skb international in south korea - diva portal401505/fulltext01.pdf · 2 abstract this essay...
TRANSCRIPT
1
Uppsala Universitet Författare:
Företagsekonomiska institutionen Michael Berggren
C-uppsats Handledare:
2011-03-02 Susanne Åberg
SKB International in South Korea
A study about consultancy of nuclear waste system management
from Northern Europe to Far East Asia
2
Abstract
This essay outlines the problems in the cross-cultural communication between SKB International and the
Korean market. After interviews with the vice president of SKB International and their representative in
Korea I compare their strategy to cross-cultural communication theories and Korean business culture
facts to see how their communication to Korea could be improved. In the results I state that the problem
with getting a continuous dialogue is created by the big cultural difference between Sweden and Korea.
If these differences can be tackled SKB International will be able to sell their public acceptance package
to Korea to enable the project of a final repository. The biggest problems seem to be the difference of
time horizons, way of building relations, hierarchy vs. flat organization and the Korean group dynamics in
clash with Swedish individualism. As conclusion I state that the isolation of Korea has created a unique
culture that needs special attention for successful cross-cultural communication. This calls for SKB
International to develop a strategy for understanding Korean culture within the whole organization. The
image of Korean culture needs to be continuously discussed through meetings or an intranet forum to
get a correct image of how to communicate with Koreans. Also I find that SKB International need more
staff to take care of all the Korean delegations that come on spontaneous visits. The best gateway into
the Korean hierarchies was found to be through inter-governmental communication.
3
Table of Contents 1 Introduction .......................................................................................................................................... 5
1.1 Purpose ........................................................................................................................................ 6
1.2 Delimitation ................................................................................................................................. 6
1.3 Acronyms ..................................................................................................................................... 6
2 Theory ............................................................................................................................................. 7
2.1 Cross-Cultural Communication ..................................................................................................... 7
2.1.1 Avoiding misunderstandings through stereotyping ........................................................... 7
2.1.2 Individualism/Collectivism ................................................................................................ 8
2.1.3 Power distance ................................................................................................................. 9
2.1.4 Uncertainty avoidance .................................................................................................... 10
2.1.5 Career success/Quality of life .......................................................................................... 10
2.1.6 Confucian dynamism ....................................................................................................... 10
2.2 Korean Business Culture ............................................................................................................. 11
2.2.1 Korean hierarchy ............................................................................................................ 11
2.2.2 Korean harmony ............................................................................................................. 12
2.2.3 Korean relations ............................................................................................................. 13
2.2.4 Dynamic collectivism in Korea ......................................................................................... 14
2.3 Model for analysis ...................................................................................................................... 16
3 Method .......................................................................................................................................... 17
3.1 Choice of study ........................................................................................................................... 17
3.2 Data collection ........................................................................................................................... 17
3.2.1 Interviews ....................................................................................................................... 17
3.2.2 Secondary Data ............................................................................................................... 18
3.2.3 Living in Korea ................................................................................................................ 19
3.3 The trustworthiness of the study ................................................................................................ 19
4 Result ............................................................................................................................................. 20
4.1 Swedish actors ............................................................................................................................. 20
4.1.1 SKB ........................................................................................................................................ 20
4.1.2 SKB International ................................................................................................................... 20
4.1.3 SKB International’s Services to Korea ..................................................................................... 21
4
4.2 Korean actors ............................................................................................................................... 22
4.2.1 Nuclear Power Industry in Korea ........................................................................................... 22
4.2.2 History of the Korean Nuclear Waste management ............................................................... 23
4.2.3 Organization of KRMC............................................................................................................ 23
4.2.4 KAERI – a competitor to SKB International? ........................................................................... 23
4.3 The Dialogue between SKB and the Korean actors ........................................................................ 24
4.3.1 Character of the dialogue ...................................................................................................... 24
4.3.2 Getting a continuous dialogue ............................................................................................... 25
4.3.3 Public acceptance .................................................................................................................. 26
4.3.4 A difference of time horizons ................................................................................................. 26
4.3.5 Building relations ................................................................................................................... 27
4.3.6 Korean hierarchy vs. Swedish flat organization ...................................................................... 28
4.3.7 Korean group dynamics vs. Swedish Individualism ................................................................. 29
5 Analysis .......................................................................................................................................... 30
5.1 Cultural differences between SKB International and Korean actors............................................... 30
5.1.1 Individualism/collectivism ..................................................................................................... 30
5.1.2 Power distance ...................................................................................................................... 32
5.1.3 Uncertainty avoidance ........................................................................................................... 32
5.1.4 Career success/quality of life ................................................................................................. 33
5.1.5 Confucian dynamism ............................................................................................................. 34
5.2 SKB International’s strategy to cope with cultural differences ...................................................... 34
6 Discussion and Conclusions ............................................................................................................ 37
7 Reference list ................................................................................................................................. 40
8 Appendix ........................................................................................................................................ 42
8.1 Interview with Magnus Holmqvist .............................................................................................. 42
8.2 Interview questions to Kwan-Sup Shin ........................................................................................ 42
5
1 Introduction
After the Korean War in 1953 the Korean peninsula was divided into two countries. The Northern, the
richer and more industrialized region, was occupied by the Soviet Union and contained almost all of the
natural resources like minerals and gas. The poorer Southern region was occupied by United States and
constituted mostly by farm land. United States were determined to blow life into the destroyed South
Korea and poured money and investments into the country. Since South Korea could not import energy
from North Korea, US had to send large gas tank boats to fuel the new industries built to boost the
economy. (Seung-Hoon Lee 2010)
Nowadays South Korea is highly dependent on their nuclear power plants to give power to one of the
most modern and energy-consuming countries of the world. A problem today is the lack of plan for
taking care of the highly reactive fuel rods after energy is extracted. Since a few years South Korea has
been working on a low- and intermediate level radioactive waste (LILW) repository combined with a sea
based transport system according to the Swedish model developed by SKB, the company responsible for
nuclear waste in Sweden. The relation between SKB´s global consulting company, SKB International, and
the Korean counterparts has been characterized by spontaneous meetings and short-term projects. A
Swedish company like SKB International is, however, more used to structured and focused relations with
their customers and has problems to answer to the spontaneous calls for help by South Korea. (Magnus
Holmqvist, Interview 2010)
After a few missed opportunities for SKB International to claim Korean projects it is necessary to see if
the business strategy towards Korea can be improved. Many foreign businesses have failed in South
Korea before, among them the internationally highly successful companies like Wal-Mart. (Renee B Kim,
2007) South Korea has been isolated from the world since the Second World War but with a strong aid
dependence on the USA. (Seung-Hoon Lee, 2010) Is it possible for a European company to successfully
understand and do business with this country in Far East Asia which is still officially left in the cold war
period and has developed its own unique American/Asian blend culture? South Korea has indeed a lot of
time and money to save by buying consultancy about radioactive waste repository from other countries
like Sweden, France and Switzerland which already have plans to build repository for SNF (spent nuclear
fuel).
How can the Swedish company SKB International increase their chances of successful consulting to
Korean nuclear energy companies? By analysing how SKB International is acting on the Korean
6
radioactive waste market, I hope to find out why SKB International do not have a continuous dialogue
with Korean nuclear companies and how to improve their strategy of communicating with Korea.
1.1 Purpose
How could SKB International handle the cultural differences in order to maintain a successful business
relationship with a Korean customer?
1.2 Delimitation
Technological aspects of how the final product should be adjusted to the Korean environment will not be
investigated in this report. I will focus on the cross-cultural communication in this report. Because of
difficulties to get interviews with people from the Korean Nuclear Businesses I will mainly describe how
SKB International is acting on the Korean market and find out how they can improve their consultancy to
Korea. I will especially focus on their relation to KRMC and to some extent also KHNP.
1.3 Acronyms
KAERI – Korean nuclear power research institute
KHNP – Biggest Korean Nuclear Power Company
KRMC – Equivalent of SKB International in Korea
LILW – Low and intermediate level radioactive waste
SKB – Svensk Kärnbränsle – Swedish nuclear waste company
SKB International – Consulting company of SKB’s services internationally
SNF – Spent Nuclear Fuel
STC – Swedish Trade Council
7
2 Theory
2.1 Cross-Cultural Communication
When doing business with other cultures communication becomes more difficult. Different beliefs,
attitudes and values are barriers for successful communication. It is therefore important for every part to
have its own strategy of how to communicate with the other culture in the best way. (Adler 1997, p.63)
Globalisation is, however, making cultures approach each other which could mean that an international
uniform business culture is emerging that eliminates the need of cross-cultural communication. This idea
is rejected by Kwok Leung et al. (2005) who believe that business cultures never will become entirely
uniform. The reason is that when cultures meet they will adapt and reject things from each other´s
cultures and will in that process not become much closer to each other since basic values will remain.
The most used theoretical framework in International business is the four dimensions of Hofstede (1991):
individualism/collectivism, power distance, uncertainty avoidance, career success/quality of life and the
fifth dimension added later by Hofstede & Bond (1988) called Confucian dynamism. As implied in a
research by Kirkman, Lowe & Gibson (2006) there is a risk with using data as old as Hofstede’s study in
1980. In their research about his framework they found that cultures have changed a bit since 1980, for
example Chinese have become less collectivistic, more individualistic and lower in Confucian dynamism.
Therefore, not to rely entirely on Hofstede’s data, this theoretic chapter is ended with more recent
updates of Korean Culture.
2.1.1 Avoiding misunderstandings through stereotyping
One of the most important mistakes commonly made in cross-cultural communication is assuming
similarity where cultural differences exist. Intuitively humans interpret their social and cultural
environment in the way they learned in their home country. This intuitive behaviour becomes a major
problem when communicating with other cultures. A way to avoid this kind of cross-cultural
misinterpretation is through stereotyping. (Adler 1997, pp.74-77) By describing the behavioural norm of
the particular group to communicate with through stereotypes it is possible to correctly interpret the
communication with a person of that group. A good stereotype should be consciously held which means
being aware of that a stereotype describes the group norm rather than individual actions. Secondly, it
should be descriptive and not evaluative. Stereotyping is not a way to judge people from another culture;
it is only a means of interpreting their behaviour. Thirdly, a stereotype must be accurate and therefore
constantly adjusted when proven to be false during interaction with persons from that group. It can be
8
difficult to have an accurate stereotype before actually interacting with the other culture. The best way
to improve accuracy is to read up on the business and social culture of the country involved.
