#Executive
2016.04.22
Bae Dong-hyun, AMOREPACIFIC Group
EXECUTIVE
INTERVIEW
INTERVIEW
Interview with members of the board aims to share the leadership's vision and promote seamless global communication
"Asian Beauty Creators,
you are the builders of the future"
- Bae Dong-hyun, AMOREPACIFIC Group
Spring is upon us, a season which awakens us to the possibilities of the new year ahead. The second quarter has seemingly slipped up on us unawares, and here we have a guest who is enjoying this year especially. His name is Bae Dong-hyun and he is the newly appointed president of AMOREPACIFIC Group. News Square interviewed him for AMOREPACIFIC members.
With his round glasses, neat suit and tie, he conveys a sharpness and wisdom which come from his years of experience in the financial and planning divisions. He smiled while recalling the past 36 years and, as a father with two daughters, began to tell his story and share his warm-hearted affection for the company and his family.
Back in 1981, it was really rare to find electronic devices such as computers, cell phones or electronic calculators. In fact, Bae Dong-hyun started working with an abacus. In the course of his career, he has been promoted to director of the Finance Division, vice president of the Financial Planning Division and vice president of AMOREPACIFIC in 2003, 2005 and 2011 respectively. This year, he has been newly appointed as president of AMOREPACIFIC Group.
Back in 1981, it was really rare to find electronic devices such as computers, cell phones or electronic calculators. In fact, Bae Dong-hyun started working with an abacus. In the course of his career, he has been promoted to director of the Finance Division, vice president of the Financial Planning Division and vice president of AMOREPACIFIC in 2003, 2005 and 2011 respectively. This year, he has been newly appointed as president of AMOREPACIFIC Group.
How have you found the journey with AMOREPACIFIC over the past 36 years?
1981 was the year after the second oil crisis. It was also when I got my first job at AMOREPACIFIC. There was severe unemployment at that time owing to the second oil crisis, so getting a job at AMOREPACIFIC felt like finding an oasis in the middle of a desert. Similar to getting a job in todays' job market, new employees went for training for a month before being assigned to the field. Since many of the employees were high school graduates due to the distinguished nature of the accounting department, I felt a particular burden of expectation as one of the few university graduates.
As a new employee, I spent most of my time trying to understand the company culture and how things were going, and the rest of time trying to get used to them. Later, I began to try something "innovative" in earnest. Then, the company's management system was undergoing modernization and yet everything was done manually – without computers. For this reason, inefficiencies abounded, with an overly manual process, particularly from today's standpoint. I focused on modernizing the management system. Looking back, I still believe it was a very good opportunity for me.
In the 1990s, I took part in business extensions and maintenance to support restructuring various affiliates. Then, in the 2000s, I took part in building a holding company system through the complicated process of mergers and sell-offs. In addition, a corporate governance system was stabilized via a number of business acquisitions and M&As. The corporate SAP ERP system, the mother of the ERP system that we currently use, was established through two stages of development and was designed to change performance methods. Today, as president of AMOREPACIFIC Group, I would like to promote management aimed at achieving the new global vision, objectives and strategies by always seeing the bigger picture.
1981 was the year after the second oil crisis. It was also when I got my first job at AMOREPACIFIC. There was severe unemployment at that time owing to the second oil crisis, so getting a job at AMOREPACIFIC felt like finding an oasis in the middle of a desert. Similar to getting a job in todays' job market, new employees went for training for a month before being assigned to the field. Since many of the employees were high school graduates due to the distinguished nature of the accounting department, I felt a particular burden of expectation as one of the few university graduates.
As a new employee, I spent most of my time trying to understand the company culture and how things were going, and the rest of time trying to get used to them. Later, I began to try something "innovative" in earnest. Then, the company's management system was undergoing modernization and yet everything was done manually – without computers. For this reason, inefficiencies abounded, with an overly manual process, particularly from today's standpoint. I focused on modernizing the management system. Looking back, I still believe it was a very good opportunity for me.
