The chief of one among South Korea’s homegrown software program corporations needs the Hancom model to turn out to be global. To obtain this, she is in search of the assistance of builders worldwide.
Hancom is a reputation ubiquitous to Koreans as Samsung and LG.
As one among South Korea’s oldest software program corporations, it’s recognized for its Hangul phrase processing utility, the nation’s reply to Microsoft Word. Hangul launched in 1989 and is until in the present day the second most used phrase processing utility behind the US firm. Hancom actually stands for “Korean and Computer.” As of 2021, Hancom was price round $350 million on the Korean inventory market.
Today, Hancom CEO Kim Yeonsu, has an bold purpose: to make the Hancom title ubiquitous exterior of South Korea as nicely.
“My desire is for every respectable software developer in the world to know Hancom, even before I meet them face-to-face when I go abroad,” she stated, who turned CEO of Hancom in August 2021 and is heiress-apparent to the enterprise group. She joined Hancom Group in 2012 and rose via the ranks to take up key govt positions, largely liable for mergers and acquisitions, in addition to administration of subsidiaries, earlier than taking the highest job of the group’s flagship.
According to Yeonsu, Hancom has began a shift from its earlier installation-based software program enterprise mannequin to a cloud-based, subscription service enterprise mannequin. The firm is providing its Hancom Office in software-as-a-service (SaaS) format, which is getting used increasingly by global audiences on a every day foundation, the CEO stated.
The South Korean software program firm has additionally been aggressive in acquisitions to broaden globally. Its Singapore-based subsidiary Hancom Alliance will full the acquisition of Taiwanese SaaS agency KDAN Mobile to broaden in North America, Europe and Asia. Hancom can be contemplating making a strategic funding in Southeast Asian HR SaaS firm Swingvy. “We plan to quickly expand in the global cloud market through acquisitions of promising SaaS companies like KDAN.”
“Hancom is currently valued at around 400 billion won; my goal is to increase this to 4 trillion won. I am confident that this can be achieved.” In her first-ever interview, completely with ZDNet, Yeonsu, soft-spoken but agency, was trustworthy about Hancom’s challenges forward, but additionally bullish when it got here to the way forward for the corporate.
A TABLE SET FOR DEVELOPERS
The CEO and her high executives are planning to participate in Mobile World Congress 2023 kicking off later this month. Yeonsu says she shall be searching for new enterprise alternatives and partnerships with builders.
And the principle providing shall be Hancom’s SDK, or software program improvement package, for all of the applied sciences and software program on Hancom Office, the corporate’s personal model of workplace suite that features Hangul phrase processor, spreadsheet, presentation, and PDF editor.
“Our strategy since last year can be summed up in one word, growth,” the CEO stated, “and collaboration with global developers is essential to that.” To use an analogy, Yeonsu stated Hancom shall be setting a desk full of varied meals for builders in North America and Europe to select every in accordance to their tastes.
“To go global, we realized that we can’t provide software packed with various functions that customers may or may not want. So we are splitting what we have into pieces of technologies so that the customers have the freedom to choose.”
Last 12 months, Hancom turned a shareholder of Taiwanese software program firm KDAN, which gives options for cellular PDF, e-signature, and animation. The Taiwanese agency additionally has its personal AI doc administration service that competes with Adobe Creative Cloud. “We have strength as an editor, but the different formats we are editing, from word to PDF, present different scenarios. Our expertise in the PDF format was relatively weaker. KDAN had that expertise in PDF.”
Approximately 80% of KDAN’s income and prospects are from North America and Europe, Yeonsu stated, offering Hancom with an entry level for these markets as a part of its global growth plan. KDAN, based in 2009, additionally has recorded over 100 million downloads for its app in Taiwan and is a well-established model there, she added, permitting Hancom to broaden there as nicely.
