Classwork # 3

Asturias, John Rey

Bierneza, Alexander Ray

Pastolero, Erick

1.) Give an overview of the short movie presentation on Samsung

The short movie presentation is all about the history of Samsung electronics. A South Korean Company
that is one of the world’s largest producers of electronic devices. Samsung specializes in the production
of a wide variety of consumer and industry electronics, including appliances, digital media devices,
semiconductors, memory chips, and integrated systems. It has become one of the most-recognizable
names in technology. Samsung was founded as a grocery trading store on March 1, 1938, by Lee Byung-
Chull. During the 1970s the company expanded its textile-manufacturing processes to cover the full line
of production from raw materials all the way to the end product to better compete in the textile
industry. New subsidiaries such as Samsung Heavy Industries, Samsung Shipbuilding, and Samsung
Precision Company were established. Also, during the same period, the company started to invest in the
heavy, chemical, and petrochemical industries, providing the company a promising growth path.
Samsung first entered the electronics industry in 1969 with several electronics-focused divisions their
first products were black-and-white televisions. During the 1970s the company began to export home
electronics products overseas. At that time Samsung was already a major manufacturer in Korea. The
late 1970s and early ’80s witnessed the rapid expansion of Samsung’s technology businesses. Separate
semiconductor and electronics branches were established, and in 1978 an aerospace division was
created. Samsung Data Systems was established in 1985 to serve businesses’ growing need for systems
development. That helped Samsung quickly become a leader in information technology services.
Samsung also created two research and development institutes that broadened the company’s
technology line into electronics, semiconductors, high-polymer chemicals, genetic engineering tools,
telecommunications, aerospace, and nanotechnology.

In the 1990s Samsung continued its expansion into the global electronics markets. The company
continued to make advancements on the technology and product-quality fronts, with a number of its
technology products ranging from semiconductors to computer-monitor and LCD screens climbing into
top-five positions in global market share.

The 2000s witnessed the birth of Samsung’s Galaxy smartphone series, which quickly not only became
the company’s most-praised product but also frequently topped annual lists of the best-selling
smartphones in the world. Since 2006, the company has been the top-selling global manufacturer of
televisions. Beginning in 2010, the Galaxy series expanded to tablet computers with the introduction of
the Galaxy Tab.
 2.) What do you think are the qualities of Samsung, as a business conglomerate, that made them
successful and thrive even up to this time and situation?

Samsung’s success in making this shift can be traced back to a single early decision to build design
competency in-house rather than import it. As we’ll describe, Samsung chose to create a committed,
resourceful corps of designers who figured out that they could manage the tensions and overcome
internal resistance by deploying the same tools that they use in pursuing innovation empathy,
visualization, and experimentation in the marketplace. The corps has helped institute policies and
structures that embed design thinking in all corporate functions and provide a framework for
reevaluating products in the face of dramatic technological change. Remaining vertically integrated is
definitely a challenge for Samsung to sustain the conglomerate. Samsung Company needs to focus more
on innovation and research and rather than following the trend, it should create the trend as a market
leader. Its leaders valued speed, scale, and reliability above all. Its marketers set prices and introduced
features according to what original-equipment manufacturers wanted. Its engineers built products to
meet prescribed price and performance requirements. At the end of the process designers would “skin”
the product makes it look nice. The few designers working for the company were dispersed in
engineering and new-product units, and individual designers followed the methods they preferred. In a
company that emphasized efficiency and engineering rigor, the designers had little status or influence.

Samsung needed expertise in design, which he believed would become “the ultimate battleground for
global competition in the 21st century.” He set out to create a design-focused culture that would
support world-class innovation. Its innovation process begins with research conducted by
multidisciplinary teams of designers, engineers, marketers, ethnographers, musicians, and writers who
search for users’ unmet needs and identify cultural, technological, and economic trends. The company
has built an impressive record on design, garnering more awards than any other company in recent
years. The bold designs of its televisions often defy conventional style. With its Galaxy Note series,
Samsung introduced a new category of smartphone the phablet which has been widely copied by
competitors. Design is now so much a part of its corporate DNA that top leaders rely on designers to
help visualize the future of the entire company. Samsung Electronics has invested a lot in its R&D and
the top management had been instrumental in bringing new talent and diverse leadership in the
organization by recruiting people from different organization and country. They have also up skilled the
employees by letting them learn best practices of different companies across the globe. This must have
created competencies in the organizations to understand different technology in a shortest possible
time. The company had also worked against inefficiencies in operations and had established integrated
manufacturing in its plants. This must have given the economies of scale and scope. The strategy of
following first and innovating second was a good approach when the company was growing. Now that it
has become a leader in consumer electronics brands and competing with companies like Apple Inc. how
such strategy can let them sustain in the business, to remain a market leader in the area of consumer
electronics, the company have to focus on innovation. Now, remaining vertically integrated makes the
organizational structure more complex.
3.) From a brand marketing perspective, what are the factors that have made Samsung into a global
brand?

To change its brand image, Samsung decided to associate itself with global sport events. In 1998, when
Seoul hosted the Olympics, Samsung became the official sponsor of the wireless technology to the
games. This move helped it boost its image worldwide. In 1999, Erick Kim (Kim), a Korean American
working with IBM, took over as the marketing head of Samsung. He focused on capturing the US retail
market for consumer electronic goods, such as TVs, washing machines and microwave ovens, through
partnerships with US retailing giants. Samsung entered into a partnership with Best Buy one of the top
US retailers. Best Buy executives conducted customer research to analyze consumer-buying behavior.

From the beginning, Samsung had to fight hard to change customers’ perceptions of it as a
manufacturer of cheap electronic goods. Starting in 1993, Samsung has adopted an aggressive branding
and advertising strategy. Samsung’s branding philosophy is built on five main pillars: innovation, cutting-
edge technology, world-class designs, recruiting the world’s best talents, and internal branding. For the
past five decades, Sony was the undisputed brand leader in the consumer electronics industry
worldwide before a period of rapid decline, which it is yet to exit. When Samsung began its branding
journey, one of its initial goals was to emulate Sony. Being a competitive industry, Samsung had to
capture customers’ attention by inventing innovative products, as Sony did with its Walkman and the
PlayStation when it launched in 1994. With standardized products and relatively short product life cycles
in the consumer electronics industry, Samsung Electronics wanted to put its innovation into building
new features, creating new appliance categories and usage. Samsung understood early that successful
and profitable innovation had to be constantly backed by superior technology and the best designs.
Samsung has invested heavily in R&D to churn out new technologies. In 2016, the EU Industrial R&D
Investment Scoreboard ranked Samsung as the top technology spender and second highest global
spender with USD 13 billion in R&D spends. In 2013, the company also announced an additional R&D
spends of USD 4.5 billion with five new R&D centers in its home country. Today, the company has over
50,000 people working in R&D globally, spreading out across its 42 global research facilities, including
R&D centers and design centers. The company is committed to invest at least 9% of its sales revenue
into R&D activities.