Monday, March 02, 2015

Feedback: Challenge One, A Global Approach

By Don Southerton
Before I share insightful reader feedback from my first commentary “A Global Approach: A Roadmap For Korea Management Teams,” some background in case you are just joining us….  Challenge 1 is available upon request.  LINK

Background
In this series of commentaries I depart from a previous focus on sharing insights specifically to non-Korean global teams working for Korean companies.

Instead I now provide a roadmap and best practices to 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 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 witnessing one company enduring the challenges in their market entry only to see the same scenario repeated by another Korean brand entering the global market. . 

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

To begin
I would like to share the thoughts of four insightful contributors—each with a unique point of view. Their viewpoints span the globe from working in the U.S and Korea, to comments from Europe and insights from India.   Your own comments as readers—Korean and Westerners – are also respected and appreciated.  Please add your own voice, experiences and perspectives.

Don
This is a very accurate reflection
Especially Challenge 1  – the solution suggested is essential to enable the markets to respond and adapt to market situations, reduce frustrations and act decisively and quickly. Furthermore the lack of industry knowledge leads to indecision and changing decisions based on influence from colleagues as opposed to decisions being taken on the basis of real understanding and experience of the market.

Regards
R

R. So well stated and very insightful, especially that allowed the local team to respond as needed will result in a better management of the brand. I need to stress this more with teams I work with daily.

Hi Don, 
Thanks for your profound insight on dispatching Korean management teams to the western nations. 

In most cases, Korean management team(s) will be confronted with tremendous "brick wall" called western business culture. I have seen many ju-jae-won in the US while successfully managing the US operation fail to integrate the US team in the manner expected by the Korean HQ.

Let us remember that nepotism exists on both sides... As an experienced Korean American expat to Korea, while US HQ may expatriate a US person as a US HQ representative to overseas, they are inevitably dependent on the local team(s) for their success.

It is same for a Korean HQ expatriates to a western nation. In order for the ju-jae-won to succeed, they will need to earn their merits by western cultural immersion including its business practices, policies, procedures and local labor regulations. While at the same time avoid being labeled back home as one who has been "assimilated" in to the respective local culture. You may find it interesting to analyze the succession potential for those ju-jae-wons who have returned back to their HQ in Korea.

While this is not new, Japanese companies dispatching Japanese management teams to the US are still fixated, though not as much in the past, on "educating" Japanese HIPOT managers in the western business environment.  As in the past, Korean business cultures usually emulate Japanese business processes and tend to follow Japanese patterns almost predictably.

However, "success" is in the eyes of the beholder.... clear definition of objectives and expectations upfront with global business mindset will truly define success for any expatriate in our current global business culture. From what I have observed based on Korean Chaebol's business expectations and practices, Korean expatriates to the western nations have to climb a steeper learning curve.

What do you think?

-K.S.L. –

K.S. L. Wonderful feedback and a quick comment:
We know returning ju jae won to Korea have to transition back.  Some find it a huge challenge to repatriate as you note.  Some, in fact, look for an alternative and seek local employment in the host country vs. returning to the HQ after the assignment. In my experience, many return to their HQs for a year and then get re-assigned to a different overseas post.  All said, a successful overseas assignment could have a very positive impact on a one’s career at least within the Overseas Divisions.


Dear Don,
…. I think that your way of thinking is really too revolutionary for Korean companies
 :-) . If you really asking me if that leadership in the overseas subsidiaries should be found in local Americans, Europeans, etc. (which is logical by the way) my answers is simple the following:

- Any change in this direction will seriously affect internal Leadership procedures and structure in Korea too. The all hierarchy structure may be affected and I hardly think that Koreans will ever accept a foreign "interference”.

- Western Management in overseas business are considered as merely executors of orders and sometime as informers. In a certain way Western Management feel in the same way as some Indians/scouts felt, when they were allied with Americans moving to west in the 19th century.

Cheers

R. E.

R.E., I agree.  We will see slow progress by the major groups in changing the model.  Some divisions within the Korean groups have eliminated Coordinator positions and made them managers with day-to-day roles, a very progressive step.  Japan's Nissan did this years ago with great success. 

What I find ironically is the major global brands entering South Korea hire local management and teams and do very well.... :)


Don,
Hi. How are you. Your emails and information is very useful. Though I am working with Indians, some of the topics parallel.

I have a question, if I understand your suggestions clearly, it's always better for the Korean team setting up overseas offices to have a local personal overseeing or managing operations to ease local understanding. So if they set up an office in the US, to find a long-time US citizen familiar with US ways would ease that burden?

If I have understood that correctly, I'd like to share a short story then ask a question.

I am working with an Indian company that has many offices worldwide, including the US. So, like Korean companies, they have set up the company locations abroad with Indian management, instilling Indian work culture. So, that being said, even if this company were to have employed a US citizen at first to localize operations a few things may have happened (1) found an Indian who is an NRI (non-resident Indian, or Indian expat who may or may not be a US citizen but has lived in the US a few decades or so) or (2) if they know an American citizen he (or she) may be of Indian origin. I am not sure the percentage they would go for a true-blue American from birth, which again would limit some of the local and national understanding depending on how long that Indian or ethnic-Indian has been in the US. But let's say they hire an American from birth- though this person would surely know more about the US culture, he or she is being mentored by the Indian manager who would be managing, directing and communicating in an Indian style, not a Western style, so some of the culture understanding would be limited in transitioning this to any employees on the ground. I see this happening in that Indian company in the US locations. Any Americans that are hired take up typical Indian work culture traits that really aren't so acceptable in other companies- such as it's ok to be late for meetings without warning, taking calls in between without warning is acceptable, even how people say yes or no have changed- even the Americans working there tend to adapt the Indian ways of doing things though they are in the US! Part of this is because many of the employees in the company are relocated from India.

