Korea can be lengthy, cumbersome and expensive (Dept of State)." We must
extensively research our mutual requirements, understandings, and
responsibilities, record it on paper, and be prepared to modify the meanings of
the terms afterwards. The estimated cost of legal representation is $20,000. The
Park Place Hotel project will exceed $1.28 million and is financially attractive
to SNI. SNI, of course, must ensure payment. The continuing slowdown of the
Korean economy, increasing deficit, and falling won add to Korea?s economic
difficulties which makes Korean banks hesitant to extend credit for businesses.
"U.S. companies should consider dealing only on a confirmed letter of
credit basis with new and even familiar clientele. A confirmed l/c [letter of
credit] through a U.S. bank is recommended because it prevents unwanted changes
of the original l/c, and it shifts responsibility for collection onto the
familiar banks involved, rather than onto the seller" (Dept. of State).
Bank of America, SNI?s current bank, has a branch in Seoul and has agreed to
handle the letter of credit for a modest fee of $5,000. Social and Ethical
Issues The Korean culture is over 5000 years old. Modern societal values remain
firmly rooted in the values of Confucianism. Confucianism is not a religion, but
a philosophy of social conduct, that originated in ancient China. In many
respects, the Korean people base many of their decisions on emotion, ethical
social relationships, and the three qualities – love of humanity, sensitivity
for feelings and justice for society rather than on sound business sense or
reason" (Fordham). "Koreans have a great respect for the family and
hierarchy, and for anyone senior in age. They will intuitively establish their
hierarchical position relative to others based on age and social position"
(Business America, 1997). There are defined familial roles in Korea. "In
the majority of Korean households, the father is the primary bread winner, while
the mother stays at home. The majority of working women, many with top
university degrees, are still relegated in Korean companies to secretarial jobs,
assembly work positions, or educational work" (Dept. of State, 1999). The
eldest male of a family would be the patriarch and is revered and respected as
an elder of the family. Even while a Korean is dealing with non-Korean cultures
it is preferable that there be a correlation between the Korean and non-Korean
representative on the hierarchical totem. The belief system used in personal and
business relationships dictates that respect and dignity be shown in all
circumstances. An unwritten code of behavior exists in both informal and formal
settings. Koreans are excessively hospitable people and will treat visitors with
the utmost deference and kindness. Their politeness does not mean that you have
won their trust and loyalty, or that you are a particularly important
individual. It only means that you are also required to be polite in a similar
manner. It is important to remember that the Korean Culture, and the Korean
people, are a homogeneous society with strong ties to their families and
country. Whereas Americans may think in individual terms – ?What is in my best
interest?? Koreans often think in group terms – ?what is in the best
interest of the group?? Koreans tend to do what is good for the country rather
than for themselves. Setting up a system that benefits the owners without
defining benefits to the country may be difficult. Older Koreans have a
difficult time understanding the concept seeing the benefits the Internet and
Intranet. This will be an important consideration when communicating with Mr.
Park Soon Lee. Korean Business Practices Americans should be ready to mix
business with pleasure as the Koreans base their business relationships on
personal ones. "The heavy drinking of the Korean alcohol, Soju, beer, or
other liquor is commonplace in establishing a personal, business
relationship" (Dept of State, 1999). If one does not wish to consume
alcohol it is advisable to attribute the decision to a medical condition or a
conflict with medication. Koreans will understand and be sympathetic. "Also
commonplace is the ?no-ray-bang? where a group of businesspeople go to an
establishment to drink and sing along to a video machine playing music. As most
no-ray-bang machines come equipped with songs in English, a businessperson may
want to be prepared to sing at least one song in order to gain social favor with
their Korean counterpart" (Dept of State, 1999). The exchange of business
cards is a very important means by which Koreans learn about the name, position
and status of the other person. Koreans observe a very strict hierarchical code
and will generally meet to discuss business with persons of the same or parallel
rank. Businesspersons should always have their business card ready (preferably
bilingual) and should treat the exchange of Korean counterpart’s card with
respect. It is a sign of respect to receive and present items with both hands,
followed by passing and receiving a card with the right hand. One should never
give a card, or anything else for that matter, with the left hand as it shows
disrespect (Dept of State, 1999). A man generally receives more respect and
affinity in the business world than a woman, though foreign businesswomen
(especially, non-Asian looking women) are accorded almost an equal amount of
respect as foreign businessmen. Single women generally receive less respect than
married women whose ties to their husband oftentimes establish their position in
society. The American businessperson, as a foreigner, is generally exempt from
