South Korea is famous for its chaebol, the huge, family-run conglomerates like Hyundai, LG and Samsung that dominate its economy.
Sun Jae Cho's challenge as an executive has been to figure out how to build a small entrepreneurial plastics company from what used to be a tiny part of one of the chaebols.
Cho, 55, is the president of Hyundai Pipe Co. Ltd., which extrudes polyethylene pipe at three factories in the city of Sangju.
He bought out the company, which currently has 50 employees, from its namesake Hyundai Group in 2003.
Cho, a longtime Hyundai executive, said he saw opportunities for plastic pipe to grow because it had a low market penetration in South Korea.
Hyundai Group had started the plastic pipe unit in 1990, and by the early 2000s was studying whether it should keep it. For Cho, who was part of the effort studying what to do with the pipe unit, it was a chance to strike out on his own.
He describes his role and Hyundai's role almost as market evangelizers, leading the domestic market “to recognize and select the polyethylene pipe applications for the next generation.”
“Korea is still in the initial stage of the high density polyethylene pipe applications,” he said, blaming a lack of innovation in the past, or what he called “the stereotypes of the previous generation having no innovative insights.”
“Even though it is approved by many countries, those hard-to-break stereotypes make harder to actively trigger the polyethylene pipe applications in Korea,” he said. “It is Hyundai Pipe's long-term task to break through those obstacles.”
That's not been easy, though. The company has been gradually expanding its capacity but Cho sees it entering a period of rapid growth that will triple the number of employees within three years.
One of its growth markets is what it calls “Super Diameter” pipe for applications like transporting water in power stations.
The company, which is one of South Korea's larger pipe extruders with eight extrusion lines making pipe up to 1 meter in diameter, has 50 percent of the Korean market for PE pipes in power plants.
It's now installing an extrusion line from Battenfeld Cincinnati Group for making 2.6 meter diameter pipe. It plans to add a second and third line for the large pipe in 2016 and 2017, respectively.
In an email interview, Cho comes across as serious, talking about his gratitude for an early mentor at Hyundai who “mercilessly” trained him and opportunities to lead units in Hyundai Group that he feels prepared him for his current job.
Indeed, while Hyundai Pipe has been independent for more than a decade, the chaebol still looms large in his thinking.
He talks about wanting to see that employees have the same benefits of working for a large company.
“The transition from large enterprise to SME has been our challenge, and we tried to maintain the corporate culture and welfare equal to that of larger corporate groups,” he said.
And the best advice he's ever received, he said, also came from a fellow Hyundai executive, this time at car maker Hyundai Motor Group. He was told not to undervalue wisdom, and not to overvalue intellect, in solving problems.
“The message was ‘Wisdom overcomes IQ. If you want to act wisely, bring up the wisdom as much as you can, then act,'” Cho said.
Q: What's the most interesting or unusual job you've ever had?
Cho: When I was a member of M&A Team in the Corporate Planning Department of Hyundai Group, the group had merged an electric wire company and I was in charge of plant operation for three years. Compared to the previous planning works for new business development, the actual M&A task involving operating of a plant was an invaluable experience for a 35 year-old employee like me. I would like to think of the experience as the core training to be the CEO of Hyundai Pipe Co. Ltd. today.
Q: What was your first job in plastics?
Cho: The company I am operating was a small business sector of Hyundai Group prior to the acquisition. The opportunity for me getting involved in the plastic industry was the feasibility test of the PE plant asking, “How could I develop the PE pipe plant within Hyundai Group” and whether the plan was feasible or not. I started with the feasibility study of the business and continued with the mission.
Q: Tell us about a mentor you've had in your career.
Cho: I do have four mentors actually, to be what I am today. The first is my father who helped me build my character. The second is my advisory professor who taught me material engineering research and analysis and the character of endurance. The third is the senior worker during my first year in Hyundai Group, who mercilessly trained me for the adaptability and ability to propel my assigned duty within the structural environment. Last but not least, the CEO of Hyundai Group who greatly helped me acquiring the company.
Q: What's the best career advice you've received?
Cho: I always take any advice seriously and tried to redeem myself from them, and I will continuously do so. I believe that taking advice and help from surroundings is one of the key survival factors of the business. The most memorable advice was the message I received from the vice president of Hyundai Motor Group, and the message was “Wisdom overcomes IQ. If you want to act wisely, bring up the wisdom as much as you can, then act.”
Q: What advice would you give to someone starting at your company tomorrow?
Cho: The most basic is to complete all tasks to the end. Collect and learn the wisdom and minimize trial and error to achieve the almost flawless result. That would be my advice.
Q: What do you want your legacy to be as CEO?
Cho: As the President of Hyundai Pipe Co. Ltd. I have no intention to compete with competitors that produce and manufacture similar products. I would like to think that my competition is the steel or GRP products industries that produce the substitution products, and in that way we can more broadly prepare and assert our competitiveness towards all types of pipe production. I wish our company to be one of the leaders in the industry both domestically and internationally.