What the Miracle on the Han can teach us about the power of infrastructure
South Korea is the 11th largest economy and the world’s most connected country. However, in 1953, when the Korean War ended, South Korea was in shambles with a per capita income of less than $100. Its capital city, Seoul, was in ruins, and food shortages were rampant.
How did South Korea go from one of the poorest countries in the world to the technological powerhouse it is today?
Infrastructure.
In 1962, General Park Chung-hee seized control of the government and launched an ambitious five-year plan for development. The strategy focused on adding and growing South Korean energy and agricultural industries, expanding roads, railways and ports, and investing in science and technology.
The path toward Korea’s transformation was steady, but not always smooth — the mid-90s brought a serious financial crisis. Cash reserves were low and stock values dropped by 75%, while unemployment rose to 6.8%. The country’s chaebols, moreover, weren’t the leaders in consumer innovation and industrial design they are today. Samsung and LG mostly concentrated on components and budget consumer electronics for second-tier markets.
Again, the country invested in infrastructure.
The government launched a moonshot-like plan to make the country a leader in high-speed broadband. Faster internet, the thinking went, would spur the development of new applications and services. It became known as the Miracle on the Han River, transforming Seoul, the capital city situated on the banks of the Han River, into a technology juggernaut. Personalized blogging, location-based services and social networks took root and grew faster than most everywhere else in the world. Samsung and LG, meanwhile, became innovation and market leaders in TVs, appliances and smartphones.
This story holds important lessons for those of us thinking about digital transformation. If you want to sustain a meaningful transformation, you must first establish an infrastructure. Digital transformation is enabled by, and is the result of, the simultaneous rising of technologies and trends.
A successful digital transformation is a continuous process, not an end goal or a single application.
As the Miracle on the Han shows us, when technological forces are combined with an infrastructure-first approach, the resulting transformation will fundamentally alter how we operate, execute and develop the products, services or value we deliver.
What is an infrastructure? It is a system for delivering a valuable resource — water, power, money, natural gas — to as many people as possible that can scale as rapidly and broadly as possible. It needs to be broadly dispersed and economical to use. Tapping into it should be easy, like turning on a faucet or flipping on a light switch, and require only a modicum of training. However, the back-end technology and services that make it possible might be complex, sophisticated and compelling.
A significant pillar for a successful digital transformation is a reliable infrastructure that spans the sources and destinations (or uses) of data. It requires adaptability of new and evolving sources and uses. Eventually, a successful infrastructure will be stretched by its very relevance. The power industry, for example, demonstrates the agility an infrastructure must accommodate — new, significant sources like renewables and new uses such as electric cars are shaking the industry.
An effective digital infrastructure enables digital agility, lowering the activation energy of incremental value, and that is the real key to continuous realization of value. Without an agile basis, the barriers for evolving, transforming and continuously adapting operations and business will remain high — reinventing the wheel with every new objective.
Establishing an agile data infrastructure is a critical and strategic key to realizing your digital transformation. Will it be easy? No, but the potential benefits are enormous. It’s something to think about when you’re driving home on the freeway tonight.
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