1. Korea's cultural background and Koreans' ways of thinking

Some year ago, an American lawyer who came from Japan said, upon arrival at the airport, he felt much at home in Korea than in Japan, simply because Koreans are as open-minded as Americans.

Truly, Koreans are open-minded, to the extent that they are so straight-forward to say “yes” or “no” in any meetings with themselves or with the people from other parts of the world, which, on one hand, makes them easily friendly with the westerners who are likewise straight forward. However, on the other hand, this often places them in some awkward situations, depending upon circumstances. This may seem too blunt to the foreigners, even to some of the Korean seniors who always expect the others, especially the youngsters, to be obedient to them customarily as part of the tradition that seniors should be respected and taken care of in any circumstances.

It can be noted that Korea is a society where seniority, both at home and in the society in general including workplace, has long been prevailing. Some say Korea is the last place in the world where to be royal to one’s parents as well as other seniors remains the precious social value. In the public places, like subway train and buses, some seats are always reserved for the “seniors, pregnant women and the disabled” and free subway tickets are given to the seniors who are aged over sixty five years or more. This is not all, seniors are given seats naturally by the youngsters in other parts of the subway train or buses, or in any places, both at home and outside. Koreans are astonished to see youngsters, in Japan and some western countries, take seats in the bus or subway train even with the elders standing in front of themselves. But, this precious social value is fading way in the course of time. It becomes a general tendency that increasing number of persons are disregard the “old patterns” insisting on own ways of living and doing things.

But, it would be much better to be polite to the seniors than otherwise. A very interesting story can be presented here, which one can refer. A lady’s father, who was angry to hear his daughter is in love with a youngster, will easily like the youngster, sometimes more than his daughter or his own son, after having a “greeting meeting” with him, who is so royal and polite to his future father-in-law, probably while serving the “senior” with a drink of wine, called “Yakjoo”, which does not necessary mean to buy the drink for him. In case the youngster can afford to buy, why not.

Again back to Koreans’ open-mindedness. As the case of the American lawyer quoted as saying as in the above, most Koreans look open-minded and straight forward , at a glance. Some might agree and some others might disagree, because, as in every corner of a society, there are various types of people who look different from each other. Some might look reserved, as such, they give an impression that they are counting on much of their own interests internally.

Then, one can argue that the open-mindedness does necessary mean the frankness in most cases. It cannot be said so. To be open-minded has much of an emotional meaning, whereas to be frank has much more to do with a person’s creed that is associated wit h one’s personality or value. Here, you’d better remember that to be open-minded does not necessary mean to be frank or to be honest, especially in business where a lot more than the personality are associated with the business. It can be said that, as in other part of the world, a person having a high personality displays good business practices, no matter how much he or she earns.

Foreigners can be assured that Koreans do not have the words “internal mind-setting <HONNE, meaning true mind as Japanese call themselves>” and “external mind-setting <DATEMAE, meaning just saying something as a gesture to please others>”, which are often used when describing the general character of the ordinary Japanese. Most Koreans do not use such a cosmetic and diplomatic approach to others. Such a mind-setting are generally disregarded by Koreans as a person of dual characters having double standards. In this sense, it is believed that the two people have long been in disharmony, at least emotionally. 

Koreans are also said to be kind to the others, especially to the guests, no matter where they are from. They are especially kind to foreigners, again regardless of where they are from. Too much kind to foreigners. There is an old saying in Korea, “To be too kind to others is not a good etiquette”, which means Koreans were too kind to the others. But, just at a glance.

Some time ago, the author of this article met, at the underground subway station just in front of Seoul Railroad Station, a group of foreigners from the U.S. and Canada, who came here to be tutors in private education institutes, called Hakwon, in provincial cities some two hours from Seoul by train. They asked me the way to the station showing me the tickets they bought already somewhere else. Alas, they have five minutes until the departure time. I asked why they were so late, who replied that they are in time but someone who was asked told to go underground, the opposite direction. If the man who was previously asked were a Japanese, he would see the tickets they had and then guided the foreigners to the entrance to the platform for the foreigners’ destination. More often, Koreans regard the sort of kindness by being polite the guests or by serving them with a smoke or a meal, but not thinking of the special situation the guests are being faced with. They are very reluctant, in some cases, to stand on the others’ places.

(The author of this articel is a Korean national, and are writing this article not just based on what the other articles about the comparison between the Koreans and Japanese, but have had a lot of such exposures to the similar situations while traveling many times to Japan and elsewhere.)