The first step to become successful in intercultural communication is to realise one´s lack of knowledge
about the other culture to become consciously incompetent. Next step is to have a conscious attitude
towards other cultures by gathering information about their culture. In that way one becomes
consciously competent in intercultural situations. But to acquire a level of cross-cultural communication
that is fluent and without disturbances one has to be unconsciously competent. The only way to reach
this last step is to have long-lasting and continuous experience with the specific culture to be able to act
correctly without thinking. (Shim, Kim, N. Martin 2008, pp.173-176)
In the remainder of this chapter I will give a description of Korean business culture to provide
information for accurate stereotyping.
2.1.2 Individualism/Collectivism
Individualists define themselves as individual persons and they always aim to reach personal success or
satisfaction. The group of an individualist culture has loose ties and is regulated by rules rather than
group mentality. Free will and self-determination are important in such a culture. Individualists believe
that there are universal values that should be shared by all. Guilt and internal pressure is regulating the
individualist’s behaviour to act according to the universal values. Individual self-respect is the mechanism
used to avoid guilt. (Adler 1997, pp.47-49)
Collectivists on the other hand define themselves as part of a group. Achievement for them is to satisfy
the group by working for the common group goals. The collectivist group is very tight and groups are
kept well apart from each other. Members of a group in a collectivistic society are expected to take care
of each other and always be loyal. These groups can have different values from other groups since
universal values are less of interest. Group members are controlled by shame and external social
pressure when someone´s behaviour is different from the group’s common goals. Shame is rarely used
though, since it would result in a “loss of face” (honour) for that person. “Loss of face” might be the
worst thing that could happen to someone of a collectivist culture and can be avoided by always keeping
harmony within the group. (Adler 1997, pp.47-49)
According to Hofstedt (1991, p.53-54) South Korea has a collectivist culture while Sweden has an
individualistic culture. In his book he lists countries in a chart according to Individualism index where
Sweden scored 71 out of 100 and Korea only 18 out of 100. He states that the difference of values in
9
these two types of societies plays a big role in international business and is an important source of
misunderstandings in cross-cultural communication.
Within the dimension of collectivism and individualism there is the aspect of universalism and
particularism. In collectivistic societies the personal relationship is more important than rules and the
opposite is true for individualistic societies. Universalism is to value rules higher than relationships and
particularism is to value relationships higher than rules. (Hofstede 1991, p.67) Corruption is rare in
universalistic societies since people treat each other equally independent on type of relationship.
Business relationships between universalistic and a particularistic cultures cause problems since the
former rely on contracts while the latter are sceptic towards contracts and rather confirm deals through
developing and maintaining personal relationships. Another problem is that particularists do not trust
universalists since they have little value in helping a friend if it strides against the laws while universalists
can think particularists are corrupted. (Adler 1997, pp.59-62)
2.1.3 Power distance
Power distance is a measure to what extent group members can accept unequal power distribution.
Large power distance cultures believe the superior is always right because he is the superior and they
always work to satisfy his demands without questioning him. It is never okay to bypass the hierarchical
structure to solve tasks with other members at different ranks without consulting the superior. (Adler
1997, p.51) Since superiors and subordinates consider each other as unequal the hierarchical system is
strong. The power is at the top of the hierarchy and subordinates are expected to do all the manual work
and report upwards about their progress. (Hofstede 1991, p.35)
Small power distance cultures give freedom to individuals to solve tasks in the way they prefer and it is
ok to question the superior if he has too difficult or questionable demands. Since the power distance is
small it is ok to bypass the superior and talk directly to the persons with best knowledge of the problem
to be solved. Titles are very important during negotiations in high power distance countries but have less
importance in low power distance countries. (Adler 1997, p.51) The hierarchical system in small power
distance countries is weak and the organization is usually flat. Instead of reporting upwards all workers
report sideways in the organization which gives everyone an overview of the whole organization.
(Hofstede 1991, p.36)
In Hofstede’s (1991,p.26) power distance index Sweden scores 31/100 and Korea 60/100 which shows
that Korea has a large power distance and Sweden small power distance.
10
2.1.4 Uncertainty avoidance
Hofstede (1991, p.113) defines uncertainty avoidance as “the extent to which the members of a culture
feel threatened by uncertain or unknown situations”. Sweden has a low uncertainty avoidance in
Hofstede´s Uncertainty avoidance index, 29 out of 100, while South Korea has high uncertainty
avoidance, 85 out of 100.
Uncertainty avoidance is a measure to what extent people try to avoid uncertain situations especially
regarding working environment. High uncertainty avoidance cultures value career stability, formal rules,
expertise and dislike deviant ideas and behaviour. The communication within the company runs
vertically and never horizontally, which reduces uncertainty since everyone knows who has authority
over whom. Low uncertainty avoidance cultures resemble village markets. Companies have flat
organizations where everyone talks to everyone else, risk taking is encouraged and deviant ideas are
welcome. (Adler 1997, pp.51-55)
2.1.5 Career success/Quality of life
The original name of this dimension by Hofstede is “Masculinity/Femininity”. Masculinity refers to career
success and femininity to quality of life. A masculine society has clearly defined gender roles where men
are encouraged to be tough and focused on career success while women are modest and should be
focusing on things related to quality of life. Feminine societies are more equal and without clearly
defined gender roles. Sweden has the lowest score in Hofstede´s masculinity index, 5/100 and South
Korea 39/100. (Hofstede 1991, pp.83-84)
Adler calls this dimension “Career success/Quality of life” to get a broader use of Hofstede´s dimension.
A country where career success is most important values material things and money higher than people.
The boss mainly worries about how to improve quality and efficiency of his workers than job satisfaction.
Extra money strongly motivates workers and low taxes are common. Quality-of-life societies mostly
value concern for other people and the overall quality of life. Women and men are expected to share
responsibility for working and household since the femininity/masculinity roles are not clearly defined.
Companies are more concerned about improving job satisfaction and flexibility than maximum efficiency.
Workers prefer extra holiday over extra money and taxes are usually high. (Adler 1997, pp.54-57)
2.1.6 Confucian dynamism
After Hofstede (1991) defined the above four categories as the most important dimensions of cross-
cultural dimensions a fifth dimension was found (Hofstede & Bond 1988), Confucian dynamism. It refers
11
to the extremely strong work ethic and commitment to Confucian values that fuels the economies of
South Korea, Hong Kong, Singapore and Taiwan. (Adler 1997, p.58)
The two sides of this dimension is long-term and short-term orientation. Societies with long-term
orientation are the Confucian dynamic countries of Asia and short-term orientation is found in most
western countries. The characters of long-term orientation countries are persistence, thrift, sense of
shame and to have strict order of organizing relationships by status. In short-term orientated countries it
is important with personal stability and status, respect for tradition and reciprocation of greetings,
favours and gifts. Since the characters of long-term orientated cultures are more oriented to the future
they are referred to as more dynamic. All these values are from the Confucian philosophy, hence the
name “Confucian dynamism”. South Korea got a relatively high score in Hofstede´s Long-Term
orientation index, 75 out of 100. Sweden which got a score of 33 out of 100 is a short-term oriented
country. (Hofstede 1991, pp.164-166)
2.2 Korean Business Culture
In this section I will explain the most important aspects of Korean business culture to consider when
doing projects with a Korean company. The motivation for having this chapter is that understanding the
business culture of Korea is fundamental for keeping a successful business relationship with a Korean
company.
2.2.1 Korean hierarchy
When Koreans meet someone for the first time the usual questions will be about age, education and job
title. These questions can be too sensitive for a westerner to share directly after being introduced but
are important to share without embarrassment to make Koreans feel comfortable in the conversation.
The reason is that they need to know these aspects to be able to treat the other person correctly
according to social rank. Even though hierarchy may be less strong in western cultures Koreans prefer to
be treated correctly according to social rank even when dealing with non-Koreans. (Shim, Kim, N.Martin
2008, p.174)
The hierarchy in a Korean company is strictly vertical and is characterized by father-son like relationships
between superiors and subordinate workers. The Korean boss should get involved in his employees
family and personal life by attending family ceremonies and giving gifts at important occasions. If an
employee has personal problems the boss will try to help solving it since it is affecting his performance at
work. In western countries employees are expected to keep private matters to themselves and keep a
12
bigger distance to their colleagues. It would be considered quite odd if the boss would start asking about
the employee’s private life. (Ungson,Steers & Park 1997, p.173)
The decision-making process in Korean companies is called pummi which means that decisions are made
at the top while the full responsibility to complete the task successfully is at the bottom of the hierarchy.
As subordinates seldom can neglect orders from above it is customary that the manager avoids putting a
too heavy workload on the group to maintain group harmony. There are mainly three different kinds of
Korean managing styles within pummi. In the “authoritarian” company the manager make all decisions
himself. The “consultative” manager first consults the subordinates before making the decision. The
most western-like style is the “participative” where the manager encourages the subordinates
themselves to make decisions regarding their work. Companies managed directly by its owner are more
authoritarian and companies managed by professional managers are more participative. (Ungson,Steers
& Park 1997, pp.174-176)
2.2.2 Korean harmony
There is a social contract between Korean employees to preserve harmony within the group. A good
example is the motto of the Korean company LG: inhwa which means harmony. Inhwa is a heritage from
Confucianism which represents an extremely high value of smooth, constructive and conflict-free
interpersonal relations. Individual rights are never allowed to interfere with inhwa. For example a post-
work drinking time for improving the tightness of the group may never be turned down because of
personal reasons like spending time with family. Inhwa is an example of a saboon, a companies’ slogan
for motivating their workers. The saboon is chosen by the company founder and is spread out at all
levels of the company in the form of paintings and such. (Ungson,Steers & Park 1997, pp.171-172)
If a Korean subordinate would openly refuse a task from a superior it would result in loss of face for both
of them. Loss of face is a feeling of extreme embarrassment which might be expressed by a nervous
smile and a face turning red. (Ungson,Steers & Park 1997) Face has a major influence on organizational
behaviour in Asia and is essential to understand for western companies in Asia. Firstly, Asians value
saving face higher than immediate economic gains. Face is the public image and status of a manager or a
company and is the best way to show trustworthiness and is a measure of how much money and
responsibility one can invest in that company or worker without losing face. Asian companies prefer
doing business with companies that have equivalent face/public status. Secondly, to promote one´s
company or business role it is consider immature to promote any personal attributes. This can be
difficult for a westerner since it is often encouraged in the West. In Asia individuals are valued in their
13
social status and relation to others instead of personal attributes as for westerners. Thirdly, people
inside a group in Asia are responsible to save each other´s face to outsiders. If one person makes a
mistake it can damage the face of the entire company. The higher status one has the more important is it
for oneself and the rest of the group to protect that face. Different ways of losing face involves to not
meeting expectations of social status, not to be treated correctly by others according to status and when
in-group members lose face. (Kim & Nam 1998)
Koreans use nonverbal cues to avoid loss of face, this kind of nonverbal communication is called nunch’i.
