Economic Success in South Korea

South Korea has to be classed as one of the world’s great economic success stories. The country has recorded five consecutive decades of economic growth in excess of 5%.

South Koreans prefer to do business with people with whom they have a personal connection. It is therefore crucial to be introduced by a third-party. Companies tend to be strictly hierarchial with major decisions being taken at the top and delgated down for implementation.

A part of doing business in South Korea is the exchanging of gifts. It is done to secure favours and build relationships. Gifts are always reciprocated so be sure to take some with you from your native country. Good gifts for a first visit are office items, maybe with your logo on them. Avoid overly expensive gifts, as this will require the recipient to match the value when they reciprocate. Gifts are usually not opened in front of the giver, although it may be a good idea to ask if they would like you to do so.

Confucian ethics dominate Korean thought patterns and this translates in business terms into great respect for authority, age and seniority. So always show respect for senior people. Your trustworthiness will be judged, in part, by your ability to create the right type of harmonious atmosphere. Individuals who have established mutual trust and respect will work hard to make each other successful. Address people by their title or by their title and family name. First names can be used once a relationship has been established, but wait for your Korean counterpart to initiate this change.

Prior to doing business in South Korean ensure you book any meetings well in advance. The most convenient times for doing business are between 10:00 a.m. to 12:00 p.m. and 2:00 p.m. to 4:00 p.m. Punctuality is important in South Korea and being on time is recommended. When entering a meeting room, the most senior member of your delegation should enter the room first and should sit at the middle of the table.

Before doing business in South Korea, understand that personal relationships generally take precedence over business. A first meeting is a ‘get to know’ affair rather than focusing on business matters. It could take many business trips to South Korea to reach an agreement or close a deal.

South Koreans treat legal documents as memorandums of understanding and they view contracts as loosely structured consensus statements that broadly define agreement and leave room for flexibility and adjustment as needed.

Can you add to these points on South Korean business culture?