In the 1990s, I took part in business extensions and maintenance to support restructuring various affiliates. Then, in the 2000s, I took part in building a holding company system through the complicated process of mergers and sell-offs. In addition, a corporate governance system was stabilized via a number of business acquisitions and M&As. The corporate SAP ERP system, the mother of the ERP system that we currently use, was established through two stages of development and was designed to change performance methods. Today, as president of AMOREPACIFIC Group, I would like to promote management aimed at achieving the new global vision, objectives and strategies by always seeing the bigger picture.
He said that the above opportunities were made possible by the serendipity of the company's strong growth and the chance he got to work in the finance and planning Division. Of course, he sometimes encountered adversities. Particularly in the early 1990s, there were affiliates facing difficulties due to payment guarantees.
Back then, we had to service loans totaling KRW 300 billion. These loans were used in capital circulation by payment guarantee to all affiliates, including Pacific Trading and Pacific Fashion. Even today, that is a huge figure; back then, it was enormous. We overcame that situation through gradual restructuring signed off by the board. Yet, it took us some time to overcome our dependence on loan finance.
Working as a member of the finance Division at that time, I issued promissory notes in the morning and submitted them to banks with sales tax calculation sheets (accounts receivable and bond collateral) every day in order to circulate money to financial institutes. I waited for the money till the evening and then paid it back to other banks. The cash flow was so tight that the money would only have to cease circulating for one day to bankrupt our company. I think that was the most anxious moment of my career. However, we found a turning point in 1997 with the appointment of Suh Kyung-bae as CEO of AMOREPACIFIC Group; the innovative products from IOPE (Retinol) and Sulwhasoo were highly appealing to the market and brought us a huge success along with a big rise in net assets. It is this which has enabled us to govern the company with zero debt since 2002.
It was at that time that I learned that hardships always exist nearby and that breakthroughs are always possible through product innovation.
What was the most fruitful moment?
I remember the day that we opened a new SAP ERP system, which was the biggest project within the corporate innovation initiative of 2002. We were trying to build an integrated ERP system for the first time, but had been suffering for months from continuous system errors. Division members and I had put our efforts into debugging of and stabilizing the system night and day for more than six months. Even though there were some tough times, the struggle proved to be truly worthwhile. After all, the system has been used for over 13 years and represents a definite innovation in the management system.
I remember the day that we opened a new SAP ERP system, which was the biggest project within the corporate innovation initiative of 2002. We were trying to build an integrated ERP system for the first time, but had been suffering for months from continuous system errors. Division members and I had put our efforts into debugging of and stabilizing the system night and day for more than six months. Even though there were some tough times, the struggle proved to be truly worthwhile. After all, the system has been used for over 13 years and represents a definite innovation in the management system.
A leader of a company is a laborious title. The leader needs to self-develop and manage his company continuously and face new challenges. Despite his venerable 36-year career, he still reads widely in order to react to the fast-changing world as a leader.
When I was still in the field, I tried to read many books to accumulate knowledge on tax law or financial affairs, and attended various seminars for developing my work capacity. After becoming an executive, I read books on leadership or management strategies. I meet the professionals from different areas and spend quite amount of time in communicating with them.
As you may be a leader in your field, I would like to recommend the must-read book Zhenguan Zhengyao (Essential of Government of the Zhenguan Period). This book recorded the stories between Li Shimin, the Emperor Taizong of the ancient Tang Dynasty, and his courtiers. Their discussions ranged over politics and governments, which might be the textbook of leadership. Though the book is quite classical, it can still deliver precious messages to today's leaders.
Actually, I am an introverted person and often have difficulties getting close to others. That's why I need to spend time in building a solid teamwork or establishing a good setup within the group. "Faith" is the most important quality for a leader to have: that is, I always do my best to fulfill any promises that I make and face my colleagues with a sincere heart, as well as sticking to the simple principles of virtue.
How would you describe yourself as a father at home?