One of the typical thing associated with such a reluctance is, to be sure, the fact that Koreans are not good at debate with others. To be more frank, they cannot not debate at all. No one can disagree that Koreans have neither participated in, nor have been taught about how to debate with others, either at home, at school, or at workplace. It seems that they are not always ready to hear the others, saying only what he or she has in his or her mind. If someone say the other way, then they argue with each other, which easily escalates into a quarrel or a fighting, which is not quite unusual.

The author once worked for a foreign government as an economic advisor for some long period of time. The jobs of an advisor involve much of debates among internal staff members as well as many visiting missions. When the author made a submission, there were many challenges, mostly from westerners who were working together with author, and debate was arranged. In the beginning of the first session, the author, faced with a lot of challenging remarks from the western colleagues, asked the chairman of the debate (Secretary of the government department) to have a break, saying “Let’s have a break for me to have a smoke, otherwise I’ll get involved in a fight. We Koreans have never had even an hour of debate before, and we usually regard the challenge as a signal for fighting.” From that time on, when we had debates, other participants jokingly asked the author if I would like to have a break time for smoke, when we have a heavy argument over the issue for debate.

This sort of attitude seems to be too blunt to foreigners. One more typical example is the people hitting the others’ shoulders, but not saying “sorry” or ‘excuse me” at all. That’s the usual part of their living. When someone who was hit by a man with shoulders say “sorry”, then the man who hit the other will see the other as if he were a strange man. And many foreigners, who have stayed in Korea, would have experienced, at least more than one time, that when one opened a door at the entrance of a building to go into, the other who wanted to come out used the time to come out before a man goes into. The man who had a free ride seems to regard the man who opened the door as a “door man”, but actually they have nether such an intention nor any particular thought in mind. They just lack a sort of thoughtfulness. A point here is that there are too many such people in Korea like the man who snatch the time and the turn for others.

But, this was not a general social phenomenon some long time ago, when Confucian values were prevailing in the society in general, which has gradually eroded in the course of the development of the industries, while agricultural sector, the cultural base for the people, has been destroyed. One can excuse this way of behaving is a result of heavy competition among the people in every corner of the society. But, an excuse is just an excuse. Now, we can consider this particular behavior pattern in association with the general lack of the debate culture in the Korean society in general.

The absence of debate is much affecting the course of decision making in most of the organizations in Korea, both small and large. In a meeting, a man, who are the most senior in the gathering speaks alone, not giving a chance for others say on one hand. On  the other hand, the others, often subordinates, are not actively trying to have a chance to say, even though he or she is allowed to do so. The meeting, and a decision made in the meeting is a unilateral in more cases. All the participants, except one in the highest position, are often too royal and too polite to their boss.  

This unilateral decision making process seems to have a deep root, originating from the Confucian value, consolidated under the Japanese colonial rule by military-based imperialists, even further strengthened for a long time under the military dictators as Presidents of the nation. They all hoped that their says would reach to the bottom of their organizations soon after they were made. It was a rule within their organizations, and those who failed to follow their says, they risked their jobs in the organizations they worked for. 

This seems to be a reflection of the rigidity dominating the society in general and most of the organizations, both public and private. And this is why so many people who want to do business with an organization, are eager to meet with the person in the higher position as possible, even the highest. 

Now, let’s turn to the cultural aspects, which heavily affect and determine the national characteristics in general. Really, Korea has a long history, during which a lot of unique cultures have been developed in association with the daily living of the people. The uniqueness can be found in most of the cultural aspects, not only in eating, housing and clothing, but also in ways of thinking and subsequently in ways of behaving. As unique as they are, it would be much difficult to understand them all, and to do something with them together.

According to a survey carried out recently by a Korean university in a study program for international comparison, it was revealed that Koreans national pride is comparatively high, but the socialization index (related to the socialization capability of the people with others) is fairly low, meaning that Koreans’ acceptance of other cultures is relatively at lower level than that of the western people, except Irish. It would not be an exaggeration that the ways of thinking and the lifestyles of the other people are neither well accepted, nor disregarded more often than not when one is in a position to do so. For example, a teacher at a primary school forces his or her students to follow only his or her ways of doing things, not trying to specifically understand or respect the student’s special situations surrounding the students. If and when the student is a foreigner, this attitude of the teacher would result in an awful consequence. In fact, there was a happening some year ago that a Russian student went back home, for which her father could not help but to terminate his contract to work here in Korea.  

Korea is a society of a long history, an abundance of unique cultures, high national pride, which all combine to work, more often than not, to represent a general tendency toward a unique type of nationalism, which served good for the nation, especially at critical point of time, like independence movement during the Japanese colonial rule, and donations of gold and jewelries during the IMF bailout period after the 1997-98 Asian financial crisis. However, if it is extended too much to the international scenes, it would be regarded as too selfishness in the eyes of foreigners.

