South Korean Business Etiquette

South Korea has its own unique business etiquette, and all of the etiquette is influenced by their unique cultures in some extent. Acquiring this culture is essential for foreign companies to do better business with South Korea. South Korean unique business etiquette mainly exhibits in six aspects, which are introduction, greeting, business cards, business meeting, K-Type management style, and gift giving. In South Korea, introduction by a friend or a person in a company that you are working with is very important. Meeting the right people in a company almost always depends on having the right introduction (Chaney and Martin, 2011). As discussed before in this paper, personal relationships are one of the key cultures in doing business in Korea. Introduction by a third party is one of the personal relationships. Koreans are more comfortable doing business with those who they know and trust. Introduction by a third party implies to Koreans that the person/company they will work with are trustable, and thus, the business relationships between them could be more solid and last longer.

 

Greeting In South Korea, greeting is one of the steps that businessmen do not want to skip. It usually happens after the introduction. The usual greeting between men is a bow, accompanied by a handshake. To show respect, the left hand is placed below the right forearm while shaking hands. Women do not shake hands as frequently as men (Chaney and Martin, 2011). During greeting, maintaining the eye contact is appreciated. Many foreigners who had some experience of doing business with Koreans said that they learned the unique greeting culture during their stay with Koreans. Every time when they met with their Korean partners and colleagues, every Korean bowed to each other, and then followed by a handshake. The bowing also happened in restaurants whenever they visited restaurants with their Korean partners and co-workers. Every host or owner bowed to customers when they went inside. The bowing is one of the most surprising cultures to most foreigners.

 

Business Cards South Koreans attach importance to business cards exchange, with their certain way. Usually, after the handshake, business cards are exchanged between professionals during initial encounters. The cards are presented and received with both hands. It is recommended that foreigners obtain bilingual business cards with Korean on one side and English on the other side. When you present your business card to Koreans, please keep in mind that the Korean language side should be facing up, with your both hands. People are expected to handle the business card by their right hand, if they need to pass the card to others. After receiving the card, it is suggested to nod your head to show your respect and thanks. Once you receive it, try not to stare too hard at those business cards as it will come across as impolite and/or possibly offend the Korean businessmen (Southerton, 2008). Business Meeting Because business is based on personal relationships and trust in South Korea, usually it takes longer to complete a deal. Therefore, it usually takes several meetings to finish the business. The first meeting is usually a start of the business-relationship building process. Very little might be discussed which relates to the actual business in hand for a while, with most time being spent exchanging pleasantries, discussing travel and other small trivia (Chen, 2004; Pelham, 1997).

 

American companies, however, value time as one of the most important things, and usually get the business done as soon as possible even in the first meeting. Meeting with South Koreans would sometimes be a frustrating cultural shock for Americans if they don’t understand the process of developing real business with Koreans. It is important for Americans not to show impatience or irritation at this stage. It is suggested for American companies that they could view the first meeting as an essential first step or investment in creating a rewarding, trustable and long-term business relationship. Regarding the negotiation in business meetings, foreign companies, like Americans, need to keep in mind that the society is a high hierarchy society. Therefore, they need to know who the decision maker is, and contact the person prior to the actual meeting. Usually, the senior managers are the decision makers, and junior staff is playing a role as supportive. American companies should focus more on what the senior managers think about during the negotiation. However, this does not mean that they could ignore the junior staff. It is recommended for American companies to keep contacts with the whole team, because one of the management styles of South Koreans is team-oriented (Aiken, Kim, Hwang and Lu, 1995; Chen, 2004).

 

K-Type Management Style Because South Korea is a society with high power distance and hierarchy, the management style is quite different from that in the United States or other many Western countries, which has lower power distance. Therefore, Korean management style, called K-Type management, consists of top down decision-making, paternalistic leadership, clan management, personal loyalty, compensation based on seniority and merit ranking, high mobility of workers. The organization structure of companies are highly centralized and formalized with authority concentrated in senior levels. Major decisions go through a formal procedure of approval from top levels of management (Aiken, Kim, Hwang and Lu, 1995; Alston, 1989; Chen, 2004; Cho and Yoon, 2001). When working with Korean companies, American ones should value the decisions made by the senior managers. As discussed earlier in this paper, Korean society values harmony as one of its most important honors, both in personal life and business world. American companies should keep in mind that they need to avoid conflicts, especially in public, with senior managers. They do not want to disturb the harmony to take the risk of ruining the business. Gift Giving In South Korea, gift giving is part of doing business. It is done to secure favors and build relationships (Southerton, 2008).

 

Gift giving in South Korea is not seen as a bribery or corruption. Normally, business gifts should be of good quality but inexpensive. The gifts from the givers’ home country would be much appreciated and impressive, regardless of the price. The gifts should be wrapped before giving, and opened in private rather than in the presence of the giver. When handing out more than one gift, the giver(s) need to make sure that senior members are given gifts with greater value than junior members, because respect for seniors is everything in South Korea (Aiken, Kim, Hwang and Lu, 1995; Chen, 2004). When you are given a gift, it is polite to seem to refuse the gift a couple times before accepting. Those items discussed above are part of the unique business etiquette in South Korea.

 

Understanding them before doing business with Koreans, is very important and critical. Besides those items of Korean business etiquette, there is some other business etiquette that foreigners and foreign companies should pay attention to. For example, punctuality is important in South Korea, however, top-level executives may occasionally be a little late for meetings or appointments (Chaney, 2011). While Americans are expected to be on time, no matter what management level the person is. Another different culture is that the behaviors at working places are stricter compared with the United States. For example, putting your feet on a chair or table is considered rude, while it is OK to do so in the United States, if in a casual situation. Therefore, there are many lessons for foreigners to learn about how to do business with Koreans, and one of the ways to do so is learning Korean unique culture prior to actually doing business with Koreans or in Korea.