A person with nun´chi is able to do the right interpretation and choosing the right words by being aware
of the social context, hierarchy and situation. A manager with a good nunch’i can look into the eyes of
the subordinate while asking a favour to determine if the employee actually feels capable of doing the
task or not. This is fundamental in Korean culture and Koreans often expect that everyone have a good
nunch’i which might result in confusions in international business relationships. (Ungson,Steers & Park
1997, p.174) Among the young generation nun´chi and loss of face is less important. Because of western
influence the younger generation tend to be more individualistic and less concerned about group
harmony than the older generation. (Shim, Kim, N. Martin 2008, p.76)
Indirectness was found to be a big source for misunderstandings and bad communication between East-
Asians and westerners in an investigation by Sanchez-Burks et al. (2003). The conclusion in their study
was that indirectness may be less severe in non-work situations due to globalization but is growing as a
problem in work situations. They stress the need of strategies for cross-cultural communication to
overcome this problem. A surprising statement in their paper is that Americans have the same level of
indirectness as East-Asians in non-work situations. The conclusion is therefore that Americans can learn
to be indirect in work situations. A suggestion is to organize non-work situations like after-work or other
activities to put all people at work into a non-work situation and take the culturally difficult discussions
there. The study is conducted on Americans and East-Asians but could possibly be transferable to other
western cultures. (Sanchez-Burks et al. 2003) Indirectness is important for foreigners to consider when
doing business in Korea. Since Korea has a past of being colonized and suppressed by other cultures
there is a national pride that makes Koreans very sensitive to criticism, especially from foreigners. (Shim,
Kim, N.Martin 2008, p.174)
2.2.3 Korean relations
Western countries rely on written contracts while Koreans only secure deals through developing
personal relationships between the business parties. Since the business relationship becomes personal
14
the goal is to find a deal which is mutually beneficial for both parties. Signing a contract is only a
symbolic action with little meaning. Foreign businesses that trade with Koreans need to keep this in mind
and constantly nurture the personal relationships to keep a successful business relationship.
(Ungson,Steers & Park 1997, pp.172-173) Even if a first attempt to conclude a deal fails, it can still be
fruitful to develop personal relationships between the companies for a future deal. A bonding is created
by exchanging favours which often result in a stronger personal bond. The favours must be given for free
to create a mutual indebtedness which is the foundation of the relationship. (Shim, Kim, N.Martin 2008,
p.175)
A difficulty for westerners with building relationships to Koreans is the strong distinction between the
group and outsiders. Koreans give full trust to all members of a well-defined group but have a total lack
of trust for strangers and therefore have strong difficulties to communicate with outsiders. A way of
bonding with a stranger in Korea is to connect through common “blood”-relations: shared home-town,
child-hood experiences and academic background. (Yoon & Cho 2010, pp.73-74) Of course these are
difficult connections for foreigners and in a study by Chang&Chang (1994) it was relieved that Koreans
only trust foreign strangers as little as 1 on a scale of 100. The trust for Koreans with shared “blood”-
relations is 97 out of 100, family relations 100 out of 100 and Korean strangers 5 out of 100. The strong
trust within a group is the base for the dynamic collectivism that characterizes Korean corporate culture,
which will be further described in following subchapter.
To get around the strong distinction between in-group and outsiders foreigners should show a great
interest in learning about Korean culture. If such an interest is shown Koreans open up more easily and
make more efforts to build a relationship. (Shim, Kim, N. Martin 2008, p.175)
2.2.4 Dynamic collectivism in Korea
The Korean collectivism is dynamic since it is collectivistic to in-group members and individualistic to out-
group members. The strong division between inner- and outer group members sparks a strong
competition which is considered to make Koreans more hard-working than many other people. The
backside of the strong competition is the hastened decisions and instability of long-term projects. “Balli-
balli” is the Korean term commonly used to describe the importance of efficiency in Korea, a society
where fast decisions and implementations often are more important than safety and stability. (Yoon &
Cho 2010, p.71)
15
Balli-balli has a big impact on Korean business and has resulted in a very rapid progress between project
planning and implementation. If the government is involved in a project the deadlines will be even
tighter which often lead to a lowered quality of the implementation and in worst case collapsed buildings.
Another side of Balli-Balli is na-doo which means “me too”. If a neighbour (or another country) has the
latest technology the consumer (or Korea) wants to have the same technology or product as fast as
possible, often without questioning the actual need or quality of the product. These two aspects of
Korean culture create an atmosphere of fast and unpredictable changes in Korea which is important to
remember when learning about their culture and society. Korea is “negotiating between Confucianism
and capitalism, hierarchy and equality, collectivism and individualism, traditional calm and recent
societal dynamism” (Shim, Kim, N. Martin 2008, pp.22-24)
The dynamic collectivism of Korea is constituted of in-group harmony, optimistic progressivism and the
hierarchical principle. The in-group harmony is the fact that all members of the group strive to preserve
group harmony, the superior through engaging in his employees personal life and using nun’chi to avoid
demanding too much and the subordinates by sacrificing their own goals for the best of the group.
Optimistic progressivism refers to the often too optimistic goals set by persons in the higher levels of
hierarchy that the persons in the lower levels of the hierarchy have to achieve without questioning their
tasks. The hierarchical principle is the strong hierarchy always present in Korean groups which gives a
very efficient military-like communication with well-defined roles. There is also an uncertainty to the
dynamic collectivism since both group harmony and strong hierarchy preserves a static social order while
optimistic progressivism is calling for high flexibility in all aspects. (Yoon & Cho 2010, pp.77-79)
Koreans are one of the most hard-working people in the world; even Japanese complain that Koreans
work too hard. A major reason for this is the Confucian work ethic that drives Korea and other
economies in Asia. Eui-yok is the Korean term for this attitude which translates “ambition”. Eui-yok is
the internal drive Koreans have to accomplish something important, not to earn money but for spiritual
satisfaction. This work ethic is group-oriented and not individual as in western countries, Koreans work
extremely hard for the group/company not for their own individual benefit. Several Korean companies
consider Eui-yok to be fundamental for a company’s survival. (Ungson,Steers & Park 1997, pp.170-171)
In recent years centrality of work in Korea has diminished because of stronger labour unions that put
demands on the management of companies for better working conditions. Working hours as well as
salary are being adjusted to be able to compete with multinational companies in Korea. At the same time
16
the old Confucian ideals of seniority promotion and lifetime employment is getting challenged by
western influences of performance-based employment. (Shim, Kim & Martin 2008, pp.48-50)
This chapter started with theories about cross-cultural communication where unconscious stereotyping
is the goal to enable a smooth communication. Hofstede & Bond´s five cultural dimensions were then
given as a tool to discuss cross-cultural communication problems. Finally a discussion about Korean
culture was given, structured after the most important topics for cross-cultural communication. Below
the model for analysis shows how the theoretical framework will be used in the further discussions.
2.3 Model for analysis
The goal of the theoretical framework is to provide a base for SKB International to improve their cross-
cultural communication towards the Korean market. The fundamentals of cross-cultural communication
are Hofstede´s five dimensions. The four most important aspects of Korean business culture to SKB
International all have a relation to one or more of the five cross-cultural dimensions. By combining the
two elements of Korean business culture and cross-cultural dimensions it will be possible to provide SKB
International with a better foundation for creating a consciously held stereotype than they had before.
Cross-cultural
dimensions
Korean culture
International business
Conscious stereotyping
Korean hierarchy
Uncertainty avoidance
Power distance
Korean relations
Career sucess/ Quality of life
Korean harmony
Individualism/ Collectivism
Dynamic collectivsm
Confucian dynamism
17
3 Method
3.1 Choice of study
I chose to write about SKB International’s relations to Korea since I wanted to combine my interest for
international business with my field of engineering studies and former work experience within the
nuclear business. The possibility to go to Korea through a department change guided me to choice of
country for this case study. My first ideas concerning this topic emerged, however, during a nuclear
industry seminar in Uppsala where SKB International held a presentation about their work in the world.
It was a natural approach to do a qualitative study since only a few persons at SKB International were
involved in the connection to Korea.
3.2 Data collection
3.2.1 Interviews
I made two interviews for this essay. The first one was with Magnus Holmqvist of SKB International who
is in charge of the consultancy to Korea. That interview took place at SKB International’s office building in
Stockholm and gave a lot of information about their business and their relation to Korea. The second
interview was made with SKB International’s representative in Korea, Kwang-Sup Shin. He helps SKB
International to maintain a dialogue with the Korean market and to find new projects. During the
interview with Kwang-Sup Shin I could find a more neutral view of both SKB International’s actions on
Korean market and also how the Korean counterparts are acting towards SKB International.
Magnus Holmqvist in Stockholm, Sweden
I chose to interview Holmqvist since he is responsible for SKB International’s relation to Korea. His job is
focused on sales, establishing contracts and project management. He studied Hydrology Science at
Uppsala University and started working with projects related to his field of studies: transport of
radioactive isotopes in rock, equipment and methods for site investigations of rock at 1000m depth.
Before he started at SKB he worked as a consult for ten years. The interview was held in a semi-loose
structure based on about 15 questions I had prepared before-hand.
The questions to Holmqvist were formulated very loosely to get a first impression of the problem.
However, to get a deeper understanding of the problems I used follow-up questions to get more details.
I asked general questions about SKB International and SKB as well as specific questions about problems
18
with cross-cultural communications. This interview was very important since he is responsible for all
communication to Korea.
