Nonghyup’s blunders

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Nonghyup’s blunders

The chairman of commercial bank Nonghyup, Choi Won-byeong, apologized to the bank’s 30 million account holders for the shutdown of its computer system and the prolonged delay in restoring services. “We apologize for the enormous inconvenience and disappointment to our clients,” Choi said in a press conference as he bowed deeply.

But what he said later was baffling and not befitting the head of a bank that serves nearly 60 percent of the country’s population. He told reporters that he was greatly shocked when he heard the report Tuesday afternoon and called the computer department.

The head of the department assured him that the system would be fixed overnight and would return to normal by the morning. He said that was what he believed. But customers still complained of problems. The bank is still struggling to find the cause of the breakdown.

What Choi intended to tell the reporters is hard to figure out. Was he trying to say he is only a figurehead in the organization or trying to avoid accountability? Either way, it’s hardly right for a chief executive of a major financial institution to say that he thoroughly believed some sanguine words from a department head. Choi added that he will investigate the incident to discover whether the fault lies with Nonghyup employees or a subcontractor - once again suggesting he has no responsibility in the matter.

But the accident does not look that simple. The shutdown was spurred by a delete command from a laptop computer that belonged to an employee of IBM Korea, the bank’s subcontractor for managing online services. But the head of Nonghyup’s IT department said there was no one in the bank who was authorized to make that order.

He said such authority lies with only a small number of staff at IBM and that he didn’t even know who they are. A major financial company gives authority over its core computer system to an outside firm? If that’s true, the bank has bigger troubles than computer glitches.

The real state of an organization is exposed when it is in a crisis. Nonghyup’s crisis management has been appalling. The bank will became a financial holding company with assets worth 230 trillion won by March next year, and will be the country’s fourth largest after KB, Woori, and Shinhan. It must start displaying leadership befitting to its status and role.
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