Consequences in Korean Business

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In my last commentary, I noted the huge challenges surfacing because of the current disruptive Korean business climate.

In particular, I shared the “why” behind Korean expatriates intervening in the local decision process. In some cases, these decisions are one-sided, lack collaborative and mutual engagement and have consequences.

In turn, western team see themselves consulted only to validate preconceived ideas or to implement directives from Korea.

Drilling Deeper

This has lead to local management seeing their input and expertise being marginalized– more so with complex situations and long-term planning “drilling deeper” may uncover ramifications.

More specifically, Korean teams under pressure are driven to take immediate action this can result in little joint discourse related to potential trade-offs and risks in projects assigned to the local subsidiary.

Particularly with a narrow and reactive workplace approach, one can draw an analogy to jigsaw puzzle building.

The pieces to a puzzle have many unique sides. There may be different ways to place them into the puzzle. What is required is to look diligently at all possible options.

Like all challenges, one needs to explore the different possibilities to find the right solution and how the piece fits into the overall puzzle—essentially one needs a reflective mindset.

As a Korean colleague once pointed out, their society beginning with grade school does not promote reflective thinking and instead looks to promote a thought process that leads to more immediate results. In fact, Korean high school students spend more than 14 hours a day studying, memorizing and preparing for exams—a model that stifles creativity.

I also see a cross-cultural aspect with many Korean decisions the result of a team workplace’s collective thought process, and in contrast, reflective thinking stems from an individual’s core consciousness.

Bottom line reflective thinking requires taking acquiring knowledge and then calling upon one’s own experience, utilizing evaluative skills and admitting personal bias.

The result is a broader perspective and a better view of the bigger picture.

Without working through a robust analysis of a problem from multiple angles and considering potential repercussions a solid evaluation can never arise.

All this said, by allowing one to think outside the box through a reflective and conscious lens, the time invested in analysis will lead to effective solutions—required in times of high stress.

All noted, in my next commentary I will provide some workarounds to soften the Korean reactive inclination to jump into implementing and producing immediate results—something we find dominating the current Korean business climate.

www,Learnmore@koreabcw.com

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Korean Business “Intervention”?

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I was recently asked to address a Korean business concern by local management.

Before sharing, I would like to state I work closely with Koreans daily. Many serve as expatriates, many on overseas teams. Like all individuals, no two of us are alike –the same goes for Koreans…each with their own unique strengths, skills, experiences and personality.

All said, the challenge I was asked to address is the company’s Korean expatriate partners (commonly referred to as Executive Coordinators) were intervening in what should be broad local decisions.

Probing deeper, local management felt based on their long experience in the market and industry that these decisions were often short-sighted, reactive and not aligned with their well thought out strategy. Of greater concern were decisions were one-sided and not a collaboration.

In any case, local management felt their input and expertise was being marginalized.

Frankly, this intervention is very cyclic.

Most recently pressure to meet “Sales Targets” had grown, so too, do we see increased intervention by the Korean teams.

Add that Koreans expats who’s DNA are rooted in a collective society and mindset where they feel not only the local stress, but also the Group’s broader pain (China and domestic sales down).

I find two drivers in the spike in recent intervention.

In recent years, overseas branches have had considerable success.

  1. In turn an expatriate working in an overseas branch could take credit for this success and they would see a boost their career when they returned to Korea… Many assigned, for example, to the U.S. and top markets in the EU and the Middle East move upward on to higher positions within the company.

Respectively, when sales are down … and they perceive that their careers will suffer if numbers are not met… it forces them to engage more and more…

  1. The second driver is Korea leadership pressuring their Korea teams to engage, come up with a plan, take immediate action and push themselves.

In some cases this has translated into serving less of a collaborating liaison with the Korean HQ and advisors—to now, the key decision maker.

Some background

Most Korean overseas subsidiaries have Korean management assigned to the host country.

The general term for these representative employees is ju jae won. Within the local overseas organizations, they may be called Coordinators, Executive Coordinators or Executive Advisors.

Some, expatriates also can hold a line managerial position with day-to-day responsibilities alongside western managers, while others hold key management C-level positions, such as CEO, COO, or CFO.