Kwang-Sup Shin in Seoul, South Korea
He is the representative of SKB International in Korea and works for facilitating the cross-cultural
communication between Korea and Sweden. He was born in South Korea but moved permanently to
Sweden in 1961.Since then he has been engaged in business between Korea and Sweden in various ways.
Amongst all he is the founder of the “Korean-Swedish Association” and also president of “SWETRA CO” in
Seoul. (Kwang-Sup Shin, Interview 2010)
The interview questions to Kwang-Sup Shin were written to find answers to the theoretical cultural
problems I have found through the theory about Korean Business Culture and Cross-cultural
communication. I also based the questions on problems that I have learnt about from the interview with
Magnus Holmqvist. In this interview I tried to get a more neutral view of the cross-cultural
communication between SKB International and KRMC/KHNP. Since Kwang-Sup Shin have a deep insight
in both cultures and is highly involved in all discussions he could comment on SKB International´s
communication from a Korean perspective as well as from a Swedish perspective.
After major difficulties with getting further interviews I chose to settle for the extensive interviews made
with Kwang-Sup Shin and Magnus Holmqvist of SKB International. Since my focus in the essay is to
explain the behaviour of SKB International on the Korean energy market these interviews provide a good
basis for understanding how their company deals with cultural differences to Korea. The interview with
Holmqvist gave an opportunity to get a basic understanding of the dialogue to Korea and potential
problems. It was a good opportunity to understand how Korean culture is perceived by Swedish business
men. The interview with Kwang-Sup Shin gave a good view of both the Swedish view of Koreans and the
Koreans view of how SKB International is acting. Of course the lack of further interviews is a problem.
But since Magnus Holmqvist and Kwang-Sup Shin are the two persons most involved with Korea at SKB
International I think they are the most relevant for this essay.
3.2.2 Secondary Data
Initially much of information regarding SKB, KRMC and the nuclear industry of Sweden and Korea was
given in the interviews. This information was later reconfirmed and adjusted through secondary data
from various more reliable online sources.
19
As for the chapter of Swedish actors I used sources from SKB’s own website. Since the information I
needed for that chapter is pretty basic information the risk of subjectivity from using the company’s own
website isn’t that important. For the chapter about Korean actors I used info from World Nuclear
Association. They write on their website that they are an organization that works to promote nuclear
energy in the world. (“WNA: Supporting a Fast-globalizing Nuclear Industry”, 2010) It is a reliable source
but at the same time subjective in its view of the nuclear industry. Then again the information I needed
for writing about Korean actors are mostly facts and not questionable in itself.
3.2.3 Living in Korea
During the writing of this thesis I lived in South Korea. I was an exchange student to Seoul National
University for one semester. Writing about Korean culture while being in Korea enabled me to compare
my theoretical findings to the reality I was living in. I also believe that things I learned about Korean
culture through living there led me to choose facts and theories that in fact are a noticeable part of their
culture today. My experiences in Korea have in that way strengthened this report.
3.3 The trustworthiness of the study
Theories about cross-cultural communication specifically highlighting the differences between Swedish
and Korean culture was used to form interview questions that would give an image of the problems SKB
International are having with the communication to Korean actors. The theories about Korean business
culture are used to provide explanations and solutions to problems that SKB International are
experiencing. All together the different parts enable a discussion where problems and solutions can be
outlined and summarized.
Since interviews only were made with SKB International and not with the Korean actors involved the
results can only be drawn on how SKB International is acting towards Korean market in general. The two
interviews were however very informative and gave a good insight into SKB International´s organization
and into some of the cultural clashes that have occurred throughout time. The theory about Korean
culture, which was constantly revised by my own experiences living in Korea, gives a good depth to the
essay which makes it easier to use the results of this essay for other Swedish or western companies that
want to improve their communication with Korean business actors.
20
4 Result
4.1 Swedish actors
4.1.1 SKB
When the first Swedish nuclear power plants were constructed in the 70’s SKB was founded by the
nuclear companies to take care of radioactive waste from these plants. The main incentive for founding
SKB was the Swedish law stating that a company producing electricity through nuclear power is
responsible for taking full care of all their waste. Taking care of the Swedish radioactive waste is in other
words the sole mission of SKB. There are in total 15 owners and the three major owners are: Vattenfall,
Fortum and EON. The first repository for spent nuclear fuel is inside the nuclear power plants themselves.
The second step is transferring this spent fuel to a repository in Oskarshamn called Clab by a specialized
boat called m/s Sigyn. The last step is transferring this spent fuel to a final repository which will be
constructed in Forsmark in the near future. There is also a repository for low-active nuclear waste in
Forsmark called SFR. Low-active waste can for example be clothes and equipment that have been
exposed to nuclear radiation. (“Om företaget SKB”, 2010)
There are 400 employees at SKB and there is a constant dialogue about their program with 350 experts
outside the company. Their main office is in Stockholm and there are also offices near the nuclear power
plants at Forsmark and Oskarshamn. The company is organized in departments according to their main
tasks: managing the current nuclear waste repository system, R&D and site investigation. (“Organisation
SKB”, 2010)
4.1.2 SKB International
SKB International was founded in 2001 by SKB to consult the accumulated knowledge of SKB to other
countries. The services of SKB International include consultancy about handling LILW (low and
intermediate level radioactive waste) and SNF (spent nuclear fuel). SKB has been doing international
consulting since the 80’s, but since their main goal is to take care of Swedish nuclear waste they created
an independent company called SKB International. Their mission is to “increase safety and decrease
environmental risks in the handling and repository of spent nuclear fuel and radioactive waste”
internationally. There are currently 15 consultants working full-time for SKB International. As projects
are carried out staff from SKB is connected temporarily to these projects. (“SKB International AB”, 2010)
21
SKB International is strictly a sales- and project management organization. They buy their services from
SKB and transfer it to their international customers. According to Swedish law SKB can only spend money
on things that benefit the Swedish power industry. Therefore, SKB International was created to be able
to sell the well-demanded knowledge of SKB to other countries. Another reason was the lack of time for
SKB to handle the international requests. SKB International is completely “self-financed” and earns all
money from their international consultancy. (Magnus Holmqvist, Interview 2010)
SKB International’s service is to let international clients get insight into SKB’s 30 year old experience in
“…research, development, siting, design, construction and operation of repository and disposal facilities
for spent nuclear fuel and radioactive waste from nuclear facilities”. They provide these services through
the SKB network which includes experts from universities, consulting firms and construction companies.
(“About SKB International AB”, 2010)
4.1.3 SKB International’s Services to Korea
SKB has about 70 years of experience in nuclear waste management while Korea just has started their
repository of nuclear waste in an organized way in the recent years. The first consultancies to Korea in
the 80’s were about nuclear waste repository know-how transfer. It was a more theoretical than
practical knowledge transfer to the Korean research institute, KAERI. More recently SKB International has
had two projects with Korea about building a LILW repository. They are building such a repository in
Gyeongju next to a nuclear power plant called Wol-song which is due in 2012. SKB International helped
with consultancy about how the organisation should work and necessary functions at the repository site.
It also involved information about all the technical details of the project. (Magnus Holmqvist, Interview
2010)
The second recent consultancy job to Korea was about the Swedish radioactive waste transport system.
Since Korea, like Sweden have all their nuclear power plants along the coast they decided to initiate a
sea-based transport system like that SKB is using in Sweden. SKB gave their knowledge about how it was
done in Sweden: about all the necessary parts in the system, communication, responsibility issues and
how to make it all work together. (Magnus Holmqvist, Interview 2010)
As for now Korea does not have any repository ready for nuclear waste and no plans for building a
repository for the highly radioactive waste such as spent nuclear fuel rods. SKB have constructed a LILW
repository in Sweden and well advanced plans to build a repository for SNF in the coming years. This
22
gives Korea a good motive to buy consulting services from SKB International. (Magnus Holmqvist,
Interview 2010)
Consulting to Korea is focused on two areas: management strategy and technology transfer. To be able
to use the technological solutions of nuclear waste management it is important to have a national
strategy for radioactive waste and SNF. A nuclear back end programme is very expensive and storage
and the repository should last more than 100 000 years. SKB International can give Korea an insight of
how these projects were achieved in Sweden, for example in areas of organisation, finance, research
foundations, university relations, industrial networks etc. The technological aspects are the same in all
of SKB:s programs, even though the technology must be adjusted to the nature surrounding the
repository. All these parts are inspired of “KBS-3” which is the policy developed in 1983 in Sweden of
how to take care of SNF. (Magnus Holmqvist, Interview 2010)
4.2 Korean actors
4.2.1 Nuclear Power Industry in Korea
South Korea has today 20 reactors that provide 17,7 GWe which is 40% of the country’s total electricity
production. KEPCO (Korea Electric Power Company) is a government corporation that had sole
responsibility of electric power production between 1961 and 2001. It was then split up into six units
where the biggest unit was KHNP (Korea Hydro & Nuclear Power Co Ltd) which handles all nuclear
generation as well as a small part of the hydropower. Nowadays KEPCO have monopoly over
transmission and distribution of electricity in Korea. The highest decision-making instance for Korean
nuclear energy policy is the Atomic Energy Commission where the Prime Minister himself is chairman.
The step below in the hierarchy is MKE (The Ministry of Knowledge Economy), they are responsible for
energy policy, construction and operation of nuclear power plants, nuclear fuel supply and radioactive
waste management. Both KEPCO and KHNP are placed under this ministry in the hierarchy. The national
nuclear R&D has a goal to secure the national energy supply and to enable the country to be a nuclear
exporter in the near future. KAERI (Korea Atomic Energy Research Institute) has the main responsibility
for R&D and lies under KORP (Korea Research Council of Public Science & Technology). MEST (The
Ministry of Education, Science & Technology) is responsible for nuclear R&D and safety. The current
energy policy is to expand nuclear power to minimise dependence on imports. (“Nuclear Power in South
Korea”, 2010)
Comment [M1]: Börja här!
