Israel is the first country, and so far the only country in the Middle East to sign a free trade agreement with South Korea, and there’s no doubt that this agreement will lead to many groundbreaking business opportunities. However, just before we all take off for Seoul, it’s essential to note some of the important cross-cultural differences between Israeli culture and that of South Korea.
It was during a marketing meeting that the Vice-president, among the senior members of a very large and globally well-known Korean company, stood up angrily, struck the board with his hand, turned red, and began shouting in Korean. This came about following a misunderstanding concerning the timetable of a project, albeit only a two-month delay in delivery on the Israeli side. The issue wasn’t really around the two-month delay, but about the vice-president who reported to his superiors that the project will be ready in two months, and by delaying delivery the Israelis had actually damaged his kibun and caused him to lose face before his superiors.
Kibun – in Korean culture, kibun, roughly translated as “face” or “reputation,” is a more sensitive issue in Korea than perhaps anywhere else in the world. This notion that any kind of social embarrassment should be avoided stems from the need to maintain social harmony. Saving face with cultural intelligence is more than the Western concept of simply protecting one’s personal integrity; it’s more about preserving the honor of the group, whether it is a family, a clan, a company or even the country. Failure to understand this can cause a permanent rift in a relationship. Giving honor is an essential keyword in conducting business relations in South Korea.
Trust-building and relationships – the starting point here is that Koreans are suspicious of all foreigners and their motives, so one needs to work hard at building their trust. Additionally, their communication style is indirect. Koreans are courteous listeners in true Asian style, but they often give the impression that they know in advance what you’re about to tell them and even tell you what you want to hear. Furthermore, they like to give lively feedback and may ask original questions; however, communicating with them can be ambiguous since they speak among themselves in Korean and their English is not always strong. Regardless, giving them “face” is important both during and after a presentation. I also recommend bringing along a local interpreter who knows how to mediate between Western communication “codes” and those in Korea. In conversing with your Korean colleague, always maintain their kibun and never refuse the suggestion to continue the evening with a meal and karaoke, because this is part of building a relationship of trust.
Conducting negotiations – South Korea is a hierarchical society and this is showcased in how business is conducted, thus meeting with a person of decision-making status or the CEO usually occurs only in the advanced stages of negotiations, and sometimes even only at the final stage of signing the agreement. Therefore, the process of negotiation will begin with individuals a few levels below the decision makers. The role of these managers is to get to know you, to review the written documentation, to understand whether the deal is worthwhile, and sometimes even to conduct initial negotiations. The negotiation process can continue as long as half a year to a year.
In addition, be prepared for a win/win tactic in negotiating with the Koreans. In other words, be prepared to make small concessions so that everybody can save face with their superiors by conducting what’s perceived as a successful negotiation.
Despite the fact that Koreans lack a startup culture, the cellular industry has become the exception to the cultural framework of slow decision making as here competition is fierce and therefore processes are faster – rapid decision-making, risk-taking and thinking outside the box has become the norm.
Meetings – Protocol is extremely important. Leadership is Confucian. Decision making is top-down and being aware of their social codes is crucial to success. In a business meeting, the seating protocol is showcased by a hierarchical order. The most senior member managing the meeting sits in the middle, with his #2 on his or her right, #3 on #2’s right, #4 on #3’s right and so on, until the lowest-ranking individual sits farthest away, near the door. The Israeli team must display a similar order, and conduct discussions facing the corresponding rank. In a smaller meeting, the most important member of the team will be seated at the head of a table, but the seating hierarchy remains the same.
There is a strict hierarchy in meetings of who speaks when and each side usually employs its senior member as its spokesperson. While in Israel it would be normal to jump in and contradict a speaker, in Korea, this would cause them a massive loss of face, as well as embarrassment for everybody else present.
Silence speaks volumes – don’t break the silence! Silence in Korea has many meanings. It can be a sign of respect. If a person asks a question, it is polite to consider your answer rather than simply blurting something out. Silence can also be used when the parties are communicating virtually and one can’t read the other’s face or body language. Saying nothing is better than offending the other side, which would cause both parties to lose face.
In addition, negative speech is avoided. Koreans find it difficult to say NO directly, as this can cause a loss of face. Therefore in negotiations, listen carefully; “maybe” “we will get back to you,” and “we will do our best” are all euphemisms for no. Therefore, sometimes silence in a meeting is maintained in order to avoid saying something negative. As an Israeli, learn to apply the same technique, omit the word “no” from your vocabulary, but also don’t let silence or the word “yes” convince you that an agreement has been reached. Listen carefully to the intention behind the words.
Practical tips for conducting business in Korea:
In many ways, there are significant differences between Israeli culture and that of South Korea, and the challenges of conducting business relations require cultural knowledge and awareness. If you want to succeed in building business relations in Korea, you must master humility, showing your Korean partners understanding and respect of their culture. They’ll be very grateful for the effort, and you’ll gain their appreciation. More importantly, if your competitors follow these rules and you don’t, it’s easy to guess who will win that contract.