KDI "Korea's Personnel Management Seriously Outdated... Need to Improve Outdated Management Methods"

Report on 'Current Status and Implications of Management Methods' Published on the 28th

[Asia Economy Reporter Jang Sehee] A national research institute has analyzed that innovation in organizational management methods is crucial to enhancing corporate productivity.

The Korea Development Institute (KDI) stated this in its report titled 'Current Status and Implications of Management Methods,' published on the 28th.

The report explained that according to the Ministry of Science and ICT's '2018 R&D Activity Survey Report,' South Korea's research and development expenditure as a percentage of gross domestic product (GDP) stands at 4.81%, ranking first in the world. In particular, private companies use 80.3% of the total 86 trillion won R&D expenditure, indicating that the level of technological innovation in private enterprises is also among the highest globally. The absolute number of R&D personnel (690,000) ranks sixth worldwide.

However, according to the national competitiveness rankings measured in the same year by the International Institute for Management Development (IMD) World Competitiveness Yearbook, South Korea ranked 55th out of 63 countries in terms of management methods among detailed categories.

In fact, KDI revealed through a survey conducted on about 1,000 domestic manufacturing businesses that there is a significant gap in the level of management methods among South Korean businesses. The difference in management methods within companies is as large as the difference between companies.

KDI suggested that active government initiatives are necessary to promote corporate management innovation.

Research Fellow Jung advised, "For the recently announced Digital New Deal by the government to succeed, it is important for companies to actively achieve digital transformation. If outdated management methods are improved and companies' acceptance of digital technology and data utilization is increased, the utilization of the digital infrastructure established by the government will be multiplied."