Wednesday, March 20, 2019
Workplace Innovation Was the Secret
Management Rewarded
Workplace Innovation Was the Secret
  • By matthew
  • July 29, 2015, 08:00
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CEO of KAMCO Hong Young-man.
CEO of KAMCO Hong Young-man.

 

The Ministry of Strategy and Finance gave Korea Asset Management Corporation (KAMCO) an A grade for its excellent management in 2014. At the end of 2013, net profits were posted as 51 billion won (US$46 million), but by the end of 2014, net profits increased 1.7 times, marking 93.9 billion won (US$81.2 million). KAMCO attributes this feat to innovation at the workplace that all staff collectively strove for.

The year 2014 marked one of the most dynamic years in the history of KAMCO. Of its 50 year establishment, the post-1997 IMF crisis and the 2008 global financial crisis were the two most important periods that cemented the image of KAMCO in the public mind. After the IMF crisis, KAMCO cleaned up non-performing loans (NPL) of troubled companies by providing debt consolidation funds. With the onset of the global financial crisis in 2008, KAMCO preemptively responded by issuing restructuring funds in an effort to save Korea from falling victim to a domino effect triggered by panic in the global stock market. The year 2014 presented another turning point for KAMCO, as it had to reposition itself from the emergency mode designed to cope with two big crises and move on to redefine its new mission.

The inauguration of current President Hong Young-man coincided with this timing for change. President Hong proposed “communication, unity, ethics, and professionalism” as the key concepts that KAMCO has focused on under his leadership.

First, President Hong launched a contest titled “Restarting KAMCO Innovation Project” in Feb. 2014. Through this initiative, the president requested a submission of innovative ideas from staff members. The central idea behind the event was to encourage staff members to actively participate in the search for new directions and organize them into categories to build a foundation. In reality, this initiative also translated into improving procedural efficiency at the workplace.

As a result, KAMCO succeeded in improving its productivity and management efficiency. Compared to 2013, quarterly net profits increased 76 percent, generating 93.9 billion won (US$811 million), up from 51 billion won. KAMCO established an emergency committee specifically focusing on planning debt reduction and regularly checking on the progresses on the “debt reduction” project. As a result, compared to the previous year, KAMCO reduced its debt-to-equity ratio by 53 percent, which is translated into 6.289 trillion won (US$5.437 billion) in amount.

The Restarting KAMCO Innovation Project is comprised of four areas of innovation: business, manpower organization, management, and social responsibility.

For business innovation, KAMCO worked to enhance its new identity as a public asset management agency. KAMCO also expanded the scope of underwriting public bonds. It also institutionalized the sales of public bonds.  

In addition, KAMCO worked to effectively organize manpower. First, KAMCO expanded its scope for outsourcing tasks that have little relevance to the original purpose of the organization, such as collecting national taxes. 

Via a vast amount of information about financial support, state asset management, and employment, KAMCO began to provide customized services for the public. As a first step, KAMCO set up an online site called “KAMCO Square.”

At the organizational level, KAMCO launched a committee called “DOT innovation”. Made with first letters from “Daily,” “On the Spot,” and “Together,” the acronym DOT is designed to foster open dialogue in the workplace. The committee proved to be an irreplaceable body, especially after the office moved to Busan. The committee offers staff a venue to raise day-to-day concerns and ways to help them adapt to new environments.

CEO Hong Young-man regularly sent out emails to all employees to communicate his business philosophy. This direct manner of communication is said to enhance unity and togetherness.

Noticeable innovation occurred in personnel management, too. Staff are introduced to a participatory personnel management culture. Open communication between management and labor helps narrow the differences on lowering the cost of fringe benefits. KAMCO also extended the scope of a flexible employment policy. For instance, the number of employees working flexible hours or working from home increased from 75 to 170.

Improving fairness and transparency in the recruiting process, KAMCO shifted its focus from titular qualifications to work experiences and competencies on the ground. As a result, KAMCO broadened its recruitment pool to include high school graduates (24 percent), women (48 percent), engineers (14 percent), and local candidates from Busan (44 percent).