Simon Denny’s current exhibition New Management at Frankfurt’s Portikus explores a pivotal occasion in the history of the South Korean multinational Samsung. The 1993 “Frankfurt Declaration” was a three-day conference in a Frankfurt hotel by Samsung’s Chairman Lee Kun-hee for dozens of his top executives and shareholders. During the event, Kun-hee outlined a new management philosophy, which helped propel Samsung into becoming the largest electronics company in the world. For the exhibition, Denny has translated this cultural history of technology, commerce, nationalism, and globalization into objects. The accompanying catalogue includes two varying translations of the event’s literature—previously only available in Korean—including an elaborate comic book created for text-challenged Samsung employees. The following presents Denny’s forward to the catalog as well excerpts of the two different translations—commissioned by the artist through freelancer.com.
This exhibition reflects in detail on Samsung’s Frankfurt Declaration, when in 1993 the company’s Chairman Lee Kun-hee flew dozens of his top-level South Korean executives and shareholders across the globe for a spectacular meeting at the Kempinski Hotel Frankfurt Gravenbruch near Frankfurt am Main, Germany. Since then, the company has grown to become the “world’s biggest electronics company by sales.”
The Frankfurt Declaration was a three-day semi-public meeting, culminating on June 7. Some kind of mix between a publicity event and high-level executive meeting, it was staged to give a heavy emphasis to Lee’s “New Management” philosophy, a massive managerial pivot for “Korea’s most successful chaebol.” At the time it was covered heavily by the media in South Korea and to a lesser extent in global business media, The Declaration focused intensely on the need to globalize the company, the importance of “quality” in production and managerial attitude, new working hours of Samsung employees and a resounding general atmosphere of “change.” Samsung makes a huge range of products, certainly not only consumer electronics. Samsung’s role in the cultural and social fabric in South Korea is integral. One can seemingly conceive the possibility of living in South Korea and almost exclusively interacting with Samsung products and services.
The New Management philosophy introduced at the Frankfurt Declaration consistently emphasizes the importance of travel, learning, and living among other cultures. It repeatedly relays the dire consequences faced if an individual, a company, a nation doesn’t integrate with—and master—a global economy. It forcefully reminds us of the “quality” that is required to become dominant in a major world market. Publicized phrases like “change begins with me” and “change everything except your spouse and kids” float above a complex philosophy filled with imagery that mix South Korea’s history with competitive, nationally focused business rhetoric. It is part of the core of the philosophy that cultural learning and global understanding is aspired to in the name of global market dominance.
My exhibition is an unauthoriszed documentary that focuses on the Declaration as one of the most significant cultural statements of the pre-millennial moment—from the outside. It presents some of the most public philosophical underpinnings of Samsung from 1993 in their unrelenting, unapologetic quest for global dominance. It is pure aspiration, unbounded ambition. On the one hand this is a beautiful, euphoric dream of expansion, on the other, it is a dream fro political and economic assertion that is ruthlessly competitive, exclusive, and strongly nationalist.
Frankfurt represents a declarative/programmatic internationalism
“Internationally,” and in my mind, Samsung’s brand has, in rennet years, come to be totally synonymous with the mobile objects that accompany us in our most public and our most vulnerable moments, from intimacy to presentation. There are other actors in this space, but Samsung is unique in that it not only produces leading mobile devices that have the most competitive specs in the world, they also make many of the key components—like screens and memory chips—that power other brands’ products (like Apple). Personal communication devices are transformative tools that we are emotionally bound to, from purchase to abandonment. When I left New Zealand to live in Frankfurt in 2007 to attend the local art academy, Städelschule, it was the moment of the release of the vastly “disruptive” iPhone—in a way, a giant step towards Samsung’s international prominence as well as one of its fiercest challenges in the field. The release of the iPhone was a game changer for the mobile industry and, as it was produced with Samsung products, it would have surely provided a clear indication of direction for the field Samsung has since come to dominate. At that time, my phone and my computer became the most important public and private spaces I occupied: I could define the terms of interaction there. They also served as the main tools for my education and work.
Frankfurt provided me with a gateway to the world—and this is in part how I interpret the gesture of Lee Kun-hee staging the New Management Declaration here in 1993. With its massive airport (referred to several times in the Chairman’s writings from the time) and as the European financial centre, Frankfurt represents a symbolically “international” place. In fact, it seems significant in this respect that the declaration issued by Lee was one of several such “Frankfurt Declarations” to have historically occurred in the city: from the first freely-elected German Parliament hosted here in 1849 to the “Frankfurt Declaration” of the Socialist International (1951) to that of the World Evangelical Alliance (1970).
