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The KBC 9.9 with Daniel (Sept 5, 2010) - “What Korea needs to do to get its per capita GDP ranking into the top ten in the world."
The KBC 9.9 with Daniel
"What Korea needs to do to get its per capita GDP ranking into the top ten in the world."
Click the button to hear online our exclusive interview, or download the mp3 file to your computer (10:19 min. length).
Listen to the podcast below and then share your thoughts in the discussion below (Hint: We are looking for controversy in this discussion so don't hesitate to disagree with what other have said.)
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Daniel is already putting together his panelist list for future shows. If you'd like to join, email Daniel directly at d.lafontaine@glomedics.net.
Daniel: Hello. My name is Daniel Lafontaine. This is KBC 9.9 with Daniel. We are here tonight with three extremely knowledgeable fellows. To start off, let’s introduce them one by one. Number one, Tom. How about you first?
Tim: Do you want to talk to me first? My name is Tim.
Daniel: Tim, sorry, Tim.
Tim: My name is Tim Thompson. I’m a visiting professor at KAIST in Daejeon, and I’m also the founding member of Education Anywhere, a small e-learning company. I’ve been in Korea a little over ten years.
Daniel: Very good. John, what about you John?
John: My name is John Stahl-Wert. I operate a company called Serving Leaders which provides leadership development resources for businesses and organizations, and my connection to Korea is that one of my books called “The Serving Leader” has been a best-seller for about six years in the Korean translation.
Daniel: Excellent. And last but not least, how are you doing tonight?
Chander: I’m doing fine. My name is Chander. I work with SK C&C which is an SK Group company. I primarily deal for their global business with my background in senior management and business consulting, primarily focused for the business development activities outside of South Korea. I have been in Korea close to two years now. My family came here in the context of the work. I had been in other parts of the globe before coming here.
Daniel: Excellent. So we have a good range of people tonight. We have one in America, one from Korea, a French-Canadian and Chander from, I believe you’re in Korea?
Chander: Originally, I’m from India.
Daniel: Very good. So a good range of panelists tonight. So let’s start this all off. What can Korea do? What does Korea need to do to get its per capita GNP ranking in the top ten of the world? Anybody want to start off?
Chander: This is Chander. I think in my opinion, we need to beef up the service sector. Primarily, if we see the Lee administration 7/4/7 policy. They are still gunning for it, but if you see the real GDP in 2009, it was about 3.4% and the service sector primarily is not up to the mark, or it’s slowly declining growth. I think service is not the area, which I strongly believe North Korea has to…
Daniel: What do you think about that, John? Do you think the service sector needs to be boosted any way, shape or form?
John: Well, I agree with the comment, absolutely. I would put a different dimension on top of it, which is that if you look at the companies that outperform in the marketplace, that go to number one in their sector, that build market share above the competitors, leadership development is at the heart of all the research about this.
The reason this connects with Chander’s comment is that what makes business outstanding is the work of everybody. There’s a paradox in leadership. Leadership matters a great deal because it creates a culture in which everybody does great work or it creates a culture in which people just punch the clock and do what they’re supposed to do.
Daniel: But is that possible in a country where children are being pushed to study until 11:00 at night and there is no individuality, there is no customer service to the most important group in society? Can we really create a culture in all of Korea where I find it’s not built into the country to begin with?
John: It depends on how we think about leadership, Daniel, and the research about great leadership that comes out of Jim Collins’ “Good to Great” or comes out of many…
Daniel: Daniel Goldman and EI, the leadership of Daniel Goldman. There’s a lot of leadership work out there being done, but not to…
John: But my point is that the leadership that outperforms is leadership that takes very considerate care of people, and I don’t think this is a values clash at all with Korea. If you think of leadership as brash, bold, run over everything, disregard the well being of people, then of course I think you’re point is well taken. But that leadership actually doesn’t produce the greatest companies on Earth.
Daniel: That’s true. What about you Tim? What do you feel?
