Korean Manufacturing in Transition: Patterns in the Past,Current Status,and Future Challenges

In recent years, Korea has emerged as one of the world's fastest growing industrial nations. Manufacturing industry has been the foundation of its economic success, and, in this paper, an in-depth analysis of the development process of the Korean manufacturing industry is presented. From an early stage, Korean manufacturers followed a general pattern in achieving their current success: they successfully combined high-quality, but inexpensive and plentiful, human resources with imported technologies and material to produce low-cost goods for a protected market. In this process, the Korean government played the role of planner, protector, and provider for the national economy and the entire manufacturing industry. In recent years, however, the private sector has assumed leadership in terms of planning and executing industrial development plans. With this change, Korean manufacturers are making a clear transition from a low-cost producer to a high value-added competitor with an increasing emphasis on quality and flexibility. This paper offers an empirical analysis of the performance improvements, future competitive priorities, and action programmes designed to achieve this strategic shift.