Education Connections Key to Asian Business

Anyone who has ever done business in Asia or with an Asian company quickly realizes that Asian business culture is different from Western business culture. While Westerners’ key focus is on profits and the bottom-line, Asians often consider these secondary to a harmonious relationship between two individuals or companies. This focus on relationships, a result of Asia’s Confucian society, is often difficult for Western businesses and expats to comprehend (see article from Communicaid). To help provide an example of how important relationships are in Asian business, we identified two of Asia's largest companies, Hyundai and Samsung, and created an IntellectSpace Knowledge Map showing their connections. Though seemingly unrelated as far as sharing a common industry, the cultural connections between the companies illustrates an alternative avenue for market leverage.

As

shown in

this Knowledge Map, the most obvious connections are not between different companies, but between universities. School connections, particularly high school and university connections (but also even elementary and middle school connections), play a key role in Asian business, politics, and government. These school connections are made for life; it is not uncommon for retirees to still have elementary school reunions a few times a year. If two negotiators sit down to do business and realize they went to the same university, they have an immediate connection. It does not matter if they did not attend the school at the same time; the mere fact that they are both alumni creates an immediate and often strong connection.

Thus, we see that most of the executives at Hyundai and Samsung attended either Seoul National University (the top university in South Korea) or Korea Advanced Institute of Science and Technology (KAIST) (the premier engineering school in South Korea). Even though they did not attend school at the same time, all of them are likely familiar with each other given their school connections and the fact that they maintain alumni relations. Another factor in these relations is that since most Asian promotions are primarily based on seniority, most Executives at Asian companies have often been with the company for several years, thus widening their social connections even further.

Understanding these basic social connections is a key factor to doing successful business in Asia.

Click here for an interactive version of the IntellectSpace Knowledge Map (Internet Explorer browsers only): http://nv.intellectspace.com/ispace/GuestMonitor.aspx?id=78456944-aaf1-4848-b5f5-758e95da4c79