Thoughts on Korean Business by Don Southerton

By Don Southerton, BCW Editor Of course I've been following the Samsung Apple IP court cases. It's a major news story both in US and South Korea. Samsung stock taking a huge hit, too. Regarding the trial, this was the Apple legal teams closing remark, "Instead of witnesses, they sent you lawyers." Seems Apple's lawyers presented a much better case vs. Samsung's legal team. When they go to appeal, Samsung needs to be more culturally savvy. I can help there :) I've coached and provided legal strategy in several high profile cases. Sister site Korea Legal.org has covered the cases for months.

By Don Southerton, BCW Editor Korea Facing represents both the title of the new book in progress, and the theme for our training and coaching programs.  The programs support those working for Korea based companies globally, Korean expat teams, and companies who work for and with Korean-based Groups.... Fill out form on the sidebar to receive weekly updates

By Don Southerton, Editor,  As an author I'm often challenged with "what to write about next?' My early books were academic papers that evolved into published works.  3 books were short historical novel. Chemulpo to Songdo IBD was a pictorial history that  tied into my work in Korea on the Songdo city and land development project, while recent writing have centered on my years with Hyundai and Kia Motors. Moreover, articles like the two for Forbes drew from my experiences w/ Songdo IBD, green Car development, and my move to the trendy Belmar District near Denver, CO. That said, I have a new work in progress. It's one I have pondered for years. It's a topic I know well... So to take from the  book I've titled Korea Facing here is an excerpt from the Foreword. The book differs from most on Korean business. Frankly, its audience is not those working or looking to be employed in South Korea, although they will benefit its content. The focus is instead f...

In case you missed,... we've recently released 2 new eBooks. The first eBook provides a concise history of early Hyundai and Kia Motors car production. Models discussed range from Hyundai and Kia's first production cars to those developed under 2000-1 restructuring. A second eBook is our latest work on early US and Korea entrepreneurial ties and the accomplishments of Henry Collbran. Both new eBooks are also now available through Amazon, Google, Kindle, and Apple. Personally, I like the Apple iBook versions. The Hyundai Kia eBook http://itunes.apple.com/us/book/hyundai-kia-motors-early-years/id538393175?ls=1 The Henry Collbran early Korean entrepreneurialism eBoo k http://itunes.apple.com/us/book/colorados-henry-collbran-roots/id549027445?mt=11 BTW  We have limited number complimentary PDF versions available upon request. Request a Copy Link

For Immediate Release Denver, Colorado and Seoul, South Korea. Author Don Southerton has announced the release of a new publication Colorado’s Henry Collbran and the Roots of Early Korean Entrepreneurialism. The eBook explores the business efforts of British-born Henry Collbran who brought modern technology and innovation to the Korean peninsula. Stepping back in time Southerton’s latest work tells the fascinating story of Henry Collbran who left Colorado in 1896 and traveled to Korea with hopes of a lucrative gold mining opportunity.  Seeing little potential in mining, Collbran successfully constructed the nation’s first railway from Incheon to Seoul.  Collbran then secured the franchise from the Korean monarch Kojong to build a modern electric streetcar system. Over the next several years, the entrepreneur added additional business ventures, including the first telephone system, a modern waterworks, a bank, a coin mint, and even a movie theater. During his later...

By Don Southerton My new writing project, which will be release soon in eBook format and print, explores the business efforts of Henry Collbran who brought modern technology and innovation to the Korean peninsula. Henry Collbran  Sneak Peek Stepping back in time... on word that East Asia held rich untapped mining opportunities Collbran left his home in Colorado for Korea in 1896. After pursing a railway project, Collbran secured the franchise to build a modern electric streetcar system. Over the next several years, the entrepreneur added additional concessions including the first telephone system, a modern waterworks, a bank, a coin mint, and even a movie theater. During his later years in Korea and with financial support of Colorado beer baron Adolph Coors and other investors, Collbran turned his effort to highly lucrative gold and copper mining operations before eventually retiring to a life of leisure in London.

For Immediate Release Denver, Colorado June 21, 2012 Author Don Southerton has announced the release of a new publication Hyundai and Kia Motors: The Early Years and Product Development. The eBook provides deep insights into the rise of the South Korean car industry. Southerton’s latest writing weaves  first-hand accounts of the challenges experienced by Korean management during the first years of Korean car production with the development of specific models,  such as Kia’s Brisa, Pride, Sephia, Sportage and Rio plus Hyundai’s Pony, Excel, and Santa Fe Southerton notes, “Today we are witnessing a remarkable transformation in Hyundai and Kia Motors’ brand image and sales are at record pace. This accomplishment was decades in the making. Hyundai and Kia Motors: The Early Years and Product Development shares the story behind this success.” The eBook will be available through Amazon, Kindle, iBook, and most digital media services. Apple link-- http://itunes.apple.com/us/b...

