Category Archives: Business - Page 5

Adapting to Korean Business Practices (MBIK 7)

Posted by on January 28, 2009 2 comments

The the huge amount of globalization these days, it is essential that anyone doing business abroad be well versed in both their own country’s legal policies and the foreign country’s policies and unwritten rules.  This can help you dodge problems and jump through hoops.

Background

Social Environment

In  the past, many businessmen in Korea have used their positions to further their personal agendas.  After the IMF crisis of 1998 these irregularities have largely been taken care of.

Personal Relationships

Most business transactions in Korea happen between people who have personal ties.  You need to be able to deal ethically but at the same time deal with local idiosyncrasies.

Competition

Since Korea is such a small country, competition is extremely fierce and sometimes leads to a philosophy of one must win at any cost.

When in Rome…

Local Expertise

Rather than relying on your own expertise in your own country, you must use local methods to be successful.  Much of the time that means having loyal Koreans that help you build relationships and make contracts.

Like it was brought up before, you should be cautious when dealing with some people who are considered expert “foreign handlers.”  They commonly use flattery like telling you that you understand their culture better than others in order to get what they want.  It doesn’t always mean they are buttering you up, but stay on the look out.

Third Parties

Sometimes the best way to make sure that you stay ethical and get things done is to hire local third parties to handle the situation.  But make sure that you trust the party who you choose, remember that they will act in your behalf.

Lofty Causes

Sometimes non-monetary methods are used to sweeten the deal.  This can involve offering educational incentives, travel expenses all paid for, etc.  Rather than giving certain individuals deals this usually involves the entire company.  This is a better alternative to trying to give individuals incentives, which can approach the line between ethical and not.

Personal Ties

Time and money invested in simply building personal relationships is very well taken and is essential if you want to develop a long term relationship if trust.

Public Relations

In Korea, a company’s public image can make or break them.  They must appear to be a company that helps the local community and basically makes Korea a better place.  If your company gets a name publicly for being unethical, you can kiss your future goodbye.

Overall Insight

Never stop developing your knowledge and expertise in doing business in Korea.  It’s a never ending process which can be very fruitful and joyful.

Go to the next chapter, Managing and Being Managed by Koreans or select a chapter.

Get off on the right foot: Business Etiquette (MBIK 6)

Posted by on January 24, 2009 No comments

et

The Name Game

Never use just someone’s first name in Korea, except between close friends.  Especially in the business world you need to make sure that you always use their name and title whenever referring to them.  Just like the last chapter stated, business cards are a great way to exchange names and titles.  Bilingual cards are great but don’t use English-Japanese cards if you aren’t based in Japan because there is some bad history there.

Nunchi (눈치) – The power of eye contact

Eye contact is very important.  When you look other businessmen in the eye, make sure that you have a sense of sincerity and, when appropriate, humility.  Looking into others’ eyes is helpful in judging their character and you will receive this kind of judgment.  A person who can quickly assess a situation psychologically is called a 눈치 빨른 사람 (person who’s nunchi is quick).  This exists in all countries, but is something important and you should know about and utilize while dealing with East Asians.

The means justified the ends

While many in the Western societies can relate to the phrase that the end justifies the means, it is backwards in Korea.  Executives and others that initiate talks spend a lot of time and energy in developing relationships and figuring out the other side.  Then the ‘less important’ details (AKA making the contract) are done by subordinates.  Make sure that you don’t overlook any part of the deal making process, parts that you may initially think are unimportant might be more important than anything else.

Money and gifts

While tips are common in Western cafes and hotels, they are unexpected in Korea (and are automatically included in your resturaunt bill).  Some people can actually take offense when a tip is offered in those situations.  That doesn’t mean that you can’t give money when someone does something for you, but remember that you generally should not give tips at those places.

Money is commonly given as a gift, like major holidays or personal events like marriages that only happen once in a lifetime.  Whether you give money or gifts, don’t give things that are associated with four (like 40,000￦ or four spoons) since that number is associated with death.

Entertainment eating and drinking

Tardiness is somewhat common in Korea, given the busy traffic and other things.  Don’t take offense to it, after all you might be the late one next time.  Just go on with business like usual, it won’t be the end of the world.  If you are the one that’s late a phone call is seen as a common courtesy.

