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South Korea


Wednesday, March 14, 2007
 
Columbia Business School Chazen Trip to South Korea
I just returned from a one week spring break Chazen Institute trip to South Korea through Columbia Business School. It is not an over-statement to claim that this trip was the defining moment of my business school career. The stellar planning, company visits, government visits, and Korean culture combined to create a phenomenal experience.

As an aside, it is interesting to note that everyone in South Korea refers to the country as Korea. It is probably a tribute to their desire to reunite with their estranged neighbors in the North. I will follow this convention.

The most striking aspect of my visit to Korea was the economic development that has occurred in the country since the 1950s. Korea was ravaged by years of Japanese occupation and a crippling civil war. As Wikipedia states, “Korea was one of the poorest countries in Asia” in the 1950s.

But this country is now fully developed. I felt proud of the Korean people for being able to achieve such extraordinary success. Clearly, there is something about Korean people’s culture, work ethic, political philosophies, and embrace of the free markets that created one of the most amazing success stories of the 20th century. Leading politicians in developing nations around the world need to carefully study Korea’s rise and emulate the policies in their own country. 

Our schedule was packed:
Day 1: President’s Blue House
SK Telecom
Day 2: Samsung Headquarters
Samsung Semiconductor Manufacturing Plant
Dinner with CBS Alumni
Day 3: DMZ Tour
Meeting with Seoul National University Business School Students
Meeting at Ministry of FSS (Korean SEC)
Day 4: Day in Seoul
Day 5: Factory Visit at Hyundai Manufacturing Plant
Day 6: Free Day in Seoul
Day 7: Fly Home

On Day 1, we went to the Presidential Blue House. It was snowing for a lot of the time that we were there. The tour of the grounds was typically boring, but then we were invited to explore inside the Blue House. We toured the room where official Presidential meetings occur. There were lap top computers and microphones at every desk. 

The highlight of our first day was having the opportunity to meet President Roh Moo-hyun. He talked to us for an hour and a half about a range of topics. It was amazing that the President of South Korea would take the time to talk to us business school students. President Roh definitely likes to talk, and we learned a lot about him and the country as a result of this visit.

Our next visit was to SK Telecom, the biggest telecommunications company in South Korea. The company seemed to be going in a lot of different directions in the telecom and technology space. They own the most popular social networking service in South Korea, but they have failed to gain traction in other countries. The PR department gave us a packaged tour of a large telecommunications monitoring facility and a museum of the history of their products. Overall, SK Telecom seemed the least impressive of the three companies that we visited on the trip.

Throughout the trip, we had many wonderful, authentic meals in Korean restaurants. A part of me wanted to switch my career path and become a Business School professor so that I have the opportunity to go on more of these trips in the future. Korean BBQ, cooking beef on the table in front of us, is very popular. Kimchi, or spiced cabbage, is served at every meal. Soju, a sweet potato based smooth Vodka, is the official drink of Korea. Noodles, soups, and small dishes are standard for most Korean meals. Finally, seafood is a hugely important aspect of the Korean diet. We ate whole Spanish Mackeral, raw Grouper (straight out of the fish), clams, oysters, and conch. 

Our next visit was to Samsung, my new favorite company in the world. The presentations were the absolute best that I have ever seen. The speakers were smart, concise, clear, and insightful. The actual slides were crisp, clean, professional, and well organized. 

The Chairman and CEO gave the opening remarks. The head of marketing talked to us for quite a while about their marketing strategy. Another VP talked to us about the firm’s overall strategy. Samsung seemed to be a microcosm of the success of Korea as a whole. Fifteen years ago, the company was a low-cost manufacturer of simple electronics devices. Today, the company is a diversified conglomerate involved in the manufacturing of TVs, digital cameras, and semiconductors, among many other components. Its financial performance has been stellar with $55b sales and profits of over $10b. 

We were also given a wonderful tour of one of their semiconductor manufacturing facilities. I could not believe all the automation. The plant’s operations were nearly 100% automated. It was truly a sight to marvel at. The organization and efficiency of the plant was a beautiful testament to the capacity of human creativity.

Our trip also entailed of a number of palace and temple visits. The temples and palaces were pretty, but also felt a bit contrived because almost all of the original structures were burnt down during the Japanese occupation.

The saddest day of the trip was our visit to the demilitarized zone (DMZ). The DMZ is the line between North and South Korea that serves as the border between the countries. We visited a train station that is meant to connect the North and South, but unfortunately, the train does not travel into North’s territory. We drove by North Korea’s Propaganda City, which is a city that is meant to showcase North Korea’s strength, but is actually an empty shell with no inhabitants.

The most interesting part of our visit to the DMZ was traveling through the North Korean tunnels. Apparently, North Korea developed 4 or more tunnels into the South’s territory which have the capacity to carry large North Korean battalions into the South for a sneak attack. The tunnels were pointed out by North Korean defectors and there still may be some undiscovered tunnels. We walked through the tunnels up to a boarded point less than a few hundred yards away from North Korean territory.

Another crazy historical incident that I learned about was the Axe Murder Incident. In 1976, American soldiers in the DMZ were attempting to trim some trees. The North Korean soldiers ordered the American soldiers to stop, but the American soldiers continued. In response, the North Koreans attacked the soldiers and murdered them with their own axes. I was shocked to hear that this happened with relatively no retaliation on the part of Americans. Kim Il Sung, the North Korean president at the time, did express regret over the incident. 

It seems that almost all Koreans hope that one day there will be reunification between the North and South. The DMZ is a sad reminder of the devastating civil war from over 50 years ago. Both the people of North and South Korea clearly keep their hopes up for a day when the country will become whole again.

Apparently, even though North Korea has severe energy problems, dilapidated infrastructure, and large cases of malnourishment, the North Korean people still believe that they are the richest nation in the world and that things are worse outside of the North. It is sad to know that the South was able to develop to such great extents while the North has stayed one of the poorest countries in Asia. 

Our visit to the Ministry of FSS was uneventful. Seoul is trying to become the financial capital of Asia, but their regulatory and financial system is clearly less developed than some of its competitors.

Our final company visit was to the Hyundai factory 5 hours south of Seoul. We were treated very well and were given introductions to the company by a high level executive. The plant was also nearly 100% automated. Many of the activities of the plant were completely automated, but there were still workers at many of the stations. One of us students asked if, in the spirit of Kaizen, individual workers were able to stop the entire assembly line. The person showing us around the factory answered, “no,” and did not seem to understand where the question was coming from. Nevertheless, the plant was still a remarkable sight. 

One other noteworthy incident happened during one of my morning workouts at the Shilla hotel, one of the nicest hotels in Korea. Because of jet lag, I was working out at around 6am every morning. During one of my work outs, one of my friends came to me and pointed out that Hank Paulson, Secretary Treasury of the United States, was running on the first tread mill. I could not believe my eyes. I walked around the gym only to notice some secret service men standing at the door. Being the bold business school student that I am, I asked the man, “Is that Hank Paulson?” The secret service man, at once confused and evasive answered, “uh…why?” I introduced myself as a Columbia Business School student who was interested to know if that is really him. The Secret Service man, relieved to find that I was a business school student, stated, “Oh! I saw your bus outside. Yes, that is him.” We had some small chat for a little bit and then I left.

Overall, this trip was simply amazing. I learned so much about Korean people, its economy, and its companies. I am very happy that I chose to go on this awesome trip and I highly recommend all business school students to take advantage of this great opportunity.
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