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[Editorial] Conglomerates and SMEs to Share Human resources for Win-Win

[Editorial] Conglomerates and SMEs to Share Human resources for Win-Win

Posted March. 18, 2005 23:04,   


The Federation of Korean Industries will pursue a “Human Resource Exchange” policy starting late this year, where large corporations will lend their human resources to Small and Medium Sized Enterprises (SMEs) for two to three years. They will aid in design, research and development, and planning and marketing, areas where SMEs are in need of aid, and 60 percent of the labor costs will be shouldered by large enterprises. The move is meaningful in that the enterprises will be taking actual steps to achieve the cooperative development model.

Though more enterprises support SMEs than in the past, the latter still holds a grudging view towards the larger companies. Samsung chairman Lee Kun-hee has been known to have said, “If small and medium companies cannot support the global competition undertaken by the larger corporations, the achievements of conglomerates can be reduced to nil.” Even without this observation, it is evident that conglomerates survive only with the aid of SMEs, and resolve national economic objectives such as growth and employment problems.

In that respect, the conglomerates should lessen the difficulties faced by SMEs instead of charging ahead, and should take multilateral steps to enhance their competitiveness. An aspect may be to pursue and succeed in central plans to supply management and technological resources to Small and Medium Sized Enterprises (SMEs). The goal to resolve the bipolarity also derives from this sort of specific program.

On one note, the cooperation of human resources should not be used as a step towards merging with the larger companies, as in Japan’s departure policy. It also should not be a tool to steal the central technologies and ideas of the smaller companies.

The conglomerates should take note of the fact that short-term outsourcing between the larger and smaller companies that is already in effect is not functioning effectively due to fears of exposure of management secrets. Conglomerates should specify that the dispatched resources should be sworn to secrecy, and it is only then that the company should lend their resources to SMEs. The government should also review policies to support labor costs of Small and Medium Sized Enterprises (SMEs).