The Korean expat model has a rotation cycle in which teams and executives are assigned to overseas divisions for 3-5 years. They then return to Korea for reassignment with a replacement expected to take over—often with little preparation.

Strengths, skills and experience can vary, too.

For some, this is their first overseas assignment. This means it is also the first time newly assigned Korean expats may be required to directly participate in the decision making process.

In Korea, senior management makes decisions and their teams execute the plan.

Roles vary with each company, but most often, as I noted, a coordinator’s primary role is to act as a liaison between Korea and the local subsidiary.

So where is the challenge?

Ju jae won are skilled and accomplished in Korean style business operations, norms and practices.

However, they have now been assigned to an overseas subsidiary where norms, practices, expectations, and laws differ.

Moreover, their responsibilities and assignments in the subsidiary may be in a department or specialty, in which they had little or no experience in Korea.

Layer on stress and we often see reactions ranging hopeful second-guessing to risk-avoidance and holding back on any decisions.

More so recognize that expatriates are cognitive that local markets and management styles differ from Korea.

This said, under stress we see a reverting back to what working well in Korea.

This is often tackled with Korean colleagues as a team pondering over a challenge and developing a plan of action.

Where the disconnect may occurs in overseas operations is when they defer to their own or the Korean colleagues (locally and in Korea) in decisions over collaborating with local management.

Workarounds   I do have them…

That said, and not trying hold back or avoid sharing but some details are best known as every situation needs to approached differently…

I’d be happy to discuss and share my suggestion for a workaround…

Stacey stacey@koreabcw.com, my assistant can schedule us a time to meet or chat by phone.

For all urgent matters, text me at 310-866-3777

For more information on my work…. www.learnmore@Koreabcw.com

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Korean Global Dining Leader Looks to the Americas

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This week, I’d like to share three popular South Korean chef-inspired restaurant concepts that are moved into the second phase of international expansion. Successful launched in South Korea and Asia, Seoul-based SUN AT FOODS now plans to bring their handcrafted artisanal cuisines to the U.S and the Americas.

One of my longtime personal favorites, which I have talked about often, is Mad for Garlic that first opened in 2001. They are known for their garlic-specialized Italian cuisine served in rather unique restaurant settings.

I feel their secrets are Mad for Garlic’s method of removing the garlic’s pungent smell and unique way of cooking Italian cuisine with a Korean twist. In Korea and Asia they have won the hearts of both garlic and non-garlic lovers.

Building on the success of Mad for Garlic are two new concepts Modern Nulung and Bistro Seoul.

Inspired by 1930s Shanghai Renaissance era, Modern Nulang is the combination words of ‘Modern’ and ‘Nulang’ –the latter meaning ‘woman’ in Chinese. They have reinterpreted the era’s ‘modern women’ in their dishes, which guests describe as ‘Sophisticated’ and ‘Romantic’ Chinese Cuisine. Best of all, folks love indulging in an exotic Shanghai dining and cultural experience captured so well in Modern Nulang.

A third concept is Bistro Seoul. Here they offer authentic Korean cuisine made with fresh ingredients and seasoning prepared in a traditional but modern interpretation. Savory dishes include Grilled Short Rib Patties, and their ever popular Korean style pancakes that include Kimchi & Seafood pancakes, Crispy Potato pancakes and Minced Shrimp & Seafood pancakes.

SUN AT FOODS plans are now underway targeting top regional U.S markets as well as meeting with industry leaders and potential regional developers. In fact, I am their market development consultant and we’re eager to meet with potential partners to share the three concepts—each with their unigue appeal.

For more information on the brands, please contact Stacey my assistant at stacey@koreabcw.com, and she can schedule a time to meet or chat by phone.

For all urgent matters, text me at 310-866-3777

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Everything Korea, April 17 Episode Working with Koreans, Part 3

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I now turn to sharing some thoughts for local western teams working with Korean teams based in Korea.
With the shift to ever-increasing daily interactions with Korean HQs via web and phone conferences, western teams need even deeper practical insights into working within the Culture along with new skill sets.
In particular, the Executive Coordinator/ Advisor model has had its limitations…but the Koreans assigned as expatriates do learn local norms and adapt over time. This mean the Coordinators molded to local operations with a little need for many in the local teams to become skilled in Korea workplace norms.