Tim: It’s ironic that I’m going to say this, but a country that’s changed so much in the last 50 years, they need to change a little bit more. Immigration policies, small and medium business policies, and fostering more creativity in education – all these things need to change in order to bring out a positive GDP outcome.
Daniel: For me, I think it’s a whole integrational aspect. You’ve got to bring in the education system up. I’m highly tuned education system. I’ve been here 11 years. I’ve done education at all levels.
The education system here – like here in Ulsan, for an example. Not in Seoul. Seoul is very different, but in Ulsan, they have these hakwons called all-subject hakwons. And these all-subject hakwons, they finish school at 4:00, they’ll go there by 6:00 and they’ll leave by midnight, and they’re covering a little bit of everything and they’re not specialists in any one area. I remember one person told me, or one of my students told me, “Teacher, how can I dream when I’m too tired to think?”
Tim: Well, they need to get away from too much memorization and get into more creativity. My catchphrase here is “More innovation; less re-engineering.” I think the whole business of re-engineering is sort of what East Asia has been famous for, and that’s not a good thing necessarily.
Daniel: They’ve been successful at it.
Chander: I just want to make a comment to comment on John’s point of view that the whole ecosystem or the culture is not geared for the leadership. But in other countries, if you are looking to be the GDP in the top ten, then I guess there is no other choice except to change. I know change is hard, but if we are aspiring for something big, then I guess we have to bite the bullet and take it on the horns looking behind it.
Daniel: Change. We talk about change. I remember in 2001, change meant EI. But ten years later, I think it’s still the most important leadership development in the history of man.
Chander: Yes.
Daniel: But the problem is nobody talks about it anymore because it was change for 2001. How can you build it into a culture so that there’s everlasting change? John, go first.
John: There’s a profound common theme in these remarks and it just has to be pointed out. If you talk about education, reform and what happens to students, if you talk about the service sector or how workers are treated, the value, the dignity, the full humanity of the human person cannot be just sort of pressed into a technical box and, presto, you get greatness out of that. There’s a tremendous common theme among these remarks about elevating the value of the human person in Korea.
Daniel: Exactly. What about you, Tim? What do you think about that comment?
Tim: I agree with that, but I just want to reiterate the change is hard and change that has come to Korea from outside, whether it be the Japanese, whether it be the IMF in ’97 – all these things were tough to take. But if you look at what’s happened after that, then you’ve got to say, “Hey, the results weren’t too bad.”
Daniel: That’s true. I agree with that. What about you, Chander? What do you think?
Chander: Yes. As I was saying, if we are gunning to be in the top ten – when I say we, I meane Korea – then I guess we need to take all these change management leadership it takes, building the service and business friendly primarily not for the chaebol, but for the SMEs. And of course looking at the education perspective, we’ve got to take it, go for it rather than waiting for it and see that we’ve missed the train.
Daniel: Very good. I think change in Korea is a great thing. I think it’s going to work. I think they can do it because in Korea, if Korea is about anything, it’s about learning. It is about growing. So because of that, I think it’s going to go. Well, we have 30 seconds left. What about everybody? Last comments? Tim, want to go first?
Tim: I think what Park Chung-hee did for this country, and it wasn’t easy, but if they work hard I agree with what’s been said before. I think great things can happen.
Daniel: What about you John?
John: Greater investment in the development of the full humanity of the Korean people.
Daniel: Exactly. And Chander?
Chander: Yeah, I guess I really much concur with John, that we need to include the service sector which the underlying principle is people and people’s abilities to deliver more. Take the bull by the horns.
Daniel: Thank you very much. This is been Daniel with KBC 9.9 with Daniel. I hope you enjoyed our discussion. If you want to learn more or to add to it, go to the KoreaBusinessCentral.com website, and we’ll be there with this discussion. Have a good night.
