Korea Thinks Small

After spending five years as a construction-site manager at Korea's giant conglomerate Samsung, Chung Hwan Oak was used to giving orders, not taking them. So making sales calls for his new catering business was hard on his pride. After bowing deeply, Chung, 49, would pitch his hot-pot lunches--steaming vegetables with shrimp and fiery pepper sauce--then explain how he had lost his Samsung job. Often people slammed the door in his face. Those who listened didn't offer him a chair. The frosty treatment stung, but Chung knew that in status-conscious Korea, Samsung is at the top of the job heap, and catering is near the bottom. "Running a restaurant wasn't a respectable thing to do," says Chung. "The hardest part of shifting gears was dealing with my pride."

That was a year ago. Today customers are flocking to Chung as word spreads about his tasty food. Friends who once scoffed at his restaurant plans now seek his advice on how to set up their own catering enterprises. The definition of what is respectable in South Korea, until recently one of the world's greatest success stories, has changed fast since the economic collapse of December 1997 punched a hole in the Korean dream and created the country's worst recession in nearly 50 years.

Less than three years ago, South Korea joined the ranks of the world's most developed nations, and parents aspired to get their sons into white-collar jobs at such giant chaebol, or conglomerates, as Samsung that dominate the economy. More than a year of life under the yoke of a humiliating $58 billion bailout from the International Monetary Fund has crushed all that. A bright horizon of lifetime jobs and seemingly nonstop growth has suddenly dimmed. In its place: soaring unemployment, a more competitive role in the global economy and diminished expectations for a country that had worked hard for its place in the sun but had also been living beyond its means.

For South Korean President Kim Dae Jung, the crisis has also created an opportunity. Since taking office a year ago, Kim has launched one of the most ambitious economic makeovers any country has ever attempted. His aim is to transform a system built on debt, endless expansion and limitless export markets for industrial goods and consumer durables into a globally competitive economy that is as nimble as the rapidly changing marketplace demands. To make it work, he has placed his bets on creating a flexible, U.S.-style labor market in which companies are free to hire and fire as they please. He also needs people who are willing to adapt to new realities. Koreans like Chung "are breaking the old attitudes," Kim told TIME. "They have the frontier spirit."