Showing posts with label chaebol. Show all posts
Showing posts with label chaebol. Show all posts

Sunday, 30 September 2018

Into Darkness - Extreme Exam Culture

"Beware the Ides of March" by all means but September is never a dull month in any country. In Germany it is the month of the Oktoberfest - nothing less than the holy grail of the calendar year for many. Of course these days the event has been successfully exported worldwide including to both North and South Korea.

Bavarian colours redesigned with military chic.
Capitalising on NK's very highly rated brewing skills, Kim JungUn gave his personal nod 

to a 20 day beer festival in 2016, which is now an annual event in Pyongyang.


Seoul's Grand Hilton Hotel Oktoberfest:
more lederhosen and fewer starched uniforms than our friends in the north

Meanwhile in the more romantic nations of Europe, September sees a slothful return to work following August's closure of schools, small businesses, consultants, etc, to enable the merchants and professionals to rekindle their passions somewhere secluded. 

Alas for most students in the northern hemisphere, September reluctantly heralds the start of the new academic year and in Korea, it is the final count down to Seunung, the College Scholastic Aptitude Test (CSAT) held each Thursday in the second week of November. This is an 8 hour long national marathon of a selection test in which approx 600,000 students compete for positions at university. The importance of this test is difficult to overstate because of the widely held (and largely self-perpetuating) belief that selection to the best university puts you above your peers socially and provides a roadmap to success for the rest of your entire life. To reinforce the gravity of the exam, police control traffic on the day to ensure everyone arrives at school on time, military exercises and civilian flights are postponed to reduce distractions, meanwhile stock markets, banks and govt offices open late to allow parents to burn the midnight oil with their kid the night before.




Today more than ever, across the world and especially in South Korea (whose OECD ranking for graduation rates leaped from #34 to #1 in only 30 years) school and exams are a test of endurance rather than a test of intelligence or a useful foundation for a career. Students learn the facts and are then tested on how much they can remember. Likewise teachers teach-to-the-test; they coach the students on the type of questions they will be asked and the answers to reply with. This seduces some with the inviting short cut of learning only the questions and the respective model answers rather than learning the basic material. These students are quickly revealed when they leave the room 20 minutes into a 3 hour exam because the questions do not include the ones they learned. 

For the last 4 years South Korea has been #1 worldwide
for high school and college graduation rates.
This prompts the Whitehouse to ask what can the USA learn from  SK ?

Defiance
In 2012 a UK teacher proudly confided that she would refuse to implement the govt exams for 6 year olds in her class. She explained that her students were too young to be stressed by exams and that school is for learning and fun. Furthermore it is unfair to assess anyone based on their performance in one particular hour. A listener noted that when they become adults, her class will be regularly assessed, accepted or rejected in much less than an hour, often in just a few seconds.  This will happen every time they walk into a meeting, attend a job interview or introduce themselves to a potential date at a party. As the saying goes; "You don't get a second chance to make a first impression", so why try to avoid the inevitable ?  Why not become good at it by regular practice ? 

May 2016: UK teachers, parents and children protesting against national exams for 6 year olds

The noble teacher might consider that in former times the Korean education system included exams for entrance to middle school and then again for entrance to high school.  Due to grueling pressure on the students, the middle school exam was abolished in 1971. However this simply increased the stakes riding on the high school exam.  Competition in the high school exam then became so feverishly fraught that it was replaced by a lottery system for allocating school places. Ultimately both of these 'fixes' combined to shift all the pressure further along the system making November's Seunung the single, defining, make-or-break, absolute cliff-hanger of a student's application to university. 



Real Life
At school I recall learning how to calculate the inclination of a cannon set at distance S so that a cannon ball fired with velocity V hit would hit the top of a castle keep at height H. I'd like to think that I could do the same calculation today, which would indeed be a fine test of memory. In real life it is astonishingly rare to be given such a well-defined problem to solve and if you are that lucky then computing the answer is rarely difficult. 

