Legacy companies and startups, what drives their workplace culture, and what’s the impact on lives and results?
Jem Kim and Alex Jensen have a nuanced, balanced and insightful conversation about the different workplace cultures that are both well established and also emerging in Korea. Korea was once well known for its semi-military workplace culture, with strict hierarchies, endless workplace dinners and a strong concentration on building jeong (정) between workmates.
But how has this changed with the growth of the startup scene, when a startup becomes a giant like Coupang, what kind of workplace culture does it have? Does it retain the leanness of a startup, or does it begin to resemble what Jem describes as a legacy company?
Through their conversation, Jem and Alex are careful to avoid judging one workplace culture as being superior to another. Yes, there is probably more freedom in a startup, but then again, there are fewer people to turn to for support. A feeling of shared mission can exist in both, as can a sense of progress and achievement.
And what does this mean for a non-Korean coming into a Korean company? Whether as a senior leader, or in a working level position. Are they supposed to act as catalyst for change, or are they expected to localize fully? Undoubtedly, the truth varies company to company, but in almost all cases non-Koreans spend a great deal of their days working out what they can tweak, what they can’t touch and what needs real change.
Their conversation also touches on the impact of ESG on Korean public companies as well as the succession from family-owned company structures in chaebols and other companies to more professionally managed structures. As stakeholders become more diverse it seems unlikely that a corporate leadership deriving from a single family would be able to cope with the increasing complexity of a modern corporate.
Alex and Jem wrap up their conversation by looking at two factors that are impacting workplaces cultures today, the pandemic and political forces. What will happen once companies are free to return or not to previous practices? What will happen if another center-left government comes in. Yoon Seok Youl has promised widespread deregulation to business including abandoning the 52-hour week rule.
Today’s episode was brought to you by Eastpoint Partners Asia, offering you an unparalleled Asia-wide network of relationships with corporates, governments and investors.
Legacy companies and startups, what drives their workplace culture, and what’s the impact on lives and results?
Jem Kim and Alex Jensen have a nuanced, balanced and insightful conversation about the different workplace cultures that are both well established and also emerging in Korea
Alex Jensen: You’re listening to Koreabizcast with the KBLA. I’m Alex Jensen and it’s Thursday, November 11th. And you know what that means, don’t you? Otherwise known here in Korea as Pepero Day, November 11th is celebrated with chocolate dip sticks made by Lotte confectionery, and they’re already a big seller at home throughout the year. But apparently, they’re becoming more popular abroad as Korea gains a bigger presence globally, having risen over 14% From a year earlier, overseas Pepero sales hit 40 billion won last year, and will be promoted from Singapore to Russia through promotional events in line with Pepero Day this year. Before you say that all sounds rather commercial for what’s supposed to be a romantic occasion. Well, this is a business podcast. So happy Pepero Day and shifting gears a little. Did you also hear this week that POSCO has vowed to create 25,000 new jobs over the next three years, they’re still making conglomerates actually joined the government’s Youth Hope On support program which has already got the participation of KT, LG, Samsung and SK. But what’s it like to work for a big conglomerate versus a startup say? and how is Korean corporate culture evolving? That’s a big topic and one will take on today with this episode brought to you by Eastpoint Partners.
Alex Jensen: So, with working from home, no longer officially advised in this country under pandemic control guidelines not to say people aren’t able to do it or not able to thrive doing so, we do have a first chance since starting Koreabizcast to really dive into corporate culture in Korea. I guess reporter today, Jem Kim is particularly well placed to do that as well. She has been looking into the difference between startup corporate culture and legacy corporate culture, both of which she’s experienced firsthand. Jem, always wonderful to have you with us and thank you.
Jem Kim: Thanks so much for having me, again, Alex.
Alex Jensen: Let’s get a bit more on your experience then before going on here.