The new eBook will soon be released. Here's a short profile. Hyundai and Kia Motors: The Early Years and Product Development  by Donald G Southerton provides deep insights into the rise of the Korean car industry. From the 1960s to early 2000s, political and economic forces impacted the growth and development of the South Korean carmakers, including Hyundai and Kia Motors. In addition, the brands at times partnered for technology with Ford, Mazda, and Mitsubishi, along with world class designers like Giorgetto Giugiaro. Expanding rapidly the Korean brands soon looked to new international markets, including the U.S.  Despite the failure of Kia Motors to survive the IMF Crisis, the merger with Hyundai led to integrated technology research, development, and manufacturing-- not to mention the economies of scale needed for the Korean automaker to compete globally with industry heavyweights such as Toyota, Ford, GM, and VW.  Car models discussed including the...

By Don Southerton The 1997-98 IMF Crisis forced dramatic restructuring across South Korea’s car industry. Daewoo Motors, once a market leader, fell with the demise of the mother group and GM acquired their Korean manufacturing facilities. Samsung’s budding car division was sold to Renault, while SsangYong Motors entered into a protracted receivership.  In contrast, Kia Motors was able to have a new start--the merger with Hyundai Motor Company setting the stage for both brands to leap forward. New Management For Hyundai and Kia Motors, new management came at a time of considerable restructuring of the company and was led by Chung Mong Koo, the son of the Hyundai Group founder. Initially, the restructuring was a combination of fiscal cuts across the company along with consolidation of duplicate services, such as R&D and parts manufacturing, between the two brands. A new marketing plan for the brands was also launched with Kia focusing on the younger and stylish consumer and ...

By Don Southerton Few events in recent history have impacted South Koreans as significantly as the 1997-98 Asian financial crisis, commonly called the IMF Crisis. Thousands of Koreans lost their jobs and lifesavings as the crisis rocked the foundations of most Korean industrial groups or chaebol . In fact, no fewer than five major chaebol failed early in the crisis amid others who had to petition for bankruptcy. In the end, as many as 18 of the largest 30 chaebol would risk bankruptcy, and no more than a handful of the top 30 groups were seen as financially sound. For Kia Motors the IMF Crisis would be devastating. Although overseas sales and growth were steady, by early 1997 with ever-increasing development and labor costs, Kia found themselves heavily in debt. Perhaps of equal concern, Kia's difficulties were also a signal of problems throughout the South Korean automobile industry. The big three Korean automakers -- Hyundai, Kia and the Daewoo Motor Company—had created mo...

By Don Southerton Political and economic forces had long impacted the growth of the South Korean carmakers, including Hyundai, Daewoo, SsangYong, and Kia Motors. Despite the country’s economic success in the 1960s and 1970s, the growth model South Korea pursued was not immune to new challenges that would hit the country. In particular, two events would have significance impact on the country’s economy: the 1987 democratic transition and the Asian financial crisis of 1997-98. Kia Motors, which had grown into Korea’s second largest carmaker, would soon experience both international success and its own demise—the latter leading to a “second chance” under parent company Hyundai Motor. New Strategy By the mid 1980s, Kia's strategy looked overseas. They planned to fill the void at the low-cost end of the automotive market which was slowly being abdicated by the Japanese brands pursuing sales of more expensive models with higher profit margins. Compared to rival automakers in Japan,...

By Don Southerton, BCW Editor I recently spoke at the World Trade Center San Diego Asia Desk: Korea workshop. The session centered on business benefits for American companies under the new U.S. Korea Free Trade Agreement. Guest speakers also included KOTRA LA Director- General Yun and Korea University’s Moonsung Kang. Both gave specific details on the new treaty, which was implemented on March 15. A complex document, the KORUS FTA immediately eliminates some tariffs, with others removed over time. Automotiv e For example, the tariffs on auto parts manufactured in Korea are removed. With regard to cars, the tariff on US cars shipped to Korea is immediately reduced from 8% to 4%--the remaining 4% to be eliminated in 2 year. For Korean cars shipped to the US, the current 2.5% tariff remains in full effect, but will be eliminated in 2 years. Professional Services An aspect of the KORUS FTA is its impact on law and accounting services. In particular, the new FTA allows for US fir...

By Don Southerton The Kia Motors Company is one of the world's fastest moving global automotive brands. It has earned a reputation as an industry leader in design styling along with a full line of fuel-efficient vehicles that have earned critical acclaim and dramatically increased consumer awareness. That said, the carmaker had early roots as a Korean bicycle and motorcycle manufacturer. In the early 1960s Kia Motors Company moved beyond bicycles and motorcycles to produce a highly practical K360 three-wheel utility truck. Across much of Asia, similar vehicles met a demand for reliable low cost commercial transportation that could transport goods and products often in tight urban areas. Based on the Mazda Mazdago design, the K360 also signaled Kia Motors’ long technology alliance with the Japanese automaker with a number of cars and trucks eventually licensed from Mazda. During this era of budding Korea’s economic development, strong technology ties with foreign partners were...

