What explains the remarkable growth of South Korean electronics companies?

These are my thoughts as a non-Korean worker at Samsung for eight years.

  • Hardwork by the people – People are incredibly hardworking. People in their late-thirties or above are especially hardworking. While it might not be productive or smart, it is not necessary. It is possible to do it with more hard work. One of my ex-colleagues used to tell me, “I always go home tomorrow” (as in after midnight). He would arrive at work sharp at 8 a.m. the next morning.
  • General psyche – The general psyche is that of the nation. I found it to be a desire to improve one’s life and be productive. This may be due to centuries of isolation from other people. People are also very honest. This is despite the fact that Samsung’s Chairman has been convicted for cheating (and pardoned later). My personal experience is that I have lost several thousand dollars in cash, high-end cameras, passports, and other valuables. They were all returned intact.
  • Goal to become a developed country – This is what more than five people told me. They wanted to reach USD 20K per-capita GDP and be a developed country. It is probably a standard, most likely of WB, IMF, etc. It was strange for me to see someone praising a nation’s goal or his contribution to it, but that is what they were. They probably crossed it several years ago.
  • Focus on #1 – There is a legend at Samsung about how GS Choi, ex-CEO, spent two decades chasing Sony to be the #1 TV brand. Similar things have happened in phones, too. The goal was simple: beat Nokia. They did it recently with more than generous support from Nokia. Smartphones are another example. Samsung was not among the top five smartphone manufacturers in 2009. It was listed under “Others”. It was an internal goal of the team to break into Top 5 in 2010 and become #1 in 2011.
  • It is a follower rather than a problem solver. Engineers and VPs often benchmark their competitors to develop new stuff. They measure things such as load-time, processing times, and so on. Example: Reports comparing the page load times of Samsung browsers with iPhone’s would take up precious time. They will sometimes follow but they do it very quickly!

These are the main reasons. However, there are other factors that could have indirectly contributed to their success.

  • For several decades, semi-dictatorial rule was in place (an ex-colleague would say it as “We had a benevolent ruler who disciplined us”).
  • Threat from North Korea (people fear this and it probably makes them work harder).
  • Hierarchical social structure. It is not uncommon to hear people say things like “I need to fix that defect because this product was my division VP’s objective/KPI for this year.” His KPI would not be met if I didn’t. I could try the same trick in India, telling an engineer to do some work because of his KPI. The engineer would likely ask me to tell the boss since that is his KPI.
  • Homogeneity in the culture/language/religion (I say this as an Indian where we see multitudes of cultures co-existing making it very difficult to figure narratives appealing to all groups of people)
  • Training in military discipline (A 2 to 3 year period is required for those who live near North Korea’s borders. This gives them the opportunity to learn how to listen and be disciplined.

They are successful because they began at the bottom with low quality products, and then built up quality. The leaders became complacent. Earlier, Western companies had been complacent about Japanese products. There are stories of Sony becoming the third television in a US house. However, American/European TVs dominate the living room. Honda/Toyota were also at the bottom end. They then both made fun of Korean cars (I’ve seen YouTube videos of UK chat-shows mocking Korean cars). All three are now likely to be about Chinese. Huawei, ZTE and TCL, who knows? In 20 years, the leader might be Huawei, ZTE, TCL etc.

You may also want to read the book titled: Sony vs Samsung: The Inside Story of the Electronics Giants’ Battle For Global Supremacy (http://www.amazon.com/Sony-Samsung-Inside-Electronics-Supremacy/dp/0470823712/)

[Well, I haven’t read the book and these points are not from it!]

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