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