23
4.2.2 History of the Korean Nuclear Waste management
In 1988 the ‘polluter pays’ principle was established in Korea through the Atomic Energy Act. KHNP has
since then paid fees to the governmental Nuclear Waste Management Fund. In 2009 KRMC (Korea
Radioactive Waste Management Co Ltd) was founded to have sole responsibility for Korea’s waste
management, waste disposition and to gain a national consensus on high-level waste. Before 2009 KHNP
had this responsibility but nowadays their only responsibility is to pay 900 000 won per kg of spent fuel
to KRMC. Nowadays spent fuel is stored on the reactor site, which will be full by 2016. There are hopes
and loose plans to have a repository for SNF ready by 2016. Even LILW is stored on the reactor site but a
construction of a radioactive waste disposal facility is planned to be ready in Gyeongju 2010. KAERI and
MEST failed several times to get public acceptance for a repository site between 1988-96 but NETEC took
over the task in 2000 and asked local communities to volunteer to host a LILW repository site. In
exchange the local community would get 290 million USD as compensation for the psychological burden
and as a reward for supporting the nation. 90% of Gyeongju’s population was supportive to such a
proposition so the repository was built there. (“Nuclear Power in South Korea”, 2010)
4.2.3 Organization of KRMC
KRMC is using the traditional Korean hierarchic organization structure. It’s a vertical organization where
everybody writes a report to his superior at the end of the day. After the superior has gathered all
information from the reports he will make a decision of what should be done. Nobody below the
superior is encouraged to take decisions and only the superior has an overview over the whole project.
The most important decisions are even made by the government. This structure was initially a problem
to SKB International since they communicated with the lower ranked people of KRMC who did not have
any power to make decisions. To solve this issue SKB International always tries to communicate with the
senior management of KRMC. According to SKB International the strict hierarchy also causes problems to
Korea. It’s difficult to do things in the right order and hard to integrate all different parts since everybody
is 100% focused on their own task. (Magnus Holmqvist, Interview 2010)
4.2.4 KAERI – a competitor to SKB International?
It’s debatable whether KAERI is a competitor to SKB International or not. Since they are a research
institute they could spend 10 years researching about a small detail which may not be the most relevant
detail for KRMC. KAERI does not have any money or interest in buying knowledge from SKB since they
are paid by the government and working for universities. In one aspect KRMC might prefer buying ‘local’
knowledge from KAERI. But since KRMC need to make progress in their programme it may be more
24
beneficial for them to buy consultancy services from other countries that already have acquired the
relevant knowledge for the specific project. KRMC and KAERI are independent of each other and put
under different ministers by the government. KRMC does not have any influence over KAERI’s research
which put them in a position more likely to buy knowledge from abroad. SKB however has a big influence
over the Swedish research program of nuclear waste through their funding’s of research at universities.
When SKB have a gap of knowledge they set up a project to fill the gap using both national and
international resources. KRMC would have more difficulties of hiring researchers from abroad because of
the national pride in Korea as well as language and cultural barriers. Korea have developed from a poor
country to an industrialised country in only 50 years all by themselves and have a strong belief and will to
continue that journey by own force. Though KRMC are willing to buy foreign knowledge they prefer
keeping the main project in Korean hands through connections with universities and KAERI. (Magnus
Holmqvist, Interview 2010)
4.3 The Dialogue between SKB and the Korean actors
4.3.1 Character of the dialogue
About 5 employees at SKB International are involved in the dialogue with Korea including Magnus
Holmqvist (Vice President), Claes Lindberg (President), Kwang-Sup Shin (Representative in Korea) and
secretaries. They have not received any official Korean culture education but get continuous help from
Kwang-Sup Shin himself. (Kwang-Sup Shin, Interview 2010)
Basically the Koreans go over to SKB:s office in Sweden to gain knowledge through workshops and
reports. These visits also include getting feedback from SKB on the systems Korea already built from
advice of SKB. SKB had two big projects with Korea in recent years which were both around 10-12 weeks.
When the Koreans are visiting SKB International’s office in Sweden they get tasks from SKB International
to solve during this period. This is also combined with lectures and seminars by SKB International. The
two major projects consulted so far were about how Sweden implemented the LILW repository including
the sea-based transport system. As for the transport system the Koreans got a task to design their own
system with the help of all knowledge about the Swedish system. The different parts of the system were
law issues, finance, responsibility, governmental communication and technical parts. They completed
this task within the 10-12 weeks and ended up with a system very similar to the Swedish one. When they
go back to Korea the dialogue continues and SKB International give support during implementation. They
usually have a lot of ideas of further developments and the work of SKB International is to find a way to
realize these ideas. During the last year only minor projects were consulted to Korea. The last project
25
regarded the human resource management system of SKB through a one-day seminar in Stockholm. The
Koreans wanted to understand why SKB’s company is organized the way it is and how to apply it in their
own company. There are usually 4-5 short visits per year by the Koreans to Stockholm where Holmqvist
also try to discuss with them about their program to find where SKB can help them in the future.
(Magnus Holmqvist, Interview 2010)
SKB International has a contact person in Korea that finds new projects for them, Kwang-Sup Shin. He
also helps them with translation and communication with the customer. He does not have any technical
background but provides a necessary link to the Korean market. Another form of linkage that SKB
International uses in other countries is the Swedish Trade Council (STC). They helped SKB International a
lot in Japan and are a major reason for their great success there. Since their projects in Japan have been
more successful than in Korea, SKB International is thinking about using STC also in Korea. In Japan STC
was used since they weren’t satisfied with their former link in Japan. Through STC and the Swedish
embassy, SKB International found partners to cooperate with to gain a successful entrance into Japanese
market. STC in Korea and Japan share the same management so SKB International may try their services
in the future. But since the cost of using STC is very high they want to avoid contacting them as much as
possible. (Magnus Holmqvist, Interview 2010)
4.3.2 Getting a continuous dialogue
The strong national pride characterises the Korean industry. Korea wants to minimize the involvement of
foreign consultancy in Korea and prefer doing short trips between Sweden and Korea to gain the
knowledge from SKB through seminars and lectures. KRMC then tries to copy this knowledge and create
something by own force, even though the result often is identical to the systems SKB International
provided. This way of communicating suits SKB International since they do not have to be directly
responsible in case of accidents or other failures of the product. It is necessary for such an expensive and
long-term project that the country building it takes national responsibility and preferably has built the
systems by proper force so that all knowledge about risks is available to the government and the local
people. (Magnus Holmqvist, Interview 2010)
Even though Korea tries to save money on consultancy Holmqvist thinks that they can save more money
by getting help from other countries who already has implemented a nuclear waste system. Since it costs
1,5-2 billions of SEK per year to build such a system, cutting 5 years means saving about 7-10 billions of
SEK. France and Switzerland are the only competitors to SKB International since no other countries have
come as far in their radioactive waste system or have an organization which allows for consulting. Korea
26
has a well-developed nuclear industry and is exporting nuclear reactors, but has not come as far as the
above mentioned countries in radioactive waste systems. (Magnus Holmqvist, Interview 2010)
The next project SKB International wants to have in Korea is about creating a final repository for SNF. The
temporary storage sites in the nuclear power plants will be full by 2016 and by then Korea need an
alternative way of disposing SNF. SKB International wants to provide help with all parts of creating such a
repository including organization, finance, laws, public acceptance and technical aspects. Holmqvist
knows that Korea is worrying about this but he is not sure how far they have come in their plans. France
and Switzerland are also interested in helping Korea with this, although they have not come as far in the
program as Sweden. (Magnus Holmqvist, Interview 2010)
4.3.3 Public acceptance
One of the biggest problems of developing nuclear waste systems is getting public acceptance from
societies living near the planned nuclear waste site. Sweden and Finland are the countries that have
come furthest in the plans of building a final repository thanks to their public acceptance. Other final
repository plans around the world have failed because of lack of trust from locals. Canada and the UK
have looked at the Swedish model after failing with their programs and are now more successful in
public acceptance than before.
Korea has gotten their public acceptance for their radioactive waste repository sites through
governmental money and investments to the surrounding societies. Holmqvist said in the interview that
buying local trust is not a good solution since they might require more and more money as problems
evolve. He has tried to inform Korea of the Swedish model of getting public acceptance but they want to
do it in their own way. He thinks the problem is the Korean national pride that inspires Korea to go its
own way without listening to advice from other countries. Holmqvist thinks it is difficult for Korea to get
advice from another country regarding how to get public acceptance from its own population. In Japan
and Taiwan SKB International are known to be experts in public acceptances-issues and are deeply
involved in their programs. Korea is still in high need of help with their public acceptance. (Magnus
Holmqvist, Interview 2010)
4.3.4 A difference of time horizons
A problem for SKB International is the lack of communication with KRMC. The Koreans are very focused
on their program and only contact Sweden when they get stuck and need urgent help. SKB International
on the other hand needs at least a month to schedule any projects with staff from SKB which delays their
27
ability for quick assistance to Korea. Because of these delays SKB International sometimes have to turn
down the most urgent requests of KRMC. This problem is less severe in relation to Taiwan and Japan
where SKB has come much further and even started consulting about public acceptance and a final
repository. SKB have been most successful in consulting to UK and Canada which have totally accepted
SKB’s view of getting public acceptance and other aspects of a final repository. This problem is based on
a difference in planning horizon. SKB International is used to plan meetings several months ahead while
KRMC often wants help within a week. SKB International wants to solve this problem by getting more
insight to KRMC’s projects through a continuous dialogue. They think it’s a bad solution to help KRMC
with urgent requests if it means the quality of the consultancy will be lowered. And if SKB International
delivers products that are not satisfactory it will damage their reputation in Korea and around the world.
(Magnus Holmqvist, Interview 2010)
Shin has difficulties to convince the Koreans that they need to schedule appointments with Sweden
months in advance and also for the Swedes to realise the importance of receiving Korean officials. The
Korean counterparts have thousands of employees so they are always ready to receive a visit. It is
difficult for SKB International since they only have about 5 employees working towards Korea. The
Swedish summer holidays are another obstacle since Korea often sends delegations in early summer to
Europe. These visits are important since the Koreans through these visits investigate which partner will
be best for consulting of different projects. Such a trip often includes visits to Finland, Sweden,
Switzerland, Germany and France. Often the visit is more of a touristic character where they want to visit
the nuclear waste site and research facilities. There might be up to 100 Koreans coming at once on these
spontaneous visits, which makes it even harder for the five SKB International employees to take good
care of them during their visit. If Sweden can’t receive the Koreans it gets tougher to win deals in the
competition with the other European countries. Swedish frustration over the Korean spontaneity clashes
with frustration from Koreans about the Swedish inflexibility. (Kwang-Sup Shin, Interview 2010)
4.3.5 Building relations
The more important visits between Korea and Sweden are in small groups of high-positioned people in
the organizations, often consisting of CEO-s, presidents and vice-precidents. Magnus Holmqvist, Claes
Lindberg and Kwan-Sup Shin are mostly involved in those visits but it might also involve other actors like
travel agency, family members and other employees of SKB. In Korea the representatives of SKB
International get treated to Korean food and drinks in the evening. Likewise SKB International takes the
Koreans to a traditional Swedish restaurant for food and drinks when they visit Sweden. This creates an
28
open atmosphere where both parts can ask important questions about projects that were too sensitive
to ask during the day. He says that all important decisions in Korea are made in the evening after many
shots of the Korean alcohol soju, and then confirmed the morning after in a sober mode. (Kwang-Sup
Shin, Interview 2010)
Shin knows that personal relations are extremely important for business relations in Korea. During one of
the 3 months project when a few Koreans were stationed in Stockholm he tried to entertain them during
the weekends. He mentions the importance of not talking business during these casual meetings.