The research process for the exhibition was unusually long and had many moments of difficulty: it started in April 2013 when my closest conversation partner, Marta Fontolan, recommended Sam Grobart’s article from Bloomberg Businessweek called “Samsung’s Secret: How did the company that makes everything win at smartphones? Size—and the paranoia of Chairman Lee Kun Hee.” From page 58 of that issue, I found my first description of the Declaration, and the elite, Yongin-based Changjo Kwan Samsung Human Resources Development Center and the physical sublimation that occurred in the framing and mythologizing of the New Management principle. I read of exemplary objects and of compellingly transgressive “paranoia.” All of this, documented in a secret room in the very private Changjo Kwan; literally across the road from the conversely public Samsung-owned Everland amusement park, just south of Seoul. I knew that it contained a presentation table covered with a pink tablecloth that was once owned by the Kempinski Hotel Frankfurt Gravenbruch. I also knew that there was at least one oil painting depicting Venice also acquired from the hotel, and probably a timeline of events and quotes from the Declaration. So I found more information where I could: trawling Internet sites with keywords, reaching out to strangers. Excited, I also reached out to Samsung themselves, knowing my cultural understanding of South Korea at that moment was more than limited, asking for further information and access to the Frankfurt Room at Changjo Kwan. When the company was not forthcoming I consolidated what I could and imagined this space, these objects, this powerful pivot myth made physical. I made a trip to the relevant sites with Portikus’ Sophie von Olfers, where we turned up and explored what we could of the special places of this philosophy’s dissemination.
In Portikus one sees a fantastic conglomeration of material that tries to monumentalize this powerful cultural message; arranging imagined and remade objects around excerpts from Lee Kun-hee’s texts and Samsung’s history. I’ve tried to stay close to the context it describes: the global material language of corporate pride and presentation. I want the viewer to be able to breathe the air produced by the objects emerging from this philosophy—air conditioners branded with key phrases and concepts from the philosophy are among the reimagined relics of the philosophy’s inception. I have also tried to follow a “global” process for production, employing several translators, illustrators, and producers, often through new forums like freelancer.com and oDesk.com to help research, visualize, and fabricate my imagined Frankfurt Room: a loose workforce that spanned continents, Europe (Germany), Africa (Egypt, Tunisia), Asia (India, China, Korea), North America (Canada, USA). In so much as these global practices mirror the production networks of a truly global company, this process of production stays in the foreground of the exhibition.
Global space / philosophical objects
I have tried to use objects that seem to exist in a global space; a culture that might be related to by a generic everybody. All of us have use for incredible communication tools and interfaces to the world. All of us have a relationship to the devices in our pockets and backpacks. The tension between the Samsung tools we use and Samsung’s strong corporate ambitions is a dynamic that dominated my production task. In a way, the Frankfurt Declaration contains the origin story of these special objects, so some of the tone of the New Management must remain embedded in them. This exhibition is a product of a Frankfurt-educated New Zealander trying to understand the principles of one of the world’s leading technology companies and its pivot point in becoming the unqantifiable contributor it is to global material culture today. This is an exhibition documenting intense cultural ambition from the perspective of an international consumer.
2. The goal is the top-tier company of the 21st century.
“The quality of Samsung’s products is the face of Samsung.” In last June, Samsung confirmed the ‘management based on the quality’ and the ‘moral management’ to make the best quality as the first priority of the company. This is called ‘Frankfurt Manifesto.’
The ‘management based on the quality’ was defined as: “to be the top-tier company of the 21st century, we should internally maximize the synergy effect thinking that the basics and the quality are the first priority. Externally, we must not stop creating new values through the self-innovation in order to satisfy the customers.”
The core of the management based on the quality is the quality, the customer satisfaction and the basics. And then, the maximization of their synergy effect will be the key for being the top-tier company.
“In the past it was important to stay up all night to make one more product. But now, even though we produce less, we must make the best quality goods without any defects. The company will not work well if it produces goods without thinking the best quality.”
Like this, Lee Kun-hee insists the innovation of the quality stressing that we are selling the image and trust in the globalized world. Samsung was obsessed with the quantity of products and it was the crisis that Samsung had. To escape from this crisis, this condition should be fulfilled—‘transformation towards the best quality’.
According to Lee Kun-hee’s idea for the management based on the quality, we can understand about the bad quality in 3 types.
Firstly, it is the bad quality of products.
‘There is a product which 30000 workers can normally make one piece. However, in Samsung, 6000 workers produce 20000 pieces per day. A representative product of Samsung is a TV but its defect rate is 6 times higher than other developed companies.’ Although we exclude this economical inefficiency, the Samsung Group can lose the trust and good image. Therefore, producing bad quality goods was defined as ‘a cancer which make the company sick and as the criminality in management’.
To understand it better, we’d better observe the change of customer’s requirements. In the 60’s, a cheap price was important. In the 70’s, a good quality and in the 80’s various models, in the 90’s, a quick response and reaction to customers’.
Customers already started to ask good quality goods from the 70’s. If companies can’t fulfil their needs, the twill fail. Emphasizing the best quality is already a late tendency and no more bad quality products are now required absolutely.
Secondly, the business management focused on the quantity. It is the bad quality of management.
The management focused on the quantity will cause a vicious circle like this: ‘a excessive and unreasonable production for the achievement of target. – a lot of defects – a lot of stocks – a forced and unreasonable sales – customer’s dissatisfaction / weak credit – sales and profit decrease’.
