Case Study on Samsung PDF

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INDIVIDUAL ASSIGNMENT
TECHNOLOGY PARK MALAYSIA
BM020-3-M-MO
MANAGING ORGANIZATION
NAME : SABITA KUNWAR
STUDENT NUMBER : NPB000173
INTAKE CODE : NPSMF2001MBA
LECTURER : JEEVAN PAUDYAL
HAND IN DATE : 30 JUNE 2020

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Abstract
Samsung is a multinational South Korean company headquartered in
Samsung city, Seoul. It was founded as a trading company in 1938 and in the late
1960s it entered the electronics industry, which is now the largest information
technology company in the world. This paper looks at the model of Samsung
decision-making and its process. Samsung's decision-making tends to be fast, well
open to market demands; however, the group has a formal organizational style
where the CEO and the board of directors make decisions. The paper provides
insights how the company mission and vision statement contributes company
growth. Samsung Vision for new decades is “Inspire the world, Create the future”.
And Samsung mission is to devote human resources and technology to create
superior products and services contributing to a better global society. At last this
paper discussed about the strength, weakness, opportunities and threats of
organization.

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Table of Contents
Abstract ............................................................................................................................. ii
1. Introduction ................................................................................................................... 1
1.1 Samsung ................................................................................................................... 1
1.2 History ..................................................................................................................... 2
1.3 Board of Director ..................................................................................................... 2
2. Decision Making Model ................................................................................................. 3
3. Analysis ......................................................................................................................... 7
3.1 CEO Contribution .................................................................................................... 7
3.2 SWOT Analysis ....................................................................................................... 8
3.2.1 STRENGTH .......................................................................................................... 8
3.2.2 WEAKNESS ......................................................................................................... 9
3.2.3 OPPORTUNITIES ................................................................................................ 9
3.2.4 THREATS ........................................................................................................... 10
4. Recommendation ......................................................................................................... 10
5. Conclusion ................................................................................................................... 11
6. References ............................................................................................................................... 12

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1. Introduction
1.1 Samsung
Samsung is a global South Korean conglomerate based in Samsung city,
Seoul, South Korea. It was founded by Lee Byung - Chul in 1938 as a trading firm.
In the late 1960s, Samsung entered the electronics industry, which is now the
world's largest IT (share, 2015 ).Samsung covers many fields including information
and communication systems, manufacturing, culture, and advertisement. We may
note that some of their goods are electronic, telecommunications components
(Aslan, 2019). Samsung is the leading brand value-added organization in the
country. Samsung operates globally in over 50 countries. Nowadays Samsung is
investing under the name Samsung brand in the construction of buildings and the
concrete market. Samsung produces electronic products such as TVS, printers,
laptops, washing machines, microwaves, handheld USB devices, LCDs, cameras,
cd players etc. Other Samsung categories are produced in building, such as real
estate, but they are specialized in electronic logging, electrical cable, tube line,
telephone log (which are all made of concrete and iron)(Essays, 2018). It formed a
number of divisions related to electronics, including Samsung Electronics Devices
Co., Samsung Electro-Mechanics Co, Samsung Corning Co, and Samsung
Semiconductor & Telecommunications Co.
Samsung Electronics Co. Ltd. is Samsung Group's sole company, and Asia's
biggest electronics manufacturer. The Samsung electronics stands for stability,
reliability and warmth (Essays, 2018).Samsung Electronics Co, Ltd. specializes in
the manufacture and sale of electronics and portable computers. The company
works as follows: Consumer Electronics, Information Technology & Mobile
Communications and Computer Solutions. The company group of Consumer
Products includes cable TV, computer, scanner, air-conditioners, refrigerators,
washing machines, and medical equipment. The company group Information
Technology & Mobile Devices sells portable products, multimedia tools, laptops,
and digital cameras. The company division Computer Solutions comprises of

