Reckoning With Challenges

By Jahan Alamzad

I received generally favorable reviews from colleagues and friends who read my opinion piece that appeared in the Dec. 30, 2008 edition of The Korea Times.

Titled ``Essential for Economic Success," I strove to highlight the ingredients that I perceived as being the foundation of Korea's enviable economic boom of the recent past.

However, some thought I was excessively complimentary and that I ignored shortcomings that any society would have. One called it ``an advertisement for Korea."

With certitude, I have plenty to support my assertions. The case in point is the fact that no one wants to compete with Koreans in the semi-conductor industry due to the tenacity of the country's major players.

The same is true in areas ranging from heavy industries and transportation to construction and consumer electronics.

Yet, for the sake of being even-handed, it behooves me to underline the impediments as well. In that piece, I left it as ``challenges remain," but elaborating a tad would make sense and relieve the fear of being biased.

The following five themes present some of the major quandaries facing Korea, which, if they continue unabated, have the potential to set the country's phenomenal economic success back.

Not Invented Here

This predicament is not unique to Korea, but is prevalent in this country. Many foreign companies have learned that without some kind of Korean angle, pushing through initiatives is not possible.

This is a proud nation, and rightfully so considering its achievements in face of all it has had to endure. I am told that the biggest insult to a Korean is to be accused of laziness, just like the hardworking American farmer in the Midwest whose pride rests on never being blamed of lethargy.

The prevailing question among Koreans upon seeing foreigners engaged in white-collar work is ``why can't we do this ourselves?" This stems from the nation's pride in its capabilities.

This trait is admirable. But, if taken to the extreme of the country closing itself off from outside resourcefulness, it will have dire consequences.

This is one area that some of the other economic giants have been able to overcome, after being horribly dogmatic about it. Korea must not fall behind them in putting an end to NIH (not invented here).

Task vs. Process

Koreans are focused, diligent and driven to problem solve. Add to that the hard work ethic, the chances of getting the job done right go up vertically.

But, more often than not, the energy that is spent on tasks comes at the expense of foregoing the assiduousness of the processes around them.

Of course, it would be a false dichotomy to pit the importance of tasks against the significance of the process. But assuming that a process is simply the sum of its tasks ignores the delicate intricacies, priorities, problem solving and leadership involved in its successful completion.

When individual contributors work as hard as ever, the result is a stagnation of business organs; rethinking is necessary to address how the processes are designed and managed.

The Korean business culture can benefit from shifting its paradigm toward being more process-oriented so that it can reap the benefits of its competent workforce.

Hit Them Where They Ain't

Rooted in baseball, this phrase has become an iconic business mantra. It instructs businesses to become dominant players in un-crowded domains. Ryanair began flying routes out of European airports that no other airlines wanted, and became tremendously successful.

The danger of this model is that if unchecked, it can lead to unwelcome consequences.

Instead of battling in the trenches of the market with solid planning and execution, something that Koreans are good at, businesses in Korea that follow this mantra blindly become weakened by their wasteful spending of resources in search of new-fangled and sensational triumphs, which, more often than not, prove to be illusive.

A contrarian view exists. With its iPhone, Apple entered phone manufacturing, competing head-on with mega players, despite having no experience in the domain. Yet, it achieved a storied success.

Localization

Localization occurs when local habits and customs seep into the conduct of commerce and Korean companies that must operate globally can be particularly damaged by this. A seamless business environment is a necessity for a thriving global company.

Whether a ``chaebol" or an emerging company, any Korean organization can benefit from recognizing localization. Instead of denying it, the companies should mobilize resources to mitigate its occurrence.

To judge whether a company has achieved the global standards of seamlessness, imagine being parachuted into the midst of a business meeting. You should not be able to recognize geographically where you are except for the spoken language. Granted, that's extreme. But it is also a good yardstick that Korean companies can apply.

Relax a Bit

This is a charged-up country. Folks often seem to be running on adrenaline. This is obviously good from the productivity perspective. However, it has consequences as well, which can hinder the productivity gains.

``Work hard, play hard," appears to be the motto of Korea. Fueled by a ``ppalli ppalli," or hurry up, culture, patience is a virtue of premium value, as everyone is in a hurry.

Increasingly, less time is spent on matters that require reflection, without which moving forward can become just spinning wheels.

The above themes, however, must be put in perspective considering Korea's economic performance. The reality is that these are the by-products of a hugely successful country that has raised itself from a deep hole created by a devastating war just a couple of generations ago and put itself among the top economic performers.

Considering that, these problems are welcomed if the alternative is a failed economy.

An intelligent cadre of commerce and government leaders, abundant in Korea, can surely gain from realizing that these challenges must be reckoned with decisively if the prosperity is to be continued uninterrupted going forward.

Jahan Alamzad is managing principal of CA Advisors (www.ca-advisors.com), a management consulting firm in San Jose, Calif. He specializes in the application of advanced analytical techniques to complex business problems. He can be reached at jahan.alamzad@ca-advisors.com.