Historically, Koreans have not much mixed bloods with foreigners, meaning there were few movement of people across the border, along with cultures, with other people. And never had received other people as its citizens except for a very few cases. So there have been a rare chance for blood mixing. This is what Koreans boast of also, but mono-culture and stereo type life style, inherited throughout its long history have, to some extent, distorted its overall value standards, when compared to the international standards.

Typically, Koreans like the pure blood, like the dogs from Wando, a south-western island in South Cheolla province, which is abnormally expensive. In this background, Koreans do not like, and well accept, international marriage. Especially, if a woman is not easily allowed by her parents to be married to a foreign male.

Nowadays, all the Korean students, and even many adults, are eager to learn English and go abroad, under a catchphrase of globalization campaign. It would greatly help, but not enough to understand, accept and respect the others’ cultures in real terms. An education programs shall be needed but no education is given to the effect. Even the Korean diplomats and company executives have not given such an education thus far.

Now, let’s turn to the Korean rituals, which has been regarded as the most important, but controversial, in Korea’s history and even now. Koreans have, according to the
Confucian teaching, four ceremonial occasions: coming-of-age, wedding, funeral and ancestor memorials. Nowadays, coming-of-age has become less important, a ceremony not being held today. Paying homage to ones ancestors were a great ceremonies among Koreans in olden days, but became a less important occasions that only family members are taking part in. But in cases of wedding and funeral the situation is quite different. Many others are invited to participate. Here they are associated with an unreasonable practice customarily, from any point of views and from any standards. The parents and the wedding couples in case of a wedding, and the descents of the dead spread out letters of invitations to almost anyone they can remember, even the business partners, who then have no choice but to attend the ceremonies, each carrying an envelop containing some amount of money, which is burdensome for the ordinary citizens as they are invited to several, and many, occasions a week or a month. Someone has to attend two to three wedding ceremonies a day over a weekend. The ceremonies are not limited to the weekend.

All the above would have led the readers into a confusion, and would have made more complex and difficult to understand really how to do business with Korea. How can one expect the customs, habbits, practices, and cultures of a foreign country to be an easy task? But, here is a key – to build up and maintain close personal relationship with the people, whatever it is about. The key will overcome, and should override, all the cultural differences and conflicts, if any.  

2. How to build up personal relathioship

Then, we can discuss how to obtain the key so as to get to the idea of how to do business well with Korea.

When trying to establish personal relationship

1. Visit or call your prospective counterpart with a personal recommendation of a person who knows your prospective counterpart well.

2. Try to have a meal and a drink together with your prospective counterpart, if possible. 

3. Call him or her regularly or whenever you have something personal that will be helpful in boosting mutual understanding, especially when you are leaving your office for a long time, or when you go out of the country. And do not fail to invite the person immediately after you return back. If you have a souvenir for his wife or children, you will be appreciated. They would think that they are in your mind even far away.

After initial contact was made

1. Present yourself as you are
After you have established a personal relationship with the person, you can present yourself as you are, regardless of which cultural background you have. The Korean can gradually adapt to the culture you present to them, while in association with you. You’d better not to follow in a unnatural way, rather you can explain the differences, if you find there are, frankly, but not strictly. To bring them some pictures or a book on your country or your region would greatly help in building up mutual confidence.

2. After-work gathering is very important As the old move titled “History is made at night.”, heavy duty works are often talked about at night, over meals and a cup of drink. This is neither a joke nor a movie, but a serious recommendation.

3. Bills are paid by the inviting party or person. If you were invited once, please try to reciprocate, but just one-to-one base is not a recommendable approach. When you have something interesting, you can inform your counterpart of the happening and invite him or her for dinner or lunch in a natural way.

4. Do not miss invitation by your counterpars at the initial stages of building relationship, and never miss invitations ones house. Especially, one generally brings a small  gift, either flowers or one or two bottles of wine. Koreans usually carry fruits with them. These are to be used while you stay at the house. But, such gifts are not brought when visiting to one's office.

5. Attend the personal events, like wedding and funeral. Even though it takes time and money you had better, and sometimes it is a must, for the businessmen to attend the family events, especially wedding and funeral. To be informed of the events, please try not to miss the information he or she talks about, and keep a record of it. They might not inform you of the personal events, then you can call him or her a few days ahead, and then he or she, to be sure, will be deeply heart-felted.

