Routledge Handbook of Korean Business and Management

Cover
Endorsement
Half Title
Title Page
Copyright Page
Table of Contents
List of Figures
List of Tables
List of Contributors
1 Setting the Scene and Overview
	Introduction
	Purpose of the Handbook
	Contextual Perspectives and Arguments
	Content Features
	Content Overview
	Part I ‘Institutional Context’
	Part II ‘Macro Issues in Big Business Groups’
	Part III ‘Micro Issues in Korean Businesses and Management’
	Part IV ‘Emerging Issues in Korean Businesses and Management’
	Part V ‘Challenges and Future Directions’
	Conclusion
	References
Part I Institutional Context
	2 Labour Market and Korean Workers
		Introduction
		Population Change, Employment and Labour Market Structure
			Shrinking and Ageing Population
			Poor Job Creation and Declining Job Quality
			Labour Market Is Closed and Academic Background and Seniority Matter
			Labour Market of Large Companies Is Rigid, But Workers in SMEs Are Vulnerable
			Workers in Large Companies Are Well Paid, But Workers in SMEs Are Much Less Paid
			Korean Workers Are Paid Well, But Management People Are Not, Compared to Other Countries
			Female Workers Are Underutilized
		Trade Unions
			Unions Represent Only 14 Percent of the Labour Force, But They Are Powerful
			Unions Lack Public Support
			KCTU Lacks Social Responsibility
		Government Policies Tackling Key Labour Market Challenges: Regulation of Using Non-Regular Workers, Extended Retirement Age and Wage System Reform
			Regulations and Not-Market-Friendly Policies Did Not Solve the Problem of Non-Regular Workers
			Extended Retirement Age With the Seniority-Based Wage System Is Not a Solution for the Ageing Population
			Wage System Reforms Were Tried, But Achieved Limited Success, and It Is Still an On-Going Issue
		Discussion and Conclusions
			Are Korean Workers Happy?
			Open Labour Market Needed
			One of the Obstacles to Labour Reform Is the Labour Movement
		Conclusions
		Notes
		References
	3 Capital Markets and Capital Formation in Korea
		Introduction
		Financial System in Korea
			Financial Infrastructure
			Financial Institutions
			Financial Markets
		Capital Markets
			Bond Markets
				Size
				Foreign Investment in the Korean Bond Markets
				Bond Yields
			Stock Markets
				The Korea Exchange (KRX)
				Size and Participants
				Foreign Ownership of the Korean Stock Market
				Key Parameters of the KOSPI and KOSDAQ Markets
				Raising Capital By Stock Issuance: IPOs and SEOs
				The Korea Discount
		Derivatives Markets
		Fintech
			Types of Fintech Services
			Operating Performance of Fintech Firms
		Summary and Conclusions
		Notes
		References
Part II Macro Issues in Big Business Groups
	4 The Corporate Governance and Practices of Korean Companies
		Introduction: The Korean Puzzle
		Development of Corporate Governance and Practices in Korea
			Family Control
			The Structure of Business Groups
			Disparity Between Ownerships and Control
			Related Party Transactions and Tunnelling
			Weak Independence of the Board of Directors
			Passive Monitoring Role of Institutional Investors
			Weak Market for Control
		The Asian Financial Crisis and Corporate Governance Reform
			Cronyism and Failed Governance
		The Government’s Reform Policy
			Independent Directors
			Managerial Transparency
			Minority Shareholder Rights
			Holding Company System
			Discussions and Policy Implications
		Conclusion
		Notes
		References
	5 Korean CEOs From a Governance Perspective: Historical Paradigm Shifts in Group Governance-CEO Models in Chaebols
		Introduction
			Misunderstandings On Korean Chaebols’ Governance and CEO Models
			A Structural Approach to Group-Level Governance-CEO Models in Chaebols
			Early Literatures On Chaebol Governance and CEOs
			The Positioning of this Study
