Cordata Gets a Seoul Man as CEO : Daewoo Trouble-Shooter Hopes to Put IBM-PC Clone-Maker Back on Track
The first proverb Hyo Bion Im says he learned in English was the one that says when in Rome to do as the Romans do. Now that he’s in Newbury Park, he says, he plans to do as the folks do here.
Im is the man the $8 billion-a-year South Korean industrial conglomerate Daewoo Group sent to the Conejo Valley community to run Cordata Technologies, a 6-year-old maker of IBM-compatible personal computers and laser printers that Daewoo controls. In the past two years Cordata has suffered badly in the computer industry slump.
Until four months ago Daewoo had let U.S. managers run the company, as is its typical style with the foreign companies it invests in. But in February, Im, 44, a 16-year Daewoo veteran and an executive managing director of the company’s planning and coordination division in Seoul, was picked to replace Daniel R. Carter as Cordata’s chief executive.
Cordata is still vague on why Carter was replaced. Carter, who could not be reached for comment, originally said he would stay on indefinitely as president, but two weeks later resigned for what he said were personal reasons.
Cordata Chairman Robert Harp, a founder of the company, said directors wanted to boost revenue and stimulate growth that had lagged in the industry slump. The private company won’t release its more recent annual sales numbers--two years ago officials said they were more than $50 million for the year ended Sept. 30, 1985.
Other Cordata executives described the relationship between Cordata and Daewoo as “tentative,” with frequent misunderstandings over shipping, manufacturing and delivery deadlines.
Im, who had no previous experience managing a computer company, seeks to portray his stewardship as uneventful and downplays any Korean-style influence over the company. His associates call him “H.B.” and he calls them “my guys.” Im says he only wants to run the company like any good American manager would.
“We have learned so much from American management,” he said. “I would not call any of my practice Korean style.”
Daewoo, whose name means “great universe,” is a classic multinational conglomerate and makes everything from textiles to computers and ships. The company has offices in 52 countries and is about to export a Korean-made Pontiac LeMans for General Motors.
How much Daewoo owns of Cordata today is a secret, although Cordata officials acknowledge that it is more than half. In addition, Daewoo has four of seven seats on Cordata’s board of directors.
“It can be said that in the past there might be a feeling of lack of communication between Daewoo and Cordata,” Im said.
One effect of Im’s appointment is that it has cut down on the number of visits made to Cordata by Daewoo Chairman Kim Woo Choong. In the 18 months before Im was installed as top man, Kim visited the company about 10 times. Since Im arrived, he has not visited.
“Do you know what that means?” Im asks. “He feels at ease.”
One of the reasons for Im’s arrival may be to help revive the company so it can go public. Cordata had intended to do so in 1983, Harp said, before it ran into problems getting parts for its computers.
Daewoo-controlled companies frequently go public, which enables Daewoo to recoup its original investment. Employees of Cordata who hold stock options are also eager to see Cordata go public, Harp said.
Monday, at the Comdex trade show in Atlanta, Cordata made the first major computer product announcement under Im’s stewardship. The company unveiled a competitor to the popular Model D, an IBM-compatible computer marketed by Leading Edge, which is based in Needham Heights, Massachusetts. With more than 250,000 units sold, the Model D ranks as one of the most popular of the so-called IBM “clones.”
Cordata’s version has the same $1,095 price as the basic Leading Edge model with two floppy disk drives. Ironically, the Model D is also made by Daewoo, albeit through a different division than the one making Cordata’s.
Stewart Alsop, editor of PC Letter in Redwood City, Calif., questions the decision by Daewoo and Cordata to sell a machine similar to the Leading Edge Model D.
“The PC business is kind of like a small town. Everybody talks to everybody else and people don’t like to have to compete with their own products,” Alsop said.
He said Leading Edge appears to be losing its market share, so Daewoo may want to shift its emphasis in the U.S. to Cordata. Another reason, Alsop said, is that relations between Daewoo and Leading Edge appear to be strained.
Leading Edge officials did not comment on the announcement, and Cordata executives downplay any direct competition with another Daewoo-made model.
“We’re really not competing with ourselves. If that were the case, Procter & Gamble wouldn’t have different brands of soap,” said Howard Levin, Cordata vice president of marketing. Im said Daewoo often makes a series of products that are similar.
Even though the personal computer business is coming back strong, there are still risks for Cordata. New product announcements are so common at Comdex that there is a waiting list for press conferences, and many of these new machines will take the technology a step further. Cordata is essentially unveiling a personal computer that lacks any new technology.
And, besides the usual price slashing, computer retailers are considering offering trade-ins to attract customers for new models. This could cause a glut of low-priced used equipment on the market and hurt sales of low-cost IBM computer clones.
Still, Im said he is determined to make Cordata less volatile by responding to the market faster than it has in the past, which he says will make it better able to withstand the shocks of industry slumps.
One of six children of a Seoul schoolteacher and his wife, Im grew up in poverty, he said, and experienced the turmoil of the Korean War when he was seven. He studied chemical engineering and business administration at Seoul National University, going to work for the Korean Development Bank before joining Daewoo.
Im views his stay at Cordata as temporary, possibly for only two years. At Daewoo, he said, managers frequently change jobs as part of what he calls Korea’s “sacrificing generation,” that is forming a bridge between the old, poor Korea and the new industrial nation.
“We have thought of ourselves as a generation that has to sacrifice ourselves for the next generation,” Im said. “Korea was a poor country and I remember the poor days. You cannot reject or deny a new assignment.”