I am no more than an ordinary Korean father. My family always scolds me because I'm not good at expressing my feelings, but I try to be a kind father and husband. I have two daughters, who create a harmonious mood at home, I think, compared to those families with only sons.
I am no more than an ordinary Korean father. My family always scolds me because I'm not good at expressing my feelings, but I try to be a kind father and husband. I have two daughters, who create a harmonious mood at home, I think, compared to those families with only sons.
There must be a heavy burden on your shoulders since you occupy such a senior position. How do you deal with stress? Tell me your strategy for maintaining a healthy life.
Right after becoming an executive, I started mountain climbing. In fact, I sometimes like just going for a drive to a quiet place to have time to think. More recently, I have found enjoyment in doing meditation at home. To stay healthy, I do regular exercises at the gym and try to avoid heavy drinking.
Right after becoming an executive, I started mountain climbing. In fact, I sometimes like just going for a drive to a quiet place to have time to think. More recently, I have found enjoyment in doing meditation at home. To stay healthy, I do regular exercises at the gym and try to avoid heavy drinking.
What qualities do you look for in employees or leaders?
I never hesitate to compliment or encourage people who are creative and challenging, rather than searching for excuses, as well as people who have upright, positive and unswerving minds. In the case of a leader, I am fond of someone who is always admired by his/her organization and colleagues for his/her warm-hearted mind and clear vision, as well as for leading by example. I believe a leader must create a work environment in which employees are highly motivated and can do their best for themselves.
I never hesitate to compliment or encourage people who are creative and challenging, rather than searching for excuses, as well as people who have upright, positive and unswerving minds. In the case of a leader, I am fond of someone who is always admired by his/her organization and colleagues for his/her warm-hearted mind and clear vision, as well as for leading by example. I believe a leader must create a work environment in which employees are highly motivated and can do their best for themselves.
I tend to communicate with those who are more senior than a field member. Since I regard them as colleagues for discussing topics with, rather than subordinates, I try to encourage them to say what they have in mind and find the middle path through negotiation, rather than chastising people for holding a different opinion.
My personal interests belong to all the ideas stemming from our vocation to change the world and from the process of becoming a Great Global Brand Company as Asian Beauty Creator. I always agonize over how we can maintain sustainable growth and prepare for the global expansion.
He also watched the recent match between Lee Se-dol and AlphaGo. He thought about what could be the AI, AlphaGo of AMOREPACIFIC. "We can achieve the vision of becoming a Great Global Brand Company by taking a journey of realizing our dream to change the world with beauty. We are targeting KRW 12 trillion in sales, which is a symbol of our company as the top of both Asia and even the world." He also emphasized his vision toward employees and mentioned the attitude he looks for at work.
"Our R&D capability, marketing power, extraordinary brand value and technologies such as creating innovative products like cushion are the primary assets we have. However, I believe that people who make these assets are the builders of the future." He also sends his wish for accomplishing the vision together with a creative and a challenging spirit.
"Our R&D capability, marketing power, extraordinary brand value and technologies such as creating innovative products like cushion are the primary assets we have. However, I believe that people who make these assets are the builders of the future." He also sends his wish for accomplishing the vision together with a creative and a challenging spirit.
What takeaway would you like AMOREPACIFIC members to have?
We have to keep asking ourselves "what we should do" to achieve that vision. We are struggling with so many obstacles in the internal and external circumstances of business governance. We should seek answers to those questions by properly assessing and responding to the external context. We have the strength to strive for adversity and uncover hidden chances. I hope you take confidence in our ability to overcome hardships through thorough preparation. In addition, do not be too proud of your successes, but keep challenging for the future with true humility.
We have to keep asking ourselves "what we should do" to achieve that vision. We are struggling with so many obstacles in the internal and external circumstances of business governance. We should seek answers to those questions by properly assessing and responding to the external context. We have the strength to strive for adversity and uncover hidden chances. I hope you take confidence in our ability to overcome hardships through thorough preparation. In addition, do not be too proud of your successes, but keep challenging for the future with true humility.
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