the above societal classification system, though one should be prepared to
answer what may be regarded as personal, such as questions of age, marital
status, religion, and education. An American businesswoman will most likely not
be included in business dinners. "Kibun places harmony and maintenance of
good feelings as the highest order in any relationship. Your counterpart may
always appear to be good-natured and friendly and will exert their full efforts
in avoiding saying no or delivering bad news. As such, the foreign
businessperson must learn to read between the lines or interpret hints of the
slightest business difficulties. Indeed, a ?yes? or nod of the head may mean
?maybe? or ?I understand." A ?maybe? usually means ?no? while
a negative response is sometimes indicated by a squint of the eyes or by tipping
the head back while drawing air in through the teeth and waiting for you to
speak again." (Fordham) Customs and Protocols A Korean has a family name
and one given name. Traditionally, the given name has two parts. Koreans
normally write their family name first, however, they may reverse the order when
dealing with Westerners. Although women do not change their name on marriage,
Mr. Park may refer to his wife as "Mrs. Park" to avoid confusing
Westerners. There is no general equivalent of "Mr." Various respectful
titles are used in the Korean language, which do not get translated into
English. The English word "Mr." is used in Korean only to address
social inferiors, but there is no objection to foreigners using it as a term of
respect in English correspondence. It will be important to be sensitive to this
particularly when dealing with the elder Park. Among themselves, Korean business
people are more likely to address each other by job title. We should plan to
have our people follow this protocol while in Korea. Greetings and thank-yous
are very important to Koreans. Words of greeting and thanks always are said with
a bow of the head. The depth of the bow required depends upon the relative
seniority of the two speakers. Koreans generally limit direct physical contact
to no more than a courteous handshake. "Koreans tend to avoid too much eye
contact and consider it bad manners to look straight into another?s eyes while
conversing" (Hoare, 1996). "Avoid the following topics in your
conversation: Japan, local politics, socialism, communism, and your host?s
wife. Among good conversational topics include Korean cultural heritage, kites,
sports (especially the Olympics), and the health of their family (do not talk
about their families unless these have something to do with their health).
Always be modest about your position and your accomplishments" (Fordham).
Koreans traditionally sit, eat and sleep on the floor, so shoes are always
removed when entering a Korean home. It is impolite to talk much or blow your
nose during a meal. Food is placed on the table all at once. Food need not be
consumed in any order. Rice and soup are eaten with a spoon while other dishes
are eaten with chopsticks. Chopsticks should not be left sticking in the food.
Koreans always wait to begin eating until the eldest person begins and wait to
leave the table until the eldest is finished. (Korea Travel Manual, 1995) When
dining out, Korean customs allow for either party to be the host or the guest
but "Dutch treat" is not practiced. IV. CONCLUSIONS AND
RECOMMENDATIONS SNI has the technical capability and available resources to
implement the LMS PRO 1.4 Hotel Management System at Park Place Hotels in South
Korea. Our success at Comfort Suites demonstrates our ability to develop,
design, implement, train, and maintain such a system. The Korean project
represents a significant source of revenue for SNI exceeding $1.28 million over
four years. A letter of credit from the Seoul branch of our current banker, Bank
of America, will ensure that SNI is paid according to our contract. The economic
unrest in Korea would prohibit implementing the system without the assurances of
guaranteed payment. SNI?s biggest obstacle will be understanding and
functioning under different cultural expectations. Since two of the four SNI
programmers going to Korea will be women, we must be sensitive to their needs
and well being. Our staff must dress in business attire (we recommend a $1,000
clothing allowance for each team member) and be willing to conduct business in a
social environment that involves heavy drinking and "karoke style"
singing. Business and social skills, too numerous to mention in this report,
must be learned and adhered to in order to ensure a successful outcome. We
recommend that all SNI personnel going to Korea attend a two day "finishing
school" sponsored by Barlitz Language School. SNI personnel are limited to
stay only 90 consecutive days on a business/ tourist visa and must be rotated.
The greatest risk to SNI is the political instability caused by aggressive North
Korean leadership resulting from food shortages and starvation in the North. The
South Korean government has made significant strides in reducing political
corruption prevalent in the 80?s. The Korean government has the full backing
of the American government so the risks, although present, should be minimal. We
believe this project presents a unique opportunity for SNI to expand its global
presence and will likely result in additional opportunities in Korea and
potentially other countries. For this reason, SNI should proceed with
negotiating an agreement with Park Place Hotels for the development,
installation, training, and maintenance of their Hotel Management System.
