Tag Archive for Donald G Southerton author

Everything Korea; September 5 Episode, Korean Business Relationships Amid Acceleration

 

Korean Business with Don Southerton

 

Amid disruptive market conditions perhaps the greatest ripple effect challenge to Korean global business is how best to maintain positive and collaborative working relations between Western and Korean teams.

 

From a cross-cultural perspective Korean commerce is dependent upon relationships and interpersonal interactions. Western business, in contrast, leans toward process and procedure.  Therefore when Korea-facing working relations are strained culturally, there is a heightened impact throughout the entire organization.

Without discounting market conditions and intense pressure to meet aggressive sales goals, I see impact of adapting to a rapidly changing and disruptive business landscape at the core of many strained relationships.

As author Thomas L. Friedman points out in Thank You for Being Late:

“As we transition from an industrial-age economy to a computer-Internet-mobile-broadband-driven economy—that is, a supernova-driven economy—we are experiencing the growing pains of adjusting. ”

Drilling deeper, I have found this acceleration has markets and industry sectors ever shifting. For example, the automotive industry is witnessing and adjusting to new consumer preferences, such as collaborative consumption shared ride services of which Uber, Lyft and Maven are examples, self-driving autonomous technology and eco-friendly vehicles.

That said, we as a society are also experiencing the need to adapt more frequently and at a more rapid pace than ever in the past.  The good news is we are perhaps adapting faster than anytime in history.  Still there is a substantial gap in the high rate of change and speed we adapt. This gap is disorienting and business models that worked in the past have become outdated further adding to stress and frustration.

In my work, this leads to a Korea driven climate of reactive and hopeful second-guess decision-making, or, in some cases, the opposite in stalled action. In both situations, I feel we need to embrace a middle course— a well thought out and responsive plan.

Again Thomas Freidman, too, recognizes this need to ponder.  He notes, and I paraphrase:

Patience… space for reflection and thought. We are generating more information and knowledge than ever today, but knowledge is only good if you can reflect on it.

In closing I return to my original point of the vital importance of maintaining relationships amid the current market condition.  No matter how challenging the situation we need to take time and work to forge strong collaborative bonds within teams Friedman again remarks:

“And it is not just knowledge that is improved by pausing. So, too, is the ability to build trust, …to form deeper and better connections, not just fast ones, with other human beings, our ability to forge deep relationships—to love, to care, to hope, to trust, and to build voluntary communities based on shared values—is one of the most uniquely human capacities we have.”

 

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

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.

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

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.

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

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

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

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, 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

Everything Korea: November 28 Episode, South Korean Impeachment, a Growing Likelihood?

Commenting on the impact of the Trump election on Korean trade for the past weeks—Korea-facing trade an area of my expertise– I have been hesitant as a Westerner to offer my views on the indictments against South Korean President Park.

Nevertheless, impeachment seems a growing likelihood. Politicos now predict the National Assembly will secure the required two-thirds majority vote needed to pass an impeachment bill. To this point, I feel the compelled to share what “next steps” we may see unfold. Pouring over scholarly updates including my longtime friend Professor Steph Haggard’s insightful “ Park Unraveling” series https://piie.com/blogs/north-korea-witness-transformation, I present a number of “If’s,” in short of President Park stepping down and resigning.

The “If’s.”

1. If the National Assembly moves forward and passes an impeachment bill, the Constitutional Court is then responsible for deliberating the case. In addition, President Park’s powers would be suspended with the Prime Minister charged to lead the nation during the interim.

2. The Court then has 180 days to make a ruling on whether charges against the president warrant impeachment. If the Constitutional Court upholds the impeachment bill, the South Korean Constitution stipulates a presidential election must be held within 60 days. That means if the Court takes the full six months to rule on the case, the election would be held in August 2017.

3. If the Court rules in favor of impeachment, President Park would be stripped of her post and could face criminal and civil charges.  Under Korean law, presidents while in office are immune from prosecution short of treason or insurrection.

4. It is worth noting, the next South Korean presidential election is scheduled for December 20, 2017. In the event, the Court rules in favor of President Park, incumbent Korean presidents are limited to a single 5-year term in office, and President Park could not seek re-election.

5. With no clear favorite yet for 2017 presidential election along with if President Park is impeached triggering an earlier election, pundits do feel the current United Nations Secretary-General Ban Ki-moon, a former Korean Prime Minister, positioned well as the front-runner amid a field of opposition party hopefuls.

All noted, with the situation subject to change and fluid, we’ll have to take a wait and see approach to what unfolds next.

