An era has ended!
Thursday, December 22, 2011
An era has ended!
Saturday, November 26, 2011
That's "noonchi", not "kimchi"
Saturday, June 25, 2011
I've had the pleasure of working in South Korea (they just call it Korea) for more than a year. We're working on transforming a large public corporation. I have made many new friends and have come to love this beautiful country of 48 million people.
But at the end of the day Korea has not gotten far from its military roots. It is a surface democracy in a police state.
The Economic Miracle
Korea is an amazing story. I believe that Koreans are kind and passive by nature. This has not served them well in their history. They have been constantly invaded and occupied. Their Buddhist stoicism has contributed to their survival. Patience has been the winning strategy.
The past century has been nothing less than a miracle in Korea. From 1910 to 1945 Korea was occupied by the Japanese - a historical fact that continues to sting. On the heels of the occupation came the Korean War, which has never officially ended. Coming out of the Korean War the country was one of the poorest in the world - the war not only killed more than a million people but it destroyed the economy. Poverty and starvation were the color of the day during President Rhee's first republic. Even today when elderly Koreans meet they rarely say "hello"; it is more common for them to ask, "have you eaten today."
But all of this changed. Today Korea has joined the trillion-dollar GDP club and is one of the worlds 20 strongest economies. From 1953 to 1995 the Korean economy grew at an annual average rate of 7.6% - it grew 21 times. Although growth from 1953 to 1960 was slow, the economic growth started to rocket and finished as the "miracle on the Han (Seoul's major river)" before the economic crisis of 1997.
Even the economic crisis was only a minor set back. With the help of the IMF and the world community Korea reestablished its economy and the economic picture has looked pretty good through out the 21st century. Generally the economy grows in the 3% to 5% range and unemployment hovers around 3%. Yes, there is poverty and some employment is artificial: the average wage in Korea is less than $30,000 US because many jobs are ceremonial, lots of security guards, helper staff (a gentleman and his assistant collect my shoes three times a week for cleaning), and excess staff in service businesses.
But when you add it all up Korea is a good place to be. The local news here is always better than the reports I hear about PIG (Portugal, Ireland, Greece), most of the EU and the stumbling US. So what's behind all of this?
The Economics Of Survival
As with any social/political/economic analysis there is no single factor; but let me offer an observation. Korea's military history serves it well economically. I always feel totally safe here, but that's because of the not so subtle presence of police.
When you go back to the economic miracle starting in the 1960's it is supported by a democracy wrapped in autocracy. A democracy run by the military. President Park's government had a clear policy for economic revival. Korea would move from a domestic, agrarian economy to one that was export driven. This required help form the cheabol - the family monopolies that had taken over the industrial threads of the economy from the Japanese after the occupation.
The government set up a policy and financial structure to support the cheabol. The brand names of Samsung, Hyundai, and LG didn't materialize on their own.
In fact, these brand names and many others rose on the backs of Korea's workers. The story of Korean labor is often not pretty. During the Park regime (he was assassinated in 1979) labor was treated harshly. Dissent was put down, and often harshly. In 1970 a young labor leader protested by pouring gas on himself and incinerating himself. Economic success came with a social expense.
Fast forward, and excluding the military uniqueness that causes a constant string of conflicts with the North, what is the picture today? On the surface it's great, and it will always be great if you know and follow the rules. Let me give you a glimpse of the rules.
Protest Within Established Guidelines
First, the police are never far from hand. I live in a hotel residence that is several blocks from my client's office in the financial district of Seoul. Between here and there are two land marks: the Japanese and US embassies. On my walk to work everyday I likely see 100 young uniformed police, men and women.
Half way on my walk to work I always pass a lone gentleman with a placard. He's protesting something, but my poor Korean reading skills don't tell me what. I know he's a protester because he's alone, and he doesn’t have a police escort. Dissents of more than one require a permit in Korea and those are hard to come by because the state needs to incur the expense of assigning police to watch gatherings of more than one person.
And that's exactly what happens several times a month when I return to my residence. Protests happen regularly on the street backing onto the Japanese embassy. Usually there are several vans, a crowd of 20 and about a dozen "comfort women." If you haven't read about the Japanese treatment of Korean "comfort women" its worth a Google. The Korean's want an apology and I think the Japanese are just waiting for the women to die off. In any event, when the scheduled time for the protest is over the leaders load up the vans, clean the site and drive off. It's like pulling your hand out of a bucket of water. You'd never know it was there.