Sometimes he takes them out with a luxury boat for dinner. Other times he invites them to his home
where his wife cooks Korean food to them. When the Swedes are in Korea, usual activities are tennis,
mountain climbing, golf and dinners. (Kwang-Sup Shin, Interview 2010)
To keep the relationship alive the Koreans sometimes send greetings through e-mail not related to
business which SKB International sometimes forget to answer during stressful workdays. The Koreans
keep a high value in maintaining the contact on a more personal level while the Swedes would like to get
a better dialogue on a professional level. However, the staff at SKB sends Christmas cards to Korea as a
way to keep a personal relationship. (Kwang-Sup Shin, Interview 2010)
Shin thinks that Holmqvist is the best one in keeping a dialogue with the Koreans on a personal level
since he is very good at adapting to different cultures. But since he is also responsible for Taiwan and
Japan he is usually very busy. Shin on other hand is available to both Koreans and the Swedes 24 hour on
his cell-phone. When Holmqvist is not available the Koreans will get help from someone else at the SKB
office, the problem is that they are not as aware of Korean culture as Holmqvist. When
misunderstandings occur because of this Shin act as a middle hand and try to solve the misunderstanding
by talking both to the Swedes and the Koreans. (Kwang-Sup Shin, Interview 2010)
4.3.6 Korean hierarchy vs. Swedish flat organization
Most decisions for KRMC are made on the top level of the hierarchy, often on governmental level. For
SKB International the decisions are made by vice-president Magnus Holmqvist or by the president Claes
Lindberg in consultancy with the involved staff at SKB. At business meetings Korea always try to match
the level of hierarchy. If SKB International sends the vice-precident of SKB International, KRMC also will
send the vice-president of KRMC. A problem is that the vice-president of KRMC does not have much
influence on the organization since the president does all the decisions as well as the government. As a
way to solve the problem Shin constantly reassures KRMC that Holmqvist in fact has the same power as
29
the president of SKB International and can make importance decisions by himself. Still the Koreans are
often disappointed when they send their President to Sweden without a possibility to meet the Swedish
equivalent. (Kwang-Sup Shin, Interview 2010)
In late 2010 five people from the Korean embassy decided to visit the nuclear waste repository at
Forsmark. Shin took care of their visit together with the CEO Claes Lindberg and a guide of the nuclear
waste repository. Korea’s ambassadors were impressed by the visit and sent a report to the Korean
government about their visit. This report was later examined by the president of Korea and sent to the
Korean minister of energy and lastly to KHNP and KRMC. Shin thinks this is an ideal way of getting
through the Korean hierarchy and hopes that it will result in future projects. (Kwang-Sup Shin, Interview
2010)
4.3.7 Korean group dynamics vs. Swedish Individualism
Decisions at KRMC are made by the top-superior after consulting with his whole group to see what they
think about his decision. The superior needs to use his nun’chi to realise what the best decision for the
entire group is. SKB International are used to a more direct dialogue about projects and sometimes gets
frustrated with the delay of negotiations when the Koreans need to consult the whole group before any
decision is made. Holmqvist have been given full power by the CEO of SKB International to make
decisions himself when dealing with the Koreans, but of course he has to call around in SKB to see if the
project is possible to make. He is using breaks in discussions to make these calls. (Kwang-Sup Shin,
Interview 2010)
Another problem with nun’chi is that Koreans are using it to interpret the negotiations with SKB
International. If the dialogue from the Swedish side sounds a bit negative the Koreans might think that
the Swedes are rejecting their proposal. But Shin thinks that Holmqvist has great nun’chi so there is no
problem when they are in dialogue with him. (Kwang-Sup Shin, Interview 2010)
30
5 Analysis
In the following discussion I will analyze how SKB International should tackle the cultural differences
when doing business in Korea. To do so I will first distinguish the major cultural differences and then
discuss how SKB International is tackling these. Finally I will give some advice of possible improvements
to this cross-cultural dialogue from SKB International’s side. The basic assumption I make is that cross-
cultural communication can be improved by stereotyping as I described in section 2.1.1. The most
common mistake in cross-cultural communication is misinterpreting the communication and also
assuming similarity in cultures where differences exist. That’s why I in this essay want to provide a good
base for SKB to successfully stereotype their Korean business partners for a successful communication.
As shown in the model for analysis the five dimensions of Hofstede & Bond is the starting point for the
analysis. Within these five dimensions theories about Korean business culture will be discussed together
with the experiences of cross-cultural communication that SKB International has had on the Korean
market. The final stage of the model for analysis is conscious stereotyping – in other words the analysis
will determine how SKB International can stereotype in a conscious and a correct way for better cross-
cultural communication with Koreans.
5.1 Cultural differences between SKB International and Korean actors
In the following points I will find out where the critical cultural differences between SKB International
and their Korean business partners lie to see where misunderstandings and frustrations might easily rise.
5.1.1 Individualism/collectivism
As mentioned in the interview with Holmqvist there is sometimes a problem of prolonged negotiations
due to the Koreans´ need to reach a consensus within their whole group including upper-level
hierarchies. It is easier for Holmqvist to make fast decisions being in an individualist culture. Free will,
self-determination and high belief in rules characterizes individualists which all encourage such a
negotiator to make fast decisions. A collectivist group like Koreans value group harmony much higher
than following logic and rules. It is therefore difficult to negotiate between these two cultures. Koreans
negotiate to satisfy their group, they are very flexible about prices, laws and rules to be able to reach a
good deal. The Swedes on the other hand have a very high belief in rules, laws; have fixed working hours
and fixed prices. Holmqvist and Shin are flexible and go beyond the Swedish boundaries to satisfy the
Koreans in a negotiation through extended working hours and giving them extra time to reach consensus.
A problem is that the rest of SKB International has less knowledge about Korean collectivism and
31
especially SKB which deliver the services for SKB International in the end. SKB have less knowledge about
Korean Culture than SKB International and are not able to bend as much as the Koreans may wish.
I would say that the clash between individualism and collectivism is a major cause for the difference of
time horizons that causes major problems for both parts. Korea has the longest working hours in the
world and has a bigger population than Sweden. All employees at KRMC and KHNP are ready to work
late evenings and even weekends just to improve group harmony and to satisfy their superior. Swedes
are individualists and believe in working to improve their own lives, where free time and minimizing
stress at work are very important. It is therefore natural for Koreans to expect the Swedish office to be
open long hours and all-year-round while it is natural for the Swedish office to work within normal
Swedish working hours and have a break for vacation in the summer and Christmas holiday. These
assumptions from both cultures are important to realise for SKB International to allow for better
stereotyping and acting towards the Korean market.
Koreans are particularists since group harmony must be preserved after any decision. To save group
harmony they might bend price, regulations or time plans in the last moment. Swedes are universalists
and always abide to regulations, keep fixed prices and very rigid time plans allowing little flexibility
during negotiations. Shin often explains to the Koreans about the Swedish culture of fixed prices and
time schedules and also informs SKB International about the particularistic culture of Korea. It is difficult
for KRMC to accept business deals if people from the upper levels of the Korean hierarchy demand a
lower price or a faster implementation. When such a demand exists it might be hard for SKB
International to claim the original price. If the Korean negotiators cannot satisfy the demands from
upper levels it would result in loss of face for them and especially for their superiors. Since there is a
value in Korean culture to protect the face of their superiors even if it might mean immediate economic
losses the deal will never be settled if SKB International will not end the price.
A way for SKB International to negotiate but keeping the same price is to let Korea know that SKB
International´s public status is high in the world and their solutions are sought-after in other parts of the
world. If for example United States and Japan are using their consultancy services they should spread
this information to Korea. As mentioned about dynamic collectivism there is a strong sense in Korea of
wanting to keep up with the latest technology that is popular on the global market. By keeping up with
the world market KRMC can keep their face towards their superiors all the way up to government level.
32
5.1.2 Power distance
Korea has a large power distance and all decisions must be approved from upper hierarchies. In Sweden
it’s okay to bypass the superior and ask things directly from the persons most suitable to answer. That is
one of the reasons why the Koreans must take long breaks in negotiations to confirm decisions while
Holmqvist wants to get more direct answers from the Koreans. The decision-making process in KRMC
and KHNP are often connected all the way up to governmental level which makes it hard for SKB
International to get a good dialogue. It is difficult for SKB International to get a dialogue directly with the
people making decisions. When Koreans come to Sweden for projects they might not be the top-
positioned people that in the end make decisions. Lately a solution was made by Shin when he gathered
the president Claes Lindberg to show the radioactive waste repository at Forsmark to the Korean
embassy. He knew that they have influence on the government in Korea and as expected a report about
the visit was transferred all the way to the Korean president and then down through the hierarchy to
KHNP and KRMC. That visit might have been that successful since the SKB International president was
there to meet them. Koreans always want to match the levels of hierarchy in negotiations and frequently
get disappointed when they meet lower-ranked people during their visits to Sweden. As mentioned in
2.2.2 a bad match of people with different status results in a loss of face for the person with higher
status. Shin has in such occasions reassured the Koreans that Holmqvist have the full power to make
decisions and acts unofficially like a CEO. It is important for SKB International to know that they still are
risking the face of a Korean CEO negotiating with someone from Swedish office that isn´t CEO too, even
though an explanation about Swedish culture is given. Especially since Koreans often keep a higher value
of saving face than acquiring immediate economic gains.
