a paraphrase of comment from one reader.

After reading Korea Perspective, I can only agree with your very accurate analysis. Leadership within Korean companies is crucial, since very little action is left to lower level of management. For example, the Western reflective behavior, as you describe in your book, is not encouraged by the leadership. The focus is solutions and quick action.

The comment further notes:

I think a good topic and matter to be studied more is how Korean Companies can really expand and/or consolidate their overseas business without considering a change in their leadership. Unfortunately what I have experienced is if this leadership is ONLY Korean these big companies will face hard time in the future, of course against American companies but I would say also with Indians and nowadays Chinese.

A Roadmap for Korean Management

Mindful of these remarks, in this series of commentaries I depart from a previous focus that has shared insights to non-Korean global teams working for Korean companies.

Instead I provide a roadmap and best practices to their Korean management and overseas divisions. This includes new Korean brands eager to launch their products and services outside Korea. The series is also applicable to those established Korean brands already in overseas markets who could benefit from benchmarking “what works” and “what doesn’t.”

Frankly, too often I see the same missteps re-occurring. What is frustrating is to witness challenges one company endures in their market entry only to see the same (something or other but without repeating “challenges” repeated as another new Korean brand goes global.

So what are these common missteps and how can they be addressed? That is goal of this commentary.

Challenge #1 Dispatching a Korean team to spearhead local U.S. or overseas operations outside Korea.

When expanding into new oversees markets, all companies need to have their HQ operations represented in the local markets. The Korean model for overseas markets has evolved– improving some over the years. In the best cases, the major established brands have recognized and learned through trial and error that key local leadership and teams, especially sales and marketing, need to be non-Korean and industry veterans.

In addition to local teams, they may still assign expatriates, called ju jae won. In the larger overseas subsidiaries, these Korean expats are assigned to the major departments, including sales, marketing, HR, and product development, along with engineering, and design divisions. In many, if not most, cases these expats are not assigned manager roles but operate as a “shadow management” with considerable oversight of local operations.

For westerners unfamiliar with the Korean model, this “oversight” usually translates into the Korean expats requiring signing off on all decisions—trivial to substantial. This can be a huge challenge when newly assigned expats have little specific background in or knowledge of the host country’s operations and market. Cognitively, the Korean teams recognize localization is needed but, especially if under pressure to perform, may defer to their Korean company procedures and cultural norms. In other cases, Korean firms have also initially resisted local management guidance and followed what they felt would be the best approach. Sadly, the Korean-led teams perform poorly and eventually yield to the local teams.

That said, it seems to be common practice that new Korean brands with little overseas experience follow a path that rarely is successful–feeling their best approach is to dispatch HQ personal to the new market and let them figure it out. In many cases those assigned are among the top employees in the Korean HQ operation—knowing their company and its product well. However, to succeed in the West an entirely different set of skills is required. Foremost is a strong knowledge of the industry—one acquired over decades.

All said, the most effective model is to hire a strong local, non-Korean management team but not constrain them with a Korean “shadow” management team that must approve or sign off on all the local decisions. This includes the Finance team assigned to the local operations but always independent of operations and reporting to their own teams in Korea.

Why? To be truly effective, local teams must be empowered to act based on their experience and judgment. Layers of approval may be commonplace in Korea but slow down the process in overseas markets, especially when the Korean support teams have little or no experience in that market or try to operate the business as they would in Korea. Inevitably, the work stalls, frustrating and demoralizing the local teams.

In part 2 of Challenge #1, we will discuss an option in lieu of dispatching a team from Korea. Should the hiring of local Korean Americans with the assumption they will be able best represent the brand in America be considered as an option?

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Korean Business Expert Don Southerton Releases Ground Breaking Book

Korea Perspective offers a road map to avoid common pitfalls while overcoming challenges, addressing issues that frequently surface with Korea.

PR

http://www.prweb.com/releases/2015/01/prweb12479689.htm

Golden, Colorado (PRWEB) February 02, 2015
Korean global business consultant Don Southerton has released his latest publication, titled Korea Perspective. Southerton notes, ” As a result of my interacting with Korea facing business on an almost daily basis, Western overseas teams, as well Korean leadership and teams, have openly shared their challenges and pressing concerns. In turn, I have worked to provide them with a framework, strategy, and solutions. This book is based on these daily interactions.”

