AM Lecture 6

Management > Asian Management > Background > Under stress > HRM abroad > HRM cultural traits > Characteristics/paradoxes > Change?

Change?

Was the 1997 crisis a catalyst for change? Mensik et al. stress the culturally-based nature of Korean management and raise doubts over their ability to respond to external change.

Rowley and Bae (2002 & 2004) identify key changes in HRM practice, such as:

From mass recruitment of new graduates and lifetime employment to recruitment on demand and job mobility
From organisation first to individual considered
From a tall to a flat structure
From no appraisals and evaluations based on seniority to introduction of appraisals and evaluations based on ability and performance
From less involvement and information sharing to more involvement and information sharing

Convergence vs. Contingency

Is this convergence or contingency? Are the chaebols genuinely changing, or is this a short-term change, meaning that they will just go back to the way they were before?

Pre-1997. In the period before 1997 Korean firms were losing profitability and they were already seen to be adapting, but in order to make profits and cut costs, short-term goals. It was also to cope with the influx of foreign workers and chaebols' experience overseas.

Post-1997. After 1997, firms downsized, including the reduction of R&D budgets. Labour was also more empowered, albeit minimally. In addition, there was a need to attract foreign investment (crisis of confidence) and thus a need to demonstrate "western/international" management.

However, the cultural and business needs conflicted greatly, suggesting that management is indeed changing, but as a result of "contingency", not "convergence".

Leadership