Replies to This Discussion | 이 토론에 대한 답글들
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Permalink Reply by Youngil Ely Loew on -
I think it was Tim, but one of the panelist mentioned that Korea needs to change some of its policies to make them more friendly to SMEs. What policies do you think need to change regarding SMEs, or what kind of policies would you recommend to help support SMEs better? I was always under the impression that SMEs in Korea did quite well, but that might have been a misconception...
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Permalink Reply by Chander Wanchoo on -
Hello Youngil,
Glad you brought up this point - While back I hear a podcast from some economic experts where the panel strongly (supported by numbers & metrics) advocated for a point that for an economy to grow its SME sector should grow - a very generic term.
That said, I don't have specific terms/numbers from the Korean SME's progress & growth, but so far I didn't really see or encountered with any SME growing or moving beyond SMEs (unless backed or supported by big business houses). I am sure there will be some cases, but how many and at what rate?
My two cents...
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Permalink Reply by Steven S. Bammel on -
It's a good question, Youngil.
It's pretty much conventional thinking that Korean SMEs are overly dependent on the chaebol and that whenever a good idea comes along in the SME sector that might grow into something big, the chaebol buy/copy it. I can remember when I first came to Korea hearing about efforts to develop SMEs into something bigger, but it seems they still tend to be no more than suppliers to the chaebol and find few opportunities to grow out of it.
I do sometimes wonder if it matters though. Every economy is going to have its own characteristics and perhaps if the chaebol are what make Korea great, then this approach is a good one for Korea to compete on a global scale.
On the other hand, it clearly leads to a great deal of "insiderism" that involves corruption, etc. A recent book in Korea, Thinking Samsung (삼섬을 생각한다) goes into great detail about this issue at Samsung. Perhaps if SMEs were in a better position to challenge the chaebol, they would help to keep the system cleaner.
At any rate, there doesn't seem to be anything on the horizon soon to change this business landscape. Innovation in Korea means innovation at the chaebol.
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Permalink Reply by Youngil Ely Loew on
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I personally agree with you Daniel, but many would argue that this is merely your 'Western-value-centric-views' showing through. Like Mr. Bammel said, it doesn't seem like these kind of cultural trends will change soon, or easily for that matter. It would require some kind of cultural shift, which is in no way a easy thing or predictable either.
The Chaebol system worries me, mostly because I don't think a concentration of money and power in too few hands can ever lead to a good thing.Eventually, I think such a system is unsustainable. I'm not trying to sound like a socialist, but I think for capitalism to thrive and develop, the SMEs need to be in the forefront of innovation, change, and development. I think this will eventually happen in Korea, but I hope it doesn't take some sort of economic disaster to shift the balance...
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Permalink Reply by Steven S. Bammel on
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Well, if you're an SME and your idea gets bought by a chaebol for a nice price, then that's an inducement to innovate. But if the chaebol give you the choice of a) selling out cheap or b) getting stomped on, then that's not so great.
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Permalink Reply by Robert Eberenz on -
Tim's points about creativity in schools, small-medium business startup policy change, immigration renovation etc. are crucial foundations of future GDP greatness. However, fostering creativity in schools MUST begin at early level education and then continue throughout University, and therefore won't have a full effect immediately but instead after a lag of 8-12 years once the primary age students have grown to adulthood following the implementation of school reform.
This made me think back to the Rob Everett interview in August and reminded me of some comments he made. Rob talks about the Kimberly-Clark innovation center here in Korea and while the subject of the interview was innovation, it became apparent that the success of this center is founded on "reingeneering" (as Tim mentioned in the 9.9). The innovation center focuses on molding existing products into better products (i.e. making diapers more water proof or biodegradable) but doesn't really bring any new ideas to life. Plus, the point brought up by Rob that explained the compete lack of team project experience among their native Korean employees is so foreign to anyone schooled in the U.S.
This week in the Korea Economic Slice we discussed ways that Korea could avoid the stagnation of growth in Japan, and it seems obvious that innovation is the answer, but somehow the strategy to achieve that hasn't really come to fruition.
