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By Steven B. McKinney, McKinney Consulting, Inc.
(Originally published by Search-Consult Magazine Feb 2009)
Korea’s economic development, often described as the miracle on the Han River, was no miracle. It was a direct result of the effective and efficient leveraging of the only natural resource Korea has always had in abundance: the will of its people.
Sandwiched between Japan and China, with virtually no natural resources to speak of, Korea's great strength has always been its people and its people’s desire to overcome whatever obstacles stood in their way. Endowed with a “can-do” attitude and a seemingly inexhaustible source of energy, Korea’s populace never fails to astound. It is a natural resource the Government of Korea has come to rely on during the last 50 years of Korea’s race to modernity. When something needed getting done, government, management and the military could count on the strength of the people to “make it happen”. This includes overcoming the after effects of war, famine, national division and development. The Korean people have always “made it happen.”
Rapid development was made possible by many factors, such as access to foreign capital and technology, along with favorable development policies, all coming together at the right time in the second half of the 20th century. Among those factors was Korea’s corporate culture which is constantly changing, based on the needs of the market and society’s prevailing culture. As Korea’s corporate culture evolves, executive search has come from nowhere to being an integral part of Korea’s ongoing miracle. More than simply being a function for allocating human resources to companies, search can now play a major role in shaping the future evolution of Korea’s corporate culture.
Almost all of the top global retained search firms have operations in Korea. Most of these firms strive to provide on-going relationships with their clients. Some of these firms - like McKinney Consulting - provide coaching, benchmarking or other talent management type services in addition to, or as a part of, their retained search practice. These retained search and talent management service providers are drivers in the evolution of the Korean corporate culture. Unfortunately, the search industry in Korea still has a long way to go.
The vast majority of search firms in Korea are built on transactional contingency based models, and thus; the retained search firms must work hard to show them the differences. We are constantly educating potential clients with contingency service experience on the full scope of what a proper retained search entails. Often enough, a company that has had a bad experience will be more receptive to try something new.
We must instill confidence in our potential clients’ minds that the retained executive firm is highly reputable and the consultant working with them is extremely knowledgeable and fully understands their executive talent needs. Within this process, it is fundamental that all the parties involved understand the search process as well as the terms and conditions of the agreement.
This is a gradual process, educating one client at a time. More and more companies are being converted as competition for the best talent continues to intensify. In order to attain the best talent, companies are beginning to understand that they must be prepared to invest in a high quality service that will bring them precisely the candidates they are so eager to attain.
Korea’s Corporate Evolution
By any stretch of the imagination, Korea’s development has been amazing. Looking at some of the notable statistics, you can see just how much progress the country has made in the last 50 years.
Korea ranks number #1 in the following areas:
• Annual Work Hours (OECD)
• Broad Band Internet Access per capita (Point Target)
• Scientific Literacy (OECD) and
• Worldwide Shipbuilding Completions (World Fleet Statistics)
Korea ranks number #2 in the following areas:
• Annual export growth (OECD)
• Annual GDP growth (OECD)
• Mathematical Literacy and (OECD)
• International Patents Granted (WIPO)
Korea ranks #3 in the Economist Intelligence Unit’s IT Industry Competitiveness Index.
Korea’s economy has become highly concentrated as a few firms, and the families that controlled those firms, had become responsible for the overwhelming amount of Korea’s production. It also drove Korea’s HR development, as “getting a good job” meant having a job that one could not lose. Korea’s young students faithfully did what was necessary to be attractive to Corporate Korea. It seemed clear that what was good for Samsung, Daewoo and Hyundai was good for Korea’s workers too. That all came to a screeching halt in 1998, when the Asian Contagion reached Korea’s shores and the social contract between workers, who had always toed the line- and companies who had always hired, but never fired - was broken. It was a revolution in Korea’s corporate landscape, and its effects are still being felt today.
Today Korea’s economy is much less concentrated than it once was. A more diverse economy is developing, which is definitely much healthier. Korea is now finding areas to grow that it never concentrated on in the past – like the leisure, sports and entertainment industries. Service jobs are relatively abundant, making up the bulk of all positions available in the market. The Life Sciences industry is also growing and the Industrial area is surprisingly holding its own.
Perhaps the most important trend that has shaped attitudes toward careers and work, however, is the fact that Korea’s growth rate has slowed tremendously from the go-go days of pre-1998. That means that large companies just aren’t hiring like they used to. Cradle-to-grave job security is largely just a memory now – as is employee loyalty.
Finding Korea’s New Executive Profile
For all the changes that have occurred, Korea’s new executive profile isn’t that much different. He (and now increasingly she) is family oriented, Confucian, well-educated, status conscious, ambitious, diligent and highly conscious of “other people.” The more mature executive will emphasize experience and connections while the younger will highlight ability and knowledge as competitive advantages.
The typical candidate profile that we – as well as the other top tier retained search firms - place usually is bilingual, has some education abroad with prior multinational company experience either in a MNC in Korea or another country. Our clients are all multinational companies.
During the past few years, more local companies in Korea have begun using executive search services. However, the majority have yet to reap the full benefits of retained search as most of them have chosen to use one of the hundreds of contingency firms.
In the heated development days of Korea, leadership was defined by the saying “If you put your mind to it, then it will be done.”Now that Korea has matured, the economy and the companies operating there have become vastly more sophisticated and success is increasingly hard to find. When the economy is growing at 8% per year about anything you do is going to grow and succeed. All that Koreans had to do was to look at the advanced countries for a roadmap of where all the opportunities were. In this new environment, unfortunately, passion may not be enough as a new, more measured, more considered, more focused-on-the-numbers leadership style is emerging. Families used to exclusively manage the business, but now professional management is increasingly more prevalent.
It is the job of the executive search professional to find the best leaders and reel them in. We must aid the hiring executive in choosing the best from among the current pool of candidates globally sourced. The executive search professional should focus on marrying the candidate’s ambition and skills to the company’s needs and goals. It is a balancing act that requires a great deal of understanding from all the parties involved, but when done right, nothing is as fulfilling. The executive search professional gets to play a part in molding the future image of the organization, not to mention share some bragging rights for an individual’s extraordinary success.
Korea is one of the most dynamic markets in the world. One can watch as the scene changes literally before our eyes. Executive search plays its part in that dynamism. It is one of the key services that make rapid-fire global business work. It is one of the intermediaries between the global business community and the local market. As Korea becomes more and more central to the global economy, I can think of no place I’d rather be doing what I’m doing than right here.
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Steven B. McKinney, Certified Master Coach and President of McKinney Consulting, Inc., a retained Executive Search & Coaching firm based in Seoul, South Korea. With over 25 years of experience in Asia, he has a refined expertise in helping multinational companies and leaders succeed in the region. Steve is a member of the International Coaching Council. McKinney Consulting is a member of AESC The Worldwide Association for Retained Executive Search Consulting Firms.
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