An age old maths problem; the ballistic trajectories of cannon balls
- until 2017 also used notoriously by Kim JungUn for launching ICMBs into the Pacific

Real life problems are poorly defined at best and often hidden at worst; they require analytical skills. The first is observation; recognising that there is a problem with a business unit, a production line or a project is a very subtle skill. The second is investigation; correctly identifying which factors contribute to the problem as opposed to other issues which have no influence. Observation and investigation simply define the problem. Then come the follow-up skills; finding options and choosing a solution. Even the best schools and the most hotly contested universities have been excruciatingly slow at coaching future generations in the analytical skills needed for real challenges. The DAX, NYSE & FTSE are littered with examples of businesses which collapsed because nobody recognised anything was wrong (eg: Lehman Bros) or because a company achieved technical supremacy and/or market share with a product for which there was no longer a demand (eg: Kodak). 

Koreans themselves are scratching their heads over this dilemma, noting that despite Korea's #1 ranking for graduates in the OECD, Korea has yet to win a single Nobel prize in sciences.  Commentators identify rote learning as a likely culprit for stifling creative thinking together with the parents' unbalanced obsession with the reputation of certain universities rather than the subject their child will actually study. 

https://www.koreatimes.co.kr/www/nation/2018/09/181_254202.html

http://www.theasian.asia/archives/99165

Returning to the example of the cannon; relevant questions to ask before lighting the gunpowder might include; what makes an artillery attack preferable to undermining the walls, starving out the defenders or better still, confusing the incumbents by rocking up in a huge wooden horse ? Also, are non-adversarial strategies feasible such as starting rebellion among the defenders, converting them into allies or subverting the loyalty of an under-appreciated gatekeeper by offering him a quiet farmhouse with a few sheep tended by a Nordic shepherdess ?

Nordic shepherdess : offers a discrete alternative to military bombardment 

The analytical skills needed to detect and define problems then assess feasible solutions are hard to teach, harder to test and even harder to evaluate objectively. Therefore the education system blithely stumbles on, testing what students can remember; not because this constitutes a good education but simply because exams are easy to operate and everyone receives a standardised  little score for easy comparison.  

Work life
Analytical skills are similarly hard to teach, test and evaluate in a working environment. But rather than admit to the fallacy of annual performance reviews, HR gurus continue to ply their trade by annually launching the latest reincarnation of their review process which is invariably tweaked, overhauled or rebooted to include some enlightening mantra 'pinched with pride' from some uncredited business class in-flight magazine.

It is no surprise that many major corporations shed the yolk of performance reviews as they stepped into the 21st century, starting with tech companies like Dell, Microsoft and IBM but then joined by consultants such as Deloitte, PWC and Accenture, then industries such as GAP, Lear and General Electric.

https://hbr.org/2016/10/the-performance-management-revolution


https://www.mckinsey.com/business-functions/organization/our-insights/ahead-of-the-curve-the-future-of-performance-management

https://qz.com/428813/ge-performance-review-strategy-shift/


Sadly Korean chaebols are generally operated like military units with decisions made by Human Resources rather than managers. Here the annual performance review is essentially abused since the manager is unable to freely score individuals according to merit. Instead the HR dept. proscribes the spread of people who can be scored high (salary rise), middle (no change) or low (salary decrease). The manager must simply decide which to assign to who, even if all the team have done well and nobody merits a poor score - see previous post


Enlightenment
The most important casualty of an exam-fevered education is the joy of discovery - which is ironically the most powerful incentive to study. Students today memorise that the planets orbit the sun, the circumference of the earth is 40,000 km or that the swing of a pendulum is proportional to the square of its length. Today these are given as dry, unremarkable truths, delivered without context of the significance of the discoveries or how they changed the world. Nothing is taught about the curiosity, passion and egos which drove people to discover these truths, the primitive methods used to make the measurements, the wrong theories which were abandoned before the right theory was realised, the personal, religious and political fallout surrounding the discoveries. A student's enlightenment comes from learning how a discovery was made, who believed it, why it was challenged, who ignored it, as much as from the actual conclusion itself. 



Once education is made devoid of enlightenment, reduced to examinable facts which are dull and unmotivating, clearly students will begrudge the best years of their lives being smothered by the inexorable darkness of extreme exam culture. 

1979: Pink Floyd's The Wall; an early warning of darker times ahead





The Bottom Line
Putting educational philosophies and student motivation aside, the bottom line is that the business of education is business, not education.  In South Korea education is a huge opportunity to squeeze everything that parents can afford in exchange for even the most marginal perceived advantage for their children.  Like the market for new smart phones, the market for educational services needs no advertising, no sales pitch, no marketing.  Parents actively seek out each and every conceivable opportunity to upgrade their child's study experience.  