The policies of R&D in Korea are expansive, but just because there's a lot of "0's" in the size of the investment doesn't mean GDP can break into the Top 10. Assuming Korea implements creative change into the school curriculum tomorrow, Korea won't see the full effects for nearly 20 years, while the new Korean economy is barely 50 years old. Innovation in Korea needs to stop being re-engineering of Japanese or American products and start being the "invention" of Korean products. No doubt, Korea can coast on the impressive triumphs in Nuclear, Laser, and Digital Display industries for maybe 10 years, but to stay in front Korea needs home grown inventions.
Without an open attitude to foreign owned businesses (outside of the regulated "free market zones"), education reform, and an open attitude towards qualified immigrants, the supposed innovation will never flourish from first graders' notebook doodle's into true inventions by the leader's of the country 20 years from now.
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Permalink Reply by Steven S. Bammel on
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Just for the record, I'm not one of those who thinks the Korean education system is broken. I think my kids are getting a fine education at the Korean school they're in and this position is backed up by our annual visits to the US where we put them in the local US school for six weeks and they do just fine (and in math, find it downright easy!). If anything, they struggle a lot more at school here in Korea than they do back in the US.
It was interesting to hear Rob talk about the lack of team project work skills in Korea. His perspective must be more nuanced than I'm realizing because when I used to work at a Korean company (LG International), everything was about "team projects" it seemed. Isn't Korea a "group based" society where people do things together?
Finally, having gotten my US college education almost twenty years ago, perhaps my memory is a bit frazzled or things have changed since then, but I don't remember a whole lot of team projects back there either. I realize I wasn't at an Ivy League school and all, but still...
I often wonder if the "innovation" thing is something that can be planned or coordinated; perhaps the process of becoming a leading global economy is going along just fine in Korea. All the harping by commentators about this or that won't change the fact that perhaps Korea just needs more time to get where it's going.
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Permalink Reply by Robert Eberenz on
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Touche Steven... All valid points!
To the school situation, I guess my experience in a Korean high school may have been a bit extreme, since it was in a rural city. Also, I'm not standing up for America's public education system, because it's AWEFUL and is the one thing I'm willing to pay more tax dollars to improve! However, there is absolutely no time for creativity in Korea's high schools from my perspective. I'm sorry but I'm heated on this because I taught in public high school for one year, and my best students would beg to hear about sports teams, after school clubs, and elective courses like photography, pottery, and creative writing.
Daniel's quote from a student that asked, "how can I dream when I'm too tired to think?" is spot on to the faces I saw on my kids everyday. When I did a class on Hobbies over 1/3 of the class said their favorite hobby was Sleeping. Literally they would rather sleep than do anything else when they have free time.
There's no doubt that Korea's school system pumps out a highly technically skilled workforce (i.e. science and math) but from my perspective there's also no doubt that when it comes to high school, there is nothing outside the curriculum and the College Entrance Exam. Just when kids are going through puberty and naturally coming to an age where existential thought and creative genesis thrive, they are forced to memorize, memorize, memorize, and compute, compute, compute.
Korea is an AMAZING success story and I'm not discounting that. I admire so much about Korea and the society here and hope I'm not stepping beyond my appropriate bounds as a foreigner living in the country. I just know that I saw so much creativity and potential in my kids that was unable to thrive or be encouraged, because of the national standards at the high school level, and I think that by allowing that creativity outlets in the curriculum through which it can flourish will benefit Korea economically and socially.
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Permalink Reply by Youngil Ely Loew on
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Since I went through the Korean high school system, I find this conversation really engaging. I have to agree with Robert in that creativity is a bit lacking, but when I was leaving the education system back in 2002, I thought they were making some impressive steps to improve on this point. Throughout my high school years I was part of an English Drama Club (they begged me to join :) and we would meet after school and practice two or three days per week. There were many after school clubs, and many schools would have every other Saturday be a 'club day', where you could pick an activity you participated in. Also, I remember my teachers talking about universities starting to look at other factors in picking students, including the amount of school activities outside of the classroom. I'm not sure if any of those ideas took off, and if what Robert is saying is true, it almost sounds like they've gone backwards from when I left the system...
