10 + 1 Commandments for Doing Business
Stick to These 11 Cardinal Rules and You Will Do Just Fine in Korea
By Jang Song-hyon and Tom Coyner
Korea Times
March 27, 2006

If you are a Korean, it is most important and advisable to have a formal introduction to any person or company with whom you want to do business. Whenever possible, obtain introductions, using a proper intermediary, when possible, in your business meetings.

In Korea, a businessperson is not comfortable until he or she knows what company and what position the person he or she has just met. Have a large supply of name cards made prior to visiting companies. Exchange your card with the other person’s taking a moment to closely examine the person’s name, title, etc. as a way of showing you hold the other party in respect. Exchange cards with both or the right hand – never with your left hand. After the exchange, you should place the cards on the table in front of you as you proceed with the meeting, using them for further reference.

Remember that the level of comprehension of many English-speaking business people may not be as good as their courtesy implies. Emphasize and repeat your key points for their understanding. Try speaking in short, grammatically correct sentences using simple vocabulary. Sometimes it is a good idea to ask questions to verify the other person’s understanding while taking care not to embarrass the other person in front of others. Try diagramming your points rather than simply using English. Exchanging notes after meetings is very helpful for this purpose.

Be prepared to be patient, gentle but firm, and as dignified as possible at a negotiating table. Do not try to push your position too hard. Sensitive issues and details may be skipped for future discussions, preferable by a go-between or by your staff, if available. Use of go-betweens can be very valuable especially in delicate dealings where financial negotiations are involved. Allow sufficient time for your counterparts.

Legal documents are not as important as human rapport and relationships. Koreans do not like detailed contracts. They prefer, and often insist, that contracts be left flexible enough that adjustments can be made to fit changing circumstances. Therefore, it is very important to develop and foster good relationships based on mutual trust and benefit in addition to the business contract.

Koreans are extremely sensitive people. Never cause them to "lose face" by putting them in a difficult position. On the contrary, offer praise for their recently earned prosperity. Their state of good feelings or "kibun" can do wonders far beyond your expectations. At the same time, be aware there are smooth "foreigner handlers" who flatter by insisting that you ``understand Korea better than other foreigners.’’

Entertainment should always be accepted, and in some way reciprocated in due time. Parties are often like drinking competitions. You may be expected to get intoxicated but you have the right to politely hold the line. Legitimate reasons for drinking little or none may include personal health conditions and religious beliefs. At the same time, symbolic or token drinking can be done as a substitute when accompanying by a positive and friendly attitude. The giving of small gifts is also an accepted practice and is recommended.

Try to personalize all business relationships. An informal agreement with a trusted party can be considered far more secure than any written document. Try to find out as much about your counterparts as possible: their family status, hobbies, philosophies, birthdays, etc. Try balancing your social life with regular activities with Koreans and not simply people of your own or similar cultures. Since Korea is a tight-knit society, what may begin as an association for non-business reasons may evolve over time into important introductions to others important to your future business.

Do not try to appeal too much to Western logic, but try instead to find "emotional common denominators." Feelings and "face" are often far more important in local business dealings. A willingness to compromise without giving up your core values is an invaluable skill anywhere but it is an ability that will serve you particularly well in Korea. Spend some time in reading up on Confucianism to get a fundamental understanding of the other persons’ perspectives.

With increasing affluence and the development of mass communication, the lifestyle of Korean consumers is changing rapidly. Accurate market research and other advice concerning future trends are often only as good as tracking a starting point of fast-moving trajectory. Korea is a world leader in the common use of broadband Internet communications. Events and trends often change at "Internet speed."

While the first Ten Commandments definitely apply to Koreans, foreigners are placed involuntarily on a different plane. A foreigner should always respect the Ten Commandments, but a foreigner has a bit more wiggle room than his Korean peer. When possible try to do things the Korean way since in the long run it is not only proper but easier. But if proceeding along Korean methods is genuinely impossible, do your homework on the market and the other party’s needs – and then proceed with caution as circumstances demand. It is even more important to work with a flexible-minded Korean partner should you be forced to break some of the rules as you move forward. This may not be the easiest way to do business in Korea, but out of necessity has come unconventional paths to success.

Foreigners are able to act differently, and they can bring new insights to Korean business. For example, selling in Korea is badly misunderstood – and often by Koreans. But that will have to wait until our next column.

In 1987 the "Ten Commandments for Doing Business in Korea" by SH Jang was published in a local magazine and again in the following year in his book, The Key to Successful Business in Korea.