Fostering SMEs via Developing the

Globally Competitive Human Capital

-The Experience of Korea

Ms. Christy Lee
President & CEO
Daewon Advisory Services
Contents
How Korea Made it?
- Developing Globally Competitive Human Capital


Fostering SMEs via Effective Training


Key Lessons Learned & Implications to KSA


Why Korea?


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Fostering SMEs via Developing the Globally Competitive Human Capital
Ms. Christy Lee
Why, on earth, KOREA?

Aerial view of Seoul in 1950s
Aerial view of Seoul Today
2. How Korea Made it?


3. Korean SMEs


4. Key Lessons Learned &
Implications to KSA


1. Why Korea?


Why Korea?
Industrial Base was Totally Destroyed During the War
- Korean War (1950 - 1953)
Average annual growth rate during the war : -19%
Amount of damage : US$ 5.5 billion
Total Civilian Casualties: 2.5 Million
Seoul during the Korean War
Over 500 times GDP growth, 300 times trade volume growth

(KRW BN, 1USD=1100KRW)
GDP Growth (Nominal)
USD 2BN
(1970)
USD 1,007BN
(2010)
(USD MN)
Trade Volume
(Source: www.investkorea.org)
Peter Drucker, Post-Capitalist Society

Korea provides us a key example of an undeveloped nation
without natural resources jumped into an industrial society, that
we cannot discuss the history of 20
th
century economic
development excluding Koreas amazing economic development.
USD 3BN
(1970)
USD 900BN
(2010)
Why Korea?
Small but Strong Economy

Ship-
building
Memory
Chip
Lithium
Battery
Auto Steel
World
Rank
1 1 1 5 6
Market
Share
48% 55% 40% 6% 5%
Korean
Companies
Hyundai
Heavy Ind.,
DSME
Samsung,
Hynix
Samsung SDI,
LG Chem
Hyundai,
KIA
POSCO,
Hyundai
Steel
Koreas World-Class Products (2011)
Emphasis on patriotism and
self-sacrifice
Determined leadership by
suggesting clear visions
My life for my country and for
the people
Thrift
How Korea Made it?
H.E. Late President Park, Chung-Hee (1917 1979 )
2. How Korea Made it?


3. Fostering SMEs


4. Key Lessons Learned &
Implications to KSA


1. Why Korea?


President of Korea 1963-1979 (16 yrs)
How Korea Made It?
Instilling Pride & Honor
Excelled in the Intl Youth Skill Olympics
- Korea Wins Gold Medal 17 times
(1977-2011)
Promoting Engineers and Skilled Technicians
Promotion of Science & Technology KIST, KAIST, Daeduck Science Park
How Korea Made It?
Monthly Export Promotion Meeting Presided
by the H.E. Late President Park, Chung-Hee
Close Partnership: Government & Private Sector
SAMSUNG GROUP Founder & Chairman: Lee, Byung Chul ( 1910 - 1987 )
Samsung Groups Opening of
Shared IT system: 1974
Samsung has clear standards when
deciding a new business ;
national needs,
sympathy of Korean people and
potential for global competitiveness.
Considering this, we will develop a
semiconductor business.
Korean Education
President Obamas View on Korean Education
"In South Korea, teachers are known as
nation builders. I think it's time we
treated our teachers with the same
level of respect right here in the United
States of America."
In the space of a little more than a
generation, [South] Korea has
developed one of the worlds best-
educated workforces and fastest-
growing economies.
Small and Medium Enterprises
Affiliated government organization Guarantee agencies Financial Institution
Execution of SME
policies
Financial support
Consulting &
Training
Financial
support
Management
consulting
Provision of
guarantee
Management
consulting
Overview of Korean SME Organizations
Investment of
Venture capital
Education
Financial support
for Micro Enterprise
Start up fund
Start up consulting
Training for Micro
Enterprises
Status of Korean SMEs

0%
20%
40%
60%
80%
100%
Total Number
of Companies
Total Number
of Employees
The Amount of
Production
The Amount of
Exports
0.1
12.3
52.4
67.7
99.9
87.7
47.6
32.3
Large Enterprises SMEs
99-88 SMEs
2. How Korea Made it?


3. Fostering SMEs


4. Key Lessons Learned &
Implications to KSA


1. Why Korea?


New Governments Policy Goals for SME
New Governments Policy Goals for SME support
Shared growth between
Conglomerates and SMEs

R&D Support for SME

Procurement

Fair opportunities for market entry



Start-Up Academy

Practical training for new
start-ups & for youth
entrepreneurs
E-Learning Training

Online courses on start-up,
management, & case studies
of successful businesses
Management Improvement
Training

Training on management improvement
to foster ability to cope with sudden
changes.
SEDAs Training Programs for Micro Enterprises
Innovation Academy
($7Mil support for 24,000 in 2013)
Practical training for start-ups
Training for those who want to switch
the business to another business
area
Youth Entrepreneurs start-up in
overseas
SEDAs Training Programs for Micro Enterprises
Management Improvement Training
($7.8Mil for 53,000 in 2013)
Sector Specific Training: 1,555
Region Specific Training: 300
Micro-Enterprise Innovation
Academy: 500
SEDAs Training Programs for Micro Enterprises
Training Programs
05 07 09 11
Innovation Training 246 1,005 11,841 101,596
Management Improvement
Training
- 23,414 112,094 104,126
E-learning Training - - 75,059 338,088
Total 246 24,419 198,994 543,810
Category '05 '07 '09 '11
Budget(100 million KRW) 5.3 16.5 65 50
Number of
Consulting 1,102 2,634 8,764 7,645
Legal Aid 26 104 346 314
Category 07 09 11
Ratio of enterprises with increased
revenues
43.0% 60.0% 58.2%
Revenue increase rate - - 3.8%
Satisfaction Level 76.3% 84.5% 83.5%
SEDA Support for Micro- Enterprises
Training
Supports
Results
SBC Support for Youth Entrepreneurs
One-stop training center to nurture young CEOs by providing all the
resources needed for starting a business: (300 CEOs per year)

Start-up training

R&D support

Prototype production

Start-up loans after training period
2013 Budget: $23 million
(Support up to: $100K/person)

Youth Entrepreneurship Training Program
Clear and Shared Vision: Communicate with your people
A Dedicated Government Agency was effective
Close Partnership between Government & Private Sector
Ensure strong execution of policies: Speed matters!
Foster a spirit of competition and enhance efficiency
Educate, Educate, Educate!
Key Lessons from Korea and Implications for KSA
Learning Journey to Korea: Incubating & Fostering SMEs

Visit to Leading SMEs with Innovative Technologies in Korea
Mr. Rashid Al Nuaimi,
Vice President, Human Capability, GASCO
Thank You