		Governance-CEO Model as Strategic Environmental Adaptation
			Difficulties in Defining Business Groups
			The Relationship Between Governance Structure and CEO Role at the Corporate Level
			Prevalent Misconception of Chaebols as a Network Governance
			Alternative Governance Structures: Market, Hierarchy and Network
			Controversies Surrounding Network Governance: Governance as the Logic of Exchange
			Group-level CEO as a Structural Role Embodying Governance Logic
		The Founding Period, 1945–1960: The Age of the Entrepreneurial Model
			From an ‘Industrial Void’
			The Age of Entrepreneurial CEOs: The Birth of Modern Industries From an Industrial Void
			Individual Entrepreneur as a Corporative Actor and Entrepreneurial Governance
		The Rapid Growth Period, 1961–1997: The Age of the Hierarchical Model
			The Developmental Dictatorship of President Park and Rapid Economic Growth
			The Development Coalition Between Chaebols and the Authoritarian Government
			The Myth of Chaebols as an Interfirm Cooperative Network
			The Hierarchical Model of Chaebol Governance and the CEO Role in the Rapid Growth Period
			Boundaries of Network and Hierarchy: Chaebol Governance From Boundary Dynamics
			The Hierarchical Nature of Chaebol Governance in the Rapid Growth Period
			Decoupling as a Source of Misunderstanding On Chaebol Governance and the CEO Role
			The Informal Hierarchical Power of Group Chairman From Ownership
			Chairman and the Office of Planning and Coordination as the Informal Headquarter
			Industrial Void and Aggressive Unrelated Diversifications By Chaebols
			Strategic Rationales Underlying Chaebols’ Aggressive Unrelated Diversifications
			Advantages of Hierarchical Governance in Unrelated Diversifications in Industrial Void
			Double-sided Consequences of Chaebols’ Hierarchical Governance and CEO Model
		The Neoliberal Period, 1998–present: The Age of the Internal Market Model
			The Unfolding of the 1997 Korean Economic Crisis
			The Disturbed Fit Caused By Environmental Changes and the 1997 Economic Crisis
			Political Democratization and the Disappearance of Labour Cost Advantage
			Neoliberalism and the Unprepared Globalization of the Korean Economy
			Korean Chaebols’ Failure of Paradigm Shift and the 1997 Crisis
			The IMF Bailout and the Forced Paradigm Shift of Chaebol Governance and CEO Model
			Forced Reduction of Unrelated Diversifications and the End of Octopus Corporation
			Radical Neoliberal Transformation of Chaebol Governance and CEO Model
			Internal-market Governance and CEO Model for Globalized Neoliberal Environments
			Neoliberal Meritocracy and a New Model of Chaebol Governance and CEO
			The Institutionalization of Elaborate Performance Control Mechanisms
			Unexpectedly High Performance of the New Chaebol System
			Fast Second Strategy in the Globalized Markets
			The Double-Sided Effects From the Internal-Market Model of Governance and CEO
		Conclusion: The Currently Ongoing Paradigm Shift
			The History of Paradigm Shifts in the Governance and CEO Model Korean Chaebols
			The Fourth Industrial Revolution and the Currently Ongoing Environmental Changes
			The New Rule of Competition in the Age of the Fourth Industrial Revolution
			The Challenges Faced By Chaebol Governance and the CEO Model
			Concluding Remark
		References
	6 Business Groups in Korea: Past, Present and Future
		Introduction
		Prior Studies On Chaebols
		Evolution of Korean Business Groups: A Family Firm Perspective
			Professionalization of Management in Strategic Leadership of Chaebols
			Intrafamily Succession of Chaebols’ Strategic Leadership
			Discussion
		The Rise of New Business Groups in South Korea
			Contextual Background of Emerging Business Groups
			Are Emerging Business Groups Chaebols?