If there is any education system that I've encountered that I would call 'broken', it is the U.S. system... The University system is excellent, but for whatever reason the high school system leaves a majority of kids way behind international standards. One thing that I do think Korea could learn from the U.S. system however is a stronger emphasis on writing skills... granted, I left the Korean school system 8 years ago, but I don't remember being assigned one writing assignment. I think this would do a lot of improve creativity as well.
Anyway, just my two cents...
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Permalink Reply by Robert Eberenz on
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Great points Youngil, I'm very interested to learn about your high school experience. My take on it is that since I taught at a rural high school in Yeonggwang-eup Jeollanam-do, I could have encountered a system without many of the more interesting extracurricular options. I'm glad to hear that steps have been made for years to offer creative outlets for students!
And YES the U.S. system is "broken". That is certain! I also have perspective from that end, since I went to public High School in the U.S., and I'll say it is very sad to see such absense of work ethic from the students met with poorly equiped teachers. The problems in America have to do with funding on many levels, but also have to do with priorities. It seems that new books and computers are great things to promise from campaign platforms, but what U.S. schools really need are quality continuing education for teachers, better educated teachers (would need higher wages to attract tallent), and more committed teachers at the primary level (also need higher wages). Part of the problem is the teacher's union in the U.S. which has dug their heels in to protect job security at any cost, even if it means being paid higher wages.
In my version of a perfect world, the U.S. teachers union would allow the bad apples to be tossed from the barrell in exchange for the opportunity to recieve higher wages if you show improvement among your students. Also in "Robert's public school utopia" there would be a new system of evaluation for teachers and students, which would also cost more money, that included writing, fine arts accomplishments, student feedback, and parent feedback, to evaluate how much a teacher was worth and implement a bonus system which created incentives for teachers with sustained success.
Throwing it out there...
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Permalink Reply by vince rubino on -
American society generally does not strongly value education and school teachers and not culled from the top performers at American universities. Being a football, movie or pop music star is much more respected than being a doctor or Nobel prize winner in mainstream American culture. I do not believe the same can be said in Korea. Quality of education results for children is dependent on the parents attitudes. If the parent's don't care or are too busy to worry about it, the kids won't care either. American kids are more likely to focus on having a part time job to earn money to buy a car than to study extra hard to get into the college of choice.
However, the world's top universities are mostly American. This has to do with openness to foreign talent and ideas and a legacy of US dominance in world economy and cultural affairs (money and status)... which is now waning. Perhaps by the time Steven's kids are ready for college, KAIST will be equivalent to University of Chicago or MIT. However, I think it will take another generation to achieve that.
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Permalink Reply by Alex Timberman on -
Very interesting discussion. I'll add my two cents. For foreigners who look at the Korean educaiton system and find it horrible, I understand but Korea will not and should not change. Their teacher-centered education makes students focused on recieving information, but not good at critically thinking for themselves. But, the business culture in Korea does not allow, or so I read, young minds to challenge their bosses or creatively brain storm over ideas with their managers. So, in short, Korea will not be like America, isn't like America, and doing things the Western way doesn't work well with the established Korean system here. The education is just an extension of the Korean style.
As for Korea's economy, there is just too much competition around for many small businesses. One thing I noticed was that Italy has approximately almost double the size of a economy then Korea has. I was startled, as I did not find myself exposed to many Italian corporations as I do Korean corporations on a daily basis. The population of the two countries are close to one another, but I discovered Italy has a much more diversified economy, along with a thriving small and medium size business sector. And, Korea's corproations make just the same amount as Italy's big corporations, so that is where you see the difference. Korea's corporations have too much power. They are into every industry, This system, may not be in the best interests of Korea's economy long-term, but then again, it may be the best way.
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