I am curious (hoping I was able to articulate this properly), if this happens with Korean companies as well, and how much of Korean work culture is adapted by local Americans working for the Korean company.

Thank you for making me think,
J.K.

Dear J.K.

As always, your comments make “me think, “ too, so thank you.

In most cases, Korean companies in startup mode for a U.S. / global launch dispatch a Korea team.   They struggle.  The larger Korea companies hire many locals but maintain control through shadow management at department level and leadership positions.  This results in many issues.

Hiring primarily a local Korean team is usually not a good path either. (Actually Part 2 of the commentary, which I will share next week, addresses this).

Hiring seasoned and high experienced locals is the best path.   These individuals will still need lots of support to understand their Korean / Indian mother company---which is where we come in..... 


Don Southerton
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DS

Monday, February 23, 2015

A Global Approach: For Korea Management Teams--- A New Work in Progress

This is a new work in progress-- feedback and comments appreciated. 

By Don Southerton
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.

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 teams of Korean heritage with the assumption they will be able best represent the brand in America be considered as an option?

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Sunday, February 15, 2015

Culture Alert: Year of the Blue Ram



Korea (as well as China and Vietnam) celebrate two New Years. One on Jan. 1 and the Lunar New Year celebration, which this year falls on February 18-20

For your Korean colleagues (in Korea), you can wish them
Happy Lunar New Year by phone, text, or email on Monday PM.
(Tuesday AM in Korea).

Koreans will have a 5-day weekend starting Wed K time.

For expat Koreans working outside Korea/ globally you can wish then
Happy Lunar New Year on the day itself, Thursday February 19.

Here is the formal greeting--Sae hae bok mani ba deu say yo

BTW Following Korean zodiac tradition this is the Year of the Blue Sheep or Ram.  A year of contemplation and peace.

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Tuesday, February 03, 2015

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.



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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Sunday, January 04, 2015

Monday, December 22, 2014

Korea Perspective: January 2015 Release

Korea Perspective
By Donald G. Southerton Publication Date: tentative January 2015


Overview
Korea Perspective is based on daily consultancy interactions in the support of the Korean automotive, golf, land development, Green sustainability technologies and retail sectors. Western overseas teams, as well Korean leadership and teams, have openly shared their challenges and pressing concerns along with the inner workings of their companies in the interest of improving communication. In turn, I have worked to provide a framework, strategy, and solutions.

About the new book
This book builds considerably upon topics shared in my two previous and well-received publications: Korea Facing: Secrets for Success in Korean Global Business and Hyundai Way: Hyundai Speed. In particular, the new book explores more deeply into issues many working for Korean based companies may experience. The target audience and focus is the ever- growing number of Westerners employed by Korean-based companies outside South Korea. This book will provide you with greater awareness into the Korean workplace and mindset.

Likewise, if your firm provides services or products to a South Korean overseas subsidiary or operation, this book will offer tactics to strengthen and maintain the relationship.

Finally, if your company has significant business in Korea, but leadership and headquarters are located in the West, we offer suggestions to key management on how to effectively deal with pressing issues and challenges that surface.

All in all, this book offers a roadmap to avoid the pitfalls, navigate around the roadblocks, and thrive.


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 extensively lectures 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.

The Author is available for interviews.



Contact:
Don Southerton
c/o Bridging Culture Worldwide 811 Illinois Street
Golden, CO 80401
dsoutherton@bridgingculture.com 1-310-866-3777
Offices in Golden, CO; Irvine, CA; and Seoul, South Korea 

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Monday, December 15, 2014

Korea Perspective: Chapter 6, Pieces of the Puzzle

Chapter 6
Pieces to a puzzle…

A Western client recently explained that a huge challenge within their company was engaging the Koreans teams in the U.S. in discussions about complex situations and long-term planning.  Specifically, there was little joint discourse related to potential trade-offs and risks in projects assigned to the local subsidiary. The Western team was consulted only to validate pre-conceived ideas or to implement directives from Korea. In most Korean companies leadership determines direction and the paths to resolving major issues. In turn, the working team's role is to focus on producing immediate results.

Contemplating this challenge, particularly within a narrow and myopic workplace approach, one can draw an analogy to jigsaw puzzle building.  The pieces to a puzzle have many sides but only some are visible. What is required is to look diligently at all possible options.

As a Korean colleague once pointed out, their society beginning with grade school does not promote reflective thinking. Reflective thinking does not produce immediate effects. More so, in contrast with the Korean workplace’s collective thought process, reflective thinking stems from an individual’s core consciousness.

Reflective thinking requires not only acquiring knowledge, but also calling upon one's own experience and evaluative skills and admitting personal bias. The result is a broader perspective and a better view of the bigger picture

Often as a consequence of this myopic analysis, more problems may occur. 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.


Part 2 of this chapter will provide hints to engage Korean teams in a more reflective approach, as well as a strategy to work effectively within a workplace with two divergent approaches—Korean and Western.

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