A lot of Korean restaurants have floor seating so be prepared for it.  Unless you have a medical condition (which you should tell beforehand) just go with the flow. You should try everything that’s put in front of you.  Don’t worry, it won’t bite back (unless you eat living squid, which does fight  back).  Some pointers about drinking are:

  • Give and receive either with both hands or with your right (touching your right elbow with your left hand).
  • Don’t refill your own glass, offer to fill those next to you and you will be repaid.
  • Many politely refuse twice but will accept on the third attempt, it’s common courtesy to politely refuse a little.

The Magnetism of Differences

While the East has many different values than the West, make sure that you go through everything with an eye of acceptance.  Be ready and tell yourself beforehand that you are looking forward to learning and adapting to the differences.  If you keep that sort of frame of mind then changing how your mind works in the situation that you find yourself in will be much easier.

Let your hair down

While talking in conference rooms is important, remember that things outside of the office are just as important when doing business with Koreans.  Many times a decision can me made by observations during a social event.  Also, when you are invited to a Korean restaurant make sure to reciprocate it by inviting them to a Western restaurant or something else.

A little humility goes a long way

Western comanies have a reputation of being bigger than their Eastern counterparts, which can bring assumptions of pride and superiorness.  Make sure to make it a point to be humble or you might fall into that stereotype.  Remember, there’s a lot we can learn from each other.

Those interested in Korean Business Etiquitte can check out this book.

Go to the next chapter, Adapting to Korean Business Practices or select a chapter.

Wage Gap Enlarging Between Small and Large Companies (Business Journal #2)

Posted by on January 21, 2009 No comments

“올 大-中企간 4년제 대졸 초임 격차 1125만원“

격차 = gap
초임 = first job
대졸 = graduate from university
4년제 = four year institution

올해 대기업과 중소기업의 4년제대학 졸업자 초임 연봉 격차가 지난해에 비해 확대된 1125만원으로 조사됐다.

대기업 = large enterprise / business
중소기업 = small business and medium enterprises
연봉 = annual salary
확대되다 = to expand, increase
조사하다 = examine into, investigate

온라인 채용정보업체 잡코리아는 15일 4년제대학 졸업자의 신입직 초임 연봉을 공개한 536개 중소기업의 연봉 평균을 집계한 결과 1977만원으로 나타났다고 발표했다. 이는 지난해 1992만원에 비해 소폭 줄어든 금액이다.

업체 = enterprise
평균 = average, mean
집계하다 = add up, total
소폭 = narrow
줄어들다 = decrease
금액 = amount of money

대기업과의 연봉 격차는 더욱 커졌다. 지난해 중소기업과 대기업 연봉 격차는 올해의 1125만원보다 적은 1101만원선이었다. 올해 대기업의 연봉 평균은 3102만원(지난해는 3093만원) 수준으로 집계됐다.

수준 = level, standard

한편 중소기업 중에서도 금융 관련 업종의 신입직 초임수준이 가장 높은 것으로 나타났다. 이들의 초임은 평균 2267만원으로 조사 대상 중소기업 중 가장 높았으며 전기전자 업종이 2120만원, 기계철강 업종이 2084만원으로 뒤를 이었다.

금융 = finance
업종 = industry
철강 = steel

자동차항공 관련 업종(2020만원), 건설(1981만원) 등도 중기 전체 평균에 비해 높은 초임 연봉을 받는 것으로 나타났다.

건설 = construction

조사 대상 중소기업 중 초임이 가장 낮은 업종은 식음료 업종으로 평균 1843만원에 그쳤다. 유통서비스(1,892만원), 중장비제조(1950만원) 업종의 초임 역시 평균을 하회했다.

그치다 = stop, discontinue, drop
유통 = distribution
중장비 = heavy equipment
제조 = manufacturing
하회하다 = to fall short of

Eleven Commandments for Doing Business in Korea (MBIK Ch 5)

Posted by on January 19, 2009 2 comments

ten-commandments

Can you guess who that is?  I can tell you it’s not Charleston Heston (I’ll give you a hint, he’s listed in the tags on this post).  I just thought I would try out my new photoshop skills…

I. Thou shall always have a formal introduction

Like business everywhere, always act your best and play your cards right.  If you know someone who can improve your chances of getting into someone else’s circle make sure you acknowledge the fact.  A little work in this department can go a long way.

II. Thou shall not be without business cards

I’ve never been to Korea, but I know that Koreans have business cards.  hundreds.  If not thousands.  I’ve heard it is dirt cheap to buy very nice looking business cards in Korea.  Whenever you meet someone, it is customary to exchange business cards.  Make sure you carry enough so that a good opportunity won’t fall through your hands.

