Showcase: Hyundai Motor Corporation HQ

2012 will be remembered for South Korean rap sensation, PSY, blazing to fame with ‘Gangnam Style’ and Hyundai taking its first SAGMJ Car of the Year Prize with the Elantra. Ray Leathern had the privilege of visiting the home of Hyundai Motor Corporation earlier in the year and here’s what he made of the trip.

Legend says that any western traveller who came upon the South Korean Peninsula in ancient times was forced to stay against their will by the locals so that news of the mysterious land could never make it back to the western world. That may sound a little sinister, but others argue that as soon as westerners arrived on South Korean soil, they couldn’t help but fall in love with the orderly way of life and its respectful people, so they simply made the choice to stay all by themselves.

Believing the legend or not, visiting South Korea may not be on the top of everyone’s bucket list, but it is a remarkable experience. Often operating in the shadow of China and Japan, I’ve never been to a place so seemingly ‘foreign’ to one’s eyes and ears, yet at the same time so well geared to business, tourism, and making silly westerners like myself feel perfectly at home. My visit took place in the winter months with other management members of the Hyundai Motor Corporation who were heading over to do their annual business at headquarters. I suppose you could call my tag-along attendance a bit of a fact finding mission, as I went to visit Hyundai’s R&D centre, one of its manufacturing plants, and its brand new steel plant. More than the factory tours and the authentic Korean barbeques, however, this style of corporate visit is probably the perfect context within which to view industrialised South Korea and understand its resultant culture.

The 49 million strong population of South Korea is one of the most homogenous ethnic societies on earth. That is to say they are culturally, very settled, and have been since the Korean war; with only 20 000 immigrants in the entire country. One can therefore forgive them then for being rather set in there ways when it comes to how they do things. Initially, it’s a bit like being in a life size public announcement video that is always playing. The florescent smiles of the actors (your hosts), the painstakingly rehearsed and sometimes strained dialogue (often exclusively about the weather), and a constant reminder of the corporate sponsors sign never far out of shot; that is ones first impression of the Korean hospitality. It takes some getting used to for our lazy, laid back South African sensibility, but not as much as you might think.

I had the wherewithal to read up about South Korean corporate culture before I embarked on the trip to realise this is entirely customary. A huge majority of the population speak English to an acceptable standard. There is an acknowledgment that two strangers from other sides of the globe may not have a whole lot in common, therefore every conversation must start by tackling a shared experience: the weather. Once that is done, a commonality can often be found in a topic like golf, football, or baseball (Korea’s number one sport) and this topic will be covered at length.

It’s this South Korean pragmatism in social norms that I find rather refreshing and I began to respect and play into the formality more and more as the trip went on. It’s a sensibility derived entirely from dealing with westerners, with whom they do there most business. The emphasis on the guest being made to feel like the centre of attention always prevails. It is therefore not uncommon to be offered to do an impromptu toast or partake in a local ritual without much warning. Failure to execute it or showing an annoyance at the formality is seen as disrespectful, potentially risking the success of your business, in the eyes of your hosts.

The ritual I had to perform was standard procedure in the corporate entertaining scene I’m sure and not difficult. I had to tip a row of balancing shot glasses filled with ‘SoJu,’ an alcohol similar to Vodka but made from sweet potatoes, into a row of full beer glasses like dominos. I failed horribly and bathed our dinner table in booze, but my willingness to just participate assured me welcome social passage for the rest of the night. At the end of each evening, our schedule said we’d depart the dinner venue at 9pm and, without exception, we always did. With business and entertainment done, each party goes their separate ways happy and ready for whatever the following day has in store. The productivity of the South Korean people is massively inspiring.

Business in South Korea is government subsidised and it’s not uncommon for big corporations in South Korea to grow at massive speed with a diverse portfolio, over every field throughout society. Samsung is one such corporation that makes cars, cell phones, owns hotels, provides finance, etc. Hyundai is another. It’s not just a car company. Under the Hyundai umbrella you will find 32 different business concerns. From car manufacturing (including owning KIA since the bailout a decade ago) to parts manufacturing, robotics, heavy steel, advertising, logistics, shipping, finance, software and even hotels; the result is ‘vertical integration’ as those in the business world would call it.

Meaning everything Hyundai needs to make its business successful is monopolised by, well, themselves. Hyundai Engineering and Construction builds the manufacturing plants, Hyundai Steel provides the raw materials, Hyundai Robotics puts the robots in the factories, Hyundai Capital helps local consumers buy cars and Hyundai Hotels can even provide the accommodation for us journalists who come to see the massive scale of operation. Hyundai was ranked 65^th in the top 100 global brands of 2010, now in 2012 it’s clawed its way up to 53^rd, overtaking Audi to become the 7^th most valuable brand in the top ten global car brands, with its overall ‘brand worth’ being valued at over US$7-billion.

The result, put very simply, considering the immense vastness of it all, is that much like the new wave of Hyundai products, everything works, everyone is ‘on the same page.’ The bus boy clearing your breakfast table in the morning is employed by Hyundai and he is as much a part of the family as the Chairman and CEO Mung-Koo, Chung. Wages are good and the standard of living is high as a result. A university graduate, starting his first job for Hyundai, will earn R50 000 a month.

So what is the relevance of all this you may be thinking to yourself? Well, South Korea has a population of 49 million people, almost identical to our own here in South Africa. Their annual GDP is $1.5-trillion; South Africa’s annual GDP is $3.8-billion. South Korea’s unemployment rate is 3.3% versus South Africa’s of 24%. Food for thought if you ask me. South Korea has every reason to celebrate their rise to dominance in worldwide manufacturing. They worked bloody hard to get there.

Comments

comments