Samsung The fast Adoption StrategyMohammad Aminul Islam11103812COLOGNE UNIVERSITY OF APPLIED SCIENCES

Company Profile

• Founded :1938

• Founder :Lee Byung-chul

• Headquarters :Seoul, South Korea

• Area served :Worldwide Key people

• Products : Apparel, chemicals, consumer electronics, electronic components, medical equipment, semiconductors, ships, telecommunications equipment Services Advertising, construction, entertainment, financial services, hospitality, information and communications technology, medical and health care services, retail, shipbuilding

• Revenue : US$ 305 billion (2014)

• Net income :US$ 22.1 billion (2014)

• Total assets :US$ 529.5 billion (2014)

• Total equity :US$ 231.2 billion (2014)

• Number of employees : 489,000 (2014)

Introduction• Samsung’s unlikely success in mixing Western best

practices with an essentially Japanese business system holds powerful lessons for today’s emerging giants.

• Samsung introduce new business model which in the combination of Western and Japanese business system

• Samsung introduce merit pay and promotion

• To grub the global business hire foreign talents in the organization and send native talent to foreign countries.

The rising history

• In 1938, Samsung group was the largest corporate entity in south Korea

• In 1987, Samsung group was the leader in Korea most of its product but overseas it was not popular for Japanese electronics market.

• In 1990, when market changing from analog to digital ,Samsung found an opportunity to grab it by using new innovation.

• In 1993, Samsung launched new management initiative to import west best practice to strategy formation, talent management and compensation in their existing business model. It is called Hybrid Management System.

• In 2004, world´s second most profitable manufacturer behind Toyota.

• In 2010, Samsung rose to number 19 on the 2010 Inter brand global ranking, with a value of $19.5 billion

Market Share

• Global Market Share– Top market share in DRAM and mobile AP

markets

• Samsung share in smart phones was only 3.7% in 2009 but has dramatically increased to 19.9%, giving Samsung Electronics the top market share

Market Share

• Division Market Share

Samsung Hybrid Management System

HybridClick here

Strategy: Bringing outsider in

• In 1983, Recruite ethnic koreans engineers and executive away form intel, IBM, bell labs.

– In that time, Samsung entered memory chip business

– Within 10 years , Samsung was the leader in the global chip industry.

• Samsung recruit non korean MBAs and PhDs by cultural, social and political tensions.

– Set up a Global Strategy Group

– Reports directly to the CEO

– Who worked fo r leading global companies like Intel, Sachs, Goldman

– Have to learn rudimentary korean before taking up their post

– Korean colleagues have had to change their working style and mind set to accommodate weternize practice

– Taking ideas from abroad

Strategy: Sending insider out

• Each year more than two decades Samsung send 200 talented young employees to abroad for full one year.

– For the first six months, their only job is to become fluent in the language and culture and to build networks by making friends and exploring the country.

– In the second six months, they carry out one independent project of their choice

– Initially sent mainly to developed countries, in the past 10 years they’ve gone more often to emerging regions, especially China and, most recently, Africa.

Strategy: Pay & Promotion

• Samsung introduce merit pay and promotion– Putting some young people in position of the authority over their

elders.– Company slowly stated seniority based pry structure and merit base

compensation system– For high performer get promotion quickly rather than poor performer

need to stay more year for a particular level.– Samsung started a profit-sharing program, employees, not just top

and general managers are eligible for a bonus based on a percentage (up to 50%) of their salary.

Those approaches company slowly progress to western business practices.

SWOT Analysis

Strength Weakness Opportunity Threads

Leader in home country

Not familier with Global market

Market moved from analog to digital

Japanese companies and others electornics company

Have native talents

Not familier with Global culture

Every company need new innovation

Have knowledge about Japanese Business system

Some talents want to leave jobs from renowned company

Conclusion: Vision 2020

References

• The Paradox of Samsung’s Rise

• http://www.samsung.com/us/aboutsamsung/sustainability/sustainabilityreports/download/2012/2012_sustainability_rpt.pdf

• http://en.wikipedia.org/wiki/Samsung

• http://www.samsung.com/

Thank You