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    Korea: Reform Focuses on the Customer

     

     
     
    © International Trade Centre, International Trade Forum - Issue 2/2002

    New trends in international trade mean that TPOs need to reassess to stay relevant to their clients. The Korea Trade-Investment Promotion Agency (KOTRA) has, in its own words, focused on essentials - customers' needs. From new customer satisfaction targets to increased online delivery of services and decentralized operations for a stronger field presence, the organization has reoriented itself around clients' needs.

    Today's global trade and economic environment has undergone change at a speed never before experienced. Three trends in particular are creating an important impact. First, values are changing as to what constitutes competitiveness. Second, the importance of regional blocs is growing with the spread of global economic standards. Third, the digital revolution has changed the speed at which information is disseminated, thrusting trade into a world of information, knowledge and creativity and spawning borderless competition.

    Competitiveness redefined

    What values drive competitiveness? The value that dominated last century's global economy and trade was productivity per time unit based on a quantitative input of labour. The prime competitive elements of the past were material capital and the capability to mass-produce.

    Today, information, knowledge and creativity are emerging as core competitive elements.

    The creation of synergy via a construction of networks (rather than individual efforts) has become a major factor in achieving competitiveness.

    Standardizing policies

    As globalization advances, the world is fast entering an era of borderless competition. Economic policies are increasingly standardized to better regulate the global economy. International organizations such as the World Trade Organization and the Organisation for Economic Co-operation and Development now determine the framework of international commerce and investment.

    Because the world's economies are globalizing rapidly, the influence of regional economic blocs, such as the European Union, the North American Free Trade Agreement, the Asia Pacific Economic Cooperation and the Common Market of the South, is becoming stronger.

    Knowledge-based economy

    We are fast heading toward a knowledge-based economy as a result of the ongoing digital revolution, considered by many the third revolution in human history following the agricultural and industrial revolutions. The Internet saves time and costs in acquiring information, resulting in significant changes in the way industries operate. In a future knowledge-based economy, knowledge rather than labour will become the major source of added value.

    KOTRA's reform

    Such changes require the world's TPOs to reassess their roles drastically, as became apparent to KOTRA during the Asian financial crisis of 1997, which severely affected all sectors of the national economy.

    KOTRA began organizational reform in 1997 to meet the challenges of the changing environment in a proactive and efficient way, thus contributing to Korea's continuing economic development.

    Vision

    Our vision is for KOTRA to become a world-class trade and investment promotion agency. To this end, we are pursuing a management policy that consists of results-oriented assessment criteria, decentralized operations and competence-oriented human resources.

    To realize this vision, KOTRA established the following management objectives:

    • raise customer satisfaction to 75%;
    • secure 50% or more of domestic exporting companies as KOTRA customers; and
    • raise our level of financial independence from 15% to 20%.


    Management innovation

    The main thrust of KOTRA's management innovation programme is to:

    • expand investment promotion;
    • focus on the field, by redeploying financial support and staff;
    • offer new customer-oriented services;
    • establish a customer satisfaction management system; and
    • expand the use of information technology throughout KOTRA as a means of effecting management innovation.


    Trade and investment

    KOTRA saw that in the current global economy, trade and investment do not behave as independent variables, but are symbiotic. Trade brings investment and investment creates new trade opportunities. We changed our name from the Korea Trade Promotion Agency to the Korea Trade-Investment Promotion Agency to reflect our expanded services and support for inbound and outbound investment and technological cooperation.

    To provide one-stop comprehensive services, KOTRA operates the "Korea Investment Service Center" and the office of "Investment Ombudsman" to help resolve complaints by Korea's foreign investors.

    New focus on the field

    KOTRA has introduced a team-based structure to improve productivity, streamline management and attain flexibility in its operations. KOTRA also transferred one-quarter of its head office staff to its trade centres at home and abroad.

    KOTRA broke with the past by focusing on regions of the world in its trade and investment promotion efforts rather than on individual countries. The eight regional head offices were empowered to set their business plans, budgets and assessment procedures, and to recruit local staff.

    Highlighting e-trade

    KOTRA has made significant moves to develop an e-trade infrastructure by organizing online trade delegations and e-trade marts through Silkroad21, a Korean e-trade portal site. The agency also launched its SME project under which individual Korea Trade Centers act as branch offices for businesses. KOTRA supports 1,061 companies via this programme. To satisfy the informational needs of our customers, the agency conducts over 12,000 overseas market surveys.

    In an attempt to establish a "virtual KOTRA", we have introduced more sophisticated and in-depth online services for our customers in Korea and overseas, such as the Korea Cyber Trade Mart and Silkroad21, both of which enable online meetings between Korean suppliers and overseas buyers.

    Last year, KOTRA reinforced its use of information technology with its Enterprise Knowledge Portal, which is composed of:

    • an in-house Intranet system;
    • a central Knowledge Management System to enable KOTRA staff to share their knowledge, experiences and information specifically applicable to KOTRA's business;
    • a Customer Relationship Management System through which KOTRA staff can respond to customers more quickly and accurately; and
    • a Management Information System, which is an internal control centre for budget and projects.


    Customer focus

    KOTRA has oriented its entire administration towards the customer. In addition to the new Internet-based services to survey customer needs, match buyers and sellers and monitor customer relations, the agency established teams to survey customer satisfaction.

    KOTRA is constructing the KINTEX international exhibition centre on the outskirts of Seoul, which will be one of the largest facilities of its kind in Asia.




    Korea Trade-Investment Promotion Agency

    • Mandate: Responsible for export and import promotion of all products; cross-border investment promotion; and support for technological and industrial cooperation.
    • Institutional positioning: Independent organization in the public sector.
    • Founded: 1962.
    • Location: Based in Seoul, 12 decentralized offices in Korea; and 98 overseas centres in 72 countries.
    • Staff: 1,008.
    • Of interest: Seeking to position itself as the national and regional e-centre for trade and investment promotion, through greater use of IT systems.


    Contact:
    KOTRA,
    300-9 Yumgok-Dong, Seocho-Gu, Seocho P.O.Box 101, Seoul, Korea
    Tel.: +822 3460 7114
    Fax: +822 3460 7777
    Web site: http://www.kotra.or.kr

    Hong Ki-Wha is Vice President of the Korea Trade-Investment Promotion Agency. He can be contacted at khhong@kotra.or.kr.


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