The prize is simple; a place at one of the nation's 3 elite 'SKY' universities; Seoul National Uni., Korea Uni, and Yonsei Uni. These accept the top 2% of students which sometimes leaves the student feeling a little more entitled than his less fortunate peers.

https://www.quora.com/How-does-South-Koreas-education-system-affect-students

Competition for SKY and other high-rated unis used to start in primary school with parents spending on average 20% of household income on private evening crammers (hagwon).  

https://theconversation.com/south-korean-education-ranks-high-but-its-the-kids-who-pay-34430

https://www.telegraph.co.uk/education/10491289/OECD-education-report-Koreas-school-system-a-pressure-cooker-for-children.html

Hagwons routinely teach until 9pm, often later, leaving children so tired that teachers perversely have to allow them to sleep the next day during regular school class.

Today the battle ground has shifted to kindergarten, specifically English language kindergartens which are perceived to be the latest way to nudge your child ahead.  On average places cost an astonishing US$ 900 per month but demand is so high that there are already more than 250 English language kindergartens in Seoul - the most expensive of which cost US$ 2,000 per month.

http://m.koreaherald.com/view.php?ud=20180724000470#cb


Ultimately money secures academic excellence with which to further leverage social standing.  To highjack Netflix's flawless adaptation of Richard Morgan's 2002 dystopian vision of our near future;


"Those with eternal wealth have 
eternal power over those who don't."








Sunday, 15 May 2016

Living the nightmare - Chaebol culture

Friends may have told you unlikely anecdotes ? Colleagues may have whispered disturbing tales ? Or you may simply be waiting for the horror movie to be released ? One thing is certain; whichever way you get to learn about it, your first insight into Korean chaebol culture will leave you gasping in awe - but not in a good way.

Korean corporations, or so-called 'chaebols', are HUGE and intentionally diverse. Many were started in 1945 after Japanese surrender and began flourishing in 1953 at the end of the Korean war. Many are still controlled by dynastic families. The largest are therefore controlled by Korea's ‘Royal Families'.

The stock market value of all the companies which comprise the largest chaebol is said to exceed the combined value of the next nine corporations listed by market capitalisation. Given that exports generate on average more than 50% of South Korea's economy, this top chaebol alone reportedly accounts for 20%-30% of the nation's GDP on average.







Predictably there is fierce competition to win a long and secure career working for one of these national-turned-global juggernauts. Twice yearly the largest corporations arrange entrance exams for up to 200,000 applicants at exam centres all across the country to kick off the formal selection process.

These applications are themselves preceded by years of regular daytime schooling (9am-4pm), zealous night-time cramming (5pm-9pm) and additional sports, music or language classes at the weekends to add some non-academic excellence with which to desperately distinguish one's application from the thousands (and thousands) of others. This effectively transforms high school and university into a gruelling, ceaseless, manically competitive scramble to gain a foot-hold in a sheer corporate edifice which remains impenetrable to those who fail to make the grade.

The 5,000 candidates who are selected annually virtually redefine the word 'elite'. Most share a relatively narrow list of socially prestigious surnames, all have graduated from a handful of top universities and most were high-school buddies before that. For the lucky few it is a progression from playground peers to 'frat-rats' to corporate clique. One thing is for sure; for those who make it and for those that don't, life will never be the same again.


http://www.cnet.com/news/the-chaebols-the-rise-of-south-koreas-mighty-conglomerates/




Having won such coveted employment one might be forgiven for thinking that the pressure was finally off. However the selection process turns out to be just a prequalifier for a much longer trial; that of endurance and survival.

Aside from the entrance exams, candidates are selected on their academic record and social background to ensure that they are .. ‘worthy'. Little consideration is given to a candidate's readiness to work abroad, which would be logical given that most large Korean corporations are now formidable global competitors. When fresh graduates are told that they will be dispatched to Saudi for their first 18 months in the job, they accept this as a small fealty for winning their dream employment.

