Nicole Bornales

STRATEGIC MANAGEMENT I. Company Profile Samsung is a South Korean electronics manufacturer that is one of the world's largest. It produces a wide range of consumer and industrial electronics, including appliances, digital media devices, semiconductors, memory chips, and integrated systems, among other things. It has become one of the most well-known technological brands, accounting for almost a quarter of South Korea's total exports. Samsung's origins started in 1969, when the company was founded with the goal of assisting others. People accomplish the seemingly impossible. They're still innovating after more than 50 years, creating technology that breaks down old and new obstacles and enables people to achieve things they couldn't before. They continue to be driven by their mission, putting people and what they care about first. They put the customer at the core of all they do. Brief History Lee Byung-Chull, a South Korean businessman, launched Samsung as a supermarket trade enterprise in March 1938. In 1969, the business made its first push into the electronics sector with a black-and-white television. Soon after, the company began exporting its products and established itself as a significant electrical maker in its native country. In 1970, the firm purchased a 50% share in Korea Semiconductor. In the early 1980s, the company experienced fast growth and formed distinct subsidiaries for its numerous electronics industries. The corporation also invested in two research and development centers during this period, which helped it become the market leader in information technology services. By the 1990s, the business had risen to become one of the world's top five electronics manufacturers, with a focus on semiconductors, LCD screens, and other technology items. Samsung first entered the mobile phone market in 2000 with the release of a feature phone with a built-in camera capable of taking up to 20 photos at once. By late 2000, the firm had released numerous phones, but the Galaxy S series of smartphones, which used the company's OLED screen technology and hummingbird CPU, became its global success story. Apart from smartphones, Samsung is a significant supplier of tablet computers, particularly the Androidpowered Samsung Galaxy Tab-series, and is widely acknowledged as the inventor of the phablet category with its Samsung Galaxy Note-series devices. Samsung is now one of the world's leading electronic component makers. It is also a key provider of electronic components to firms like Apple, Sony, Nokia, and others, including batteries, semiconductors, processors, flash memory, and hard drives. Samsung has also been the world's top television manufacturer since 2006, and the world's leading smartphone manufacturer since 2011. In 2017, the firm surpassed Intel to become the world's largest semiconductor chip producer. Vision, Mission, Core Values Samsung’s vision statement is “to inspire the world with our innovative technologies, products, and design that enrich people’s lives and contribute to social prosperity by creating a new future.” The statement emphasizes the company's leading position and how it steers the market and improves people's lives through its products and services. The following features can be found in it: 1. Inspire the world: Samsung does not simply create items; it does them with a level of accuracy that inspires. It accomplishes this by being aware of global differences. As a result, it can personalize all of its products to match the demands of everyone, no matter where they are. 2. Innovative Technology: Samsung has set a goal to become the world's most innovative tech company. It has always made strategic decisions that are in line with the vision statement. To obtain a competitive advantage, Samsung welcomes emerging technology. Samsung's most recent adoption is to be environmentally friendly and offer environmentally friendly products. 3. Contributing to social prosperity: Samsung sees its presence in the electronic and other product markets as a critical opportunity to improve people's lives and relationships. Samsung regards simplicity of use as a must-have component in everything it makes, which is seen in the care and individual demands that the business considers when designing goods. This, in essence, enhances how individuals work, interact, and carry out our other societal responsibilities. Samsung’s mission statement is “We will devote our human resources and technology to create superior products and services, thereby contributing to a better global society.” The mission statement exhibits the following elements: 1. Devoted Human Resource Management: Samsung is a firm believer in the value of a welltrained human workforce. They have emphasized the development of human resources as a crucial predictor of growth over the years. Samsung maintains a nondiscriminatory work environment in which talented people can flourish and generate new opportunities. 2. Superior Quality and Customer Service: Samsung devises razor-sharp tactics for creating great products. They are zealous in their pursuit of new ideas and are quick to adapt. Samsung never compromises product quality or superiority in order to keep up with the competition on the battlefield. As a result, they strive to be the greatest on the market. 