Strike, Please. Not!
Then there's the famous Japanese triple header this March: tsunami, earthquake, and nuclear meltdown. Although the Koreans have a hyper-fear of the "nuclear rain" (you should see the umbrellas go up in a drizzle) the Japanese disaster has been a gift for the Koreans. The disaster for the Japanese car industry has been a gift for the Korean car industry. Or, maybe not!
About a month ago workers started to take advantage of the disruption in the global automotive supply chain. Korea, specifically Hyundai and its subsidiary Kia, were seeing that they could take away huge segments of the Japanese auto market; but not so fast. Labor in one of the large auto parts suppliers decided to use this as leverage. They went on strike. I watched the media reports with interest for several days as negotiations faltered. Then I watched no more. Without warning, one night, the government sent 3000 police into the factory. The strike was over. Labor would not be a barrier to an economic gouge that could be inflicted on an old enemy.
It’s Not Tienanmen
Then there is the student protest that is taking place; a protest that no one knows about. Like everywhere else students are being asked to take more of the tuition load. Like everywhere else, they don't like it. So for the past few weeks you'll hear a bit of noise in the Gwanghwamun area of the city near the palace. When you look you'll see a well-guarded "gathering" of students doing their "riot" thing. Then they disappear and so do you. But the police don't.
On Friday nights it’s my tradition to walk into the wealthy boutique and restaurant area of Samcheong Dong. I have dinner then a drink with friends at a wine bar. The last two Friday nights have been different. This Friday was the most different. You could feel them everywhere. Police!
I have to walk about a mile before getting to the shops and bars. The palace wall runs the full length on one side of the boulevard while art museums and small businesses line the other side. Usually this is a crowded walk until you hit the turn where the commerce really begins, and then it's mayhem. The street is full of cars and you can hardly move on the sidewalk. But not last Friday.
Walking up the boulevard there was no one on the walk and for the first time ever the street lamps were off. When I hit the turn the sidewalks were vacant. I was almost alone for dinner at Eight Steps and when I crossed over the street to Pason the wine bar was empty. My friend who owns the bar told me that the student unrest had been ruining his business for more than two weeks.
The walk back to my room was safe, but eerie. Once I got to the darkened part of the boulevard I could feel the return of my protectors. I was in a mile long dark tunnel that concealed the presence of several hundred police. After every few yards I could make out the vague shimmer of their chartreuse vests. Across the street was a squad of 20 with riot shields; down the alley was a neatly ranked group of ten with their batons in hand; at the stop sign were four more, two in front with two behind holding the shoulders of those in front; there was a big group of protectors in the museum parking lot; there were pairs patrolling the walkway and others in cars in the street; there was a stretch of five police buses book-ended by paddy wagons on the other side of the boulevard and lined up behind this string must have been a group of 50 standing at ease pinched up against the palace wall; as I got to my traffic intersection I wasn't surprised to see large groups of police on each of the corners, but I was caught off guard by the team that was hidden in the shadows of the old hanok behind me.
I was back in the light and a few hundred yards away from home. Oh, how I hoped that those violent students wouldn’t come out to play! If they did then thousands of police would pour from the darkness into Gwanghwamun Square and the riot, like the strike, would vaporize.
It’s All About Trade-offs
So what does all of this mean? I wish I knew. You can go any where in Seoul in the middle of the night and never think of your safety. There aren't many other cities in the world where I can say the same. As for the economy, Korea isn't looking back; it's part of the Asian miracle that sees itself as the new economic order - strengthening everyday at the expense of the decaying West.
Maybe the lesson is simply that world is made up of people just trying to get through their day. They have to find ways to make this happen. That means political trade-offs. In the West we value individual freedom to the point that we have incapacitated our governors; in the East people hold more holistic traditions to the point that the individual is subordinated.
Do you like your trade-off?
Friday, May 20, 2011
To grow, and even survive, it will need to fill the revenue gap with new products & services. Doing this requires ideas. New ideas. Powerful ideas.
For more than a year, Bud Taylor led teams of KT professionals in the Mobile & Enterprise business units in their quest for radical ideas that could be implemented in a short cycle.