Business cards are great for remembering someone and finding out what level they are in the company they work at.  When you give them, use both hands or your right hand (touching your elbow with your left hand) in order to show respect.  Keep the card out for a little while to use it as a reference instead of putting it away immediately.

III.  Thou shall not assume everything you say in English is completely understood

Like it was pointed out in a previous chapter, Koreans don’t like to appear that they are ignorant on any subject.  This includes English (although, aren’t we no different in this aspect?).  Even if they appear to understand what you say, make sure to speak in terms according to their perceived English level.  This usually involves a little casual talk and some questions so you can know what level to talk at.  Enunciating can be very important too.  If you are presenting information, make sure to give written notes out so that they can look up words if needed.

IV. Thou shall restrain pushing your position too hard

Korean businesspeople are believed to be good negotiators worldwide.  When you negotiate, be patient and firm, but gentle.  Decisions can take some time, don’t feel like you have to rush into things.  Also don’t worry about the little things when you are at the negotiating table, since that person probably won’t make them any way.  You can use other people to worry about those details

V. Thou shall build human relationships

Although you may think a contract is immutable, you can expect things to change with Korea.  Koreans don’t like detailed contracts and tend to make changes as things go.  This can be very frustrating since many Westerners regard a contract as set in stone and can be offended when Koreans change terms.  Just remember to keep good relations and develop relationships of trust.  This can involve giving and taking.

VI. Thou shall respect your partner

Do not put others in a difficult situation, keeping face is very important.  Compliment them and keep the atmosphere positive and you will reap the benefits.

Also, be careful for those who try to act like you know Korea more than other foreigners.  This is a method used by some to try to butter you up and get their way.  Just be mindful in whatever situation you find yourself in and remember to keep things professional.

VII. Thou shall entertain and be entertained

Entertainment is a big part of business.  Many business relationships are developed through having parties, which can involve a lot of alcohol.  Make sure to do your part and entertain them, relationships are not one sided.  Small gifts are very common also.

VIII. Thou shall try to know your counterpart

When you develop relationships, try to find out as much about the other party as you can (family, philosophies, hobbies, etc.).  Verbal promises and trust can be more binding here than a written agreement.

Make sure to go out and experience many different cultural activities.  By diversifying your life you get more chances to understand the people and develop new connections.

IX. Thou shall temper the use of Western logic

Although it’s built into you (if you are from a Western country), try to branch out and learn how Koreans think.  Study Confucianism and observe how Koreans interact with each other.  If you do business like a Westerner, you can expect to get business … with Westerners.

X. Thou shall keep fully informed

Korea is the 4th most wired country in the world according to the OECD.  On top of that, Koreans use mobile phones and Internet constantly.  This results from proliferation of information at an incredible speed.  Make sure you keep your data up to date and use reliable sources.  Information is power and power is money.

XI. Thou shall recognize foreigners are different

Lastly, as a new foreigner you will be given some slack. Being a foreigner can sometimes take a toll on negotiations (sometimes while negotiating with foreigners Koreans can expect to get more because they are from a country that has less than others) but it can also be very positive.  Try to keep the previous ten commandments in mind, but Koreans do realize how hard it can be for new foreigners to deal with them and understand their customs.  If possible do negotiations with someone who knows Korea well, but if you can’t do that it’s not the end of the world.

Go to the next chapter, Get Off on the Right Foot: Business Etiquette or select a chapter.

SSangyong In a Tight Spot (Business Journal #1)

Posted by on January 14, 2009 No comments

“쌍용차 법정관리 신청..회생 가능성은“

Summary

쌍용차가 이제 아주 나쁜 상태에 있습니다. 2004에 상하이차가 쌍용차의 큰 부분을 샀기 대문에 그 상태에게서 떠나기를 원합니다. 쌍용차는 돈이 없어서 한국은행과 상하이차에게 부탁하려고 합니다. 근데 둘다 다른조직에게 책임이 있다고 합니다. 쌍용차의 SUV 아주 나쁘게 팔렸습니다. 이 이유로 상하이차가 전에 돈 주겠다고 했지만 지금 있는 많은 문제 대문에 개발비 안 내겠다고 했습니다.

Vocabulary

경영 = management
대략 = generally
신청* = N. petition / V. to petition
대비 = comparison
상하이 = Shanghai
좀처럼 = rarely
향후 = hereafter
회생 = N. restoration / V. to revive
추가 = N. addition / V. to add
제대로 = well, properly
일단 = first
이행하다 = to impliment
판단* = N. judgement, decision / V. to judge, estimate

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