3. Improving Communities: Samsung demonstrates that it is concerned with more than simply the immediate client who benefits from its products. Samsung's first line of attack on the status of society is the production of products and services that satisfy their demands, but it also does more. "People, quality, change, honesty, and co-prosperity" are among Samsung's key principles/ Core values. Samsung has a rich culture in all of its facilities across the world, and they all follow similar and comparable methods. Everyone who has a direct or indirect relationship with Samsung is at the heart of the firm, and the company holds them in high regard and encourages everyone to do the same. One approach to do this is to sustain high-quality performance at all levels and in all activities while constantly seeking to inspire positive change. While delivering is vital, according to Samsung, honor must come first. Most importantly, Samsung advocates policies and practices that ensure that benefits are distributed equally and that no single organization profits solely. Instead, everyone gets a piece of the cake, assuring success for the company's employees, clients, and other stakeholders. II. EXTERNAL FACTORS Political- Samsung’s successor, Jay Lee, has been charged for 5 years for bribing the opposition leaders in the latest election. Samsung gave billions for the funding. The company was said to be involved in various political controversies (Freu, 2019). Economics- Samsung targets the developing countries compared to the first world market. This is because they want to establish a strong market position as a phone manufacturer that can deal with the economic standpoint of a certain country, which Apple does not practice. This gives Samsung an edge in underdeveloped economies. Socio-cultural- Samsung strategy is work from the inside. Before spreading into the global market, the company prioritizes expansion within the country. When dealing with multinational contracts, Samsung always runs a quick cultural study to see if their business will fit in the new environment. The most influential is the consumer preferences and lifestyle (Freu, 2019). Technological- Samsung deals with new innovation, but the remarkable failure in their technology is the unreliable battery in the Galaxy Note 7. In fact, 95% of the requests of units were cancelled, supposedly an amount of 5.3 billions was lost to Samsung. This was a problem to the company however, Samsung promised to improve their R&D team in developing better approach of producing quality phones (Lopez, 2019) Competitors- The main rival of Samsung is still Apple. Budding phone manufacturers such as Huawei, Oppo, Xiami are becoming a threat for the company. Samsung’s greatest opportunity, occupying 52% of the EFAS, is the growing mobile advertising industry. On the other hand, the main threat for Samsung is the changing customer habits (33% weighted score) which clearly they have no control over, but with its power to advertise more and with conviction, the company can influence this. 1. Political Stability Samsung is a household name in the electronics industry. It is critical for the organization to adhere to government rules, both new and old. Samsung's capacity to operate is partly dependent on political stability. Its expenses rise and profits fall without political stability. Political unrest also restricts the supply chain and product availability in retail shops. This type of political upheaval is extremely damaging to businesses and their financial success. The use of political turmoil has both benefited and harmed Samsung. Samsung is affiliated with two South Korean political parties and has experienced significant backlash as a result of its tight relationship with the country's first female president. They also gave the "Uri Party" billions of Korean won for the duration of the presidential campaign. On the other hand, they gave the other party billions of Korean won. As a result of this, the South Korean populace felt dissatisfied with Samsung's inclusion in the political system. The company's image was harmed in the eyes of consumers as a result of this flagrant deception. As a result of the uproar, Samsung's heir, Jay Y. Lee, was sentenced to five years in prison. Samsung's political activity harms the brand's reputation in the eyes of customers around the world. This restricts Samsung's global sales, and they also face restrictions in a number of countries. Germany, for example, has banned the sale of Galaxy tablets in the country as a result of the uproar. (THE FINANCIAL TIMES LTD, 2021). 2. Growing mobile advertising industry For the release of its Galaxy S6 phone, Samsung worked with Indian tech company InMobi to develop interactive ads. These ads created a personalized real-time battery identification mobile ad unit that displayed the product and service to a user with a demo on their phone when their battery levels were low. The mobile ad highlighted the new phone's "super fast charging capability" right when their battery was low, enticing them to upgrade to the new phone(Kenton,2021). 3. Innovation The research and development team of Samsung is always working hard to come up with innovative ideas. The company can use this opportunity to control the marketplace by developing dynamic products like the recently launched “Foldable phone”. If the trend can be created and quality can be enhanced, Samsung can easily triumph over other manufacturers(Davis, 2021). 