The League of Gentlemen’s Extraordinary Path to Innovation Vol.2 Junkyeong Kim

“I believe in the DNA of Samsung Electronics.”

–  A Legend of Home appliance distribution who tripled the sales in a year believes there is no crisis that cannot be managed.

What do you picture when you hear this career profile of a 30-year Samsung employee:

He joined the company in 1978. He has expertise in strategic distribution in overseas offices especially in so-called ‘tough areas’ in Southeast Asia, Middle East, and Africa. He is a strategic distribution expert in domestic sales especially for ‘problematic departments’. He is a legend who entered the organization with the lowest sales in Korea and tripled the sales in a year.

Sounds impressive, right? We’d picture the person to have charismatic, strong features – everything you think of when you think of success.

Former Samsung Electronics Vice President Junkyeong Kim (61, currently an auditor at East Bridge Partners) whom we met at his office in Nonhyeon-dong, Gangnam-gu on the 15th of last month was far from this stereotype. Rather, he seemed to be bright, warm-hearted, and humorous.

“There was always a crisis. There is no life without a crisis. People say they are going through a crisis now but to me, it’s nothing compared the early days when we had to pioneer the overseas market. Honestly, I work better during a crises. I tend to enjoy them. I am attracted to challenges people are often reluctant to take on.”

Today we want to share with you Kim’s role at Samsung and the changes he was able to affect.   We think his unique approach represents the way in which Samsung innovates solutions.

The Challenge of Becoming No. 1 in Iran

During his career, the toughest “mission impossible” was to break 100 million dollars in sales in Iran. Until 2000, Samsung Electronics was always ranked 2nd in Iran. When Kim visited the country, he saw there was “complete distrust”. The dispatched Korean employees had a hard time trusting local hires. In return, the locals did not have good feelings toward the head office.

“First, I had to decide who to keep and who to let go. To make this decision, I needed information and above all, I had to listen to what the locals had to say.” Kim met with each and every local worker and listened to their story. In the end, people who took pride in their jobs stayed.

▲ ‘Success of sales depends on HR’ is what Kim believes in. In fact, he concentrated on recruiting outstanding individuals while working in Iran. He also fully supported the employees to become loyal and proud of the products they sell.

“In Tehran, Iran, there is a prestigious university named Sharif University of Technology. Many Iranians at this school are known for their brilliance. I visited the university and requested the school to send us some good students. I began to recruit employees and organize existing members.”

To be able to obtain enough information to make good judgments, it is crucial for managers to have acute ears and eyes to hear and see. “There’s  this one local employee I cannot forget. He was a secretary at a business branch. He was a quiet and slow man, and people thought he was inadequate. However I did not agree with them. I saw his eyes twinkle, and I figured that he was a fast learner. I had entrusted him with some work, and he managed to finish it well step by step.”

Kim assigned him marketing works. “I changed his position, one person, but this led to the change of the entire company. He dealt with people calmly and persuaded them, and this resulted in improved performance. It turned out that one of his many strengths was his roots. He was from a prestigious family originating from the Pahlevi Dynasty, which in turn meant we were connected to a great network. I felt like I had discovered a hidden treasure.”

Open your eyes and ears wide to strangers

Kim asserts that one’s eyes and ears should not only be used for his or her acquaintances but be opened to anyone. “Resident employees in certain cultures simply believe what their predecessors say and set their own limitations regarding the work. In those countries, Koreans only hang out with Koreans. For example, when I was working in Iran, there was a rumor among the Korean resident employees that you should only use cash in Iran. All of them had plenty of cash at home. How dangerous is that? I found out that the locals use checks. Later I told the employees to use checks only. Since then, there was no problem using the checks. When in Rome… right? This was one of the small steps we took towards learning the local culture.”

Those who want to bring about change frequently force their ideas on others. However Kim emphasizes this:  If you really want a change, you need to break away from your stereotype and focus on what is going on at the site. “In the heart of Tehran, there is an electronics complex called Jomhuri. Once I was visiting there to do market research, and I realized that most of the dealers did not know about Samsung products. And of course there was a good reason behind it. The head office was in charge of training the dealers and the salespeople, and they did so in English. But the employees at the head office did not speak English.”

▲ Samsung Electronics advertisement in Downtown Tehran, Iran

Without delay, Kim recruited graduates from Sharif University of Technology and conducted product education for the head office employees in English. Those who participated in the education were to train the local salespeople. At the same time, Kim implemented a strategy where he freely provided a Samsung Electronics billboard to those Samsung retailers who wanted one. The sales record grew rapidly. An American brand had been maintaining its position as unchallenged No.1 in the Iranian refrigerator market. However in less than a year since Kim was appointed, Samsung Electronics succeeded in subjugating the market.  The same thing happened with other products.