Therefore, the transformation from the management for the quantity to the quality should be carried out. To do so, Lee Kun-hee thinks that some factories might shut down for a short period if we can make a good quality.
Lastly, we can talk about the bad quality of the morality and mind of Samsung people.
Lee Kun-hee thought that this was the most serious and primitive one of all other bad qualities. Why? He thinks that the two thirds of bad quality goods don’t come from the lack of capability of skill but from the bad morality and mind. There are three related things. —No responsibility, No interest, No participation. These 3 No-things appear because of the bad quality of the morality and mind. For Samsung, the elimination of these 3 types of the bad quality and the transformation of management towards the better quality are the first priority. The transformation of management towards the better quality is surely including the better life of each worker and the better quality work.
“What is the next of the quality? It is not the quantity but the scale. You are afraid now because the quantity will be reduced and it will lead to the decrease of sales and profit. However, if you have know-how to keep the best quality, the scale can be bigger. For example, we can expand our scale of business to other regional markets of the world, to Southeast Asia, North and South America. Make your scale bigger.”
This Lee Kun-hee’s ‘Scale Merit’ is a correct and proper alternative suggestion when we have to choose the quality of the quantity. It means that we have to conquer the world with a good quality.
The best of the best in the 21st century!
This is the Samsung’s goal in order to create great tomorrow of Samsung.
2. The Goal is the world-class enterprise in 21st century.
“The quality of Samsung Products is the face of Samsung.” Last June, Samsung confirmed their ‘quality oriented management’ and ‘ethic management’ through the Frankfurt conference, and chose a ‘Frankfurt Announcement’. The meaning of ‘quality oriented management is “A statement of putting the basic quality of the product on top of the priority list and make synergy effective, and continuously trying to satisfy all customers by self-reformation and creating new value to become the world-class enterprise in the 21st century.”
In other words, the focus on quality oriented management is quality, customer satisfaction, and the basics, and the synergy entering the world-class level. “Previously, the most important thing was making one more product, passing nights without any sleep. But now, we must make a product with no fault and as perfect as possible with the technologies we have, even if we are making only one product. If we ignore the quality, we won’t be able to run any of our businesses, because of a high product fault. rate.”
As you can see, Chairman Kunhee Lee emphasized that toad’s society seeks a trustworthy image and since the ‘quality’ determines that, we must bet everything we have on the innovation of quality. The baseline of crisis, which Samsung is in now, was the ‘obsession on the quantity of products’, and to overcome this crisis, Samsung decided what they need right now is ‘switching over to quality’.
According to Chairman Lee’s speech, the understanding of the failing of these enterprises is about ‘quality oriented management’ and can be divided into three cateogies.
First are faulty products.
‘6000 people were fixing 20,000 products a day, when the product was made by 30,000 people’ and the fault rate on Samsung TVs, which are one of the main home appliances Samsung makes, reached a 6 times higher rate than that of other advanced countries, which is just economically inefficient and gives Samsung a big strike against their image. Therefore making faulty products is considered ‘a rotten apple making the company look to be moth-eaten and it is a criminal act against the enterprise’.
To understand this correctly, one must be aware of the satisfaction of the customers change following the state of the time period: cheap prices in the 60s, good qualities in the 70s, variety of products in the 80s, and a fast response was asked in the 90s.
That said, the customers already wanted to have quality products starting in the 70s, and the company that wasn’t able to meet the satisfaction went out of business. So, actually, being quality oriented at a late stage, and the extermination of fault is a requirement.
Secondly, the quantity oriented business systems are another way of saying that it is the fault of the enterprise.
Quantity oriented thoughts, a mount oriented business system, repeating the vicious cycle of ‘forcing of making too many producets in order to meet the goal – too many faults – wasting stock of leftover products – customer complaints – insincere credit – sales and profit decrease’.
Therefore , now we need to change our thoughts from quantity oriented to quality oriented, from management for quantity to management for quality. And to achieve this, ‘the factory may close down’ for short term or period. This is Chairman Lee’s policy.
Third, is the wrongs of ethics and consciousness of Samsung employees.
Chairman Kun-hee Lee states that this is the most serious baseline problem they have. Because he looks at 2/3 of faults in products, which comes from their faulty ethics and consciousness, not from lack of skills and technology; and these are irresponsibility, indifference, and no participations.
Samsung considers eliminating those three faults, and switching over to quality oriented management as their top priority. And the quality we are talking about here, contains the maligning of quality management as well as the quality work and quality of individual’s humanity.
“What comes after quality? It is not quantity. It is the scale. Everyone feels anxious because they have no ideas on how big the scale is. Everyone says they are hesitating to switching over to quality oriented, because they are afraid everyhitng they have might go down. But if you know how with quality, the company can grow out to South-East Asia, South America, or North America, anywhere you want. Grow the scale of your company.”
These kind of Chairman Lee’s comments on scale merit is criticism on the understanding of thinking that there is a choice between quality and quality, along with the suggestion “Let’s conquer the world with quality”.
World-class enterprise in the 21st century!
This is Samsung’s goal to create a ‘Greater Tomorrow’.