Comments and questions welcome.

Trump and Trade, Part 2

“Trump?”—a question that surfaced often while I attended the 2016  LA Auto Show Media Days. I fielded questions from both Korean and American auto industry leadership on the impact of the election. Many had been following my daily posts and recent commentary.

See http://brandinginasia.com/trump-nafta-south-korea/

Assessing what next to share, I see several actions by the incoming U.S. administration.

First in contrast to the president-elect’s bold statements to take on NAFTA, I find the U.S. is less likely to purse extreme actions such the withdrawal from or a major renegotiation of the KORUS FTA.

That said, the U.S. is likely to strengthen “policy” measures that could restrict imports by imposing anti-dumping tariffs or countervailing duties. This is not new. For example, after a repeated pattern of pricing below cost by Samsung and LG on clothes washers over the years the Korean brands now pay hefty anti-dumping duties to offset margin and price advances over manufacturers and threatening American manufacturing jobs. The incoming president could direct the U.S. Department of Commerce to aggressively purse similar actions against Korean importers where local jobs are impacted.

The incoming president may also demand its trading partners revalue their currency, starting with those nations that we recently placed on its currency watch list.  In April, the U.S. Treasury Department announced a list of countries on its watch list that includes South Korea it would closely monitor for any unfair trade practice.  Weakening a currency can make goods produced for export more attractive however it leads to a trade deficient especially if the host country has a stronger currency as is the case with the Strong U.S. Dollar.

In recent days, the U.S. Dollar has continued to surge in value against currencies around the world following the election. Again, this may be good for American consumers buying foreign goods but makes U.S. manufacturing less competitive for export. As for the South Korean Won it has finally begun to strengthen against the Dollar following the shock U.S. election results.

More an issue than the Dollar to Won is if the U.S. targets and designates China as a currency manipulator and slaps up to 45-percent tariffs on Chinese imports to America. Korea will as a ripple effect suffer since their economy is increasing dependent on its export trade to China, which would slow.

Well-Stated Korean Concerns …

My longtime friend Yun Won-sik, who serves as the executive vice president for the Korea Trade-Investment Promotion Agency (KOTRA) recent statements capture the mood in Korea. He notes how major Korean exporters could potentially face increasingly unfavorable business conditions in the United States.

“Although it is too early to say what steps the Trump administration will take at the moment, it is certain that Korea will face greater pressure to open its legal and other services industries, and curb its shipments to the United States,” Yun said.

“It is unlikely that Trump will nullify the KORUS FTA but will instead choose to revise it in favor of U.S. companies. He will certainly raise trade barriers to keep out foreign goods to revitalize America’s faltering steel and other traditional manufacturing industries as he promised to marginalized blue-collar workers.”

Oh, one more thing…

On the encouraging side, earlier this year the International Trade Commission (ITC) showed the KORUS FTA did have a positive effect on the American economy and improving the trade balance.

The report pointed out that the KORUS FTA led to a $15.7 Billion improvement in the U.S. trade balance in 2015. The U.S. posted a $28.3 billion trade deficit with South Korea that year, but it would have been $44 Billion without the bilateral free trade pact

Building on this and to counter the fallout of Trump’s protectionist trade policies, last week the Korean government has begun to mobilize resources in an effort to sway the incoming U.S. administration that the KORUS FTA is mutually beneficial and, in particular, how South Korean investments in the U.S. has stimulated American jobs over the years.

I, too, see this as a strong argument as one only has to travel Route 85 South from Georgia into Alabama to see the growth spurred by the Kia Motors Manufacturing Georgia and Hyundai Motor Manufacturing Alabama plants.  The rise of Tier One and Two providers along the corridor and the boost to the local economy is hard to ignore.  More so, for those of us who visited the area prior to the opening of the car plants.

Stay tuned to my updates as new developments unfold.  Questions and comments welcome. Questions@Koreabcw.com

Everything Korea: November 14 Episode: Trump and South Korea Trade

I would not be fitting without sharing my thoughts on the recent US presidential election and its potential impact on US Korea global business. To many in Korea the election results are troubling… another layer of stress and concern amid a downturn in Korean exports.

Trade agreements, US military support for South Korea and dealing with North Korea top the list.  On the trade agreement front, I was a supporter of KORUS FTA both prior to its ratification and contributing a number of high profile articles on the benefits of the treaty.

