MANAGEMENT JOURNEY OF SAMSUNG ELECTRONIC COMPANY Essay Example

  • Category:
    Marketing
  • Document type:
    Research Paper
  • Level:
    Undergraduate
  • Page:
    3
  • Words:
    1936

Table of Contents

Background of the problem 3 I.

Objectives of the study 3 II.

Research questions 3 III.

Significance of the study 3 IV.

Literature review 3 V.

Methodology 3 VI.

References 4 VII.

  1. Background of the problem

Samsung electronics company, a Korea based company, which was once a manufacturing that evolved to become a known for exemplary product designs, and this study therefore focuses on the journey the company passed through to become what it is at me moment. This research paper therefore analyzes how Samsung electronics used design to create competitive advantage and differentiate itself. Likewise, the paper outlines the steps that the company took on the workers, systems and processes to improve its design capabilities. Therefore, the Samsung designs and the use of these designs towards realizing the competitive advantage.

Samsung like any other company in a business environment that is under the influence for the technological advancement, Samsung has proved its ability to make use of the advantage to produce innovative products that sales faster in the market without comprising cost and on the other hand, keeping the cost of the products at low. Samsung electronics encountered challenges both internally from its facilities and externally from its global partners.as a result, it strategy for innovation relied solely on the technological revolution which comprises of collaborating with the digital technology and improvement of the infrastructure of the company.

  1. Objectives of the study

  1. To find out the impact of the role of Jong- Yong Yun, the CEO, in the change process.
  2. To find out the criteria that Samsung employed to promote diffusion and innovation of ideas in the company.
  3. To find out the level to which Samsung is a learning organization.
  1. Research questions

  1. How significant was the role of Jong- Yong Yun in the change process?

  2. What criteria were used by Samsung to promote diffusion of ideas and innovation in the company?
  1. What is the level of Samsung as a learning organization?
  1. Significance of the study

Many organizations find it difficult to cope up with the technological advancement while maintaining their competitive advantage in the market producing innovative products at low cost and without compromising quality. This research focuses on Samsung Electronics Company and how it managed to cope up with the technological advancement to differentiate itself. The study therefor is a key light to the companies who are struggling in the markets that are heavily influenced by technological advancement, the methods they can employ, and the criteria they can use to save their organizations, by emulating Samsung Electronics Company. For future research, this study will provide the researchers with a foundation for carrying future research on differentiation and companies’ competitive advantage as far as technological advantage is concerned.

  1. Literature review

Managers play a vital role in the achievements of an organization they lead. Strategic planning by managers determines the success of an organization. The organizational structure and culture that managers use to run organizations determine the shape and the direction the organization takes. For the case of Samsung electronics company, the company underwent four strategic changes namely revolution, evolution, reconstruction and adaptation. The changes were either implemented suddenly or overtime which saw the success of the company (Balogun and Hailey, 1999).

Reconstruction is the drastic change that is likely characterized by confusion and regardless of a string paradigm shift on the manner an organization does its operations. It is a turnaround situation characterized with the need to for key cost cutting program and major structural change to deal with the dynamic market conditions and declining financial performance. Yun, the CEO of Samsung Electronics Company, together with his management team took control of the company by embracing steps that saw Samsung get out of its unstable financial position. As a result, Yun carried a reconstruction which led to about 30,000 employees being laid off (Dempsey et al. 2003). This was considered as a major cost cutting step to get the company out of debt. Also, Yun’s management team opted to close down some of the Samsung companies thus stopping the production in these companies for a while in order to get rid of the unsold inventory (Dempsey et al. 2003).

The closure and getting rid of the inventory saw Samsung get two billion dollars’ worth of business which was a significant future of the firm. The revenue helped Samsung to regain its losses something which the company was in dire need of. Besides, Yun had the intention of implementing a move that would differentiate Samsung from its competitors, and made the company to produce its own new products and not coping what was already in the market (Wrigley & Currah 2003). Product development to meet customers’ needs was the key emphasis of the CEO. Thus he decided to restructure how the company was doing business and he needed to see Samsung reach high levels where it would compete favorably with big companies. Following the restructure, Samsung underwent a design change where it shifted to an in-house design from poorly designed products (Baker & Sinkula1999).

To achieve his dreams for the company, Yun took another bigger step by recruiting new engineers and managers who developed considerable experience recruitment in the U.S. recruitment led to a major turnaround since it helped the company to start developing its own innovative products. Besides, the move saw the Samsung’s seniority based system being abolished and merit based system being embraced for the sake of the advancement of the company. The merit-based system was a good motivator to the employees since they could express their creativity and ideas freely. As a result, the company had a better relationship with its employees (Baker & Sinkula1999).

Moreover, Yun employed Eric Kim, a marketing whiz who improved the image of the company and its products in the market. On arriving to Samsung, Eric implemented key turnaround by changing Samsung’s way of advertising from various 55 agencies globally and grouped them under one firm (Wrigley & Currah 2003). This created a consistent brand globally for the products made by the company. His endeavor pulled Samsung from discount chains and took it’s a high specialty level. Likewise, the bureaucratic shift allowed Yun to make the massive investments in major technologies which made the company to produce more digital and advanced products.