Hancom’s global growth will focus on North America and Europe as markets there typically have excessive spending in software program, the CEO stated. On the opposite hand, conventionally, Asian markets require plenty of customization from the software program supplier to match the native market, Yeonsu stated, which requires a comparatively massive native crew for system integration. “So we want to provide the technologies we have first, then find out what our customers’ needs are. That way, we can select the technologies that are suitable for further development which we can feel confident about.”
This blueprint for global growth largely stems from Yeonsu’s expertise from Hancom’s acquisition of Belgium-based PDF answer agency iText in 2015 and later promoting the corporate in 2018 to personal fairness Crescendo Equity Partners. After the sale, Yeonsu continued to handle iText as CEO and chair of the board for 3 years.
“During my tenure at iText, we tried to find a role in the Asian market as well. What we learned was that we couldn’t just sell the services of iText to these markets but needed to offer consulting services as well. So this experience shaped how I think a Korean software company should approach expanding globally. ‘We have these various technologies; this is our licensing policy,’ and help customers find what they need.”
Besides increasing overseas, by way of the South Korean market, Yeonsu stated that the corporate was searching for new enterprise alternatives by using the gathered knowledge from offering the Korean language phrase processor utility Hangul for 32 years. “For us this accumulated document, or data, is an asset. We are thinking of various scenarios, such as a comparison of how the Korean language was used in an older document to a more recent one. We also want to improve the Hangul format itself.”
This utilization of knowledge, which AI can help in, may be very a lot an ongoing homework for the CEO.”We provide an editor: a tool to document information in various formats, from word to PDF. Now more than ever, we are looking at our editor as a container of information.
“So one of many issues we take into consideration is how to extract what info and the way to apply it in order that we are able to clear up prospects’ issues. AI is likely one of the instruments we use for this, however AI or not, we predict extra by way of what worth the appliance of a selected know-how can present for the purchasers.” Yeonsu stressed that forming SDK collaboration with developers will also give Hancom access to more data.
CULTURE SHIFT
Yeonsu’s experience abroad and managing foreign companies has also shaped her management style. She sums up her own style as pragmatic and to the point. Her executives that I talked to described her as an entrepreneur who stresses the importance of overcoming challenges, freedom, quick decision-making, and personal responsibility. Communication seems to be one of Yeonsu’s top agendas: soon after she was nominated as CEO, in November 2021 Hancom sent its first shareholder letter.
Most Korean companies still are very hierarchical. Most employees call each other by their last names combined with their positions, which are usually given based on seniority and age. The Korean language also has honorifics, where someone talking to another that is older or of higher status uses special nouns and verb endings.
Hancom under Yeonsu has done away with much of this and employees call each other by their full names without their positions. Yeonsu herself is called Yeonsu by her subordinates. Employees use honorifics between each other regardless of position, which is considered more polite than not using any honorifics. This sets an atmosphere of respect for individuals but with boundaries.
“My experiences in North America and Europe have modified how I strategy convincing and changing into pleasant with folks,” the CEO said. “This can be the identical for my workers. When I negotiate with them, after I persuade workers to work with me, it’s actually about discovering widespread floor.”
Instead of a top-down structure, Yeonsu strongly prefers forming a consensus. “I believe how a lot consensus a purpose has throughout the firm correlates to how efficiently the purpose was achieved.”
Traditional Korean companies, similar to their counterparts in Japan and China, have also in the past demanded employees to put the good of the company before themselves, but this work culture has shifted tremendously around the past five years by the global debate over work as well as the pandemic, and Hancom has also been impacted by these societal trends.
“Since I began my profession in Korean corporations, I’ve additionally had the mentally of ‘every part for the job’ and anticipated the identical from colleagues prior to now. I now not strategy administration this manner.”
“Even earlier than I turned the CEO, there was a rift between the older era and the youthful era, culturally talking, and there have been efforts to bridge this hole by the corporate even earlier than I took the helm. So I might say the Hancom tradition in the present day was fashioned partly from my course and the pure evolution of notion about work in South Korea.”
But Yeonsu also stresses the importance of personal responsibility that each employee must have, if they want the so-called work and life balance. “The firm’s position is to set a transparent commonplace of method to the worker and between workers. Also, an organization should give clear roles and obligations to the person. But after that, it’s up to the person.”