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memory, integrated circuit system on a wide scale, and light emitting diode(Forbes,
2020).
1.2 History
In 1938 Samsung launch local and non-electronic company (a retailer in
fruit, vegetables etc.) Samsung also launches new invention other goods such as
radio, computer ship building from the 1950s to the 1970s.
In the late 60s Samsung started making electronic goods, TVs, and cell
phones. Samsung received its second chairman after the group founder's death in
1987. The company's worldwide establishment and growth began in the 90s and
entered its electronic goods trade in numerous countries in Asia, Europe and
America until 1997. Samsung succeeded in maintaining the rate of growth in the
late 1990s when all other businesses faced extreme credit crunch.
Samsung now produces world-renowned televisions, mobile phones and
video cameras. Holding an eye on emerging industry developments, Samsung
already produces high-quality smartphones and 3 G networks to deal with Nokia
and phone's main business rivals (UKEssays, 2013).
1.3 Board of Director
As of 31 December 2019, the Board of Directors had 10 Directors, four of
whom are Executive Directors, (Sanghoon Lee, Ki-nam Kim, Hyun-suk Kim, and
Dong-jin Koh) and six Independent Directors (Jae-wan Bahk, Sun-uk Kim, Byung-
gook Park, Jeong Kim, Curie Ahn, and Han-jo Kim). Mr. Sang-hoon Lee, former
CFO, has been named by the Board as Chairman because he will be able to mediate
the multiple views of the Directors and is best suited to oversee board operations.

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The positions of Chairman and CEO have been divided to increase the flexibility
and openness of the Board(Samsung, 2019).
Independent directors constitute a majority of the board, pursuant to Article
542-8 of the Commercial Act. The Board leverages its experience and competencies
in diverse fields to ensure successful and strategic decision-making. Directors are
chosen by resolutions of a shareholder assembly. The executive directors are elected
from candidates approved by the board, and the Independent Director Selection
Committee recommends independent directors. Every members of the board shall
have a three-year term in office and shall be entitled to be re-elected at a
shareholders' general meeting at the conclusion in their tenure. In particular,
autonomous managers must demonstrate excellent managerial qualities, an
outstanding professional experience, and comprehensive expertise of specific fields
such as Banking, auditing, economy, accounting , economics, and law, while at the
same time fulfilling the criteria of applicable laws (e.g. Commercial Act) for
effective management oversight (global, 2020).
2. Decision Making Model
A typical form of planning is decision-making. It includes selecting the best
alternative from various alternatives in order to achieve those objectives. According
to D. E. McFarland, “A decision is an act of choice – wherein an executive forms a
conclusion about what must not be done in a given situation. A decision represents
a course of behavior chosen from a number of possible alternatives”(Shika.K, n.d).
Models reflect the actions and interpretation of decision-makers in the context of
decision taking. All models are based on certain hypotheses that make the decisions.
There are three models which direct managers' decision taking behavior.
 The Rational/Classical Model

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This model is based on a choice logic, which would maximize an
organization's value and profitability. People follow a logical approach when taking
certain choices, according to this pattern. In this model the sequences of different
steps are(Verma, 2014):-
a. Identification of problem.
b. Generation of solutions and alternatives.
c. Selection of best alternative.
d. Implementing the desired solution.
 Administrative/Bounded model
This model provides a more objective definition of an organization's
decision making. Decision makers have different motives, opportunities and
expectations according to this pattern, but they seek to find options that are
appropriate to all due to lack of time(Verma, 2014).
 Retrospective decision model
This paradigm of decision-taking reflects on how decision-makers try to
rationalize their choices after taking them and attempt to explain their decisions. In
this case, the decision-maker takes a decision on both irrational and subjective
without considering the alternatives. This strategy is applicable to actions which are
not scheduled. The decision-maker chooses what he considers best suits (Point, n.d).
Samsung's decision-making seems to be quick, well receptive to business
demands; in addition, the company has a structured operational style where the
CEO and the board of directors make decisions.The corporation has a structured
system that lets the top executives control the powers and the power for all the
crucial decisions, and this has a good effect on the business as the decision-making
phase is swift and all strategies, proposals or processes can be executed properly.
The top management makes all the crucial decisions, while the middle and first line
management cannot express their views but must obey the direction from the top.
Therefore, if the action reached by the top management is wrong, it will impact the
company's operations immediately.

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In comparison, Samsung utilizes rational decision-making, which is where
people utilize analyzes, data, and a step-by - step decision-making method.This
kind of decision is particular and the procedure is comprehensive, this kind of
decision taking is in reality helpful for a big business like Samsung(Aziznrk, 2020).
Samsung applied the "Authority Judgment After Team Review" process,
using(Gbajabiamila, 2014):
 Leader calls a meeting
 listens to the issues and ideas of innovation
 deliberated until he/she is sure of the decision
 decision is announced to the group
The cycle will take time and can cost a ton. Samsung adopts this approach to
produce the right smartphone, for example to the more time-consuming Galaxy S8
than ever. Samsung has gained tremendous popularity in the electronics company
market. Samsung effective decision making is the result of its success. Under the
supervision of structured management Samsung was able to make a successful
decision. Talent-oriented management and decision-making at high pace have
contributed to Samsung's performance with these characteristics(Gbajabiamila,
2014);
 speed management
 time management
 removal of unnecessary business processes
 pursuing perfection
 talent-oriented management
Samsung makes decisions by various means, taking into account many
factors, such as(Baig, 2018/2019);
 Decision Requirement
 Needs of Market
 Wants of Customers