			Distinctive Features of Emerging Business Groups
			Discussion
		Concluding Remarks
		Notes
		References
	7 Government–Business Relations in South Korea, 2000 to 2022: An Institutional Perspective
		Introduction
		Institutional Theory: What It Is and How It Works in South Korea
		Economic Opening and Market Reform
		Improvement of the Business Environment
		Innovation and Digitalization
		Globalization
		Conclusion
		Notes
		References
	8 The Strategy Behind the Global Success of Korean Firms: Applying the ABCD Model in Practice
		Introduction
		Theoretical Background: Four Mainstream Theories for Firms’ Competitive Advantage
		Literature Review: The Fundamental Factors for the Success of Korean Firms
		The ABCD Model: An Alternative Approach to Competitive Advantage
			Agility: Speed Combined With Precision to Increase Productivity
			Benchmarking: Learning and Best Practices for Efficient Catch-Up
			Convergence: Mixing Synergistically to Create New Advantages
			Dedication: Diligence and Goal Orientation for a Strong Commitment
		The ABCD Approach to Explaining the Global Success of Korean Firms
			Agility: Hyundai’s Competitive Advantage in the Construction Industry
			Benchmarking: Samsung’s Emergence as a Global Leader in the Smartphone Business
			Convergence: Samsung’s Successful Entry and Emergence as a Global Semiconductor Maker
			Dedication: POSCO’s Work Ethics and Strong Motivation for Success
		Discussion
			Implications for Latecomers
			Implications for Leading Firms
		Conclusion
		Note
		References
	9 Catch-Up Strategies of Korea’s Big IT Corporations
		Introduction
		Literature On Latecomer Catch-Up
			Technological Capability
			Non-technological Capabilities
			Modular and Integral Product Architecture
			Mass Products and Complex Product System (CoPs)
		Big IT Corporations’ Catch-Up Strategies
			Product Architecture and Organizational Arrangement
			Core Competence Based On Technological Linkage
			Product Life Cycle/stage-Based Technology Catch-Up
			Upgrading the Innovation Activities of Large Business Firms
		Discussion
		Conclusion
		Acknowledgements
		Notes
		References
	10 The Rise of Two South Korean Multinationals: How Samsung Electronics and Hyundai Motor Built a Competitive Advantage By Closing the Capabilities Gap
		Introduction
		The Liabilities of Origin
		Building a Competitive Advantage By Closing the Capabilities Gap
			Step 1: Diagnosing the Need for Change – Using the Quality Gap in the US Market
			Step 2: Setting and Delivering Stretch Goals to Bridge the Quality Gap
			Step 3: Sequentially Addressing the Capabilities Gap in Design and Branding
		Discussion
		Conclusion
		Notes
		References
Part III Micro Issues in Korean Businesses and Management
	11 Putting Korean HRM Into the East Asian Context
		Introduction
		Korean Culture and Institutions in Context
			Korean Culture in East Asian Context
			Korean Institutional Environment in East Asian Context
		Korean HRM Compared to Japan and China
			Recruiting and Selection
			Training and Development
			Pay and Benefits
			Retention and Outplacement
			Industrial Relations
			Gender Diversity and Employee Wellbeing
			Global Talent Management
		Case Study: Samsung’s HRM Practices
		Convergence, Divergence and Converging Divergence
		Conclusion
		References
	12 People Management in Korea: An Organizing Logic Perspective
		Introduction
		Theoretical Framework: Three Organizing Logics in People Management
			Three Organizing Logics: Hierarchy, Market and Community
			Change and Hybridity of Organizing Logic in People Management
		Contextual Background: History and Features of People Management in Korea
		People Management Practices of Korean Big Businesses
			Case Selection
			Samsung Electronics Company
			SK Telecom
			Hyundai Motor Company
			Kakao
		Discussion
			Changes in Organizing Logics
			Implications for Research
			Current Challenges and Implications for Practitioners
		Concluding Remarks
		References
	13 Employment Relations: Labour Issues and the Labour Union
		The Developments of Korean Employment Relations
			The Origins and Development of Korea’s Militant Labour Movement
			The ‘Miracle of the Han River’ and the Great Labour Struggle
			Rivals in the Labour Movement: FKTU and KCTU
			Underperforming Tripartite Commission
			Resurgence of Union Density in the 2010s
		Current Employment and Industrial Relations Regulations
			Individual Labour Contracts and Protection
			Union Organizing and Industrial Disputes
			Labour Polarization Within a Superficial Industrial Union Structure
			Stronger Public Sector Union
			Outdated Laws and Regulations in Industrial Relations
			Inflexible Union Leaders Neglecting Fundamental Changes
		Current Labour Issues Facing Us
			Adapting to the Fourth Industrial Revolution
			Addressing Intergenerational Strain in an Aged Society
			Non-union Employee Representation as Future Trends for Labour Representation
		Conclusion
		Note
		References
	14 Executive Compensation in Big Corporations: Unique Features in Korean Firms
		Corporate Governance in Korea
			Controlling Shareholders and Secondary Agency Problems
			How Is Executive Compensation Determined and Disclosed?