In contrast, Korea-based teams follow deeply imbedded HQ and company norms. They are not likely to model or adapt to their overseas subsidiaries.
This now means strong skills in managing the relationship and understanding the Korean workplace “in’s and out’s” and “do’s and don’t” as well as effective communication take on a new heightened significance.

Over the past years, I’ve shared solutions in my books, articles and case studies…

That said, I find that each situation required my having to drill deeper to truly grasp and provide solid resolution…. Thus best to contact me and we can discuss…

Stacey, stacey@koreabcw.com, my assistant can schedule us a time to meet, or chat by phone. For urgent matters, Text me at 310-866-3777

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Everything Korea, April 10, Working with Korea 2017, Part 2

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In this Part 2 of my “Working with Korea 2017” series, I cover several scenarios with best practices for supporting overseas team.
All take finesse and collaboration, plus recognize norms and practices differ… as well as require working “within the Culture.” To again clarify, my perspective is based on years working with Korea and especially in daily mentoring and providing strategy for their overseas operations—Koreans and Westerners.

Scenario One
It’s common for a Korea expatriate, frequently called a Coordinator, to directly request members of the team to gather information or data on the local operation. Usually, Korea has asked for this information and the Coordinator is executing the request. These always have a sense of urgency.
The Challenge is the local departmental head may be circumvented (often unintentionally)…. and requests disrupt operations and designated priorities.  More so, the line of management for the department is blurred—i.e. staff confused on “who is in charge.”

The Workaround centers on an effective working relationship between the Coordinator and the department head.  An understanding must be reached that when requests from Korea (or from the senior Korean leadership at the subsidiary), it is first brought to the department head… and they handle who will execute.

In particular, the local western manager is more familiar with their team, individual workloads, any special situations and skill sets.  In fact, with a clear communication channel the work will be performed with better results by the individuals tasked with the assignment, and less stress on the Coordinator asked to acquire the data.

As a caveat, one burden on a department can be when a high percentage of work and tasks teams are engaged are to support Korea and not the local operations. Part 3 in the series will provide some thoughts on shifting workload dedicating to Korea requests to actually running the local operation.

Scenario Two
As noted, a Coordinator’s role is to support the local operation. Local teams and specialists are hired with a high degree of knowledge and experience. A clash occurs when decisions best left to those in the know are deflected.
The Challenge occurs when Coordinators override a decision or unilaterally make the call. This can range from the hiring of new employees to pushing off a much-needed program to the next year.

Again, the Workaround is a clear defined role for the Coordinator. They are advisors who can provide much-needed input and an HQ / mother company perspective… but not assume line manager responsibilities.

In other words, clarity must be established in regard to as long as they are acting on behalf of the mother company considerable weight must be given to their input. That said, even when they have the company’s best interest in mind, their own personal views must be gauged and moderated.

Scenario Three
Perhaps the most challenging situation is moving Coordinators to make a decision.
The Challenge- In most Korean companies leadership decide on direction and major issues. In turn, the working team’s role is to implement or gather needed information. This role/ skillset changes when working level Koreans are assigned as an overseas Coordinator.

The Workaround- When conducting a meeting where a decision must be made recognize that your Coordinator will have considerable say in the outcome. First, since the topic and subject matter may be new to your Coordinator, I recommend you share prior to the meeting any needed background documents (best provided in PPT format).

In addition, have an informal pre-meeting Q&A with the Coordinator to brief and update them on any specifics. Note: they may need a day to review proposals and agreements, so timing is critical.

Even in the best cases, expect that the Coordinator may want to postpone any decision until they can carefully review and perhaps confer with Korea. I suggest all documents and meeting PPTs be immediately forwarded to the Coordinator.

I’d create a sense of urgency with a timeline for execution and implementation. Regardless, expect some delays and be patient.

Over the years, I’ve found that Coordinators appreciate when their overseas co-workers recognize that the internal approval process takes time and be ready to offer, as needed, additional supportive data or documents.

