An open effort at "coexistence" (sangsaeng) between conglomerates and mid-sized companies is in the works. That is welcome news. But it should be remembered that there have occasionally been similar stirrings in the past with nothing to show for them. True coexistence does not happen because of a single round of slogans.
Conglomerates need to start with a fundamental change in the way they perceive mid-sized companies. No small number of conglomerates talk as if mid-sized companies are their partners and praise them as such. Still, most of them treat mid-sized companies as little more than safety valves in the course of producing profit. It will be hard to have true coexistence until conglomerates get rid of the idea they can use their dominant positions to seize what rightly belongs to these smaller companies.
Having structural framework for implementing concrete proposals will be essential. Top executives may preach about coexistence, but if a conglomerate's working-level people don't carry out those promises what the people at the top say ends up being nothing more than empty chanting. For example, top executives tell the purchasing department to maintain an appropriate unit price of goods supplied to the conglomerate by mid-sized companies, and then purchasing department staff later have their performances assessed based on how much they have lowered costs. Lets stop that kind of trickery. There needs to be concrete "coexistence guidelines" for employees of the country's conglomerates for their dealings with mid-sized companies.
Naturally there needs to be work on the part of mid-sized companies, too, because coexistence is possibly only when each side has a degree of mutually suitable terms and conditions. They cannot depend on conglomerates' benevolence forever, just for being the weaker ones in the relationship. These are times in which a conglomerate competing on the global market has to go searching far and wide, to the far ends of the earth, in search of quality, inexpensive parts. Mid-sized companies have to have a minimum level of competitiveness if there is going to be coexistence.
The need for government support must not be forgotten. There needs to be policy in support of innovative mid-sized companies and constructive support for conglomerates that set the example. One hopes that these many measures will fall in place and that 2005 is remembered as the year when the framework for genuine coexistence between conglomerates and mid-sized companies was established.
The Hankyoreh, 19 January 2005.
[Translations by Seoul Selection (PMS)]
[Editorial] Cooperation Among Conglomerates & Suppliers |
