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[Meet the CEO] Communication is key to brewery crown

OB CEO says distributors and employees to strengthen mutual trust

For Oriental Brewery Co., October 2011 is a month the nation’s No.1 beer maker cannot forget: It recaptured the title of top brewery by finally edging out its archrival Hite Jinro, which dominated the beer market for about 15 years.

Behind OB’s success, company officials agree, was an aggressive marketing push by CEO Jang In-soo, who was nicknamed by news media the “master of sales.”

Speaking in an interview with The Korea Herald last week, the 58-year-old CEO picked his “communication” with salespersons at local branches and dealers as the key strategy in retaking the nation’s title as the No. 1 best-selling brewer of beer.

While “communication” is a cliche among Korean business leaders, Jang’s communication skills are like none other.

The CEO stressed that successful communication comes paired with a comfortable work atmosphere ― a workplace that gives employees confidence and makes them welcome Mondays.

Jang said, “When employees were asked to submit sales goals in digits, they would bring up overly ambitious sales goals and ultimately suffocate themselves. Instead, I would tell them to look ahead and catch up to those ahead of us.”
CEO Jang In-soo. (Chung Hee-cho/The Korea Herald)
CEO Jang In-soo. (Chung Hee-cho/The Korea Herald)

After Jang took over the helm of OB’s sales marketing sector as executive vice president in February 2010, the firm achieved 2.3 trillion won ($2 billion) annual sales in 2012, marking two-digit growth. He became the company’s CEO in June last year.

He noted that OB’s outlook for 2013 is as promising as last year, since it reported two-digit growth in this year’s first quarterly report.

In contrast to the recent controversy surrounding large manufacturers’ alleged bullying of small wholesale dealers, OB was able to build a strong bond with its dealers, according to Jang.

“I would frankly tell liquor dealers that I am a high school graduate,” the CEO said.

“Then they get caught off guard and open up their minds. It helps them feel that we are equals,” he said.

Jang made it routine to make solo visits nationwide to liquor wholesale dealers, to have candid talks in a comfortable manner.

At the end of each month, he sends greeting text messages ― someting he started when he became CEO.

“I do so to make sure that they have my mobile number to call when they feel mistreated,” he said.

Jang said that he does not use English in the company, whose largest shareholder is Kohlberg Kravis Roberts, a global investment firm.

A large portion of frequently used terms in beer companies are in English, he said.

“Using difficult English terms can make local dealers feel alienated.”

The OB CEO acknowledged that there had been times when OB had communication blocks with some of the local liquor dealers, such as when OB employees rejected their requests citing the company’s principles.

Now, in such cases, OB employees tell the dealers that they will consult with the company’s managers once more to see if they can make an exception. This does not mean that the company always bends its principles to accept dealers’ requests, but it helps to strengthen mutual trust between the manufacturer and the dealers, he stressed.

About concerns that OB’s two largest shareholders, KKR and Affinity Partners, may sell the brewery, Jang said all signs point to that not occurring within the next 12 months ― if ever.

“In general terms, shareholders tend to signal a sale of the company about one year in advance, such as via investment cuts and slim-downs. There are no such signs right now,” he stressed.

Jang also commented on another controversial issue: The taste of South Korean beer.

He claimed that news reports that South Korean beers taste bad and dull is an ill-intended scheme of minor beer companies that seek a place in the Korean beer market.

“Liquor’s strength and taste follow the cultural code of that country. Vodka is the best-selling drink in Russia, but not in Korea,” he said.

He stressed that Korean beer products are typically mild in taste and scent because they are mostly served with meals.

But freshness was a chronic problem that beer firms had. The first thing that Jang pushed for was to shorten the distribution cycle of OB’s beer products.

“Changes are different from reforms. I do not ask employees for reforms. I ask for a small change at a time, because a gradual shift is more acceptable for everyone to follow,” he said.

CEO Profile

- Born in Suncheon, South Jeolla Province
- Graduated from Daekyung Commercial High School
- Joined Sampoong Trading Co.
- Joined Jinro Corp.
- Served as CEO of Hite Brewery Co.
- Worked as executive vice president at Oriental Brewery Co.
- Became CEO of Oriental Brewery Co.

By Chung Joo-won (joowonc@heraldcorp.com)
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