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 Market Demand
A company, Samsung is going through several steps in this case before
selling products or services.
 Need Recognition:
Recognition of need is the first step that is very important, as it leads
Samsung to sell products or services. Global culture has become a requirement for
smartphones. People use smartphones to connect and obtain information through
apps. Smartphone has the advantage of being transportable, unlike a desktop laptop.
Most sites provide free Wi-Fi, and users can use their smartphone to access the
Internet. It means you can get information with your smartphone that you want to
know where and whenever you want.
 Information Gathering and Searching:
The second step of decision making is information gathering and searching.
Good warranty is a sign to performance for Samsung Electronics. Once consumers
get a good warranty service, they will think positively of the company.Samsung
Electronics Inc. spends its one of the largest budgets on TV, radio, newspaper,
magazine and so on advertisements. Samsung spends one-third of its promotional
budget on TV, for these reasons.
 Evaluation of Alternatives;
Some of Samsung Electronics' biggest move was to outsource Galaxy Note
7. It had been a smart, prudent and cost-effective choice from my viewpoint.
Samsung has lost Note 7 to save the enterprise. Whether organization wants to cope
with certain mistakes that may preserve or demolish its reputation. Samsung is a big
international corporation with worldwide products, systems, and services. It rolled
out the Galaxy Note7 with a lot of excitement and fanfare, only to find out quickly
that it was having a crisis. Some caught fire or exploded by the phones. It was made

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clear then that Samsung was not aware of the root cause of the issue. The argument
was not about the phone itself but about the company and its customer interaction.
 With consumers all engaged, Samsung had a choice;
Decision by Samsung to recall Note 7 would be an anomaly in the
company's overall history. There is no question that Samsung will concentrate on
quality assurance across its supply chain and at every point of the product
development process. There is no doubt that Samsung is going to lose any sales on
smartphones. Samsung took this unscheduled decision and responded according to
the business situation, writes John Sutter of CNN Tech. The business will continue
to innovate to ensure customers are not scared of Samsung phones or any other
device from Samsung, he says. The transfer is long lasting all about.
3. Analysis
3.1 CEO Contribution
Chairman K.H. Lee's leadership style is innovative, and charismatic.
President expresses a highly demanding long-term strategy and goals for company,
completely delegating management and organizational responsibility to the CEOs
of the company. Samsung people admire and pursue his special vision and
motivation for the future and long-term ambitions of Samsung Group
businesses(Kang, 2015).Samsung CEO has set a strong mission and vision for the
success of company in local and global market.
Samsung is a technology company whose mission and vision statements
concentrate on creativity through innovative goods for global societal enhancement.
The mission statement of the organization implies dominance, indicating success
and supremacy in the semiconductors, telecommunications, and other industries. In
the other hand, a vision statement from Samsung supports an inspiration-focused

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strategic target that makes the company an influencer among citizens and
communities around the world. The fusion of strategic strategy and mission
statements thus generates the image of a technology organization that strives for
supremacy in the market and global impact (MARTIN, 2019 ).
The mission of the organization is to improve the lives and social
obligations of people, to contribute to the prosperous development with creative
technology, goods and the desire to create creativity for the world of the future.
“This mission is related to their vision that is “Inspired the World, Create the
Future.” It is the conviction of the group that aligning their activities with the dream
and purpose of the organization will help Samsung succeed in the Market, conserve
market share and become the world's top five brands by 2020 (Madani et al., 2014).
3.2 SWOT Analysis
3.2.1 STRENGTH
Samsung's base has always focused on Creative Research and Development.
Expenditure on these departments resulted in the company having among its
competitors a wide range of product portfolios. Things involve a laptop, camcorder,
smart phone, computer, television / video / audio, flash cards, Desktop, and other
gadgets. Samsung's brand image has been boosted by its environmentally
sustainable technologies. It achieved its place in 9th position in the EPA's 2016
Green Power Partner list of Top 30 Tech and Telecom firms.Samsung retains a
foothold in Asian markets, especially in India and China. Business opportunities in
both India and China are rising considerably, which is why Samsung has taken
advantage of the ability to incentive in these countries accordingly(Hub, 2019 ).

