Definition of zombies

By Lee Sun-ho

“Zombie” has become a common word in the Korean mass media. For example, a zombie company is used to describe an economic situation where a failing company continues to operate with government support, but cannot stand on its own. However, few Koreans are familiar with its meaning, its origin and the current issues of this particular terminology.

Zombies, as fictional undead creatures, appear through the reincarnation of human corpses. They are most commonly found in horror and fantasy genre works during the U.S. occupation of Haiti (1915-34). The term comes from Haitian folklore where a zombie is a dead body brought back to life by magic. The English word zombie was first recorded in 1819 in a history of Brazil. The Oxford English Dictionary gives the origin of the word as West African. But how these creatures came to be called zombies is not quite clear.

The modern conception of the zombie owes itself almost entirely to George A. Romero’s 1968 film “Night of the Living Dead” in which he bred the zombie with the vampire. He used zombies not just for their own sake, but as a vehicle to criticize real-world social evils. Recently, AMC series “The Walking Dead” has created a renewed interest in the subject and has spurred copycat series and movies. On the show, the resurrection of the dead is portrayed as a scientific process rather than a mystical one, and the resurrected dead are more violent and dangerous than their living selves.

When used in the business world, zombie is a designation for a company that is unable to attract enough investment to start paying off its debt covering various operating costs. Instead, all attention is focused on any positive elements within a company, while liabilities are given little attention at all. When this type of mindset persists, it is not unusual for the company to become unstable financially.

The National Assembly has been under legislation of the Promoting Law for Corporate Restructuring, to expire by the end of 2015. The Bank of Korea estimates the number of zombie enterprises as of 2014 equaling 3,295, 15.2 percent of the grand total. These zombie entities are among several marginal businesses in the fields of transport, shipbuilding, construction, textiles, electronics, iron, steel, etc. They are still trading and are partially “alive,” but unable to grow to pay off their debts. The half-dead zombie firms are losing money and have little hope of improvement in the imminent future. Therefore, they depend on banks to grant them another loan to survive or seek other means of solvency to avoid a negative ripple effect on the economy at large.

Insolvent companies can take steps to move away from a zombie mindset and get back on track. A three-step process to conduct a wide evaluation of the company is desirable. First, the employees should be given the chance to express their opinions on what is holding the company back. Next, an outside firm should be hired to evaluate the organizational structure and corporate culture of the company. Last, the findings of these two surveys should be taken seriously, with their recommendations implemented while there is still time. Zombie businesses don’t have to end up bankrupt, or lost in a buyout or merger.

Once such a company, equipped with a strong will and challenging re-entrepreneurship, stops avoiding tough issues and determines to tackle them head on, it’s possible to bring the zombie back to a full level of health.

The writer is an outside director of Samyang Tongsang in Seoul. Contact him at kexim2@unitel.co.kr.