“Merging Isn’t a Cure-All” ... Effectiveness of Public Home Shopping–HanYuwon Merger Under Scrutiny

[Financial News] As the government moves to restructure public institutions under the Ministry of SMEs and Startups with the stated aim of eliminating similar and overlapping functions, calls have emerged for a “joint review” to objectively assess the need for consolidation or functional separation. In particular, critics say a joint review must be guaranteed so the government’s restructuring plan can be revised or put on hold.
At a forum titled “What Is Consolidation or Separation For?—Problems with Public Institution Functional Reform as Seen on the Ground,” held on the 27th at the National Assembly Members’ Office Building in Yeouido, Seoul, Professor Chae Jun-ho of Jeonbuk National University (JBNU) emphasized that “procedural legitimacy and social consultation are needed in the process of the government’s functional reform.”
Professor Chae said that “because each institution has different functions and responsibilities, service recipients, and regional characteristics, the need for consolidation or functional separation must be objectively assessed.” He argued that “for meaningful labor-government consultation, a joint review must be conducted that allows not only for the government’s original proposal to remain unchanged, but also for it to be revised, put on hold, replaced, or withdrawn.”
The forum was organized to give labor unions at the institutions covered by the government’s plan for functional reform of public institutions, announced last September, an opportunity to directly explain problems with consolidation or separation and assess the impact on public services and people’s lives. Labor unions from eight institutions and sectors participated, including Public Home Shopping Co., Ltd., the Korea Employment and Labor Educational Institute, the Korea Copyright Protection Agency, the Institute for the Translation of Korean Classics, LH Korea Land and Housing Corporation, four port authorities, the National Airports Council, and the Korea National Oil Corporation.
The government is currently pursuing a plan to merge the Korea Small and Medium Venture Business Distribution Center with Public Home Shopping Co., Ltd. to establish a new “SME Marketing Promotion Corporation.” The plan is for a single institution to handle everything from identifying promising SMEs and products to commercialization, online and offline distribution, and actual sales. The two organizations have authorized headcounts of 379 at Public Home Shopping and 295 at HanYuwon, for a combined total of 674.
Until now, HanYuwon and Public Home Shopping have performed similar and overlapping functions in identifying promising SMEs and supporting product commercialization, while sales support has been divided across online and offline channels, as well as in-house and external channels. Critics say this has limited their ability to link product discovery with actual sales and other results in an integrated way.
Some argue that the restructuring is moving forward without adequate assessment of the effects of a merger. The Public Home Shopping union, in particular, is strongly opposing the plan, saying that “the two institutions have completely different founding purposes and core functions.”
Bae Ju-hyeon, chair of the Public Home Shopping union, said, “HanYuwon is an institution centered on policy programs and joint purchasing, whereas Public Home Shopping is a specialized distribution institution that identifies products, schedules broadcasts, and makes actual sales.” She expressed concern that “the public-service role of Public Home Shopping, which uses its own revenue to support market access for SMEs, farmers, and fishers, could be undermined.”
[email protected] Lee Ju-mi Reporter