5.1.3 Uncertainty avoidance
South Korea has high uncertainty avoidance and value career stability, formalities and expertise. They do
not like deviant ideas or behaviour. Sweden has low uncertainty avoidance, risk taking and deviant ideas
are encouraged. This is related to the dynamic collectivism of Korea which makes a strong distinction
between the group and outsiders. There is a total lack of trust for strangers, especially foreign strangers
since the major way of connecting is through a common academic, location or relative background. This
makes it hard for SKB International to get good relationships to the Koreans. Building relations is vital
when doing business in Korea to gain trust between all actors. Since SKB International is not able to
provide such a “blood” connection it requires more efforts to build and maintain the relationship.
Holmqvist said in the interview that they had realised the importance of having local connections and
Shin is their way of getting “blood” connection to the Koreans.
33
Since Koreans secure a deal through developing personal relationships it is important for SKB
International to constantly work on developing that relationship. One way of building relations are
through such after-work activities that Shin have initiated during the Koreans visit to Stockholm. A good
way of getting accepted into the in-group as a foreigner is through showing interest in their culture.
According to Shin this interest and openness to Korean culture has been shown in a successful way by
Holmqvist in several ways. Something that can be improved is of course to respond to the Koreans e-
mails, calls and requests for coming to Sweden faster and more consistently even though the
communication might be on a more personal level from the Koreans side.
Another usual way of strengthening relations in Korea is through creating a mutual indebtedness as
described in 2.2.3. That is something that Holmqvist and Shin are trying to avoid even though it would be
beneficial in the long run for their relationship to Korea. But since the way to create these bonds is to
exchange services for free it might not be possible for SKB International to do since they are a Swedish
company bound by Swedish rules, laws and culture. An important factor to understand why SKB
International´s relation to Korea sometimes is halting is the lack of will or possibilities to create mutual
indebtedness. It might be worth giving a few services for free to get better possibilities for signing a big
project later.
5.1.4 Career success/quality of life
As mentioned earlier the focus on career success in Korea is enormous. Koreans live to work while
Swedes work to live. As Holmqvist mentioned in the interview the Koreans seem to work in a
spontaneous environment with deadlines that sometimes are too tight to handle for SKB International.
That hastened culture is called balli-balli as discussed in 2.2.4 and ought to be strong for KRMC since
there is governmental influence in the nuclear industry. The dialogue between Korean actors and SKB
International is suffering from this culture difference. The Koreans can’t understand how SKB
International can turn down their spontaneous visits and request for help. They often want to make
large-scale visits during summer while SKB International has summer holidays. Shin tries to mediate in
this matter and informs the Koreans about the Swedish summer vacation as well as convincing the
Swedes how important these visits are. This problem is especially serious for Sweden since Switzerland,
France and Germany have later summer vacations and also have a higher value of career success and can
be more flexible regarding time schedules. As long as SKB International keep turning down spontaneous
visits and requests from KHNP and KRMC the dialogue cannot be improved to the advantage of the other
European countries doing consultancy to KHNP and KRMC. It must however be said that it might be
34
difficult for a Swedish company to adapt to balli-balli where fast progress is more important than safety
issues. Safety issues are of highest priority in the nuclear waste industry, which could be useful to point
out to KRMC when their projects have too tight deadlines.
5.1.5 Confucian dynamism
The confucian collectivism of Korea is different from that of other Asian countries since there is an
addition of optimistic progressivism. Although there is high uncertainty avoidance there is also a high
flexibility in the Korean culture as a way to always satisfy group harmony. If a person on top of the
hierarchy decide to adapt to a new business culture or behaviour all employees are required to follow.
This makes the Korean business culture a bit difficult to understand but it also gives opportunities for
Korea to adapt to western business culture. SKB International are aware of this since they are consulting
KRMC about how SKB themselves are organized. KRMC was in fact created on the model of SKB. KRMC
have occasional meetings with SKB International to continue learning about SKBs organization. But still if
KRMC is an ideal copy of SKB they still have the problem of communicating with KHNP, KAERI and the
Korean government to get their projects approved. KRMC’s position is too weak in the Korean society
since they do not have the same influence over KAERI, KHNP, government and universities as SKB has
over Swedish universities and government. It is difficult for KRMC to fully copy the organization of SKB
since they have a totally different structure of society where the government have a lot more power
over the Korean nuclear waste market than in Sweden. The Confucian dynamism in Korea is however
more of an open window into the Korean market for SKB International.
5.2 SKB International’s strategy to cope with cultural differences
Generally the strategy SKB International is using to tackle the cultural differences is to let their
representative Shin guide them in the dialogue with the Koreans. The SKB International consultants are
divided into their specific regions of the world. Only around five persons are dealing with South Korea
where Magnus Holmqvist has the main responsibility. None of these have gotten any longer official
introduction about Korean business culture. They get constant help and advice from Shin. When problem
occurs Shin tries to mediate and make both the Swedes and the Koreans understand each other.
Holmqvist have learnt a lot from Shin about Korean culture. He puts this knowledge in action in the
dialogue with the Koreans where he tries to adapt to their demands and way of negotiating. Both
Holmqvist and Shin spreads knowledge to the other people at SKB International of how to deal with
Koreans. It seems like the information about Korean culture comes too late to the other employees of
SKB International and SKB, mostly after cultural misunderstandings already have occurred. The first step
35
to take might be to realise or assume that the staff of SKB and some parts of SKB International are in fact
consciously incompetent about Korean culture. Second step is to implement a program to learn about
the most important parts of for cross-cultural communication of Korean culture for involved staff at SKB
and SKB International. In that way their staff can become consciously competent through using an active
and up-to-date stereotype about Korean business culture. In the end this will allow bigger parts of the
organization to become unconsciously competent in cross-cultural communication with Koreans,
something that Holmqvist might already be. Due to the sometimes heavy workload and the size of the
Korean organizations I believe that one person at the Swedish office is not enough to handle all the
communication.
How did SKB International then solve the different problems they have met so far? In the meeting
between the Swedish individualist and the Korean collectivist culture tensions arise because of different
styles of negotiation. To solve those issues Holmqvist was given full control over the project by the CEO
Claes Lindberg to give Holmqvist flexibility enough to adapt to the Koreans negotiation style. Holmqvist
can transfer projects from the Koreans to SKB through a cultural filter with the help of Shin. But when
the Koreans discuss directly with other employees of SKB International the clash between individualism
and collectivism is more evident and problems evolve that might disturb the relation.
To solve the problem with dealing with Korean hierarchy Shin brought the president, Claes Lindberg to
show the Korean ambassadors their project in Forsmark. This was a very clever move of Shin to find an
effective way into KRMC and KHNP, through their government. Korea is a very hierarchical country so it
might not be the highest efficiency for SKB International to negotiate directly with KRMC which in fact
might not have that much power of major decisions. The government is at the top of the hierarchy and
is the most valuable negotiating partner.
Since Koreans have a lack of trust of strangers, especially foreigners, SKB International get a good
connection to KHNP and KRMC through Shin. He has Korean blood and culture which lets him to get a
little bit closer in the relation to the Koreans in accordance with the theory of Korean dynamic
collectivism above. The best way for the Swedish staff at SKB International to get trust from the Koreans
is to show a big interest in their culture as well as showing their knowledge about it.
As for the difference of time horizons, little has been made to solve the issue. Shin has tried his best to
get both parts to accept the others cultural differences. But still, if the other European countries accept
spontaneous visits by Koreans while Sweden is turning down their visits it will put SKB International in a
36
difficult situation. This is evidently a problem due to the high value of quality of life in Sweden versus the
high value of career success in Korea. If SKB International wants to be more successful in the relation to
Korea they should consider keeping the office open all summer and at times more suitable to Korean
time.
SKB International has made good use of the Korean optimistic progressivism to enable their consultancy
of new managerial structures. KRMC itself seems to have been established as a replica of SKB. If the
Korean radioactive waste system gets closer to the Swedish system it will get easier to give consultancy.
So the consultancy of managerial structures to KRMC and KHNP might be the most important asset for
SKB International. It is also this that the dialogue has been about the latest year. Since Korea not yet has
any plans for a final repository of SNF this kind of consultancy is a good focus until Korea will be looking
for further help with their radioactive waste systems.
37
6 Discussion and Conclusions
As mentioned in last chapter SKB International is helping Korea to adapt the Swedish way of organizing a
radioactive waste system. It is good for Korea since Sweden already has one of the world’s best
radioactive waste systems with advanced plans on a final repository for SNF. It is even better for SKB
International though since the further Korea adapts to the Swedish system, the more they will need SKB
International services. At the same time the similarities of managerial system will allow SKB International
to provide more effective consultancy. The major problem is that Korea has a very different culture and
political system. SKB International have realised that they have more success when they deal directly
with governmental instances. The more they can take this correct way into the Korean hierarchy the
more success they will get in Korea. Loss of face in Korea is best avoided by always negotiating between
organizations with the same “public status” so it would be good if SKB International could get help from
the Swedish government to do negotiations with Korea. It is difficult to speculate about inter-
governmental relations between Korea and Sweden. But it might be worth considering for SKB
International to get a more proper way into a country where the position in hierarchy means everything
for negotiating. As mentioned in the background info about the Korean nuclear power industry the
Prime Minister is chairman of the Korean Atomic Energy Commission, the highest decision-making
instance of nuclear industry. Getting into negotiations with this instance or the instance below called
MKE would be of high value to SKB International.
Secondly an increase of the department at SKB International dealing with Asia is necessary to be able to
cope with the spontaneous visits from Koreans. These visits are essential for keeping a good relationship
with KRMC, KHNP and the Korean government and are the base of getting future deals. Holmqvist seems
to have sole responsibility of Korea together with Shin with the help of the president and a few other
staff at SKB International. KRMC and KHNP on the other hand have thousands of employees working
longer hours than Swedes which makes the speed of dialogue difficult to handle for both parts.
