Identifying Corporate Strategy (Individual work) A. What are some of the business units (products) of Samsung? Samsung is a huge conglomerate that is well-known and respected globally. Its iconic brand is considered leader in its respective field in the industry. As a huge multi-national conglomerate, it consists of many business units or products with worldwide following and in the assignment excerpt, it mentioned some like first and foremost their flagship galaxy s4 and its previous series, the note, chips, displays and other technology.
Aside from what is mentioned in the excerpt, Samsung had a variety of technological product advancement like their own version of tablet, phablet, other phone models, laptops, appliances and a lot more products. The company also involves in manufacturing, most especially in smartphone components as detailed in the table and therefore not heavily dependent on outside source of supplies from other companies which I think one of the competitive advantages of Samsung. B. In your own words, described Samsung’s corporate strategy.
Samsung as a company is not best or well-known for pioneering certain products. They are not investing huge amount of money on something that they are uncertain or not sure of, but rather they want to hit what the consumer wants bulls eye. Samsung corporate strategy is always monitoring what competitors are doing or what others are cooking, and take note seriously the behaviour or response of the market and from there they pick-up the idea as to what will click to consumers. Samsung take action by mimicking that product and come up with a good and much better version.
This strategy saves a lot of time and money on doing market research on what product to launch and instead know right away where they will focus their energy and resources on R & D, and eventually produce superb quality at a very good price in comparison to competitors. Samsung corporate strategy had brought them into trouble like when Apple sued them for imitation issue and loss a big sum of money to pay for damages. However, it seems to be a calculated risk and for them a small price to pay compared to the renewed enthusiasm and curiosity of consumers to Samsung products. It gave irth to the new reputation of Samsung as a quality and innovative product that is now well known globally. C. How does Samsung’s corporate strategy impact the structure and financials of the organisation? Samsung corporate strategy is definitely very risky as it requires the company to redirect or realign their resources in order to meet the needed change in the company. The management seems to know what they are doing, and know from the start that in order for them to succeed in their corporate strategy, they have to heavily invest a huge amount of money on research and development.
True enough, Samsung spend more than doubled on R & D versus Apple, which is the world’s largest technology company by revenue. Samsung’s research spend is 5. 7% of its revenue, compared to 2. 4% for apple. In addition to this, Samsung also spend huge amount on massive advertisement all over the world. They are aware that they have a unique and innovative product that can compete with that of competitors but it definitely need the right marketing strategy so that they message will reach the consumers.
For example in the U. S. , where iPhone dominates, they increased their advertising budget five-fold, to $401 million from $78 million which is $68 million ahead of Apple and more than $200 million ahead of its nearest competitor in the Android market. Samsung’s heavy investment both on research and development and advertising has paid them off, reaping success from one product to another with Samsung scoring many points at Apple’s expense. D. In what way does the corporate strategy involve senior management?
Samsung is very much a Korean company and very hierarchical and dominated by its founding family. They play a very important role in company’s corporate strategy as they definitely have positive influence in the organisation. They can be at fault at something the company does, but not its ambition or commitment which can be attributed to its owners or senior management mission and vision for the company. For the past decades, it went from just beginning to invest in making batteries for digital devices and flash memory to being a global leader.
Samsung’s senior management perfectly know how to play the business game. They don’t just want to play but rather win it. They want to be the dominant player in the smartphone market, and they know they have the strategy in place, and will use all available tools and resources to achieve their goals and succeed. E. How do Samsung’s planners decide on future business? Samsung planners know perfectly well that to achieve dominance in Smartphone business is to deliver a product that is truly game-changing.
In order to attract Apple followers to Samsung , they need to innovate itself beyond marketing and bigger screen tactics. To realize this dream, Samsung is aggressively investing in Silicon Valley, with several campuses helping them to start to lead in software as it already does with hardware. F. How does the corporate strategy affect the shareholders? Samsung successful corporate strategy will have a positive financial impact or effect on its shareholders.
As it gained global acceptance and patronage, it impacted on company’s profit as well as shareholders. As the company continue to reap good sales record every month and every year, it reflects a good financial statement and therefore means a good return of investment to its shareholders. If the company will continue to perform well by producing new, unique and innovative products and manage by efficient and aggressive management team, investors will continue to come in and the company will exponentially grow.