4. Diversification and Acquisitions The extensive product portfolio of Samsung which includes apparels, automotive, solid state drives, telecommunications equipment, chemicals, consumer electronics, electronic equipment, medical equipment, home appliances, semiconductors and electronic components speaks volumes about Samsung’s diversification strategy. Historically, Samsung has diversified into different businesses upon spotting an opportunity with growth potential in different regions in the world. Due to Samsung’s diversification strategy, Samsung has an extensive product and service portfolio under the Samsung brand operating all over the globe(Saxena,2019). Samsung has made 38 acquisitions and 47 investments. The company has spent over $ 17.53B for the acquisitions. Samsung has invested in multiple sectors such as Display Technology, Energy Efficiency Tech, Imaging Diagnostics and more.(Tracxn, 2021) It is critical that Samsung avoids the mistake of being limited to just one marketplace. It not only invites risks from an economic perspective, but it also attracts unwanted political polarization and negative media publicity. That’s why there is a business vacuum present in the Asian and European economies in which Samsung can thrive. It needs to expand its customer base as well. It can only be achieved through diversification and acquisitions of other businesses. Samsung is a popular brand and can generate impressive revenues thanks to its financial standing(Business Strategy Hub, 2020). 5. Rapid technological change Every product sold by them has high technology. Every couple of years, the organization periodically upgrades current items. Regarding a critical production project error from Samsung Galaxy Note 7, the company watched their exploding cell phones after launching in 2016. The batteries inside Samsung Galaxy Note 7 were unreliable and quickly overheated, leading them to burst. This was a catastrophe, Samsung states over 95% of the requests in the United States were returned. It was an estimated recall of more than 2 million smartphones that would cost Samsung 5.3 billion (Lopez, 2017). 6. Strong Competitors The main competitor of Samsung is Apple. But newer Chinese brands like Xiaomi and Huawei are rapidly progressing in the marketplace. These new companies are manufacturing and selling smartphones at a much cheaper price than Samsung which may become a matter of concern. On the contrary, though Apple is not providing cheaper products, its marketing policy is trying to make a better impression on the market than Samsung(Davis, 2021). 7. Changing Customer Habits Recent events have catalyzed uncertainty in the global market and led to a decline in new smartphone sales by 20.2% in Q1 of 2020. Financial struggles have forced many consumers to seek recycled or refurbished phones, which has increased by 24%. Samsung has already experienced a decline in sales, and it can drop further if uncertainty persists(Business Strategy Hub, 2020). 8. Impact of Pandemic This is the time of pandemics. Samsung is one of the leading companies in the consumer goods department. Even though this pandemic has failed to make any big impact on the sales figure, that does not mean that the magnitude of the situation is any less. This pandemic has affected the manufacturing, distribution, and purchasing of Samsung products. This has fueled major changes in Samsung’s business strategies (Davis, 2021). III. Table : Internal Factor Analysis Summary (IFAS) of SAMSUNG Company Samsung has a weighted score of 3.92. It can be perceived that Samsung edge is its Creativity with a rating of 5 (55% weighted score), however its product failures and limited global managing ability received 3 in rating (0.3 and 0.18 respective weighted scores) and evidently affected its overall performance. STRENGTHS Creativity Samsung Electronics earned 48 prizes at the prestigious International Design Excellence Awards (IDEA) 2021, including seven Silvers, three Bronzes, and 38 finalists, according to the company. Samsung's IDEA 2021 awards encompass inventive ideas in a variety of categories, highlighting the company's competence in consumer lifestyle design, from product design to interactive and advanced concept design. The Industrial Designers Society of America has presented IDEA every year since 1980. IDEA, widely regarded as North America's most prominent design awards program, selects honorees based on design innovation, user benefit, and societal benefit, among other factors (SAMSUNG NEWSROOM, 2021). Promotion Knowledge Advertising, it argues, is the most effective way to engage potential customers and position the business. Samsung uses newspapers and digital media to market new goods. To take advantage of celebrities' large followings, the brand has invited a number of celebrities to serve as brand ambassadors and market the product. Highways are adorned with large hoardings and posters. Through social media networks, digital marketing, and online adverts, the company has a strong online presence. Samsung uses a variety of promotional strategies in addition to advertising to persuade customers to purchase the product. Samsung is well-known for its product quality and user experience, but it is also well-known for being a major event sponsor. Samsung is also a key event sponsor. During national festivals, Samsung offers significant discounts (MBA Skool Team,2021). Strong global brand tied to consumer electronics Samsung was rated fifth in the Best Worldwide Brands list released by the global consulting firm Interbrand on October 20 (local time), with a brand value of USD 74.6 billion, up 20% over last year. The company's brand worth increased by 20% this year, twice the average brand value growth rate