The intended audiences, the author points out, are Westerners employed by Korean-based companies outside South Korea, firms providing services or products to a South Korean overseas subsidiary or operations and global companies that have significant business with a Korean company.

Southerton adds, “All in all, this book offers a road map to avoid the pitfalls, navigate around the roadblocks, and thrive.”

Korea Perspective is available through Amazon Kindle, Nook and most popular booksellers.

About the author
Don Southerton has a life-long interest in Korea and the rich culture of the country. He has authored numerous publications with topics centering on culture, new urbanism, entrepreneurialism, and early U.S.-Korean business ventures. Southerton also lectures extensively and writes and comments on modern Korean business culture and its impact on global organizations.

He is a frequent contributor to the media (WSJ, Forbes, CNN Fortune, Bloomberg, Automotive News, Korea Times, Korea Herald, Yonhap, Korea Magazine, and FSR) on Korea facing business and culture. He heads Bridging Culture Worldwide, a Golden, Colorado based company that provides strategy, consulting and training to Korea-based global business. An avid martial artist, Southerton has pursued the study and practice of Korean traditional arts for more than forty years.
The author is available for media interviews.

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Golfsmith Korea Virtual Tour

Very cool. Golfsmith Korea virtual tour, Lotte Premium Outlet Paju. A BCW project.

 

 

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Korean CEO Tenure

By Don Southerton, Editor

I often share that non-family Korea CEO tenure being considerably less than their overseas operations.

By comparison internationally the non-Korean CEOs tend to stay in the job lots longer … and a more performance based model.

Of course, the organizational dynamics in Korea with everyone in the ranks ever-moving upward forces those at the top out to make room for the next generation.

This excerpt notes CEO tenure at many of the top Korean Groups.

SEOUL, July 30 (Yonhap) — The average term in office of South Korean CEOs is 2.63 years, shorter than the minimum three years endorsed by the country’s commercial law, a finding by a local corporate research firm showed Wednesday.

The report was compiled by tracking the tenures of 576 CEOs at listed companies belonging to the country’s 30 largest conglomerates from 2000 onwards, CEO Score said. The results exclude chief executives who actually run the conglomerate or are family members of these tycoons.

The data showed that 367, or 63.7 percent of the total, stepped down in less than three years, with 102, or 17.7 percent, staying on for less than a year.

CEOs at Hyosung Group had the shortest term, 17 of them staying on the job for an average of 1.7 years during the measured period.

Mirae Asset and CJ had 1.79 and 1.97 years, each.

Others such as Kolon, Hyundai, KT, GS, POSCO, Doosan, Kumho Asiana and Dongbu had CEOs staying for less than 2.6 years on average

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It’s That Time of the Year, Again: Christmas in Korea

By Don Southerton, BCW Editor

Korea Christmas Greeting

 

 

With the year end, Korean Groups are finalizing annual end of year reporting, restructuring, promotions, and new assignments.

Some Korean team members already have begun to share news of the re-assignments, others will find out in the coming days.

Meanwhile expect some change both at senior leadership and across the teams. Those receiving promotions should be congratulated–promotions bring considerable status along with a boost in wages.

On a more personal level…
As the holidays approach, you may wish to greet Korean colleagues with:

Sae hae bok man i ba deu say yo! (Seasons Greetings)

Hint: Break the greeting into: sae hae bok—mahne—bah deu say yo

Sae hae bok man i ba deu say yo! works well both in person, in a card, or an email. It is a common seasonal greeting actually good into the New Year.

If you have a specific questions, feel free to contact dsoutherton@bridgingculture.com

1-310-866-3777

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A New Case Study: Korean Brand Market Entry

By Don Southerton, BCW  Editor

We provide both strategy and support for bringing brands to Korea, and Korean brands to the US and the international market. This Case Study shares a snapshot of some of our recent work in progress.

For more details, please just email us or schedule a time for a call Dsoutherton@bridgingculture.com

 

Don Southerton Korea Market Entry Mad For Garlic

 

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