Global Business Cultural Analysis: South Korea Essay

Global business cultural analysis of the nation of South Korea is the focus of this research paper and will address how South Korea is placed as a trading partner with the United States, what is South Korea’s economic growth prospective, does China impact South Korea’s economic growth, what are the economic ties between North Korea and South Korea, does tourism play an important role in their economy, what are the major elements and dimensions of culture in this region, how are these elements and dimensions integrated by locals conducting business in this nation, how do both of the previous items compare with US culture and business, and what are the implications for US business that wish to conduct business in that region. South Korea 3 Introduction South Korea has emerged numerous calamities in its recent history. â€Å"Korea’s remarkable economic growth since the 1960s has been described as an East Asian miracle† (Hongshik, 2008). They survived the occupation by Japan, the ravages of the Korean War, all resulting in poverty and a dysfunctional government. These events did not leave South Korea in a position to compete or participate with a growing global economy. However, within recent years, South Korea rose from the ashes to become a leader in communication technology and the automotive industry. A changing global economy has induced the Koreans to transform their government and utilized the strengths of their culture to become a formable player in the global market (Lee, 2003). This paper will discover how South Korea is positioned as a trading partner with the United States, South Korea’s economic growth prospective, China’s impact South Korea’s economic growth, the economic ties between North Korea and South Korea, the role tourism plays on its economy, the major elements and dimensions of culture in this region. (Communications, Religion, Ethics, Values and attitudes, Manners, Customs, Social Structures and Organizations, and Education), how these elements and dimensions are integrated by locals conducting business in this nation, how do both of the previous items compare with US culture and business, and the implications for US business that wish to conduct business in that region. South Korea 4 Major elements and dimensions of culture in South Korea South Korea’s religion can be considered a poly-religious society or perhaps know as a melting pot of religion due to the increase in foreigners. Confucianism, Christianity, Buddhism and Shamanism are just a few of the main religions and Islam is one that is growing fast over the last 50 years. Confucianism saturates South Korean’s daily life and evolved or was introduced from the Chinese. However, it is probably better defined as a way of life than a religion. Confucianism was a system created by Kung Fu-Tzu about 500 BC. Kung Fu-Tzu taught the system during a time when China was disrupted by fighting. He developed five concepts to follow. Fairness and morality, father and son shall have an appropriate understanding between themselves, husband and wife shall maintain separate roles, the elder shall have priority, and friends shall give precedence to faith and conviction. Confucianism has an impact on Korean society by influencing social status and contacts where Koreans standing is decided by age, gender, education , family history, affluence, job, and governmental philosophy. Korean’s prosperity is determined by their contacts. Korean prominence is determined by age, gender, education, family background, affluence, job, and governmental philosophy .Social contacts determine success. Heredity and history are important factors on how people are treated in an ordered society (Choong, 2012). Buddhism has existed for thousands of years and is considered by many not to be a religion but a means to develop spiritual awareness of one’s true self. â€Å"Buddhism famously denies the existence of the self. This is usually understood to mean that Buddhism denies the existence of a substantial self-existing over and above the flow of conscious experience† (Fink, South Korea 5 2012). It does not worship a God of creation. Globalization has introduced Buddhism to the world to become a multinational religion (Kitiarsa, 2010). South Korea’s ethic and value system has been influenced by the diverse cultural make up since the Korean War, and the things that influence the Korean people are different on how decisions are made in other nations. Globalization draws attention to the need for understanding business ethics and values of the culture a business or corporation is working with. Recent scandals have brought into focus the need for business ethics. The US firm, Enron, filed bankruptcy due to business ethics being ignored and Daewoo had the same fate for South Korea. Corporations have adopted codes of ethics to repair their image to the world. â€Å"Among four people-centered core values, human-centered management/human resource development and knowledge sharing were the values preferred by the managerial group. Managers placed more importance on accountability