By Don Southerton, BCW Editor On Wednesday May 9, 2012, I'll be a speaker for the World Trade Center San Diego Asia Desk Business Series: Korea. Also speaking at the event will be Moonsung Kang, Ph.D from Korea University’s Division of International Studies. I'll be sharing insights on how to benefit from the U.S--Korean Free Trade Agreement, including finding the right Korean partner, structuring your market entry strategy, and ways to avoid common pitfalls. Double click image to enlarge About Don Southerton When Fortune 500 companies, top Korean Groups, leading international law firms, and elite consultancies, such as Bain and Monitor, look for Korean-facing business strategy, coaching, and advice—they turn to Bridging Culture Worldwide and Don Southerton. With over 35 years’ experience, Don Southerton is the definitive authority on Korean-facing global business--from automotive, golf, and QSR sectors to New Urbanism and Green technology.  When problems and chal...

By Don Southerton On February 20, 1986, Hyundai Motor Company began selling the Excel, their latest production model, in the United States. Building on the success of the original 1975 Pony and then an updated 1982 Pony II, by the mid-80s Hyundai was ready to introduce a new front wheel drive X-1 model. They were also confident enough to tackle the world’s largest car market—the United States. Hyundai X-1 Excel Following a common practice in the automotive industry, the X-1 was badged under a number of names depending on the market. For example, in Korea a sedan version was sold as Hyundai Presto, while in Europe the new X-1 kept the original Pony badge.* For Americans, the X-1 would be known as the Excel--with a reputation for low cost, breaking sales records and, sadly, a tainted quality image.   Beginning in 1976 and prior to launching in North America (with Canada in 1985), Hyundai was exporting the original Pony to a number of markets. Today little recognition is giv...

By Don Southerton Some Background Since the early 1960s, Korean firms have entered into partnership arrangements with international carmakers, including Nissan (Datsun), Toyota, Mazda, Fiat, and Ford. In particular, the Korean government and key industrial groups forged these alliances as the best way to introduce advanced automotive technology to South Korea. In 1967, Hyundai Group also entered the auto sector as a result of  both the founder Chung Ju Yung’s early ties to the car repair business and growing government pressure. Entering into a Ford Overseas Assembler Agreement, Hyundai looked to assemble Ford compact cars imported as knockdowns (CKD). Ford, in turn, would transfer technology and explicit knowledge, such as blueprints, technical specifications, production manuals, and training of Hyundai engineers. Following the Hyundai model for taking immediate action and leveraging their background as a construction company, the Hyundai Ford plant was operat...

Don Southerton 2011 My public image is of a passionate Korea-facing global business consultant, coach, trainer, strategist, social commenter, and author.  I’ve also been an avid student and instructor of traditional Korean martial arts for 40 years. During the 1970s, 1980s, and 1990s, I trained extensively in Moo Duk Kwan Tang Soo Do (now Soo Bahk Do) under the Korean system’s Founder and son, the current Grand Master. A highlights of these years included serving as Chief Instructor/ Coach for the United States Military Academy at West Point. Before shifting my interest to academia, writing, and global consultancy work my martial arts schools were nationally recognized leaders in the industry and among the largest in America While no longer an active instructor, nevertheless over the past 12 years as a practitioner I have added a number of complex Chinese forms to my repertoire of over 35 hyung—the traditional sets of combative movements martial artists’ practice to hone the...

By Don Southerton, BCW Editor It has only been a short time since the March 15 implementation of KORUS FTA and some interesting developments have surfaced. I found this WSJ Asia article more than informative, not only because of the FTA, but I was never aware of all the tariffs and VATs on wine.  Like imported cars, VATs add considerable to consumer costs. Korean consumers now are seeking reforms. Koreans Raise a Glass to Unintended Consequences Since free-trade deals haven't brought down wine prices as much as promised, Seoul is now under pressure to deregulate further. By JOSHUA HALL During debates in the U.S. and Korea over ratification of the free-trade agreement, politicians fought over the macroeconomic effects on employment, trade flows and investment. Now that the deal is coming into effect, implications for individual businesses and consumers are just starting to come into focus. One of the most interesting case studies is the wine industry, which is seeing sign...

IcebergBCW , originally uploaded by Bridging Culture Worldwide . Like the exposed section of an iceberg American teams working with Korean-facing business recognize there are difference in management style, work habits, body language, food, hobbies, etc. What is hidden and needs coaching and training is to better understand the differences, along with attitudes or beliefs, social norms, cognitive process, popular trends, opinions, viewpoints, preferences, tastes, and specific knowledge of their company and its practices. We provide this hidden side of the iceberg.

By Don Southerton, BCW Editor The image shares a vision of Bridging Culture Worldwide's focus--getting to core of challenges and issues, which hamper Korea-facing business. This requires a deep understanding of US and Korean corporate and business cultures. We, then, tackle the problem based on a better feel of the true cause for the impasse. Not always an easy task.