A Cross-cultural Management Analysis Of Korean Corporate In China

In O’Grady&Lane’s (1995) book “The Psychic Distance Paradox”said that“Companies tend to begin their internationalization process in countries that are‘psychically’ close.” Researchers describe the sequence of entry that firms follow and themode of entry they choose. They suggest that psychically close countries are more easilyunderstood than distant ones; and offer more familiar operating environments. But thepsychic distance paradox is that operations in psychically close countries are notnecessarily easy to manage, because assumptions of similarity can prevent executives fromlearning about critical differences.Since the year1992, China and South Korea established diplomatic relations, the twocountries made a great stride in many fields. But the development of South Koreanenterprises in China has not always been smoothly. Since the year2000, the scale ofinvestment and the proportion from Korean companies declined dramatically. In the2008financial crisis, a large number of Korean enterprises divested from China. Which ofcourse have a big environmental impact, but the Korean enterprises in China suffered fromcultural conflict and cannot solve it, lead to one of the root causes of a large number ofKorean enterprises fail. The author has ten years work experience in the Korean enterpriseH Company, so choice the company as an object of study of the cross-cultural management.Firstly, the author used Hofstede’s Cultural Dimensions and organization culturesdimensions to analyze this company, and then try to find the problems of culturaldifferences in the corporate. Finally to develop how the enterprise find the appropriate wayto solve these cross-cultural differences. The significance of this paper is to provide anexample of how to resolve cross-cultural conflict by managing to make a reference to theother Korean enterprises in China, and to promote the development of Korean companiesin China and also promote the development the economy of China and Korea.The current global economic situation is not very clear; we may face to "secondrecession" risk. The European economy has already entered a recession, the USA’seconomy also in the edge of the recession. For Chinese enterprises as well as Koreancompanies should be more emphasis on economic cooperation with each other. In addition,I also hope that this article should have implications in multinational companies in Chinafor how to manage the cross-cultural.