Eight Essential Questions to the ever-evolving East Asian enterprise leaders

The age of Asia is dawning. China has emerged as the new super power, and it is determined to make the transi-tion from being „the world‟s factory‟ to „the world‟s market‟. Japan is also determined to bring back its glory days using the recent slowdown of the US economy as an opportunity. An increasing number of key Korean corporations are rising as major players in the global arena. 

East Asian business management style is also under the spotlight. In East Asia all members of a society are ex-pected to play their rightful role and uphold their responsibilities to the society, and corporations are no excep-tion. Therefore, corporations were expected to guarantee jobs for the life of its employees, while pursuing mu-tually-beneficial business transactions with its suppliers unless faced with imminent bankruptcy. Sharing its economic gain with other members of society was also a well-accepted public expectation. 

During the post IMF bail-out in the late 1990s, the previous expectations changed when Korean corporations were bombarded by the so-called „global standard‟ which was the new western capitalism model that placed shareholder value as a distinctly top priority. Business managers were forced to embrace a new value system where good companies are the ones that maximize profit, manage human resources as a cost factor instead of assets, and make decisions on the basis that which benefits shareholders, is beneficial to the corporations them-selves. 

The shareholder value movement caused many changes in the business world and brought some negative conse-quences. For instance, employees had to bear the brunt of unfavorable business performance far more than they used to and job stability was weakened significantly on a societal level. A dramatic increase in temporary work-ers is a direct consequence. Shareholder demand for increased profit was passed on to suppliers, and we began to see increased number of suppliers driven to bankruptcy even when their buyers, typically large corporations, flourished with record profits. The shareholder value movement which had been subjected to much criticism has now been shaken to its core since the global financial crisis resonated from 

The recent crisis calls for Asian corporations to adopt a new management method. The stage has been set for a new business management method to become the new norm. East Asian corporations have a good opportunity to present this new norm but before they do, they need to present answers to some very important questions. Here are the eight key questions selected by the Hankyoreh Economic Research Institute.