Hyundai Motor: Cruising or Skidding? Hyundai Motor is representative of the flaws of the nation’s family-controlled companies: a hierarchical structure over-dependent on charismatic personal leadership
March 14, 2014 Leave a comment
March 11, 2014, 12:00 PM
Hyundai Motor: Cruising or Skidding?
By In-Soo Nam
For some Korea watchers, Hyundai Motor is representative of the flaws of the nation’s family-controlled companies: a hierarchical structure over-dependent on charismatic personal leadership.
But that “Korean-ness” is what has made Hyundai a winner and should be embraced, including by foreign hires working at other Korean businesses, says Don Southerton, chief executive of Bridging Culture Worldwide, a Denver-based consulting firm.
“That’s what’s been successful. You don’t take out what’s successful,” Mr. Southerton said in a recent interview in Seoul.
Author of a book titled “Hyundai Way: Hyundai Speed,” Mr. Southerton cites the company’s rapid decision-making as a critical advantage.
Many years ago when orange became a popular car color in California, Kia Motors, which is controlled by Hyundai, was able to get it into production in just three months, he noted. It would have taken Toyota Motor two years, he said.
Mr. Southerton says Hyundai Chairman Chung Mong-koo’s hands-on approach to management helps speed up problem resolution. Critics say Mr. Chung’s frequent staff changes, including abruptly firing executives and rehiring some of them, hampers management consistency.
Mr. Southerton has conducted training sessions for Hyundai and is a frequent visitor to South Korea.
He recalled a cross-cultural coaching session he held in 2005 at Hyundai’s manufacturing plant in Montgomery, Alabama, where many Western managers complained about Hyundai’s management style.
“The consensus was that the problem was cultural–Koreans not understanding Americans and vice versa,” he said.
“But what surfaced in discussions was that many of the new American managers had been searching in earnest for a Hyundai way. In other words, documented policies and procedures that would guide them in decision-making and day-to-day work,” he said.
“The challenge that Hyundai has is not unlike what even Apple has today. How will Apple continue to convey — as they grow — the core message that they used to have when they were a small company and Steve Jobs was in front of everybody all the time? That’s the challenge Hyundai (also) faces for sustainable growth,” he said.
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