Most importantly SKB International need to improve the cross-cultural communication by being able to
read the Koreans mind and culture in a better way. This is already being done in a good way by Shin who
also helps Holmqvist to communicate correctly. The knowledge need to spread to all staff of SKB
International that is communicating with the Koreans. The main goal is to give everyone involved
“cultural glasses” that allows for correct interpretation in dialogue with Koreans as well as know-how of
how to respond and interact. A good strategy mentioned above in the essay is stereotyping. By spreading
the basic facts mentioned earlier in this report about Korean culture an initial stereotype can be withheld
38
in everybody’s mind. The importance of accuracy of this image is high, so these facts must be abandoned
if the Koreans of KRMC and KHNP seem to behave differently from above facts. Therefore it would be
useful for SKB International to have a system of learning from cross-cultural communication mistakes.
This knowledge database about the culture of the Koreans at KHNP and KRMC should be widely available
to all employees of SKB International that deals with Korea. It should also be easy to add new entries
about problems and lessons learnt. It could be in the form of an intranet website where Shin and the
Swedes of SKB International can discuss Korean business culture continuously as problems and solutions
are found. This discussion could also be held in regular meetings or through the company newsletter.
When a correct stereotype has been found it is important to put away the Swedish business culture and
put on the “cultural glasses” to communicate with the Koreans in their own terms and mind-set. This
would allow SKB International to get ahead in the relationship with Korea, especially if the other
European countries keep ignoring the Korean business culture. This strategy is effective, since cultural
ignorance is the most common and most serious mistake in international business. The more correct
image of Korean culture the staff of SKB International can get the better dialogue they will get.
Something that is interesting to note is that while the dialogue with the Korean actors is halting, the
dialogue with Japan and Taiwan is smoother. There are several possible reasons for this.
Firstly, as mentioned in the introduction, Korea has for several reasons been an isolated country in
recent history compared to Taiwan and Japan. They are less used to global business and it is harder for
foreign firms to enter their market because of cultural differences. This essay is meant to explain these
cultural differences in comparison to Swedish culture. The uniqueness of Korean culture is the first
obstacle in itself. When doing business with Korea it is therefore more important than otherwise to have
a clear strategy of how to deal with these cultural differences. It should also be said that Sweden also has
a somewhat isolated geographical situation since its neighbouring countries all have a similar culture.
Secondly, the lack of staff with knowledge of Korean culture at SKB International’s office is the other
major reason for why the dialogue with the Koreans is not as continuous as they might wish. It is
important for Koreans to always maintain the relationship which also might be more personal than is
usual in Swedish business culture. The incentives are many from the Koreans and it is difficult for SKB
International to keep up. Sometimes the Koreans send emails with personal greetings to maintain the
relationship on a personal level. There are also frequent wishes from Korean delegations to visit the
facilities in Sweden. These groups are too big for SKB International to handle and the requests come too
spontaneous and too often. There is no chance for the staff at SKB International to accept these urgent
39
requests. When they do accept these visits it is important that Shin or Holmqvist is there to handle the
Koreans in correct way. It is easy that the visit turns out to a failure due to misunderstandings in the
cross-cultural communication if the contact persons at SKB or SKB International have lack of knowledge
about Korean business culture. This situation can be improved by increasing the number of people
working towards Asia in combination with raising the general knowledge of Korean business culture in
the Asian department of SKB International.
Lastly, the dialogue is halting from the difficulties in entering the hierarchy of Korean Nuclear Industry.
During business meetings the Koreans have been disappointed not to meet the President of SKB. Slowly
they start to understand that the leader of Asian Department Holmqvist have full responsibility for the
projects with Korea. This issue has been improved by Shin when he explains to both sides about the
other’s business culture. It might also be a smart move of SKB to let their president have more of a
representative role and more contact with the Asian delegations. But there might be little interest of
that since SKB’s main goal is to take care of the Swedish nuclear waste, not doing international business.
It has also been difficult for SKB International to make real changes in KRMC and KHNP when they deal
directly with the concerned department. The Korean hierarchy is more complex and the power often lies
far away from where the actual work is done. Transferring the projects to KHNP and KRMC through the
Korean government is often the best way to go. This was done lately by Kwan-Sup Shin when he showed
the radioactive waste repository at Forsmark to a delegation from the Korean embassy together with the
president of SKB International. The dialogue with the Korean embassy in Stockholm seems to be a good
way to entering the Korean hierarchy and should be encouraged in the future. Preferably this relation
should develop at a personal level since that’s the base of Korean business relationships.
The big challenge for Korea to get a final repository for SNF is to gain a public acceptance for this. SKB
International is ready to sell this knowledge to KRMC but the national pride makes it hard to tell them
how they should treat their own people to create acceptance. The best strategy SKB International can
have at this moment is to try influencing the Korean government directly and show how Sweden has
done it. The more visits from Korean delegations they can accommodate to Sweden the better publicity
SKB will get in Korea. The Korean embassy in Stockholm was shown to be a good path to the Korean
government and to keep informing them about the success of SKB might also spread good publicity to
the Korean government.
40
7 Reference list
Printed sources
Adler, Nancy J, 1997, International dimensions of Organizational Behavior, 3. ed. Cincinnati, Ohio: South-
Western College Publishing
Bradley L. Kirkman, Kevin B. Lowe, Cristina B. Gibson, A Quarter Century of “Culture’s Consequences”: A
review of Empirical Research: Incorporating Hofstede’s Cultural Values Framework, Journal of
International Business Studies, Vol. 37, No. 3 2006
Chang, C.S. and Chang, N.J., 1994, The Korean Management System: cultural, political, economic
foundations, Westport: Quorom Books
Hofstede, Geert H., 1991, Cultures and Organizations: Software of the mind, London: McGraw-Hill Book
Company
Hofstede, Geert H. & Bond, Michael Harris, The Confucius connection: from cultural roots to economic
growth, Organizational Dynamics, Vol. 16 No. 4 1988
Jasook, Zhao, Choi, Nisbett, Sanchez-Burks & Lee, Conversing Across Cultures: East-West Communication
Styles in Work and Nonwork Contexts, Journal of Personality and Social Psychology, Vol.85 No.2 2003
Kim, Joo Yup & Nam, Sang Hoon, The Concept and Dynamics of Face: Implications for Organizational
Behavior in Asia, Organization Science, Vol.9, No.4 1998
Lee, Seung-Hoon, 2010, The Industrialization of the South Korean Economy: Background, Process and
Challenges, Seoul National University
Leung Kwok, Bhagat Rabi S., Buchan Nancy R., Erez Miriam, Gibson Cristina B., Culture and International
Business: Recent advances and Their Implications for Future Research, Journal of International Business
Studies, Vol.36, No.4 2005
Shim T. Youn-ja, Kim Min-Sun, Martin Judith N., 2008, Changing Korea: Understanding Culture and
Communication, New York: Peter Lang Publishing
41
Ungson, Gerardo R., Steers, Richard M. & Park, Seung-Ho, 1997, Korean Enterprise: The Quest for
Globalization, Boston: Harvard Business School Press
Yoon, Jeongkoo & Cho, Yung-Ho, The Origin and Function of Dynamic Collectivism: An analysis of Korean
Corporate Culture, Asia Pacific Business Review, Vol. 7, No. 4 2010
Interviews
Kwang-Sup Shin, SKB International, Representative, 2010-11-10 Personal interview, Seoul
Magnus Holmqvist, SKB International, Vice President, 2010-05-10 Personal interview, Stockholm
Electronic sources
Renee B Kim, Wal-Mart Korea: Challenges of Entering a Foreign Market, Hanyang University, 1997,
[www], downloaded 2010-12-06, from <academic-papers.org/ocs2/session/Papers/D3/1135-2171-1-
RV.doc>
“Om företaget SKB” [www], downloaded 2010-12-01, from
<www.skb.se/Templates/Standard____15446.aspx>
“Organisation SKB” [www], downloaded 2010-12-01, from
<www.skb.se/Templates/Standard____15471.aspx>
“SKB International AB” [www], downloaded 2010-12-02, from
<http://www.skb.se/Templates/Standard____15474.aspx>
“About SKB International AB” [www], downloaded 2010-12-02 from
<www.skb.se/Templates/Standard____24533.aspx>
“Nuclear Power in South Korea” [www], downloaded 2010-12-02, from
<www.world-nuclear.org/info/inf81.html>
“WNA: Supporting a Fast-Globalizing Nuclear Industry” [www], downloaded 2010-12-06, from
www.world-nuclear.org/about.html
42
8 Appendix
8.1 Interview with Magnus Holmqvist
1. What services are you offering to Korea?
2. How are you delivering these services?
3. What is your job at SKB International and who are involved in these projects?
4. Please tell me about your background.
5. What projects have you had so far with Korea?
6. How ownership of SKB International structured and what is your relation to SKB?
7. Do other countries have similar organizations like SKB International?
8. What companies are competing with you about consultancy to Korea?
9. How is it going for you to sell the idea of public acceptance to Korea?
10. What are your current projects with Korea?
11. What future projects do you want to have with Korea?
12. How do you think the market will look like in ten years from now?
13. What is KBS-3?
14. Would you like to have a better relation to Korea? What would you like to improve?
15. Tell me about your contacts in Korea.
16. Why are you using export council in Japan but not in Korea?
17. Do you have any problem with Korean hierarchy?
18. What role is KAERI playing to KRMC and KHNP?
19. You mentioned that the Korean national pride blocks your path sometimes. Tell me more about
it.
20. What cultural clashes have you noticed and how have you solved them?
21. Have you ever had a missed deal due to cultural problems?
8.2 Interview questions to Kwan-Sup Shin
1. Please tell me about your carrier.
2. What is SKB International’s strategy to learn about Korean business culture before meetings?
3. How is SKB International tackling the frequent spontaneous requests from their Korean business
partners?
4. What is SKB International doing to preserve group harmony when the Koreans are visiting for a
project in Sweden? Have they ever failed to preserve group harmony?
43
5. How are deals signed between KRMC and SKB International?
6. What is SKB International doing to maintain good relations to the Koreans between meetings?
7. When Koreans are visiting SKB International, what is done to develop personal relations between
employees of SKB and KRMC?
8. When Koreans are visiting SKB International, how do you think they should take care of them?
What do you think SKB International can improve on this issue?
9. Nunchi is a Korean phenomenon that is not really used that much in Swedish society. What
problems have this led to? How have SKB International handled their lack of nunchi?
10. Problems occur when Korean hierarchy meet Swedish flat organization. How have SKB
International acted to solve these issues?
11. Have there been any problems due to lack of trust from Koreans to “strangers” or foreigners?
How did SKB solve these problems?