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3.2.2 WEAKNESS
Over the years Samsung was mired in a variety of scandals. For starters, in
the supply chain from 2012 to 2015, many concerns were presented about child
labor, including breaches of the laws on overtime for adult employees.Samsung
was also threatened with price manipulation, and the European Commission
reportedly punished €35.1 million for setting the prices of mobile chips (BBC,
2014). Like IOS, Samsung doesn't offer its own operating systems.This utilizes
Google's Android operating system for its smartphones that certain people find to
be inferior to Apple's IOS. Moreover, Google's Android licenses may impose
limitations on Samsung's apps (David, n.d).
3.2.3 OPPORTUNITIES
Emerging markets like India, South Africa and others are facing rising
demands for consumer products, smartphones, tablets and other tech gadgets. India,
for example, is the world's second largest smartphone market after China, and has
over 430 million users of smartphones. In 2018, the Indian smartphone market
increased by 10 per cent. Samsung had market share of 24 percent in India in 2018
where industry leader is Xiaomi with market share of 28 percent (News18, 2018).
Smartphone sales grew 7.2 percent in 2018 in South Africa where Samsung is the
market leader with a market share of 43.84 percent as of April 2019 (David, n.d).
For many developed as well as prosperous countries the middle class is
rising rapidly. For many developed as well as prosperous countries the middle class
is rising rapidly. Surely this accelerated progress would raise demands for mobile
goods, tablets, and other software products that give Samsung growth opportunities.
The demands for new tech products and services are certainly out there as it is a
digital time and age now. For many developed as well as prosperous countries the
middle class is rising rapidly. Surely this accelerated progress would raise demands
for mobile goods, tablets, and other software products that give Samsung growth

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opportunities. The demands for new tech products and services are certainly out
there as it is a digital time and age now(David, n.d).
3.2.4 THREATS
The final item to tackle in Samsung's SWOT review is hazard.The final
item to tackle in Samsung's SWOT review is hazard. Samsung is faced with a range
of large rivals in each of its global markets. In the smartphone industry, for
example, Samsung's major rivals are Apple, Huawei, Xiaomi, OPPO, LG, Lenovo,
ZTE, Vivo, Sony, RIM, HTC, & Nokia. The final item to tackle in Samsung's
SWOT review is hazard. Samsung is faced with a range of large rivals in each of its
global markets. In the smartphone industry, for example, Samsung's major rivals are
Apple, Huawei, Xiaomi, OPPO, LG, Lenovo, ZTE, Vivo, Sony, RIM, HTC, &
Nokia. In the global consumer electronics industry, Samsung's major rivals are HP
Inc., Apple Inc., Sony Corporation, LG Electronics Inc., Panasonic Company,
Hitachi Ltd. and Toshiba Company(David, n.d).
4. Recommendation
1. In Samsung's market and industry climate, the capabilities, vulnerabilities,
incentives, and risks pose a competitive circumstance that demands creative
approaches to maintain business development through competition.
2. The company possesses core competencies for capturing a bigger market share,
increasing sales revenues, and growing the technology business operations.
Samsung's weaknesses are barriers and challenges that require strategic solutions.
So it is recommended that the company exploit the identified opportunities.

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3. Samsung's vision for the year 2020 places an emphasis on innovation. Samsung
must be cautious with this strategy as it often leads them into infringement lawsuits.
4. Dependence on android owned by Alphabet Inc. (Google) leaves the company
vulnerable to improvements in OS implemented by Alphabet Inc. It is strategically
necessary for Samsung to build its own operating system (OS) and applications to
improve its chances of long term development. It is proposed that Samsung build its
own OS that combines best features of IOS and Android by drawing the industry's
brightest minds.
5. Conclusion
Samsung brand is world renowned for its operation, outstanding staff, and
creative, quality product. Quick and structured model of decision-making is
responsible for the ongoing organizational growth. The company has a hierarchical
mechanism that helps the top management to monitor the forces and authority over
all the important decisions and this has a positive effect on the sector because the
decision-making period is fast and all plans, ideas or procedures can be better
implemented. Samsung's mission is to be the digital electronic company which is
based. It conforms to the world of poor and legal quality treatment. Maintain value
of clean organized culture and respect for customers and shareholders. Samsung
vision is based on satisfying the need of global society.In Samsung's market and
industry, the power, vulnerability, opportunities and risks pose a competitive
environment that needs innovation strategies to maintain development through
competition.

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