Jem Kim: So, I was a journalist at a so-called Legacy media company, we didn’t we did not call that legacy in the past. But that was who I was, for 13 years after that I did have a chance to taste the business side of that same media company for about seven years. And that was when I had a chance to meet with many different startups, you know, I covered them. And also, smaller companies that maybe aren’t necessarily startups, although now the line between startups and small companies, it does seem to be a little bit blurry. So, after that my most recent experience was a company that started out as a startup. But I think it’s, you know, you can’t actually call it a startup anymore, because it’s one of the biggest firms in the industry in both Korea and globally. So, I guess to some of you can say that I had direct experience of the media, both on the editorial and non-editorial side, and also a construction company that took over that media. So, I would say that company is like, you know, the king of legacy companies. And then in the indirectly I’ve met with and heard about many different smaller firms in startups and their cultures.
Alex Jensen: Can we just briefly define what we mean by legacy company in the context of Korea, where we’ve all heard I’m sure about the family run conglomerates, the Chaebol?
Jem Kim: Right? Um, you know, for me, that’s actually a very good question. I wonder myself, I mean, you know, what kind of a company is a legacy company, and what kind of a company is not? My, and this is just my personal take on it is that usually you call an old company, you call it a legacy company and that’s putting a positive spin on it. And I think it does make sense because, you know, it being a legacy company, it doesn’t mean that it’s all about negativity. There are many aspects of it that’s worthwhile to learn. So that’s my definition of a legacy company, a company, that’s all that was maybe in the past that thrive in the past, but there are things to learn from it.
Alex Jensen: So, after experiencing both legacy and startup companies in various different forms, what’s your view on how each is so different here?
Jem Kim: Right, I do think they’re the same in all that all of these cultures, they do pursue, you know, some type of a KPI that set out from the beginning. And however, at the same time, it’s still different because each culture has actually evolved according to their own needs in order to hit those KPIs, of course, and I think it’s also defined by the kind the type of product or service it produces. And I’m not going to talk too much about the legacy media because it has been a long while ago for me, but I We’ll say, you know, and you might have the same opinion or not, Alex, but does seem like there’s a lot of working alone for journalists, you know, you go solo, it’s hard to work together, when you’re a member of the media. So, collaboration, I don’t think it, it usually defines the company culture for the media, regarding the construction Company, which took over that media, that was really an eye opener for me, because, and my take is that there are so many third persons involved in construction, you know, you need to have these subcontractors. So, collaboration is absolutely unnecessary. But at the same time, I kind of felt this, you know, sort of forced collaboration also breeds a lot of distrust for one another, despite that, the company culture aims for the opposite. So that was, that was, you know, how I felt after those two companies. And going back just a little bit with the media firm. I was, I was kind of surprised, because, you know, you talk about how the media is supposed to be really free, freedom of speech, speech, and it talks about, it’s supposed to get out stories that people, you know, for underrepresented people as well. So, you think that there’s a lot of freedom there, and the culture would reflect that. But for me, I felt it was really restrictive. The culture itself was, you know, how else would I put it, except it’s really like a legacy culture, and you don’t really have a lot of freedom to put your ideas out there and try to make something of that. So that that rigidness was, for me, it was a bit surprising, you know, as the years went by at the media company. Now, having said that, I think for startups, it’s a whole different story. But not because it’s like the exact opposite of a legacy company, I think. Because all of the decisions have to be made based on a consensus. That’s where startups start from, you know, the co-founders, they need to agree. So, it usually ends up with nobody really having the initiative or authority to make those decisions. And because startups do have to grow really fast, they have to scale really fast. A lot of times you see that people or the company culture, and often these things get lost in the process. And when you think about, I guess it does make sense, because who needs that when you when you have a really big company to grow, and you have a lot of investors to satisfy.
Alex Jensen: I know that more recently, you’ve worked for an ecommerce company whose name we don’t have to mention, but there is an element there of a huge company that is still also new. What was the culture like there? Did you get a bit of both the startup atmosphere as well as this feeling of the conglomerate atmosphere seeping in?