From 2012:

https://bridgingculturekorea.blogspot.com/2012/05/korea-facing-business-2012.html

From 2013:

http://www.uskoreaconnect.org/blog/2013/04/trade-in-ideas-a-hidden-benefit-of-korus-fta/

From 2014:

http://www.uskoreaconnect.org/news-events/newsletter/newsletter-3-2.html

More so, I’ve commonly referred to KORUS FTA is news articles, interviews and speaking engagements.

My clients Hyundai Motor America, Kia Motors America and well as Mobis Parts America benefit from the treaty…  although I’m told 60% of the two OEMs finished product sold in America are made in US plants. (Some engines and a number of Tier 1, 2 and 3 components are still imported, but much less than when the plants were established).

Frankly, I am more concerned with trade agreements with Mexico. Korean Groups, Hyundai, Samsung and LG operate plants across Mexico for local demand and export to America.

As an example, a new Kia Motors Mexico plant opened earlier in 2016 with plans to supply up to 80% of their capacity for export. A heavy trade tariff on Mexican goods exported to the US would be troubling not only to Kia, but a growing wave of Korean Tier providers. On a side note, opening a plant in Mexico for an OEM is not only about labor costs and savings, but eliminates a heavy tariff on vehicles the brand also wishes to imports into Mexico.

In addition and less know as another example is Hyundai Motor Group affiliate Hyundai Translead, who I have also supported. First developed under the maquiladora program, trailers made in the Mexico plant currently are sold in the US—check out the back of a Wal-Mart trailer you see on the highway for the Hyundai logo… or this Hyundai Translead video.

 

As for Samsung Electronics, since the 1980s, with the construction of an electronics complex (SAMEX) in Tijuana, where TVs, color monitors, and mobile phones are currently being produced. Samsung Electronics Mexico (SEM), a local sales subsidiary, was established in 1995, and now the operation has been expanded to include refrigerator and air conditioner production. Samsung Electronics also has local production of side-by-side refrigerators, front-loading washing machines and other high-end appliances.

All said, Detroit’s Big Three automakers — GM, Ford and Chrysler — all have production plants in Mexico, and any hefty tariff would impact them as well. In addition, GM’s Korea plants produce cars for the US market.

With more questions that answers, I’ll be revisiting the impact of the elections as it unfolds over time. So stay tuned.

Oh one more thing-

Regarding North Korea, I see with President- elect Trump’s unpredictable, and aggressive way of thinking it may make Pyongyang more cautious about its military provocations.

Questions and comments welcome.

Everything Korea November 7 Episode, Traversing the Challenges

november_7

One of my passions is mountain trail running—the more demanding the terrain–the better. It’s the same in my consultancy –I enjoy tackling tough challenges – and providing sound solutions and a work through.

Over the past few days, I’ve had inquiries on resources to help western managers and teams better work with their Korean counterparts.  As I’ve mentioned, for example, we’re seeing local teams increasingly in daily correspondence and on calls with Korea HQ teams, so practical skills and insights can help traverse the cross-cultural challenges.

In addition to my weekly vodcasts, now with more than 100 videos on the BCW YouTube Channel and over 20,000 views, I’d like to share another web-based resource –Issuu—where I’ve uploaded 22 publications.

Subjects are wide ranging from my 10 insights into Hyundai Motor Company culture to articles in Forbes, Chief Executive (Korean language), The Economist, The Korea Herald, Yonhap New Agency, FSR Magazine, and US Korea Connect to name a few.

Link to Issuu –

https://issuu.com/bcwkorea/docs

Oh, one more thing –

Have a subject you’d like me to discuss or comment on in an upcoming episode?

Just email the request to questions@koreabcw.com

Everything Korea, October 24 Episode: Deconstruction

oct-24

As I have shared before, supporting clients and their challenges requires getting to the core issues. It’s distinguishing between what may be, for example, a local organizational, or what may be tied to the Company in Korea. It then requires probing for any cultural impasses before providing a practical solution and a work through.

Much of this work is first listening carefully to clients and their challenges.  Equally valuable is walking around the corporate offices, observing and capturing multiple viewpoints.  Nothing beats being onsite. Nothing beats getting face to face.

Too often, I find challenges as murky, complex and layered with frustrations, so a deconstruction is needed.

In most cases, I bring a fresh perspective—one rooted in years working with Korea-facing business.  I’d like to share that in addition to mentoring, my work also involves directly supporting specific and very select high profile projects with clients.

Next Steps

As a next step, I suggest we set a time to discuss how we can work together. My personal assistant Stacey at stacey@koreabcw.com can coordinate a time for us to meet or chat by phone.