“We have to take into consideration the top purpose. The finish purpose of setting a piece tradition is to talk and work higher collectively.”
Starting this year, Hancom is also planning to implement a new process where the company and employees on a mutually accepted goal that will be evaluated at year’s end. This process was tested in small units last year but will now be implemented in Hancom headquarters in South Korea.
When it comes to culture and HR, however, the CEO said this also needs to be based on where a certain operation is based. For example, Taiwan will have its own HR; South Korea its own as well; there will also need to be a Global HR, Yeonsu said.
Another change the CEO made was what Hancom’s own developers focus on and how they approach work. “In the previous, our personal builders largely targeted on applied sciences associated to Hangul. But to coincide with our growth, I’ve given them extra freedom to select and develop the applied sciences they need that in the end match our finish purpose of offering worth to prospects. Failure is OK, so long as there’s something we are able to be taught from it.”
“We have software program builders with many years of expertise. We have legacy property as a software program service supplier that operated for many years. I might say we’re but to totally make the most of these to their full potential and we’re at all times pondering of the way to achieve this.”
FOR THE ALLIANCE: MORE ACQUISITIONS
Yeonsu said that Hancom is preparing for more acquisitions of companies that fit into the company’s overall strategy. “You have to have a look at what you’ve as an organization earlier than you concentrate on acquisitions. What we’re good at and the place that may take us.”
The CEO also shared her thoughts on how she chooses candidates: “Most vital is the folks. Who I work with. I additionally keep away from corporations which are searching for a public sale.
“When it comes to acquisitions in the past, most of it came organically by our executives working well with their executives.”
Yeonsu stated after an acquisition, she provides clearly outlined roles between Hancom and the newly acquired firm. “Sometimes Hancom will be able to acquire a new arena from the acquired company. Sometimes Hancom will work with the acquired company to secure new arenas.”
“For example, KDAN will be using our Office SDK to launch a KDAN Office in Taiwan. We wrapped our office engine and gave it to KDAN, which added UI and UX that fit better with the local market.
Hancom set up a subsidiary called Hancom Alliance in Singapore last year in September, a company that will be looking for strategic investments and partnerships with companies like KDAN.
The Hancom Alliance brand will be subservient to the brand of acquired or partnered companies that are well established in their respective sectors, Yeonsu said. “I believe extra model worth is created from having a number of manufacturers, as a substitute of getting totally different manufacturers comply with one model,” CEO said, which is markedly different from most South Korean conglomerates that like to unify different companies under one brand, such as Hyundai or SK.
She also makes it clear that the profitability of a company is very important. “The software program sector generally will get plenty of enterprise capital funding. But to me, how enterprise capitals can spend money on corporations with huge losses is kind of frankly a thriller. I believe it comes from [them] at all times searching for the outlier of their perspective. In that sense, I suppose the margin price I would like from Hancom and the businesses it really works with could be perceived as above the market common.”
At the same time, Yeonsu says how she looks at profitability, revenue, and valuation overall is nuanced. “Revenue could also be excessive proper now for a corporation. But I believe we’ve to have a look at future profitability and progress. An organization with a great resume is not at all times worthwhile. Whatever the scenario is, an organization’s worth is decided I believe by the way it convinces its inside workers and exterior stakeholders of its visions and targets.”
The release of SDKs, the cultural shift, and acquisitions all have the end goal of propelling Hancom’s growth. “We are recognized for the Hangul Office in South Korea. I believe there have been many doubts about whether or not Hancom had room for progress.
“So what we are changing is selling our Office technologies, finding different values from the document solution we already posseses, and my job is to convince the internal staff that we can expand.
“In the previous, since most of our prospects got here from the general public sector, we had little incentive to discover out the wants of shoppers. But now our precedence is to discover out deeply and precisely the wants of our prospects. This will assist us construct a wholesome ecosystem round our SDK.”
…. to be continued
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