BTW, if you are a vendor and your firm provides services to a Korea-based partner, it’s best to provide both the western and Korean teams with background information prior to any meetings. Moreover, be prepared to share the meeting’s content in digital format afterward with the Korean team, too.

Questions, Comments?
Email me at questions@koreabcw.com  Your comments, all kept private and confidential.

Other questions? Stacey, stacey@koreabcw.com, my assistant can schedule us a time to meet, or chat by phone. For urgent matters, text me at 310-866-3777.

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Everything Korea, April 3 Episode –Working with Korean Teams, Part 1

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For most of my career I have worked with Korean teams—many based in Korea, many in local overseas operations. I find both exchanges rewarding, but very different and require a varying set of skills.
In this Part 1, I offer some insights into the overseas teams assigned to local subsidiaries.
Part 2 will cover my recommendations and best practices for supporting overseas teams, including work-arounds to common issues that surface—for example when department-level expats assigned to “support” local executives begin to assume more direct control over day to day operations.
Part 3 will look at working with Korean teams based in Korea.
To begin
We find with Korea facing international operations the communication channel between the Korean HQ and local subsidiary is through expatriates– although it is shifting some and I’ll cover more in Part 3.

In key positions, Korean expats serve in roles including the CEO who is responsible for managing the local company or region. The CFO and technical support can be expats, too. Most often these Korean expats along with local leadership executive form the core for business operations in the host country.

By the way, the expats below senior management are often referred to as “Executive Coordinators” or “Executive Advisors” in the West.   As a caveat, this model does vary some and in some organization we see a mix of  “Coordinators” and Korean assigned as line managers. However, the Korean term for these expatiates is ju jae won.

In the larger overseas subsidiaries, the Korean expats are assigned to the major departments.

In many instances, as I mentioned, the expats Coordinators are not assigned a direct managerial role but still hold considerable oversight over the local operations.
Roles vary with each company, but frequently a Coordinator’s primary role is to be a departmental liaison between Korea and the local subsidiary.

That said, for westerners unfamiliar with the Korean model, this “oversight” usually translates into the Korean expats requiring sign 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, they recognize local management skills and expertise, but especially if under pressure to perform and meet expectations may defer to engaging in decision-making.

Of course this can be challenge.
New ju jae won are skilled and accomplished in Korean style business operations, norms and practices.

However, they are now assigned to an overseas subsidiary where norms, practices, expectations, and laws differ.  Adding to this “Managing westerners” is very different than overseeing a Korean team…

All said, I do have proven recommendations and workarounds, so look for Part 2 in the series.
In the meantime, I’d like to ask if you could share your experiences working with expat teams.  Email me @ questions@koreabcw.com  Your comments, all kept private and confidential.

Other questions?  Stacey, stacey@koreabcw.com, my assistant can schedule us a time to meet, or chat by phone.  For urgent matters, text me at 310-866-3777.

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Everything Korea March 27 Episode Chaebol Restructuring and Reform 2017

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Reform in South Korean reaches back to the Asian Financial (IMF) Crisis of 1997.
A bailout package from the International Monetary Fund (IMF) shut down insolvent banks and pushed debt-ridden industrial companies into receiverships. The remaining Groups still standing had little choice but to follow government mandates including restructuring and greater transparency.

In some ways little has changed 20 years later… regulators continue to pressure the leading Korean groups to take on a more transparent corporate governance structure– now in the form of a Holding Company model.

So, what is a holding company?
A holding company is a legal entity that owns other companies’ stock. Holding companies typically do not run these businesses, but they do wield control over their affiliates or subsidiaries. In turn, a holding entity collects fees from operating units for the use of the corporate brand, which is considered an asset.

The Korean government has gone back and forth between tightening and loosening regulations on chaebols over the years, and the trend now is toward tightening.

More so, following the Impeachment and graft scandal involving Former President Park Geun-hye, which pulled in Samsung, Lotte and SK, politicians are calling for even greater reform.

Complicated Steps
In most cases, the Model is for a Group to split itself, often the flagship company, into an ownership company and an operating company as part of a complicated set of steps.