Especially, it is strongly recommended to take part in the funerals. In Korea, a funeral is taken place two days after a man dies. Usually the families members stay overnight for two days at a hospital. The best timing is either one of the two nights, preferably around mid-night. The funeral section of a general hospital is like hotel, where some food and a drink, either soju or beer, and sometimes Makeolri is served. Unlike wedding, everything is calm here. To be together with a person when he or she is at a sad moment itself means much more than business. Here also you should carry an envelope containing some money. The amount may be different from case to case, you had better consult with your Korean colleagues in this regard.

6. Remember and pay attention to family members, especially parents of the person you are in contact with.

7. Try to get in acquaintance with family members of your Korean counterpart as well

8. Try to really love the Korean cultures, especially Korean traditional dishes

3.  How to survive ever intensifying competition in the markets

Now, finally, let us talk about the most sticky points – competition in the market. As the Korean markets grows bigger, while the open market policies have been cherished, competition is getting tougher year after year. For a long time, it has become a place for international contests for high-end brands across the board, including durables, automobiles, apparels and fashions, whiskey, dairy products, fruits, even vegetables and live fish, not to mention the all kinds of raw materials Korea does not have. It is generally said that it is more difficult for a Korean to run a business in Korea than in the United States. As such, it is absolutely required to have an in-depth market survey, based on which to establish a sophisticated market strategies before implementing a business plan. In the market research process, the researcher needs to meet at least more than three experts in the area, each from different organizations, and to know about the general trends of the specific industry the products or services are belonging to.

4. How to deal with labor problems

When deciding on whether to make investment in Korea or not, one would be mjuch concerned about labor activities, while weighing the advantage of Korean labors' technical skilfulness and high labor productivity.

However, it can be a minor matter of concern depending on how the operations are managed. There are many Korean companies that have not been embroiled in the antagonism with the labors, while there are some foreign concerns, like West Pak Bank in 1990, that closed operation due to a sour confrontation with Korean labors. But the latter cases are very rare. In the case of West Pak, its was said that Korean workers were much mistreated and therefore workers in the bank was determined to see their workplace close down even at the loss of their jobs.

Who would want to lose their jobs? When Recently, Korean multinational corporations have made much investment all over the world. There was cases where Korean invetors mistreated local workers and have had been faced with heavy labor protests, even to the extent that it had to halt operations temporarily. The cases gave a lession on how to manage their operations abroad. Now, Korean investors pay much attention to the education programs for their managers dispatched to the operations as well as the local emloyers. The education programs are much on the local cultures for the dispatched managers and Korean cultures, including Korean language, for the local employers.

One typical example is that an American company that wanted to penetrate into wireless commucation market failed to open its Korean branch due to diputes between the company and key personnel preparing for opening the operation. The issue of the dispute was whther the company would provide lunch to its employees or not. In fact, most Korean companies, even small ones, provide lunches to their workers. Koreans have an old traditions to share something, especially to eat and drink, with the neighbors, not being accustomed to take a pieces of hamburger at work, like those in the United States. The U.S . company offered a high pay scheme for the employees, probably thinking that the workers could buy their lunches with the money, but it should have compromised. Later the company officials said they did not take into account the Koreans' emotional matters.

The informal organizations, which are so much emphasized in business administration textbook, are very much important in Korea. They want to have a meal or a drink together with their boss or their colleagues after work once in a while. If not, they would do so themselves in the absense of their seniors. Then the communication channel is cut off. On the contrary, if a manager joins the informal gathering which is paid for by the company, the workers would listen to the managers, and the communications are focused naturallyon the company affairs. So, the more the informal organizations are utilized, the better the organizations are run. In some cases, the company can provide financial support for the in-house hobby groups, such as soccer and hiking groups. It will pay off and at least the ardent conflicts with labors will be avoided. The successful foreign investors in Korea are those that have effectively utilized these types of in-house informal organizations.  

5. Koreans' general perception about contract

A contract is appreciated, but not as much honored before it is followed by initial cash payment or L/C opening or any other guaranty. As such, contracts are not executed with itself, but only after the down payment is made. More often than not, contracts are not taken care of or revoked before that time. Therefore, in case of a hurry, one had better make an early initial payment to the other party of the contract if he or she wants to have the contract executed at an early possible date. It is not a good idea to make a verbal commitment or contract with regard to any important matters. Habitually, Koreans are opt for making a contract in a simple form, not making the terms and conditions as specific as possible, leaving some matters to the possibility of future disputes. Any foreigners do not have to follow this Korean habits of making a concise-format agreement. They are accustomed to the western style contract formats. One had better make the contract in every detail.