values, among which obedience to the law was significantly emphasized by the managers. With respect to the social responsibility values, the managerial group scored higher for the value of disclosure with no significant difference. As to the leadership values, social responsibility, faithful tax payment, and transparency of information† (Eunsang 2009 11(2), 235-252). Whistleblowing is an important tool to help keep businesses in line and is a concept the Asian countries have adopted. However, not much has been reported on its progress in those countries. Confucian Ethics and Individualism-Collectivism can have an influence on effective whistleblowing. â€Å"Confucian ethics had significant but mixed effects on whistleblowing Intentions. The affection between father and son had a negative effect on internal and external whistleblowing intentions, while the distinction between the roles of husband and wife had a positive effect on those intentions. The effects of collectivism were also different depending on the specific types of collectivism. Horizontal collectivism had a positive effect on both types of whistleblowing intentions, whereas vertical collectivism did not show any significant effects on whistleblowing intentions. These results indicate that cultural traits such as Confucian ethics and collectivism may affect an individual’s whistleblowing intentions†( Park, 2005 58(4), 387-403). Ethics and values in the public relations field also play a significant role a business when dealing on an international level. The situational environment tis complicated, and opinions are competing most of time. An issue of ethical relativism exists for each situation. Public Relations Society of America’s (PRSA’s) new Code of Ethics still contains this complex problem of ethical relativism. The PRSA Code of Ethics 2000 provides free flow of information as â€Å"Protecting and advancing the free flow of accurate and truthful information is essential to serving the public interest and contributing to informed decision making in a democratic society.† At the same time PRSA code recommends (1) to avoid â€Å"real, potential, or perceived conflicts of interest† in order to build â€Å"the trust of clients, employers, and the publics,† and (2) to protect confidential and private information of clients.(Yungwook, 2003,42(3), 209-223).The food industry is another area of public concern and interest in values and ethical behavior of those involved in importing meat . The Korea U.S. Free Trade Agreement (KORUS FTA) facilitated the ability for U.S. beef supplied to South Korea. However, the public protested due to concerns that safety guidelines for handling beef were not followed and resulted in mistrust of the public officials (Kim,2009). Attitudes of the South Koreans are influenced by the dynamic diverse cultural, and globalization. South Korean college students seem to be in favor of globalization. However, the South Korean females were more cautious concerning globalization (Suplico, 2008). This information gives good insight into future or potential globalized consumers. Exactly how a country or nation conducts its manners presents a very challenging concern when different cultures interact. Body language, standing too close, smiling, a hand shake, bowing, taking your shoes off before entering an area or house, and tone of the voice, are just some of the ways people interact and can insult someone without knowing what they did to insult or anger an individual or group. For that reason, it is important to learn everything you can about the culture before you do business with them. South Korea customs have evolved and changed over the years but they still have strong family bonds, practice Confucianism, have elaborate weddings, special rice dishes, eat with chop sticks, and traditional Tae Kwon Do martial arts. Social Structure in South Korea changed over the past 50 years on several fronts. The family structure is altered due to the family size changing. The value of a child is important to the Korean family. The reason to have children is psychological, and the reason not to have children is due to economics. â€Å"A person was not considered complete, or as an adult, until he or she had a child. Not being able to have a child, especially a boy, was considered a personal and family tragedy. It meant that a person’s future was in jeopardy since their children would not succeed them and the family line might come to an end. It was inconceivable that a person would choose not to have children. However, with modernization, young Korean mothers are choosing to have far fewer children (on the average one child) than their parents (four children) and their grandparents (six children; Korea Statistics Bureau, 2003). Cultural transformations over recent decades have led to the improvement of contraceptive methods and medical technology† (Uichol,2005 54(3), 338-354). Industrialization led to an increase in the urban residents and changed the family structure creating an increase in nuclear family structures and decrease in the extended family. Industrialization is also affecting the family in