Challenges for Korean HRD

Citation

(1999), "Challenges for Korean HRD", Journal of European Industrial Training, Vol. 23 No. 8. https://doi.org/10.1108/jeit.1999.00323hab.016

Challenges for Korean HRD

Challenges for Korean HRD

Keywords: Currency, Crisis, Financial restructuring, Human resource development

In the wake of the unexpected currency crisis that befell South Korea last year, Korean corporations began a restructuring process to improve organizational efficiency and profits. To achieve this, they began to focus more intently on their core businesses, downsized their workforces and reduced management costs in many areas, including human resource development.

According to a survey by Human Resource Development magazine in Korea, by June 1998, 70 per cent of survey participants had reduced their training investments by 12.5 per cent compared to 1997. In addition, 16.3 per cent responded that their training investments had remained the same for 1998 and only 11.4 per cent said their training investments had increased compared with the previous year. This necessitated the development of more cost-effective training strategies and activities for Korean HRD.

To better understand the impact of this with regard to human resource development, two researchers, Dr Yonjoo Cho, a senior researcher at Korea Telecom Research and Development Group, and Dr Hye-Young Park of the Yonsei Education Institute conducted interviews with human resource development managers in South Korean conglomerates.

Within Korean conglomerates, businesses have a centralized training centre and small training departments within each company. To realize synergies within the conglomerates, a centrally integrated HRD structure was considered, with each company's HRD department specializing in only one type of training. For example, rather than have each company's HRD department offer a variety of training courses to its employees, each company would specialize in a particular course and offer it to all the other companies in the conglomerate. This would result in cost savings for each organization since there would be no need to manage and market a multitude of courses in each company.

Additionally, outsourcing is now being considered more by Korean businesses than in the past. However, because most training has always been conducted internally, the quality of external providers is questionable.

These changes have driven Korean HRD practitioners to exert greater efforts to demonstrate a return on investment in training, and to make organizations more cognizant of the importance of HRD.

For more information about this study, please contact Dr Park at skpark00@chollian.net or Dr Choo at yonjoo@kt.co.kr