Cynically this is an endurance test, designed to sort the survivors from the quitters, which parallels the concept of basic training or boot camp. Like squaddies in the army, the dispatched graduates either sink or swim. Those that sink, usually resign and return home devastated that they lost everything that the dreams of their whole family were built on. For the survivors, the price of victory is the insecurity that the longer you endure and the higher you progress, the easier it is to have a career toppled completely.





Inhuman Resources
Somewhat mind-bogglingly, Korean business divisions are reorganised every 6 months; from the departments within the division, right down to the staff in each team of each group of each department. While the division heads decide the new structure of the division, it is Human Resources (HR) which has total autonomy on filling the structure with people.

Managers remain accountable for the performance of their team or group, however they get no say over who they keep or lose during the reorganisation, nor the size of the revamped team or any recruitment if necessary. HR will decide everything, not based on the manager’s input but based on rigorous systems which are astonishing to see outside of the military. 

When such sweeping changes are made as often as twice a year, one wonders exactly how the efficacy of an organisation is judged on such short timescales.  Given that people require time to adjust to the new structure, the responsibilities of each unit and the workflow between them, it would be no surprise if the staff spent most of their time simply trying to figure out how the company is wired.




Top Secret
To make the working environment even more exciting, the structure of the division remains a carefully guarded secret throughout the whole year.  Employees may view the structure on their computers but are not allowed to save a copy, print it to paper or even to capture a screenshot of the organisation.  Inevitably some have dared to use their smartphone to take a photo of their screen, which has resulted in some chaebols obliging each employee to either buy smartphones without cameras or else to simply surrender their phones each day when they report for duty.




Dream Job : Social status is a key factor


Performance reviews
Each year staff are subject to an annual performance review and graded A to E. A proscribed percentage of each team must receive grade A (10% pay rise), grade B (5% pay rise), C (no pay rise), D (5% reduction) & E (10% reduction). The manager may decide which staff receive which grade, but the spread of grades is fixed, even if the performance of the whole team is great or dismal.



Recruitment and redundancy
HR sets recruitment criteria, assess candidates and assigns new recruits to managers when HR deems necessary and similarly HR sets redundancy criteria, assess candidates and dismisses them when HR decides appropriate. All this is done over, above and despite the opinion of the manager who simply has to deliver what is required with the team he is given.

After a few months in this environment, it comes as little surprise when a colleague approaches wearing a proud but tearful face to explain that he was honoured to be part of the team but he has been told to clear his desk so he wishes everyone continued success and happiness in their work without him.



The Untouchables
The way to beat the system is to know something damaging to the reputation of a higher mandarin in the company, or better still, to have aided him in his skulduggery. In this way a person becomes 'untouchable' - at least until the downfall of said mandarin.

Incredibly a person's 'untouchable' status is officially known to HR and to their team manager, who remain powerless to dismiss the individual, even if he contributes nothing on a daily basis, which often they don't. It is a sorry manager who is lumbered with untouchable staff by a knowing HR but his team is still expected to exceed expectations.

At higher levels, a person may become untouchable and therefore protected, if his discredited actions were instructed by his seniors. Sure, he knew he was doing wrong but he was powerless, he was ‘just following orders’. The reward for not implicating those above him is to be exiled to a new position created somewhere abroad from where he will continue to earn a tax free salary with expat perks while remaining conveniently absent from daily company business.







Chaebol humour
There was a joke in South Korea back in the 1990s. It went like this:

What would employees of the mighty Korean conglomerates -- the so-called chaebols -- do if they were accidentally confronted by a fearsome bear while strolling through the forest?

Hyundai employees would club the bear to death without hesitation.

Daewoo would call its Chairman Kim Woo-jung and await his command.

Samsung would hold a meeting -- with the bear still in front of them -- to discuss how to proceed.

LG would wait for Samsung's response, and then do the same


http://www.cnet.com/news/the-chaebols-the-rise-of-south-koreas-mighty-conglomerates/










The Annual Admonishment
Against this background the highlight of the corporate year is reduced to a farcical piece of theatre, however all staff are still expected to take it seriously. This is when the CEO suspends normal business for an entire day, calls his 200 top managers into the massive boardroom, then invites his selected targets to stand one by one while he personally scolds them and exacts grovelling apologies, admissions of blame and promises of renewed effort from each of them. Meanwhile every other employee watches live on their laptop.