Crashing Lenses = Ideas
Generating radical ideas starts by asking new questions to find new answers. This is done by using the power of four lenses:
2. Customer Insights
3. Core Competence
By crashing these lenses we can see opportunities that used to be concealed.
At KT we generated 1000’s of idea candidates from every corner of the organization. Small, dedicated teams synthesized and grouped these candidates into domains and from here they selected the first business opportunities.
Next the high impact business opportunities were explored and expanded; business models were refined; action plans developed, approved, & implemented.
The teams made big changes in:
• Customer service
• Online sales channels
• Retail operations
• Smartphone & tablet sales
• Account management, &
• Operational processes
It wasn’t always easy. Often we had to call on the executive team for help to stop ideas from going to the natural graveyards caused by:
• Silo politics
• Committed resources
• Lack of priority, &
• Bureaucratic controls
In fact we leaned heavily on the executive team. We involved them as sponsors in all of the work & we held working sessions every month to break through barriers & develop their skills as leaders of Innovation.
It’s been a long & continuing journey that has engaged employees, changed the culture & built capability for the future.
Thursday, January 6, 2011
Sinking of the Chenon
When I arrived in Seoul in April of 2010 the Chenon had just been sunk. You'll remember this as the sinking of a naval vessel where 46 South Korean sailors lost their lives. An international panel concluded that the sinking had been at the hands of the North Koreans - who of course strongly disagree.
The politics surrounding the Chenon were interesting to watch. The US decried the North while China took a strong stance on non-committal. There were several months of blustering and then things cooled down.
For my part I was amazed at how the average Korean took little notice of what was going on. It was business as usual ... "what can we do."
Then in early November, militarism faded while hopes turned to financial reform on a global scale and US-Korean trade on a bi-lateral scale while the g-20 met in Seoul. However, even the graciousness of the Koreans couldn't bring success to the G-20. Everyone went home extolling their agreement to sit down and develop agreements at a later time.
Shelling of Yeonpyeong Island
Everything seemed normal on the Korean peninsula until November 23rd. I was sitting at my desk that afternoon when I got an email from my son who works in Paris. It had a tone of panic: "are you alright? can you get out of there? be safe!" I had no idea what he was talking about. I went to the web and sure enough, the North had just unleashed an attack on the island of Yeonpyeong. Two military were dead as well as two citizens. Here we go again.
I got up and walked around our offices to ask how people viewed the incident. Most people didn't know it had happened and those that did still had a nonchalant attitude. That evening I was driving to dinner with one of my client EVP's. I asked about her reaction. She hadn't heard. Her driver turned on the TV to show her the news. She was annoyed, but not concerned - "what can you do?" This was fully four hours after the attack. She floats around at very senior levels and yet no one she dealt with that afternoon had mentioned the attack.
Ever Decreasing Concentric Circles
I've learned a lot about Korea in the last year. I've learned that things aren't black and white even when we want them to be. I've learned that South Korea has not signed the armistice to officially end the Korean War - they live in hope of reunification. I've learned that the demarcation border that runs into the Yellow Sea has always been disputed by the North; and I've learned that the North warned the South not to do live ammunition naval exercises in the disputed waters.
So yes, we all believe that Kim Jung-Il and his heir apparent Kim Jung-Un are pushing the envelope, but does President Lee Myung-bak of the South have to keep the tension high? Since the Yeonpyeong bombardment the South has put a more aggressive defense minister on the job and it continues to flex it military muscle - along with its alley the United States.
It seems that this whole Korean mess just continues in a state on numbness. Everyone knows that all out war would be devastating and would also be over in about 10 minutes. It's questionable whether the Chinese would engage - it sees the North more and more as a "bad boy" and its global economic power has taken away the need for the North to act as a protection buffer from the US in the South. The only problem is that 10 minutes of hell from the North would result in millions of dead in the South.
Why do North and South put up with this? How do they break with the tensions of the past? You would think that after almost 60 years that someone would find a way to break the cycle. Why hasn't it happened? I'm sure there are many social-economic-political-military reasons that make sense; however, maybe they simply can't break with the orthodoxies that keep them apart. Maybe tension is better than the alternative; that is, figuring out how to include everyone on the Korean peninsula in the modern world.