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South Korea: Insider business tips

By Chuck Durnberger - Apple, Flash Storage Operations Program Manager, and has logged countless hours traveling to and from South Korea on business.

While the primary knowledge of South Korea for many Americans may be from watching the team of doctors on M*A*S*H, the medical drama/black television comedy about a team of doctors and support staff stationed at the 4077th Mobile Army Surgical Hospital in Uijeongbu, Korea, during the Korean War, South Korea’s emergence since the conclusion of the Korean War has been remarkable.

Over the past four decades, South Korea has separated itself from its neighbor to the north, developing a very strong economy and becoming a world leader in various industries, including the semiconductor, electronics, and automotive industries. In many ways a far more westernized country than many of its Asian counterparts, there are many recommendations for conducting business successfully in South Korea, some of which are detailed in useful hints and tips outlined below.

Moving around in South Korea
Incheon International Airport opened in the early 2000’s. It is billed as the world’s 10th busiest airport. Despite this, it is extremely accommodating to foreign travelers, with virtually all vendors fluent in English and with easy access to transportation and other services within seconds of exiting customs.

Located approximately 40 miles northwest of Seoul, there are two primary transportation options: taxis and ‘limousine buses’. Taxis will be the most direct route to Seoul, but expect to pay a hefty rate of US$100 or more. If time is less of an issue and expense is a consideration, the limousine buses are very convenient. Running between 6AM and 9PM, there are approximately 15 well-marked ‘bus’ routes, each departing (from the airport) approximately every 15 minutes to major Seoul hotels.

For about US$15, business travelers can board the bus and expect to reach their hotel in 60 to 75 minutes, depending on traffic. Travel times can be much longer to hotels on the east side of Seoul between the hours of 6:00PM and 9:00PM due to heavier traffic.


Business communication

Korea uses different telephony standards compared to the U.S., but there are options. Several Korean phone companies (LG Telecom, SK Telecom, KTF) make it easy to rent cell phones at the airport for very reasonable rates (US$2 to US$4 per day); you can choose to use their long-distance service (<US$0.50 per minute) or, by checking with various providers, you can probably find one that, due to sharing agreements with U.S. phone carriers, allows you to transfer your SIM card to their phone and receive calls using your existing phone number and standard services. However, be aware you will likely pay a stiff price for the convenience of keeping your U.S. phone number; international roaming rates in excess of US$2.25/minute will apply and be charged by your U.S. carrier.

 

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English proficiency across South Korea is generally proportional to the size of the company you’re dealing with. Most of management in larger Korean companies speak English but expect some difficulty communicating in English with smaller and/or more traditional companies.

If conducting sensitive or more complex business discussions with non-English speakers, it is advisable to hire an independent translator (or ask your counterpart company to do so) to avoid any concern about bias. Many people do not exhibit proper protocol when communicating through a translator. When employing a speaking interpreter, international etiquette when doing so maintains that translators are merely a conduit to convey communication between parties. It is important to keep your eyes focused on your business counterpart while the translator is speaking. This shows respect and courtesy toward your business colleague.

Most meetings begin with the traditional exchange of business cards accompanied by introductions. Compared to other parts of Asia such as Japan, it is less formal in Korea. In South Korea, you can hand (and expect to be handed) business cards with one hand while also shaking hands with the other. It is considered disrespectful to write on business cards you are handed.

Dress for the occasion
South Korean companies are formal when it comes to business attire. Nearly all white-collar employees wear (almost uniformly) dark blue or black suits and a tie on a daily basis (with very basic striped or geometric-patterns). When meeting your hosts for the first time, it is advisable to dress conservative although it is also acceptable to wear a good quality sport coat (with shirt and tie) instead of a suit.

What to expect during in business meetings
When meeting prospective suppliers or clients for the first time, it is traditional for your Korean hosts to provide small gifts as the meeting concludes such as a pointer, necktie, or company watch. It is rude to not accept the gift.

Organizational hierarchy is important in South Korea – especially during business meetings. Assuming a language difference is not a factor, during initial meetings it is typical for highest-ranking executives to do most of the talking, particularly for smaller companies.

The concept of ‘face’ is important in South Korean culture. Never take an action or decline an offer which would cause your hosts to be embarrassed or lose face. One simple example: it is customary to be offered coffee, tea, juice, or water. Even if not thirsty, it is best to accept some refreshment so you don’t appear rude to the host.

South Korean companies remain male-dominated at the managerial levels. Most female employees work either in administrative functions or in blue collar type jobs such as manufacturing. It is likely for all formal meetings to consist entirely of men. When ‘actively’ engaging South Korean companies, it is advisable the leading communicator from your group be a male to help maximize effectiveness and respect.

During your meetings, it is common and acceptable to introduce humor, albeit in a culturally-sensitive manner. Any questions presented in meetings are typically responded to promptly, however, depending on the situation, it is possible (if not likely) respondents may exaggerate or fabricate initial responses if it best serves their interest.

Smoking is still common among South Koreans, so plan meeting breaks (perhaps every 90 minutes) to allow your counterparts to do so. On this note, specifically limit break times or a 10-minute break will quickly become 20 to 30 minutes. If there is a Korean-speaking smoker within your team, it is likely they can accomplish (speaking Korean) just as much in a 10-minute informal ‘smoking break’ as you can accomplish speaking for 90 minutes during a formal meeting.

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Negotiations and contracts
The relationship is more important than the contract. Business contracts in South Korea tend to be very basic, not detailing the most controversial terms or liability expectations. In this spirit, it is suggested to not push for extensive contracts with Korean suppliers, but rather to focus on high-level strategic alignment between executive teams.

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