among the top 100 brands in 2021, thanks to its solid financial performance, which has recovered to pre-pandemic levels. Samsung has retained its position in the top five for two years in a row, with the highest gain in brand value since 2013 (Samsung Electronics Co.,2021). Strategic Partnerships The South Korean multinational electronics company also introduced its latest Galaxy Watch at Mobile World Congress (MWC) 2021, which will be officially launched later this year. Samsung and Microsoft strengthened their strategic relationship last year to provide consumers with unified experiences across their mobile devices. Microsoft and Samsung have a long history of partnership and innovation, with Microsoft solutions being integrated into some mobile devices to allow customers to operate seamlessly between their smartphones and Windows PCs. In terms of Samsung's cooperation with Google, the two firms partnered to create "Wear OS," an operating system for Samsung's Galaxy Watch devices that integrates Google's technology with Samsung's Tizen wearable operating system. The new wristwatch will be the first to use One UI, a new unified platform developed in collaboration with Google that promises improved performance and a more seamless interface between the wearable device and Android handsets. "We're leveraging our long tradition of mobile advancements and our partnerships with trusted industry leaders who have developed alongside us in our open ecosystem to unlock the full potential of these wearables," Chomet explained. "Through these efforts, we will improve our smartwatch experience and the Galaxy ecosystem's ease for our customers." The unified platform will enable additional features and connections with popular third-party apps that can be downloaded directly to a user's Galaxy Watch through Google Play. "Samsung and Google have a long history of collaboration, and whenever we've worked together, the experience for our consumers has been dramatically better for everyone," says Samsung. That certainly holds true for the new, unified platform, which will debut on Samsung's new Galaxy Watch for the first time; longer battery life, quicker performance, and a wide choice of apps, including many from Google, to a whole new wearable experience in conjunction with Samsung." (Sibahle Malinga, 2021) WEAKNESSES Product failure- The decline of sales in Samsung’s smartphone demand could be still related in their product failure way back in 2016. A customer using the Samsung Galaxy A20 whose life was endangered while inside the airplane. The disturbance of the whole flight was because the A20 exploded. This directly affected the sales of the succeeding new phone models. The latest product failure is their foldable phone. Low-end Smartphone- In terms of high-end phones, Apple is the leading phone brand, but when it comes to low-end Samsung has been a key player in providing customers with budget-friendly phones. However, Samsung was too dependent on this area that limits their potential to produce more innovative products. From 71 million market share, the decline went at 55 million. Encounters in managing global employees- the diversification in labor causes problems in the value chain of Samsung. Company’s main manufacturing practices in Korea cannot be observed in other manufacturing companies. There are cultural hindrances, but was resolved later. Although the solution was implemented. The problem has caused delays in their operation. High strain employees- In 2018, Samsung was honest enough to apologize for its failure to provide a healthy environment for its workers. There were cases of illness and deaths within the factory’s vicinity. Samsung provided compensation for the bereaved families and provided medical assistance as well. The president Kinam Kim sincerely apologized for the incident. This raises speculations and rumors have affected the public image of Samsung. IV. A. TOWS Matrix Samsung TOWS Matrix INTERNAL FACTORS( IFAS) Strengths (S) Weaknesses (W) S1 Creativity S2 Promotion knowledge S3 Strong global brand tied to consumer electronics S4 Positive Employee W1 Failures of Products W2 Low-end Smartphone Dependence W3 Encounters in managing global organizations are limited. W4 High strain employees Opportunities (O) SO Strategies O1 Political Stability Utilize the creation of collaborative work and promotion between different products offered. (S1, S2, O1, O3, O4) WO Strategies To increase customer satisfaction, a section dedicated to recalls and product warranties was established. (W1, W3, W4, O1, O2) Highlight cutting edge technology and Boost sales of Samsung and related products by using internet advertising (O2, O3, S1, S2, S3, ) The worldwide management system may be improved with the aid of technology improvements. (W1, W3, W4, O1, O2, O3, O4) Because Samsung offers product variety, it will be able to meet shifting customer expectations as their lifestyles change with the use of various goods. (S1, O4) Global expansion or expansion and active presence into more countries in Europe, North and South America. (W3, O1, O2, O4) EXTERNAL FACTORS (EFAS) O2 Growing mobile advertising industries O3 Innovation O4 Diversification and Acquisitions Threats (T) T1 Rapid technological change T2 Strong competitors ST Strategies Samsung will be ready to surpass the obstacle given by companies providing identical items at a lower price by diversifying its product offerings. (T1, T2, T3, S1, S2, S3) WT Strategies Labor stress may be lowered with good