Once per year this ritual admonishing starts shorty after the 8am corporate broadcast as the CEO takes his seat on a raised platform with long rows of parallel tables stretching away in front of him. Protocol dictates that executive management take the central tables at seats closest to the CEO with the senior and upper management carefully arranged on the outer tables and further from the CEO.

One by one, the CEO calls each target to attention, whereupon the victim stands bowed with horizontal torso, hands clasped by his knees and eyes fixed firmly on his feet. The CEO then lambastes the hapless wretch with details of his failures, what his duties were, what he should have done, how he failed in those duties and shamed his co-workers, the CEO and the company. 


Without lifting his gaze from his shoes, the accused then admits complete personal responsibility, without daring to suggest any mitigating circumstances. He promises he has learned from his mistakes; it will never happen again. Meekly he asks for one more chance to redeem himself with longer working hours, superhuman effort and unfailing determination so that he can correct his mistakes and turn his failures into success for the glory of the company. 

Depending on the issues, the CEO's scrutiny focuses for 5-10 minutes on each target with approx 10 targets being held to account her hour.

Finally, with all the irony of a man who inadvertently steps under a bus while musing on the eulogy he may receive one day, the CEO then also apologises for putting his faith in so many undeserving managers whose failures have clearly wasted the good work and sacrifice of the loyal staff under them. The CEO implores everyone to redouble their efforts to make up for the lost ground and bring home the victory which the company richly deserves. This entire performance lasts 8 to 10 hours during which the rest of the staff finally see exactly what it is that they competed so hard for - and what they will have to endure if they wish to continue any further.



The Art of Apology
Social observers like to repeat the often-heard phrase that you can never apologise enough to a Korean.  Certainly the mass media likes to regularly (and relentlessly) take foreign governments, dignitaries and moguls to task for failing to be 'sufficiently sincere' with their apologies.  Regular targets include North Korea (no surprise), Japan (inevitably) and others who upset Korea's fragile sensitivities. 

When Koreans themselves apologise, it is admittedly done very well, crossing over into some sort of art form.  As often as not, when done well, a good apology will in time be rewarded with genuine forgiveness.  In fact many business leaders have not only been forgiven by the state but even pardoned from their jail terms. The most recent example perhaps being the release of 14 'notable businessmen', including SK's Group Chairman, released in August 2015, imprisoned in 2013 for embezlement.  Upon his release, holding a bible in fact, he bowed sincerely and apologised deeply "for causing concern to the public".  From the awed reaction of the assembled crowd, clearly nobody expected an apology for the actual embezelment itself.
http://www.koreatimes.co.kr/www/news/nation/2016/05/116_184826.html  


Probably the most high profile pardon so far was afforded to the former head of the Samsung Group in 2009.  
http://www.ft.com/cms/s/0/983c3922-f423-11de-ac55-00144feab49a.html#axzz48jXkE9co

The problem with granting pardons to high-profile transgressors is that the crimes, and by extension the law, are perceived by the public to be flexible (at best) or worthless (at worst).  The public then take this as a signal to enjoy a little flexibility with the law themselves.


Nut Rage
Nut Rage: Heather Cho - apologies from the rich and famous require a special sincerity  

Deeply penitent Heather Cho, former Vice President of Korean Airlines (and, quite co-incidentally, daughter of KAL's Chairman and CEO) was charged with commanding the pilot to return to the departure gate at New York’s JFK International Airport after cabin staff served her macadamia nuts in a packet instead of on a plate.

During the trial, there were allegations of attempts to silence the witnesses however the cabin staff’s testimonies were supported by the passengers. Ultimately a one year prison sentence was issued for obstructing aviation safety, which carries a maximum possible 10 year sentence.

The case highlighted the increasing perception amongst the public that the children of chaebol moguls do not deserve, and cannot handle, the responsibilities of the positions that they inherit. 



Corporate Apologies
These came thick and fast in 2014 and 2015

Everything from crashed airliners
http://www.washingtonpost.com/news/worldviews/wp/2013/07/08/asiana-airlines-president-bows-in-apology-for-crash-a-show-of-koreas-very-different-corporate-culture/


Never a dull moment ;)

















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