				Setting Compensation
		Overview of Executive Compensation in Korea
			Data and Sample
			The Level and Structure of Executive Compensation in Korea
		Literature Review On Executive Compensation in Korea
			Theoretical Background
			Empirical Evidence On Major Topics in Executive Compensation in Korea
				Determinants of Executive Compensation
				Executive Pay for Performance Sensitivity
				Use of Stock Option Grants for Top Executives
				Consequences of Executive Pay
		Discussion
		Conclusions
		Note
		References
	15 Knowledge as a Unifying Factor for An Individual Firm and Macroeconomics in Korea
		Introduction
		Literature Review
			Open Innovation
			Co-creating Innovation With Customers
			Critiques
		Methodology
			Research Setting
			Data Collection
			Data Analysis
		Findings
			Phase 1: Idea Generation
			Phase II: Development
			Phase III: Commercialization
		Discussion
			Theoretical Contributions
			Implications for Practice
			Limitations
		Conclusion
		References
Part IV Emerging Issues in Korean Businesses and Management
	16 Corporate Social Responsibility and Social Entrepreneurship in Korea
		Corporate Social Responsibility as a Non-Market Strategy
		Fledgling Capitalism (1953–1970s)
		Seeking Legitimacy in the Fast-Growing Economy (1980s–early 2000s)
		Globalizing CSR and the Blossom of Social Entrepreneurship (2008 Onward)
		Facing Future Challenges With Global Perspectives
		Dynamics of Korean Modern Economic History and Current Issues in CSR and Social Entrepreneurship
		Concluding Remarks
		Notes
		References
	17 The Shifting Startup Ecosystem in Korea: Government’s Efforts to Revolutionize Education and Finance
		Introduction
			A. Organizational and Administrative Initiatives From Government Institutions
				Korean Government Creating an Entrepreneurial Economy
				Rapid Growth and Evaluation of the Korean Entrepreneurship Ecosystem
				Pursuing Sustainable Growth Through Changes in the Role of the Government
			B. Broadening Reform and Support From Finance Policymakers
				Entrepreneurial Finance in Korea
				New Sources of Money
				Remaining Problems
			C. Entrepreneurship Education Initiatives in the Korean Context
				Korean Pedagogy Toward Creativity and Innovation
				Outcomes From Korean University Entrepreneurship Efforts
				Roadblocks Challenging Future Success From Entrepreneurship Education Reform
		Concluding Remarks
		Notes
		References
	18 Managing Gender and Diversity in Korean Businesses
		Introduction
		K-Management in Need of Change
		Government Initiatives for Improving Gender Diversity in Korea
			Promoting Gender Diversity Through Legal Reforms
			Promoting Family-Friendly Culture in Business and Society
			Promoting Flexible Work Arrangements and Workplace Innovations
		Empirical Assessment of Efficacy of WLB Measures in Korean Workplaces
			Work–family Balance Survey and WLB Index
			The Role of WLB Availability and Utilization On Gender Diversity Performance
		Remaining Challenges and Issues in Gender and Diversity Management in Korea
			MZ Generation: Generational Difference in Korean Society
			Gender Issue and ESG Management
			Pandemic and Gender Diversity
			Gender Conflict as a Major Issue in Politics
		Conclusion
		Notes
		References
	19 Fourth Industrial Revolution and Employment Issues in South Korea
		Introduction
			Global and Domestic Context
		The Possibility of Worsening Technological Unemployment
		Employment Mode and Management Issues
			From the Internal Labour Market to the External Labour Market
			The Shift of the Management Paradigm
		Policy and Managerial Implications
			Policy Implications
			Managerial Implications
		Conclusion
		References
Part V Challenges and Future Directions
	20 The Korean Business System: Evolution and Future Challenges
		Introduction
		Overview
		The Tranforming Korean National Business System
			Political-Economic Background
				(1) 1961–1979
				(2) 1980–1997
				(3) 1998 – After the Asian Financial Crisis
			Labour Market
			Culture
			Financial Market and Banking System
				Before the Asian Financial Crisis
				After the Asian Financial Crisis
			Education and Training System
			Industrial Relations System
			HRM System
				Before 1987
				1987–1997
				1998 Onwards
			Institutional Evolution and Economic Competitiveness
		The Future of Work
			New Challenges to the Business System
			Technological Developments and Skill Levels
			Fertility Decline
			Organizational Loyalty and Work Ethics
		Conclusion
		References
	21 Conclusion: Lessons, Challenges and Implications
		Introduction
		Key Lessons From the Korean Experience
		Challenges and Rigidities
			1. Global Level
			2. Institutional Level
			3. Industrial Level
			4. Corporate Level
			5. Individual Level
		Implications
			1. Research Implications
			2. Practice Implications
			3. Policy Implications
			Conclusion
		Notes
		References
Index