[Viewpoint]A spy on the assembly line

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[Viewpoint]A spy on the assembly line

Lately, some people who work or used to work at a Korean automaker attempted to hand over assembly technologies to a Chinese company and were caught. The leaked technologies would have cost the Korean company 22 trillion won ($24 billion).
A person who used to work for a shipbuilder also tried to pass shipbuilding technology to China and was arrested. If the technology had been leaked, the loss would have been 35 trillion won over the next five years.
Industrial espionage was also attempted in flat panel display technology and the technology of semiconductors. The National Intelligence Service caught five illegal industrial espionage cases in 2002 and six in 2003. But the number increased to 26 in 2004, 29 in 2005 and 31 in 2006. In more than half of the cases, technology was headed for China.
An industrial spy collects manufacturing methods, business secrets, technology and information about management through illegal means and sells the data to other companies for his own profit. There is no doubt that an industrial spy is a criminal.
A single act of espionage creates a tremendous loss for the company that loses key information. But such espionage acts are done in secret, so they are hard to catch. It is more usual that a company’s workers, rather than outsiders, commit industrial espionage. But only a few Korean companies have a special unit in charge of security or have implemented special measures to protect core technologies and key information. Many companies believe they save money by not taking these precautions, but actually, they run the risk of losing all they have.
Company information is computerized and kept in a central place. This has increased how well protected it is.
But at the same time, the chances that data will be stolen have increased, too. The same amount of information that used to fill a large storage area in the past can be copied on a couple of CD-ROMs.
In a recent case of industrial espionage at a shipbuilding company, the data included 69 blueprints for vessels, including a mega-sized oil carrier and a liquid natural gas vessel, as well as a plan for a shipbuilding deck. Almost all the information needed to build ships was copied onto a single external hard disc and was ready to leave in the hands of the spy.
As the world economy is globalizing, companies compete more fiercely than ever. They pour an astronomical amount of money into research and development in order to develop core technologies. A company achieves its know-how over decades, and thus its value is priceless. If a rival company gets hold of this know-how, the company that has lost it is in deep trouble. It could be on the verge of going under.
Recently, Chinese companies have come close to Korean ones in terms of technology. If they obtain Korean companies’ core technologies, they can easily catch up with and overtake Korean companies by using cheap labor.
Since the financial crisis in the late 1990s, Korean corporate culture has changed drastically. There is no longer the expectation that companies will take care of their employees for their lifetimes. Colleagues in the same company are not very close. They have official and inhumane relations. Employees are barely committed or devoted to their companies. A worker has a long life after retirement that he or she alone must take responsibility for.
This pushes some workers who have access to a company’s core technologies or know-how to become industrial spies. It is tempting when a single act can bring an enormous fortune. The romance between potential spies and foreign companies seeking core technologies begins here.
Industrial espionage will become more widespread. In order to prevent spies from leaking technologies, the country must regard the leakage of technologies as a drain of the national wealth and thus prepare systemized measures against it.
Attention must be paid to security in venture capital companies, which usually have weak security systems. A law banning industrial espionage must be established and severe punishment must be levied for such acts so that people do not give in to the temptation of industrial espionage.
Companies must have a unit in charge of protecting their technologies and assets and not spare money in this job. They also must give better benefits to senior employees and retired workers.
We need to help our export markets establish measures to protect intellectual rights and punish industrial espionage. But even core technologies become widely known in the end when an item is released on the market and parts for the item are on sale. Thus, what’s most important is to speed up the development of new technologies to be ahead of foreign rivals.

*The writer is a senior researcher at the Korea Economic Research Institute. Translation by the JoongAng Daily staff.

by Park Seung-rok
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