“One day, the branch manager of a Japanese vacuum competitor came to me. He asked me how Samsung beat them and became No. 1 in the vacuum market. To tell the truth, there is no special strategy. We provided appropriate product training and were not stingy spending money on advertisements. The 95 million dollar market became a 156 million dollar market in but a year. Now, the sales in Iran reaches billions of dollars. And the entire Jomhuri electronics complex feels like a Samsung complex.”

▲ Thanks to the support from the head office, Samsung Electronics dealers in Iran were able to put up billboards. It was the fruit of Kim’s effort, who had realized the importance of visual advertisement early.

▲ In 2003, a nation-wide marathon competition was hosted by Samsung Electronics in Iran. With this competition, the position of Samsung Electronics in Iran became even more stable. At that time, Kim (right) did not mind personally persuading the headquarters, the Olympics Committee, and the local chief of the company to make this event happen.

How to deal with hardship: standard tactics

In 2004, Kim returned to Korea and encountered his next assignment: supervising the entire domestic sales strategy and distribution. The organization he was entrusted with had a decent name – New Distribution Team – but performance to suit this name was still to follow. Employees avoided the team, calling it ‘New Irritation Team’.

Once he joined New Distribution Team, the first thing Kim did was to assess the HR situation. After figuring out the strengths and weaknesses of the team members, Kim called all the staff from the branches and the head office to start the so-called 1-to-100 conversation. It was a place where people could talk openly about dissatisfaction they had in mind and possible improvement plans. Different stories burst out. And in this process, the ‘real cause’ behind the problem was exposed.

“More than a few dealers were playing against the rules to boost the early sales record by making illegal cash-back transactions using a credit card or reporting false sales. If they failed to balance their income and outlay, the difference is considered illegal sales. If the damage increases, the dealer will not be able to continue operation. In the center of the problem was the ‘lie’ that is told repeatedly in the process of product distribution. Big and small lies told to mitigate sticky situations were prevalent among the clients and sales outlets.”

He made a bold choice of choosing ‘standard tactics’. “When you want to sell, you need to use your head a lot in the first place. Lying complicates things. When you lie repeatedly, the problem becomes complex beyond control. However if you keep on the right path, you won’t produce nonsense. It is tough in the beginning, but it does not obstruct the execution of the work.”

In fact, he took severe disciplinary action whenever he found a case of illegal sales. On the other hand, he rewarded immediately when employees voluntarily reported an issue. He gave a bonus and complimented the sales outlet with increased sales record even if it was the slightest growth. Twice a year, he held 3-day camps  to encourage the heads of distribution businesses and their families. As a result, the annual sales of 400 billion won jumped to 1 trillion within a year.

“Don’t work with people you can’t trust. But once you have placed your trust in someone, trust him. ”

“The most important thing at work is trust. You need to remember this when you are listening to the stories at the sites. If three employees say the same thing, then you should take it as the truth. Without trust, things do not work out. Of course, you need to flexibly decide at what point to believe, and this should be done based on your experience. Former Samsung Electronics Chairman the late Byung-chul Lee said, “Don’t work with people you can’t trust. But once you have placed your trust in someone, trust him. ” If you want the other party to believe you, you need to be honest from the beginning. Once you lie, the truth will be exposed soon or later. It is only a matter of time before you lose credibility.”

▲ For the past 30 years spent as a Samsung Man, Kim kept his principle of “never lying even if things are tough”.

Another trait Lee places as much importance on as trust is connection. “Should I call it the feeling of becoming one with those you are working with? It is one of the reasons I consider lunch time important. When I was working overseas, I enjoyed local food, although people had dissuaded me from eating it because it’s not what Koreans are used to. I thought, ‘they’re things people here eat every day. why shouldn’t I?’ If you have this attitude towards everything you do, you can communicate naturally. For more efficient communication, other strategies like training can be added. I believe this is how I enhanced the status of Samsung Electronics in the world little by little.”

Asked about the ‘Samsung Electronics crisis theory’, he gave an explicit answer. “Samsung Electronics has its own DNA. It becomes stronger and more solid confronting crises. It may be the same for other industries, but things in the electronics industry change relatively fast. Samsung Electronics would have failed already if it had let the big and small changes affect it.”

If anything, Kim more enthusiastically looked for solutions and took an ‘in-your-face’ attitude every time he encountered a crisis. The result is proven by his records and achievements he has fulfilled. During the not-so-short interview, he delightfully shared his stories, and I naturally thought to myself, ‘Samsung employees may, after all, really have a different DNA.”

▲ He cheered up the juniors saying “I believe in the Samsung Electronics DNA that becomes stronger confronting crises.”

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