Absorption , Assimilation , and Diffusion of Imported Technology - A Case of a Machinery Company in Korea in the 1970

This article tells the story of a Korean machinery firm, which sought to absorb imported foreign technology, assimilate it and then diWse it in the 1970's to Korea. Through this story, the reader will gain an understanding of the political, social, and economic context in which Korean enterprises managed their businesses in a decade of rapid economic growth. This case will also illustrate the role that the Korean government played in assisting businesses in building up their competitive strength in order to make a positive and significant contribution to the growth of the national economy. The firm which will be examined was founded as the Chosun Machine Works in 1937 when Korea was still under Japanese occupation. During that era it produced industrial machines, mining equipment, and weapons such as artillery and small submarines. After Japan's retreat in 1945, the firm was nationalized by the Korean government and resumed production of industrial machines under government management and control. In 1968, the Korean government handed the company over to private hands. The new owners changed the name of the company to Hankook Machine Industrial Co., Ltd. (to be abbreviated as Hanki). Since 1968, the company has extended into several new business areas and diversified its main products aggressively. Despite its leading role in the machinery industry in Korea, however, the company experienced chronic deficits until 1975, primarily due to the result of i n ~ ~ c i e n t domestic demand for their products. In 1976, Daewoo Corporation, one of Korea's top five business