This said, South Korean laws mandate a holding company must own at least 30 percent of its publicly traded affiliates. This poses the challenge.

For example, the Samsung Group were to move towards a holding company model with flagship Samsung Electronics as the entity, it would require the flagship to buy additional shares in some of its affiliate companies at a cost of millions.

All said, Korea’s conglomerates are increasingly being reined in with new laws and taxes that seek to hold family members accountable and to increase the transparency of their organizations.

More significant perhaps is a disruptive public mood and presidential contenders who “pledge to shake up corporate governance as they lay out reform agendas.”

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Everything Korea, March 20 Episode Move Forward Within the Culture.

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That’s my message this year in both commentaries and on-site presentations. It captures my work, which is to provide companies, leadership and teams with how best to work effectively… taking into account Culture plays a huge role in their workplaces.
This week we’d like to share 2 publications, too.
Korea Perspective (2015)
http://unbouncepages.com/korea-perspective-launch/

and Korea Facing: Secrets for Success in Korea Global Business (2012)
http://unbouncepages.com/korea-facing/

They compliment each other. One builds upon the other.
Together both explore issues. Together they provide workarounds for challenges that surface.
Follow the links and we’ll forward PDF copies.

All said – I’m passionate about providing needed strategy, skills and mentoring offered in these books as well as programs like Korea 101℠.

My goal is for Companies, executives and teams to “move forward within the Culture.”
To discuss about more a Korean facing business question, Stacey stacey@koreabcw.com, my assistant can schedule us a time to meet or chat by phone.

For all urgent matters, text me at 310-866-3777

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Everything Korea March 13 Episode: Korea 101 Foundation for Understanding Korea Business

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When you ask somewhat “what are you most passionate about?”  It can be very revealing—family, work, hobbies, sports, and social issues.

For me and my work its sharing Korean business culture and, in particular, strategies to succeed with the Culture.
Since 2004 I have offered programs and mentoring to thousands across America and internationally. A flagship Korea 101 program has served as the core for this Korean business culture mentoring. In turn, this training and coaching builds upon current experiences of the teams, while providing new understandings that lead to solutions.

Both our on-site and web-based programs have been offered to teams not only in America, but also in Canada, UK, Belgium, Germany, Russia, AU, India, South Korea, and the Middle East.

Customized versions have been professionally recorded and distributed worldwide to organizations and incorporated in their in-house programs.
Ideally the program is on-site over 4 to 6 weeks—each class a 1½-hour session. That said, we have a number of options including half and full day immersion programs.

Korea 101 and 201 programs are also an integral part of on-boarding and mentoring for key executives and management.
I like to highlight that we find participants genuinely care about their work and the company, and acquiring the needed skills offered in Korea 101 specifically help them to move forward within the culture.

Finally, the key to the success of our Korea programs has been the strong endorsement of our partner firms’ CEOs, senior American and Korean management, and across their teams. As organizations they realize that their teams need support. Expecting employees to “get it” without training and coaching rarely works. We are proud to work with our partners and their teams.

To chat about Korea 101 or a Korean facing business question, Staceystacey@koreabcw.com, my assistant can schedule us a time to meet or chat by phone. For all urgent matters, Text me at 310-866-3777

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Everything Korea March 6 Episode: Back to The OC

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I’m taking a week off from sharing commentary on the Korean car brands, market entry best practices, the Korean presidential impeachment, the indictment of Samsung’s de facto leader, and North Korean sword rattling.

However, beginning next week a Korea 201 program on Korea corporate and business culture will have me back in The OC (Orange County, home to the US HQs for Hyundai Motor, Kia Motors, Genesis, MOBIS Parts, Innocean, GLOVIS, Autoever, the California design centers, and Hyundai Capital. )

Amid meetings, days are filling up, but times are still open on Wednesday and Thursday.

As always, Text, Facebook Message, Linkedin Message or Email, and we can arrange a time. Or, Stacey stacey@koreabcw.com, my assistant can schedule us a time to meet, or chat by phone.  For all urgent matters, Text me at 310-866-3777

BTW

If you have not had an opportunity to read my recent articles, here are the links

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