Besides Yun’s impact, Samsung employed some methods to promote diffusion of ideas and innovation in the company (Brooke 2003). The first step Samsung made was to promote innovation when it decided to make its own products and not coping what its competitors were producing. The development of the new products by the company mad Yun believe that they would attract and impress customers because of the attractive design of the new products. Likewise, Yun reoriented the firm to and the recruitment of the new engineers and managers helped the company develop new capabilities.

With the aim of creating an incentive for new talents, the new engineers and managers underwent a four-week boot camp. In the process, Samsung’s seniority system was abolished and merit based system was embraced which motivated the new managers and engineers since it was an assurance that their innovativeness and ideas were not in vain (Baker & Sinkula1999). From the above efforts, the company started to impress customers in a big way through new designs. Besides, the close relationship that Samsung had with retailers enabled them to improve their designs to meeting customer needs by including the features that customers needed in the products. The link between Samsung and retailers was a key to the success of the company which made Samsung to be the bestselling electronics company since customers found what they needed in their products (Brooke 2003).

The new managers who had worked for Samsung’s competitors admitted that they had to go a few levels of bureaucracy for the product to win new approvals, marketing and budget plans, heightening their capabilities to seize opportunities. As a result, the company seized bureaucratic obstacles which led Yun to investment towards important technologies and permitted ne products’ design (Dempsey et al. 2003). The technological advancement attained by the company was a clear indication of hard work shown by manager engineers and designers who were frequently summoned by the Yun in the efforts to achieve the dreams of the company. Besides, Samsung Company created design centers where the designers were able to see how the customers used their products and were forced to finding a way to make the designs to meet customers’ needs. Their efforts were rewarded when the new designs were accepted by the customers something which motivated them because their innovativeness and ideas were a success (Wrigley & Currah 2003).

On the other hand, a learning organization is that which provides learning opportunities to its employees in the process of transforming itself (Pedler 1997). A learning organization develops because of pressure from the modern organizations. Thus the organization remains competitive in the market. Such an organization is characterized by Team Learning, System thinking, Personal Mastery Shared Vision (Senge 2000). Gilley and Maycunich (2000) argue that the approaches that Samsung used were aimed at promoting a learning organization. Today, modern learning organization is characterized by organizational culture which permits improvement in three areas which are: workforce, productivity, the performance of the business and its overall operation, is a continuous learning process (Dempsey et al. 2003).

Samsung mainly focused on productivity, profitability, and market share, and their good understanding of a learning organization, was critical in the success they attained. The idea of learning was also a key to the success of the company where employees are exposed to learning to the level of the company. As a result, Samsung established a six sigma academy to build the quality of teams and increase the problem solving techniques (Ruffa 2009). Besides, 3.6% of Samsung’s payroll is directed to the training and development of the employees while on the other hand keeping them motivated through incentives. As a consequence, Samsung has stood out to be the most innovative a competitive company in electronics industry exposing its workers o the latest technological advancements. Also, bringing in the right employees has helped the company achieve its success. Thus, Samsung is a learning organization because of its investment in its employees is its main focus (Wrigley & Currah 2003).

  1. Methodology

This research paper is going to employ a single case design to get an in-depth understand of how Samsung and other companies employ strategies to make them remain competitive in the industry. The research study will involve collecting a number of reliable secondary and primary materials will help in finding out the validity of the study.

  1. References

Baker, W.E., Sinkula, J.M. (1999), «The synergistic effect of market orientation and the learning organization on organizational performance», A Journal of the Academy of Marketing Science, Vol. 27 No.4, pp.411-27

Balogun.J and Hope Hailey.V, 1999, Exploring Strategic Changes, Prentice Hall

Barber, Ben, «South Korea’s Troubles Are Blamed on ‘Chaebols,’” A Washington Times, December 25, 1997.

Brooke, James, «Samsung Tries to Keep Outgrowing Economic Woes,” An International Herald Tribune, April 28, 2003.

Dempsey, Michael, «Jong-Yong Yun of Samsung Electronics, “A Financial Times, February 4, 2002.

Pedler, M., Burgogyne, J. and Boydell, T. 1997.A The Learning Company: A strategy for sustainable development. 2nd Ed. London; McGraw-Hill.

Peter Senge (1990), A the Fifth Discipline: The art and practice of the learning organization, Doubleday, New York, Page .105, 164

Ruffa Morato, A Company Case Studies Technorati Tags: A company case study, An Essay samples, September 30, 2009, retrieved 7 July, http://ivythesis.typepad.com/term_paper_topics/2008/09/sample-essay-sa.html

Wrigley, N., Currah, A. (2003), «The stresses of retail internationalization: lessons from Royal A hold’s experience in Latin America”, International Review of Retail, Distribution and Consumer Research, Vol. 13 No.3, pp.221-43.