Jem Kim: Well, I mean, you and we can name this company, because it’s actually on my LinkedIn profile. So, I work for a Coupang. And I would say it was a very interesting experience. Because I think it’s because there’s a lot of expectations towards startups. It’s going to be a flat culture, right? It’s going to be a place where you can, you know, your ideas can explode and create products. I think that’s a lot of a preconception, would you say, regarding startups. So, a lot of those expectations that I had, or actually, they, you know, they did not actually meet the reality, reality was a little bit different. That’s my opinion on, you know, the company that I was at. I think, though, there were a lot of procedures that people, you know, a lot of the stakeholders, my colleagues that they tried to place in order to try and improve a culture that was very, very much focused on hitting KPIs and getting out results, again, as I said, and then people usually tend to get lost in that process. So, while that was all going on? there were people there are a lot of people at the company who are trying to make sure that the corporate culture still gets built that’s still focused on people.
Alex Jensen: Yeah. Do you sense that when startups become so big, that they may be described as unicorns, for example, that they start to behave like conglomerates inevitably within Korean culture?
Jem Kim: Absolutely, absolutely and it gets so confusing, because, you know, you keep you keep hearing things, you know, your superiors, or your bosses, they would tell you, you know, we have to think like a startup. You can’t think like a conglomerate. That’s something that you hear every single day, but at the same time, you’re already big as a conglomerate. So, you need to make a decision, you know, are you going to be, you know, what kind of company are you going to be? and you have to make you have to realize you can’t be called a startup anymore. It just doesn’t make sense. And you can’t tell people within that organization, you know, we’re still a startup, we can still make mistakes, we can afford to make mistakes because you can’t afford to make mistakes, the implications the impact will be too big on the industry and the country because you’re already too big to fail. So, I think you need to face reality when you’re at a startup that’s, that’s too big to be called the startup anymore.
Alex Jensen: Korean culture generally is moving at a rapid pace. I don’t want to give the impression like it’s static, but there are certain features that would appear to be distinct from the corporate experience abroad. And would you say that it’s very relevant to both startups and these so-called legacy companies?
Jem Kim: Can you elaborate a bit more?
Alex Jensen: I guess, when I first came to Korea, that corporate culture would smack me in the face with things like Hoesik, for example, the corporate dinners and forced drinking sessions, but even on a more subtle level, I guess, the hierarchy, the types of communication between management and staff, the way that management and staff might be segregated. A lack of openness, perhaps, but again, I don’t know how much of that in your view is Korean? And how much is just a certain type of culture that is popular among legacy companies that’s seeped through?
Jem Kim: Oh, wow. That’s a loaded question. Um, I do think though, it you know, each culture has pros and cons, and hierarchy. That was the word I was looking for when I was describing the media company I was with, and also, of course, the construction company. But the thing is, when you have a lot of hierarchy, that also means that people on the bottom, the bottom rung, they do get taken care of, as long as you follow those rules. So, in a way, it’s easy, easier to navigate, you know, people may force you to drink, you may have to attend Hoesik which are horrible. I, you know, one of the reasons that I quit the media companies, because I didn’t enjoy them anymore. But at the same time, there’s a, there’s like a weird sense of taking care of each other. So, I think those are the pros and cons. At the same time, when you talk about startups, and you and especially for tech companies, the culture is, you know, all the things that you just mentioned, you cannot force anyone to go to Hoesik, you cannot force anyone to drink, you cannot even force anyone to have any kind of a meeting with you outside of working hours. So those things, I think, for me, they were there were changes that I looked forward to. And I think those are the, again, the pros of working for such a company. But at the same time, it also means you know, you’re on your own, nobody’s going to take care of you. Because your freedom has been respected. That also means that you need to, you need to make sure that you are responsible for everything for you know, you’re accountable. So, I think those are I don’t know, if I’m answering your you know, exactly answering your question, but I do and for me, that’s why it’s so it’s sometimes confusing, you know, which is better, which is not. But again, it all comes down to every culture has pros and cons.