training, which will aid in overcoming the high level of competition. (W3, W4,T1, T2, T3, T4) There is product differentiation, and Samsung sees this as a chance to reach out to a diverse range of customers. (T2, T3, S1, S2, S3) Consistent brand advertising will increase brand recognition and product demand. (W2,T1, T3) T3 Changing customer habit T4 Impact of pandemic Samsung will be willing to surmount competitive pressure with the use of technological product improvements even in this times of pandemic (T1, T2, T3, T4 S1, S3) Make significant investments in technology to keep ahead of the competition and establish yourself as a market leader. (W1, W2, W3,T1, T2, T3, T4) TOWS Matrix Table B. Goals ● Further increase market share ● Have more interactions / engagement with the general public and target market ● Stay Significant in terms of brand reputation ● Be a leader in using cutting edge technology and manufacturing devices C. Objectives ● Increase sales by 10% every year ● Have constant online presence with regular content creation (at least 12 videos/ content a month) to increase social media presence and engagement. ● Create impactful and powerful advertisements ● Creation of up to date gadgets and observation of trends D. Course of Action Create a joint effort to produce equality advertisements and deliberate about modern technology and novel concepts. To increase sales, Samsung will maximize its advertising and marketing efforts. Samsung has an edge on partnering with top electronic manufacturers (S3). Improve the content of advertising evoking more on emotional experiences while using the products rather than focusing on the innovation. To have a constant online presence, influencers will be the main endorsers. The selection of the influencers will be based on the activeness of their online interactions and number of followers on social media. In terms of improvement on advertisement, Tiktok has been the most reliable app in spreading information. Advertisements on Tiktok will be made. Samsung will also create a Tiktok content competition that aims to know how Samsung changed the lives of the user. Instagram advertisements will also be one of the goals. Samsung will further strengthen the R&D and will lessen its dependence to low-end units. The company needs to reflect on one component of Vision that promotes innovation in the products. Samsung cannot be complacent in this age of advancement. New products will be a great way to provide opportunities to the business and bring back its image of technological superiority during its peak of Galaxy series way back 2012. E. Metric/ Key Performance Indicator KPI Innovation Introduction of 4 new products in 2021 Interaction 17% Increase of social media interaction and followers in the past quarter due to new content Sales 10% increase in sales from last year’s record References ● Peter BondarenKo.,Britannica (2021, October 01).SamsungSouth Korean company/Fast facts retrieved from https://www.britannica.com/topic/Samsung-Electronics ● Business Standard Pvt Ltd (2021).SAMSUNG retrieved from https://www.business-standard.com/about/whatis-samsung ● Samsung (2021).Brand identity retrieved from https://www.samsung.com/levant/about-us/company-info/ ● THE FINANCIAL TIMES LTD (2021).Samsung’s biggest challenge: ‘The Lee family has to reform’ retrieved from https://www.ft.com/content/8035a965-19fb-4b6f-88ca-d301073d0e38 ● Lopez, M. (2017). Samsung Explains Note 7 Battery Explosions, And Turns Crisis Into Opportunity. 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(2021, Oct 21).Samsung Electronics Solidifies Its Brand Value with Top-Five Ranking in Interbrand’s Best Global Brands 2021 Retrieved from https://www.samsung.com/nz/news/local/samsung-top-five-best-global-brands-2021/ ● Samsung Newsroom (2021, OCTOBER 06).Fostering a diverse culture to create a better future retrieved from https://news.samsung.com/us/celebrating-people-global-diversity-awareness-month/ ● SAMSUNGMOBILEPRESS (2021).SAMSUNG https://www.samsung.com/global/galaxy/security/ PRIVACY POLICY HIGHLIGHTS retrieved from ● Brand Finance Global (2021, January 26).Brand Finance Global- - Asia’s Most Valuable Brand retrieved from https://brandfinance.com/press-releases/brand-finance-global--asias-most-valuablebrand-samsungs-brand-value-breaks-us100-billion-mark-for-the-first-time ● Samsung Newsroom.korea, (2021, JULY 29).Samsung Electronics Announces Second Quarter 2021 Results retrieved from https://news.samsung.com/global/samsung-electronics-announces-second-quarter-2021- results ○ Samsung Newsroom.korea, (2021,October 26).Samsung Electronics Announces Third Quarter 2021 Results retrieved from https://news.samsung.com/global/samsung-electronics-announces-3q-2021results ○ ● Samsung Newsroom, USA (2021, October 07).Samsung Foundry Innovations Power the Future of Big Data, AI/ML and Smart, Connected Devices retrieved from https://news.samsung.com/global/samsung-foundryinnovations-power-the-future-of-big-data-ai-ml-and-smart-connected-devices ● Sibahle Malinga (2021, June 29).MWC 2021: Samsung bolsters partnerships with Google, Microsoft retrieved from https://www.itweb.co.za/content/GxwQDM1Z6pYqlPVo Name Contributions Irene Nicole Bornales Company Profile, Data or informations (IFAS), Strengths Angela Garbin IFAS table Ariza Joy Cardeño Data or informations (EFAS), External Factors(Opportunities & Threats) Trisha Mira Weaknesses, TOWS, Goals, Objectives, KPI Patrick Nacario EFAS table, IFAS table, Course of Action Justine Perrera TOWS matrix