On the ball
(China Daily)
Updated: 2006-03-29 09:54 If there is one issue on which South Korean firms have faced criticism, it
has been the perceived slow progress in management localization in China. But
Park Rae-Jeong, senior economist with the LG Economic Research Institute, says
the company operates more efficiently when Koreans are leading operations.
Western companies usually have large multilingual staff bases, because most
of China's 4 million annual college graduates have had to study English in some
capacity or another. But only several thousand Korean-speaking students graduate
each year and almost all of them major in the Korean language, with little
training in technology or management.
One shortcut around the language problem is to send "regional experts" in the
company to China to study the language, culture, and economy for a year.
Samsung is reported to have assigned more than 400 regional experts to China
over the past three years; most work for either Samsung's Chinese operations or
are in charge of China strategy at the global headquarters.
When Koreans head Chinese operations, they also handle communications
effectively with the head office and shorten the decision-making and execution
process.
For instance, the presidents of both Samsung and LG China directly report to
global chief executive officers (CEOs), which helps them to understand global
strategies and report their local decisions.
This decision-making process is faster than in some multinationals in China,
where reports to regional presidents are required before information can filter
through to global headquarters.
Global executives in both companies also visit China several times a year to
better understand the market.
Kim Ssang-soo, vice-chairman and CEO of LG Electronics, has led the company's
rapid development over the past several years and visited China four times last
year. He is known for his ability to make important decisions on the working
sites for efficiency and for his emphasis on responding quickly to local
conditions.
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