Alex Jensen: Well, I think also, there are other features that we haven’t touched on there, like for example, the people would queue up to get a job at one of the family run conglomerates here because it would be seen as a job for life. Whereas maybe today, especially post COVID, suddenly, there’s a lot more diversity in the way, people are working and maybe it’s changing that mindset, something that was perhaps happening before, but which has been sped up not to the extent maybe of other countries. But I’m curious on your thoughts about that, on this on a different approach that people coming into the workplace would have?
Jem Kim: Hmm, well, I mean, Alex, the reason that I thought maybe, you know, this topic would be interesting for us, and you mentioned it as well before but is that I saw a post on LinkedIn. And it said that, you know, that person was so happy that he or she did not pursue the same traditional the conventional career of working for a conglomerate Daegieop. And instead that person pursued change and pursued excitement pursued, you know, unconventional ways. And I was very happy for the achievements that that person had made. But it made me think so does that mean anyone who works for a legacy company is a loser? Are we all losers if we work for a legacy company, and I don’t think so because, you know, my husband works for a legacy company, and every single day, he goes out at the same time, in the morning, they, you know, rain or not, and I do feel sometimes the importance of being able to be resilient, and holding on to something that, you know, won’t change is actually more difficult when you think about it, you know, a lot of times people say people don’t like change, but in I think these days, people do actually embrace change more. And change is exciting when you think about it. So, in a way, you know, being left in that legacy, working environment, it’s actually more difficult, difficult now in some sense, so I feel that there need there needs to be more understanding among people who work for different industries. And especially as you as you said, different working cultures we need to understand that just because you’re working for a startup, it doesn’t mean that you know, you’re going to you’re the pioneer of change and vice, so it just means we’re all different. And we’re working for different companies and in different environments. So, I do think we need to understand each other better, and also try to take a page from the other person’s company or the culture so that, you know, that means that they’re probably points that we can complement each other on.
Alex Jensen: Also, one more question related to the Korean cultural component of all this, I think it might be particularly relevant if you are a foreign staff member, or even a foreign Executive coming in, do you think that they need to be particularly sensitive to the so-called Korean way of doing things, it sounds horribly, much like a generalization, but in a relatively homogeneous culture, it is relevant. And I know of some foreign executives who’ve actually spoken to us on this very podcast about changing the hierarchy a little bit, but at the same time trying not to alienate people from their own culture. What would your thoughts be, for example, if you’ve been a Coupang and a foreign Executive came in and decided that the try and turn everything into a Silicon Valley type operation?
Jem Kim: Again, it has. That’s a great question. I don’t think, you know, my answer would be no, I don’t think you have to be sensitive in terms of, you know, trying to do exactly what that culture dictates. Because that’s not why you’re here, right? I would believe somebody who’s coming out of the Korean culture, and who’s coming here to, to work would be, you know, we would want that person to bring change, a positive change. So, I would say no, you know, just being sensitive and just following and conforming to everything that’s already being done. No. I would say no, but at the same time, what I think is, there needs to be trust, you know, a lot of times and I know, you know, there are a lot of foreigners who don’t feel the same way. But think, you know, there could be that sense of distrust, because you don’t know how long that person would be here to stay for, you know, is this for forever? or is this not? And I think that that those questions it does bring to mind, you know, the change as this person is going to be bringing, it could be lasting. So, can that person actually be take the responsibility for the impact as well? or is this person just going to leave after a couple of years after just making this change? Because when you make change, the impact is actually, the more I think the more difficult, you know, the more difficult part of it, and how it’s going to be tweaked to make it more lasting to localize it. So. And I’m not saying just because you’re, you know, somebody who’s come here from outside of Korea has to stay here forever. But I but I just believe that sense of trust is, is probably the most important factor and not just only about like, you know, are you going to be sensitive about the culture or not? If that makes sense.
