What Is a Korean FELO?

Answer: A Member of an Elite Power Group within Korean Business

By KBC Creator Steven S. Bammel

From the Korea Business Advisor column in the April 2012 issue of Seoul Magazine[EXPIRED LINK REMOVED: http://www.seoulselection.com/seoul/].

A few weeks ago, The Korea Times reported that 10% of listed Korean firms employed foreign executives in 2011. According to FELOResearch.com, the hiring of foreign executives into Korean organizations is a fairly new phenomenon, but one which can be expected to grow as Korean business engages more and more with world markets in ways that go beyond manufactured goods exports.

The term given to a sub-set of non-Koreans in Korea is Foreign Executives in Local Organizations and learning more about the FELO phenomenon is a key step in understanding the crucial roles non-Koreans can play in helping Korea keep its economic miracle going.

A Korean FELO Works in a Business Environment

The number of registered foreigners living in Korea now surpasses one million and it’s important to establish from the outset what a FELO is not. Of course, foreign spouses of Koreans living in Korea are not FELOs, neither are the many laborers from elsewhere in Asia who work in factories in Korea. The tens of thousands of English teachers in Korea, and students at Korean universities, and even their foreign professors, do not fall under the FELO category as they are not functioning in business roles.

A Korean FELO Makes Decisions within a Korean Organization

Foreign hires within Korean companies who do not exercise significant decision-making authority are not FELOS. Neither are foreign managers of foreign branch offices and subsidiaries in Korea FELOs since they are working for a foreign company. A foreign employee working at an overseas branch office or subsidiary of a Korean company does not fully meet the conditions for FELO classification either.

A Korean FELO Bridges the East-West Cultural Divice

While non-Korean East Asians, including Korean-Americans and other overseas Koreans, working at the executive level in Korean companies may be termed “foreign executives” by nationality, the Korean FELO typology focuses more on the role of functioning in a Korean organization as a Western outsider.

Thus, the definition of a Korean FELO narrows things down to a very small group of people with cultural backgrounds very unlike Korea who are working at the executive level in companies that primarily operate on Korean business cultural norms.

In the last year or two, there has been a well-publicized scaling back of the foreign executive presence in Korean organizations—most notably at LG. On Korea Business Central, we have interviewed a couple of former FELOs who explained how difficult it was to succeed in their jobs.

However, in spite of the challenges, FELOs are in a position to contribute to their Korean employers in unique ways and, starting from a very low base, their influence on the Korean business scene is sure to grow in the years to come.

There is ongoing research in this field and many success factors, approaches and strategies have been identified academically. If you’re a Korean FELO, know someone who is a FELO, or if you would just like to learn more about the FELO phenomenon, including additional Korean FELO insights by Dr. Frithjof Arp of FELOResearch.info, be sure to visit on my weblog below.

For additional information on the following related topics and more, click here to visit the a dedicated page on Steven’s weblog [EXPIRED LINK REMOVED: http://nojeokhill.koreanconsulting.com/2012/03/what-is-a-korean-felo.html]:

• Additional insights into the Korea FELO phenomenon by Dr. Frithjof Arp
• FELOResearch.info (including cases in Korea)
• Korea Joongang Daily, “Foreign executives finding place in Korea” – October 20, 2009
• The Korea Times, “10% of listed firms hire foreign executives in 2011” – January 31, 2012
• Interview with Korean FELO Dr. Linda Myers at SK Group
• Interview with Korean FELO Didier Chenneveau at LG Electronics
• Interview with Korean FELO Dr. David Dolinger at Seegene, Inc.
• Report by Korea Listed Companies Association on the status of foreign executives in Korean listed companies