APPENDIX A. CAPABILITIES OF LMS PRO 1.4 Reservations – The reservation system
allows easy booking and inventory management for individuals and groups. Room
numbers and the type of suite and their availability are readily accessible. Run
of the house inventory and overbooking controls are easy to use and understand
and provide safeguards from embarrassing mix-ups. Registration – At registration
an entire group or convention can be registered with a single command key saving
individual members of the group as well as the hotel large amounts of time.
Individual registration within the group is also provided. The system allows
access to the data base by individual or company name, or arrival date.
Application of advance deposits is automatic and posts directly to the bill on
registration. Charge Posting – Daily charges are posted to each room account for
individuals or to a single account as an option for groups and conventions. All
charges are transferred to the company ledger automatically with references that
track back to the reservation and registration information. Guest Services -
Special requests for service can be entered at the registration or reservation
screen allowing the earliest recording of special customer needs. Wake-up calls
are automated from the quests room or can be entered from the registration desk.
Guest Settlement – The system allows for inquiry and posting by group or
individual. Group check out like group check in provides for an efficient
timesaving alternative. All major credit cards and after event billing in
addition to cash and checks are provided as options for settlement. Housekeeping
- Room status alerts the maid staff of unusual requests or scheduling needs. On
check out, housekeeping is alerted that the room is ready for service. Travel
agency accounting – The reservation system can be set to allow travel agencies
to search for available rooms. Access can be global. Telephone service – An
automated telephone service allows callers from outside and inside the hotel to
access a data base which will connect the caller to the guest by name. Voice
mail as an option for quests. Each room will be configured for internet access.
Package plans – Bundled services including lodging and other travel options can
be recorded into the system with automatic posting to the general ledger.
Special features are noted on the screen at check in and vouchers for tickets,
car rentals and other options can be mailed with the confirmation of lodging.
Night audits – No shutdown is required for night audits. Charges and corrections
are posted automatically to the financial system. Hotel management reporting -
Numerous created reports are available on request. A report writer is also
included to allow for customized reporting options. Guest history – Special
requests and account history is maintained by individual and group. This allows
special needs and desires to be anticipated with repeat customers. Frequent
customers can be coded with special considerations. Demographic reporting is
provided as an option to assist in marketing the hotel and in meeting the needs
of its customers. APPENDIX B. FINANCIAL BREAKDOWN OF PARK PLACE HOTEL PROJECT
APPENDIX C. GANDT CHART
American Chamber of Commerce in Korea. (March 12, 1999). [On-line],
Available: http://www.amchamkorea.org/. The American Chamber of Commerce in
Korea shares frequently asked questions including information on working and
investing in Korea. Business Etiquette Around the World. (1998). Promo, VXIn(9).
S4, S5, S22. This article offers general tips to offer insight into different
cultures around the world when doing business abroad. Carroll, P. & Hwang,
B. (1992). Doing Business in Korea and Taiwan: Cultural and Marketing Hints.
Business America, V113n(17). 8-15. Cultural and marketing hints on doing
business in Korea and Taiwan. This article shows the many differences that you
may face when dealing with a foreign culture and some hints on how to deal with
the differing business cultures of Korea and Taiwan. Country Commercial Guides
FY 1999: Korea. (March 1, 1999) [On-line]. Available: http://www.state.gov/www/about_state/busi?om_guides/1999/eastasia/korea99_nine.html
This is a helpful guide on dealing with business customs, travel, and Korean
culture when doing business in Korea. Dunung, S.(1995). Doing business in Asia
? the complete guide. New York: Lexington Books. Sanjyot Dunung, an expert on
international business development, has written a concise, comprehensive
handbook for doing business in twenty Asian countries. Fordham (February 3,
1999) Graduate School of Business MBA Pages: Doing Business in South Korea.
[On-line], Available: http://www.force2020.com/MBAPages/Projects/south-korea/sources.html
These are a set of web pages that offer several tips and cultural hints to doing
business in South Korea. Hoare, J. & Pares, S. (1996). Customs and etiquette
in Korea. Great Britain: Cromwell Press Ltd. This book details social, business,
entertainment and other social tips when visiting Korea. In defense of