Alex Jensen: Yeah. Well, speaking also of foreign Executives and staff, do you see one particular corporate culture within Korea as being more open to diversity, for example, startups versus the legacy companies?
Jem Kim: I think in some ways to answer your question some ways, the startups are bringing in, you know, so-called Global practices, Global cultures in. But I think, having said that, that also means some of the negative side, the negative aspects of those global cultures and global practices also get brought in as well. And I think I for one thing, that’s a good thing. Because unless there’s something to push back against, you can never actually improve.
Alex Jensen: What might be a negative thing, though that you’re referring to there?
Jem Kim: You know, sometimes I guess you feel like, and this could be just me, I do feel as if achieving your, you know, the KPI is actually the only thing that matters. And because startups do have to please a lot of investors, they have to hit those milestones, you do end up emphasizing that over anything else so maybe, you know, that can be one of it. Because I believe that unless people are motivated, you can’t in we talked about this before, you can’t, you cannot have sustainable results. So that kind of thing, maybe. But again, you need to have, you can’t just say okay, I’m just going to cherry pick and take this side of the culture that this aspect of the so-called Silicon Valley culture, you just can’t do that. It all comes in a single in a package. So, I think again, it’s a good opportunity for people to grow, and people to learn what other cultures are about.
Alex Jensen: What about the changes, though, that have happened in the larger corporations, and which perhaps will be further forced in the coming years under ESG, which I talked to you about in the fairly recent past? What won’t the gap especially where negatives are concerned close a little bit between all different types of corporations?
Jem Kim: Well, do you know that let’s say if there’s an ethical issue, and it gets brought up to there’s usually a committee of some sort at any kind of company. What I’ve noticed these days is that issues that would be usually brushed aside at startups, at larger companies, they actually, it becomes a really big problem. And a lot of times that problem would blow up. Again, I’m not, you know, I’m not going to say that this is a case for all companies. But what this means is that conglomerates, I think, maybe in some ways, they have learned their lesson than they do know, unless you focus on the people on, on sustainability, on you know, the environment, then people just the consumers will shun them and that means the end of it. So, they’ve learned that the hard way. So that’s why I feel these days, in some ways, startups are actually falling behind in ESG, you know, in sustainability. And I think, and I’m not, it’s not like it’s fun, but it’s interesting, because each company is there, there, they’re at those stages that you know, there’s a stage where you have to pass, you know, you’re an infant, and then you learn to walk, and then you become an adult. I think the conglomerates have passed that. And now I do feel it’s the startups, you know, turn. And yeah, having said that, I think both sides, they probably do have a lot to learn from each other.
Alex Jensen: What do you think about the legacy of the chair bowl, and for the future that is because I can imagine as Korean society continues to open up as well, that there will come a point where it’ll become very difficult to hand on a company down to the grandchild and the great grandchild, which we’re seeing now that the largest company in Korea, Samsung Electronics, go through its succession still, and it’s been a bit turbulent, to say the least over the last few years. It was a scandal that was connected to the presidential scandal that, of course, toppled Park Geun-hye and that was a big watershed moment for the country, do you think then there will necessarily come a point where the whole tone of conglomerates changes from top down?
Jem Kim: I think it’s already changing. They can have they cannot afford not to change. They cannot. And it all comes down to you know, when you think about it all comes down to the stakeholders, the shareholders, you know, can we name one company that’s, that doesn’t have a whole big diversity of shareholders, there’s not one single company in Korea, of course, there might be firms that we don’t know about that are hidden, but the ones that are out in the public, you know, they cannot afford to go on without making sure that the values that they are pursuing are they that they’re aligned with the shareholders values, and people aren’t stupid, you know, the shareholders aren’t stupid. Everybody, people know, people have a lot of information. They have a lot of, you know, valuable information people, they know about what’s going on at the international markets. So, you know, I, for one believe that, for instance, companies like Samsung, they will never be able to get away with murder anymore. And you already see that happening, you already see those changes happening.
