Addressing South Korea’s Business Development Challenges with SAP
South Korea has developed rapidly in recent years. No longer the agricultural economy of decades past, its technology-motivated, smartphone-wielding population has fueled the nation’s modern-day industrial economy. Despite these changes, however, the country’s technology startup ecosystem has yet to flourish as quickly or comprehensively as its government expected. This is due, in part, to the South Korea’s inability to attract international investors and corporations; technology incubators in South Korea are mostly domestic, unlike other global technology hubs, such as Silicon Valley or Singapore.
One exception to the country’s homogenous business demographic is international software market leader SAP, which houses its Korean branch in Seoul. Aware of the many ways in which South Korea’s startup scene could benefit from diversity, SAP’s corporate social responsibility (CSR) team set out to initiate projects that encourage both national and international social entrepreneurship. SAP realized that while the social entrepreneurs in South Korea had passion, they lacked access to tools that would help bring their ideas to fruition. With the Classes of 2019 and 2020 studying in Seoul for a semester, the CSR team saw an opportunity to apply what students have learned while living and learning in different global hubs, as well as their experience being part of Minerva’s diverse community, to support South Korea’s social entrepreneur ecosystem.
Understanding Entrepreneurial Difficulties
To kick-start their collaboration, Minerva students formed teams and were paired with a SAP staff member and social entrepreneur. Each team was tasked with using design thinking principles to develop an event prototype that would boost entrepreneurship in Seoul. To start, the teams conducted interviews with the social entrepreneurs to better understand business development difficulties in South Korea and to empathize with the needs of their users. Students found that one of their concerns was potentially being blindsided by fundamental complications due to their inexperience in social enterprise. For example, one entrepreneurial group had attempted to develop “smart” trucks to improve agricultural work. As it turned out, however, they tested the product on the wrong audience and were therefore unsure whether the product would even be desired by farmers, their target market. Theoretically, by testing a product with the target audience before creating it, the developers could more easily discover and solve for potential problems before bringing it to market. In their conversations with the entrepreneurs, student learned that though entrepreneurs were eager to carry out their ideas, they were overwhelmed by the prospect of testing their products. As a result, their progress was often delayed.
With these challenges in mind, the various teams set out to develop prototypes that would improve the entrepreneurs’ efficiency and efficacy. One group chose to develop a networking workshop focused on establishing a participant selection process that would help determine entrepreneurs who were likely to succeed. In order to do this, students first interviewed entrepreneurs to define the qualities successful entrepreneurs share. Then, they drew from their own experiences as global citizens from an array of cultural backgrounds to identify drive, practical empathy, and competence (measured by previous experience and knowledge of the specific field) as critical components of a successful entrepreneur. The team decided that the workshop’s target market would be early-stage entrepreneurs looking to launch their businesses. Once the prototype was complete, students presented their mock-up website — featuring their proposed workshop — and a series of questions designed for participants to use to calculate the probability that an entrepreneur would be successful. The presentation itself was a screening process for SAP; following all of the team presentations, they selected three students, each from different teams, to continue developing their prototypes into a working model.
The Power of Iteration
During the second half of the collaboration, students selected from the four original prototypes and began working toward creating an actual event for entrepreneurs to attend. The team decided to devise a workshop that would teach entrepreneurs an artificial intelligence-based problem-solving tool — means-end analysis — which enables users to break down a final goal into sequential project components. The students learned means-ends analysis during their Foundation Year Empirical Analyses class and modified the tool to meet the unique needs of their entrepreneurs. Generally, means-end analysis calls for a chronological sequence of steps. However, students discovered that entrepreneurial ventures often had parallel processes, so they amended the mechanism so that it would divide duties by roles — accounting, sales, and product development, for example — and then organize projects in chronological order within the various fields.
Students hypothesized that breaking down complex, large-scale problems into composite parts would enable the entrepreneurs to more easily generate manageable solutions. To teach the entrepreneurs the revised means-end analysis tool, the team created an informative guide that explained the tool and established a schedule of events for the workshop. Having defined their goal, the next challenge students faced was finding a way to describe the tool, as well as the goals for the workshop, to an audience who spoke a different language. After several iterations, the students finalized a prototype that was clear and concise with simplified, yet specific questions designed to invoke clear next steps for the entrepreneurs projects.
Visiting South Korea’s “Silicon Valley”
Before presenting the final workshop prototype to the entrepreneurs, students visited Jeju Island, informally known as the “Silicon Valley of South Korea.” In an effort to catalyze business development, the country’s government has invested a considerable amount of money in Jeju Island, hoping it will attract international tourists and enable companies to set up shop. The team visited the Jeju Social Economy Center, a government-financed social innovation hub, and learned about business incubation strategies from professionals. Next, they met with professors from Jeju University and learned more about design thinking with the Director of Corporate Social Responsibility at SAP Teddy Choi.
At Jeju, the team saw firsthand the effects and potential consequences of rapid development. One concern was the lack of input from local citizens throughout the development phase, an issue which mirrors those noted by an entrepreneur. Their visit to Jeju Island made one thing clear: while those pursuing a social venture may have good intentions, not including local residents who actually live in the environment that will be impacted can result in displacement and an unintended shift in culture. In the case of Jeju Island, a region that primarily comprises families dependent on farming and agriculture, the government’s sudden interest in technology initiatives were met with distrust.
Testing the Final Prototype
Tackling large-scale problems like creating a culture of entrepreneurship within a country is not something that can be accomplished overnight, or even in a single semester. Once students returned to the SAP office in Seoul they ran a trial workshop with a group of new entrepreneurs and introduced their refined means-analysis tool to the trial participants and SAP staff. The entrepreneurs stated that the tool was engaging, understandable, and, most importantly, useful. What is more, the team at SAP has decided to move forward with developing the tool and will continue to test and gauge its effectiveness on different types entrepreneurial groups, now that student have moved to their next city in the global rotation.