Korea must get over the fear of failure

Noh Junyong
The author is a professor at the KAIST Graduate School of Culture Technology and head of the Center for Ambitious Failure.

Korea has achieved spectacular growth. Since experiencing colonization by Japan and a war with North Korea, the country has been galloping ahead without taking a breather. Per capita GDP has passed $30,000, and the economy is in the global top 10. Korea’s president was invited to G7 summits in 2020 and 2021 to underscore the country’s changed status. The United Nations Conference on Trade and Development (Unctad) formally elevated South Korea from the emerging group of nations to the advanced category. The achievement is the result of the perseverance and hard work of the people. It is also related to Korea Inc.’s skill as a “fast follower,” choosing what it can excel in, adopting the new business and innovation and being good at it.

Limits of ‘fast follower’
Korea’s current technology and development focuses — semiconductors, artificial intelligence, electric vehicles, drones, metaverse and space rockets — all stem from the belief that the country must hurry in catching up with what developed economies are focused on. To narrow the gap in innovation, Korean companies work hard to learn and mimic their path. The phenomenon is not restricted to technological development. Government policy decisions and regulatory overhauls are also triggered by comparisons with advanced countries like the United States and those in Europe to argue for change. The strategy has helped Korea advance to the top 10 by taking a shortcut. Studying and emulating the successful cases in developed countries rarely fails.

As we look toward 2030, we are at the crossroads of outperforming others and jumping to the top five or even the top three. We must devise a new strategy to compete with bigger countries like the United States, China, Germany and Britain. We can hardly expect to outpace them if we chase after what they have done. We should not be content with the agility to fast match the frontrunners but act as a first mover to set exemplary models others envy and wish to follow. BTS and “Squid Game” have proven how Korean pop entertainment can become the best in the world.

To become a first mover, there are steps South Korea must take. It must allow for the freedom to fail, whether it be in technological development, decision-making in public policy or any new effort in society. It is unreasonable to expect a successful result when you take an unchartered path where there are no precedents or right answers. Korea must provide an environment where individuals can exercise their potential and creativity to their maximum and succeed in unimaginable ways instead of being taught to do well under a given framework and rules. A huge success can only come from fearless risk-taking. Dare-deviling is only possible when one does not fear failure.

The SpaceX Starship SN9 explodes into a fireball after a high altitude test flight from Boca Chica, Texas, on February 2, 2021. [REUTERS/YONHAP]

A world led by venture firms

A society must study various aspects in building a new approach towards failures. One is on starting a venture business. Korea’s economic development so far has been led by a select few big corporate names. But the future will be driven by venture enterprises with ingenious ideas, freedom and an adventurous spirit. KAIST and other universities have been encouraging faculty and students to start businesses based on their ideas and innovations instead of focusing on publication.

But if responsibility for the risk-taking is not shared in the promotion of start-ups, the move will only push zealous entrepreneurs into a corner. Who can boldly attempt a business with a radical idea if a business failure can destroy a person’s credit score? In Silicon Valley, 80 percent of start-ups end up in failure. But an entrepreneur who incorporates failures for new attempts and continues with the challenge is rewarded with a successful result. A business failure does not make one a failure in life. Business failure should be just a process in the creation of an enterprise. The experience and lessons in the process become valuable assets towards success. Enterprises must be encouraged to go on without the fear of failure, and social security must be enhanced to come to their protection and motivative them to try again.

The case of Jubilee Bank can be an example. When loans go delinquent at banks, the deferred payment is booked as a loss and resold to lower-tier lenders at cheaper rates. And the lenders buy the subordinated loans at just 1 to 10 percent of the original principal and go after borrowers to collect the principal as well as interest. Jubilee Bank buys the junk debt and writes it off to help debt-ridden borrowers return to normal lives. Loans can be deferred until a businessman can restart and afford to repay the debt.

The second aspect is on research. Korea’s success rate in research and development projects exceeds 95 percent. The data clearly imply that R&D projects with a high chance of success are favored and undertaken. The projects are designed for success from the start since a research team could be scorned for poor results, the institution for poor recruitment and oversight and the government for wasting taxpayer funds if the project ends in failure.

Downfalls are a key to success

In other words, research is pursued after setting a safe goal with good odds. A high R&D success rate therefore should be worried about — not encouraged — as a loss of opportunity in innovation. The future depends on innovative research that can awe the world. Only a precious few can succeed. An individual also may come upon an innovation after numerous attempts. To learn to ride a bike well, one must fall many times. Failures in the research process also can become strong assets and lessons. The ratio of research that can fail in commercialization must increase. Attempts that have never been taken by advanced countries also must be encouraged instead of merely following their cases.

At the same time, the implementation of regulations and rules should be flexible. Since inefficiency and corruption can be bred without regulation, policymakers went on making new regulations when facing new problems. There cannot be a perfect regulation for the past and future and for every environment. There is a limit to effective regulation. Exceptional cases breed faster in a fast-changing world. In the future society, there must be greater leeway to employ regulations creatively and flexibly according to the conditions instead of trying to fit a set of rules onto a world brimming with exceptional cases.

Society has lost faith in individual judgment. Failures from odd and poorly thought out efforts are not tolerated. If actions are taken according to the rules and order, liability over the results could lessen. When we sit across from a civil servant tending to our case, we often end up hearing that there is nothing the government can do, regardless of the understanding tone. Although regulations must be respected, things could turn out better if attempts are left to individual judgment and creativity. An unprecedented step taken upon one’s own judgment could end up in failure. But these cases could be studied to draw up better regulations.

SpaceX and repeated failures
Korea stands at the final stage of joining the front-running group of nations. The first step should be a change of perspective by the individual, society and government on failures. The discovery of America was in fact a failure as Columbus was searching for India.

The 3M Post-it we cannot do without was commercialized from a failed adhesive project. Nvidia developed the Tegra mobile processor to power the iPhone in 2007. The project flopped despite its superiority over Samsung Electronics and Qualcomm chips due to the bulkier size and low energy efficiency. But the Tegra project was revived in 2010 for autonomous vehicles. Elon Musk’s SpaceX went on testing rocket launches using used rockets and finally succeeded.

What looks like failure happens all the time. But instead of stigmatizing it, we need to regard the attempts in the context of progress towards success. When failures become commonplace, Korea would be making a leap towards the first-moving group.

Translation by the Korea JoongAng Daily staff.