Alex Jensen: Doesn’t it make a difference if you’re an employee? If you feel like you’re working for a company that’s effectively run by a royal family? versus one where you have someone dynamic who’s seemingly there are merit? Doesn’t that set the tone for a whole culture within a corporation?
Jem Kim: And that’s why you see people leaving. I mean, if you feel like it’s a company, it’s a place that you don’t want to stay. You don’t agree with the corporate culture. Sure, you know, one thing you can do is you can try to change it, you can be one of the pioneers, but I guess I was never, you know, that brave, but I do, I did feel that, after a while it does get difficult for a company to change. And what you have to do then is find the one where you’re, you know, where your values are aligned with, and I think to say, you know, I have to stay here that, you know, you can’t say that anymore, because as you said in the beginning of this, Alex, people are moving everywhere in anywhere companies accept people from different backgrounds now. So, I think it wouldn’t be an excuse, if you say it said, you know, you’re an employee there. So, you have to stay there despite the fact that you don’t like the owners or running everything.
Alex Jensen: Well, as we approach the presidential election, there’s another outside factor within this country, that is that could have a big impact that you can imagine the difference between Yoon Seok-youl government on the conservative side and Lee Jae-myung government on the left, that could have a huge impact on corporate culture in itself, couldn’t it?
Jem Kim: I would say so, I mean, you know, leadership is everything political leaders, whether it’s political leadership or, you know, corporate leadership, you see whole countries, you see companies, communities that change their tone because of the type of leader who’s in charge and I’m not going to say who I favor or who’s going to do a better job. But yeah, you’re absolutely right there the who the leader will be, it’ll have a lot of say in setting the tone for a lot of companies and, and even now you see a lot of these club conglomerates, they’re just waiting to see who’s going to be the winner so that they can follow that tune which is kind of sad when you think about it. But these are really big firms that depend on the government for a lot of, you know, for a lot of things. So, I guess they’re waiting too, to see who’s whose leadership will be defining their corporate culture.
Alex Jensen: But Jem, COVID-19, it’s always there in the background of the conversation, it’s forced, actually a lot of people to take on change, whether they wanted to or not. What’s your lasting impression here conclusion if you like, on the direction you see us all heading?
Jem Kim: I think there’s going to be a lot more diversity. And I do think, as you just mentioned, Alex, more people will be taking the chance because they saw that. Number one, maybe it’s not worth it not to take a chance when, you know, the world man tomorrow, there may be another pandemic. And number two, we’ve seen that, when you when you do take the risk doesn’t always end in a disaster, there are, you know, you’ve seen a lot of cases where people came up with a lot of creative solutions to, you know, to get over the pandemic to live within or live with that pandemic. So, I think we’ve seen that thinking out of the box, it does in a lot of cases, it’s actually paying off. So again, you know, it may sound a little vague, but I do believe that there’s going to be much more diversity and people will be, you know, they’ll have more courage to come out and do what they want and of course, within, you know, not harming or undermining the other, you know, other people’s freedom. But I think those changes are some things that we can look forward to and just think about this podcast, Alex, I’m sure a lot of people said, this may never happen, but look where you’re now.
Alex Jensen: Just needs to have the will, I think to make ideas happen with the so much talking that goes on and that’s another thing I think that happened during the pandemic, for me personally was a chance to reflect on the difference between talking and action. And that’s a good place to I think leave a bit of inspiration. Jem Kim, thank you very much for speaking with us today on Koreabizcast.
Jem Kim: Thanks a lot, Alex.
Alex Jensen: It’s amazing how many different people we’ve spoken to already in the first month and a bit of Koreabizcast and we’d love to hear your story to get in touch via info@kbla.net and thanks again also to today’s sponsor Eastpoint Partners. We will be back same time tomorrow.