another negative concern involving a stress in marriage and increase in divorce. However, a decrease in prearranged marriages and more woman in the workforce. Also, individuals are seeking more self-satisfaction. A plus side can be seen in the changing society concerning younger people is wealthier with pensions for the future retirement, have an increase in traveling (Shin, 2003). The connection between daughters-in-law and mothers-in-law in South Korea’s upper-middle-class families that live in an urban area is changing as the common residence disappears and an increase in the nuclear family. However, they remain deeply connected to the extended family. This change reflects the industrialization of their society. The industrialization has made it economically possible for a larger number of nuclear families soon after the son is married (Kim, 1996). â€Å"Despite an increasing trend of nuclearization of the family, the family has not been replaced by a dyadic conjugal bond and has not lost its basis as the primary social organization in keeping ties among members of the virtual stem family. In contrast to many western societies (Reiter 1975), egalitarian ideology has not completely undermined the authority of parents, and mothers still act as agents of their sons and socialize them to be committed to perpetuating the family and maintaining family status. (Kim,1996, 69(4), 179-192). Mother and son relations continue in a traditional manner outside the nuclear family. Mothers from an upper-middle-class continue to intercede in their sons life well in to the sons marriage. The dedication the mother has to her son’s achievement does not guarantee the son will want to care for his parents once they get up in age. The daughter-in-law will support her husband and join her mother-in-law in keeping the family ties by communicating by phone, visits, physical labor, and gifts. The state enjoys the nuclear family because welfare programs are few with this relationship. However, the relationship between mother-in-law and daughter-in-law is not without problems. As the mother-in –law gets older she no longer has the influence of her ideologies and put pressure on the daughter-in-law when she tries to impose her authority. The daughter-in-law can be crafty about utilizing her higher education and experience to destabilize her mother-in-law. This will lead to the deterioration of unity and result in the two sides avoiding each other to deal with their disagreements.( Kim,1996). The Korean and US Free Trade Agreement (KORUS FTA) provides a significant ongoing opportunity to benefit both nations. In 2008 the ratification of The Korea-United States Free Trade Agreement (KORUS FTA) paved the way for the Korean National Assembly and the United States Free Trade Agreement to implement FTA in 2012.However, during those 4 years, both sides lost valuable remunerations that could have been accumulated. Even though opportunities were lost during those 4 years, the economic and political impact is substantial for both sides. December 2010, President Barack Obama and President Lee Myung-bak negotiated a supplemental agreement to hurdle the main political problems concerning the agreement because they both knew the huge benefit that both sides would obtain for their future. KORUS FTA is a huge arrangement that created a strong alliance between the US and South Korea (Schott, 2011). Also, the largest gain would come from the production gains produced by the increased competition between the United States manufacturers and local Korean fabricators. Another important area of gain for Korea will be from increased opportunities from the reduction in non-tariff barriers (Hongshik, & Backhoon, 2008). South Korea Economic Growth Perspective South Korea’s financial development, over the past 30 years, has been excellent. Financial development for economic growth is a significant program issue. Economic growth can be accomplished through a couple of routs. The first is well-developed financial intermediaries can encourage the public to increase saving and then to accumulate social capital. The second route is that, as financial mediators develop, more savings are allotted to organizations more efficiently, and thus, financial development improves productivity and growth. (Song, 2010). South Korea’s per capita GNP, was only $100 in 1963. However, it surpassed $14,000 in 2004. In 2006 South Korea was the United States’ seventh-largest trading partner and 11th-largest economy in the world. Park Chung Hees’s administration introduced across-the-board economic policy changes in the 1960s stressing exports and light industries. This lead to prompt debt financed industrial development. In addition, Hee, reformed their currency, strengthened their institutions for finance, and financial institutions, and presented an economic development plan that was more workable for future growth. Manufacturing became an area they expanded on during the 1970s along with endorsing chemical, electronics and the automotive industry. As a result the manufacturing industry grew at a rapid pace into the 1990s (Economy, 2006).