Korea wins the Nuclear power plant bid at United Arab Emirates – Part2


What were the reactions to the victory of Korea in the international bidding on nuclear plant contract?  Here are some examples which I have gathered through my local sources.

1.  ‘The result was no surprise, but certainly was shocking.  Nuclear power project is accumulation of SYSTEM in every sense, and that Korea proposed a lower price by 10% and has won the trust of UAE suggests the reality of decline in competitiveness of Japanese industry.  Japanese industries stressed in their presentation only its high techs and quality of appliances, without any comments on the safety control of government or how capable Tokyo Electric Company (giant electric producing house of Japan) is in running the system, which was a sharp contrast to the overall aggressive presentation of Frenh team. The difference of their view (an ‘easy way’ of thinking based on the faith on their technologies) apparently caused a miss-match between Japan and the expectations of the customer (Japan has neglected the importance of building network of ‘personal connections’, which takes time).  This sort of difference was such that I hear some leaders of UAE have actually given advice to Japanese top leaders about it.’

2. ‘Whole Korea worked on this, by contrast.  I feel that we have to send young people to overseas and invite foreign talents to Japan ? this is, in my view, the only way for Japanese to recognize how fast the world is changing.  In fact my company also lost a competition for a mega project at Abu Dhabi to a Korean company.  We absolutely have to make people more international minded- which I believe that this is the key to the success of management in the future.’

3. ‘This success was not only good for strengthening ties between Abu Dhabi and Korean electric company but also in other fields (semiconductors, ICT, energy (Masdar), education, etc.)’

4. ‘People say that Korea was outstanding in following 3 ways on this bidding of nuclear plant agreement, that in fact the proposal was the State of Art; 1) Competitive price, 2) Shortest construction period, 3) Offer of support for education and human resource development in nuclear energy field at UAE ‘

5. The President of Korea, worried about the situation, sent a large mission to UAE, including the President of KAIST as the core member. KUSTAR (Ref.1), was designated as the only university in UAE to offer courses in nuclear energy.  This opened the way for Korean Professors on nuclear energy to visit UAE, and students from UAE to study at KAIST.’

6. ‘Korea was trying to see things as Abu Dhabi would see: it perceived the needs of Abu Dhabi, what kind of cooperation it was looking for.  Korea understood that human resource development was the key to survival for Abu Dhabi.  This is why Korea won the heart of the Crown Prince.  I understand that the Crown Prince and the Korean President became close enough to have direct conversation by cell phone (reference is available on Chosun online, as I have introduced to you in my column, part1)’

7. ‘Also, responding to a remark that ‘Korea is unable to produce all necessary parts or components of the nuclear power plants, so it must order them to other countries’, Dr. Myung Seung Yang, President of Korea Atomic Energy Research Institute (KAERI) commented that ‘In shipbuilding and semiconductors also, we don’t make them 100% domestically, but import necessary technologies from overseas.  What is important is the fact that Korea possesses the ability to design, run, and maintain those systems as a whole and export them’.’

8. ‘In contrast, Japan was dwelling too much on the special performance of parts, praising self as the ‘excellence in manufacturing (‘monozukuri’) giant.’

9. ‘I see clearly how Korea attacked Abu Dhabi as one nation.  Korea, confident after winning this bid in UAE, is now moving forward to other markets such as Turkey or Southeast Asia.  President Lee has experience of working for a construction company, so he seems to have giving advices in makings of the plan presentation to be submitted to Abu Dhabi and helping staffs to polish it.’

In contrast, the leaders of Japan was busy with the domestic issues following the Administration change to new political party, so there may have been a huge difference in the level of support by the government.  You can use this as an excuse, if you would….PM Hatoyama visited India at the end of the year and announced that ‘Japan will support nuclear plants in India’ (who advised to say so?), but obviously it was a bit late to notice the trend.  I wonder what sort of outcomes this comment is going to produce in the future

In India also, Korean business people (in Japanese) (Ref.1 in English) are known for their hard work, so even if we do have some technologies on clean energies, this does not necessarily allow us to feel safe.

To share this experience at UAE among government and industries, analyze the reason for defeat (Dr. Ikujiro Nonaka is also point this out repeatedly,learning from failures…), make good plans for the next step, and act ? this is most important.  I am writing this column precisely for this reason.

Basically, current age is not of ‘just manufacturing ability (‘monozukuri’)’, but of‘the entire story telling (‘monogatari’)’. (in Japanese).  Also, the time has changed to ‘Demand ? driven’ innovation.