Corporate Transformation

S T R A T E G Y – II

S T R A T E G Y – II

S T R A T E G Y – II

S T R A T E G Y – II

S T R A T E G Y – II

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Transformation

Corporate Transformation

Korean Air: Chairman/CEO

Yang-Ho Cho’s Radical

Transformation

A series of fatal accidents, coupled with

operational inefficiencies snowballed

Korean Air into troubled times. Then, at

the beginning of the 21st century, its CEO/

Chairman, Yang-Ho Cho undertook various

transformation initiatives - for instance,

improving service quality and safety

standards,

technology

integration,

upgrading pilot training, better business

focus; putting in place a professional

management team, improving corporate

image through sponsorship marketing, etc.

He gave a new corporate direction in the

form of '10,10,10' goal. However, Korean

Air is held up by a slew of challenges. Among

which are inefficiencies of - Chaebol system

of management, possible clash of its cargo

business with its own shipping company,

limited focus on the domestic market and

growing competition from LCCs. How

would Korean Air manage growth as a

family-owned conglomerate? The case

offers enriching scope for analysing a

family business’s turnaround strategies, with

all the legacy costs involved.

Pedagogical Objectives

• To discuss the (operational) dynamics

of Korean Chaebols - their influence/

effects on the country’s industrial sector

and the economy as a whole

• To analyse how family-owned businesses

manage the transition phase - from a

supplier-driven economy to a demanddriven economy

• To identify all the possible reasons for

Korean Air ’s turbulent times and

assessing whether they are controllable

or not

• To critically evaluate Korean Air ’s

transformation efforts - in terms of

growth, productivity and cost cuts,

especially the efficacy of '10,10,10' goal

in a family-run business

• To identify various challenges to Korean

Air in sustaining growth and finding ways

to overcome them....