Strategic Analysis of Samsung: Innovation and New Technologies

Running head: INNOVATION AND NEW TECHNOLOGIES
INNOVATION AND NEW TECHNOLOGIES
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Author Note

1INNOVATION AND NEW TECHNOLOGIES
Table of Contents
Introduction....................................................................................................................2
Part 1..............................................................................................................................2
1. Porter’s five forces analysis of Samsung...............................................................2
2. Stakeholder analysis of Samsung...........................................................................3
3. Porter’s value chain analysis of Samsung..............................................................3
4. PESTEL analysis of Samsung................................................................................5
5. SWOT analysis of Samsung...................................................................................5
6. Technology cycle...................................................................................................6
7. The Utterback and Abernathy Model or three phases of innovation model..........6
8. The McKinsey’s 7s model of Samsung.................................................................7
Part 2..............................................................................................................................8
Current market condition of Samsung.......................................................................8
Part 3..............................................................................................................................9
Ways by which Samsung can overcome the challenger Huawei...............................9
Conclusion....................................................................................................................10
References....................................................................................................................11

2INNOVATION AND NEW TECHNOLOGIES
Introduction
Samsung is a South Korean multinational organization that operates different types of
businesses under the brand of Samsung. The company includes many different businesses
like, food processing, insurance, textiles, securities, retail. Samsung had entered the
electronics based industry in the 1960s and had also started its business operations in the
shipbuilding and construction industries in 1970s. Samsung had gained the position of 6th
largest global brand based on the value that has been developed in the market. The Samsung
has been able to develop a powerful influence on the economy of South Korea. The revenues
of Samsung are considered to be equal to around 17% of the total GDP of the country that
amounts to 1082 Billion Dollars.
The report will be based on the analysis of the competitive environment in which
Samsung is currently operating. The different strategic analysis frameworks that will be used
for this analysis are Porter’s five forces framework, stakeholder analysis, Porter’s value chain
model, PESTEL analysis, SWOT analysis, technology cycle, The Utterback and Abernathy
model, McKinsey’s 7-S model.
Part 1
1. Porter’s five forces analysis of Samsung
Threats of the new entrants – The economies that are required to be developed in the
technology industry are quite high. This production based activities for the new organizations
becomes quite difficult and cost advantage is provided to the large companies. Product
differentiation is strong in this case and requirements of capital are also high. Distribution
networks that have been developed by large organizations are highly important for Samsung
(Adner and Kapoor 2016).

3INNOVATION AND NEW TECHNOLOGIES
Bargaining power of the suppliers – Samsung Group has many suppliers in the
industry in comparison to the buyers. This is able to reduce their power and the impact that
they have on the prices of products and raw materials (Christensen, Raynor and McDonald
2015).
Bargaining power of the buyers – The buyers in the smartphone industry have huge
amounts of choice based on the products that are offered to them by different organizations.
However, it is not always easy for the customers to switch to new products due to the cost
based factor. The power that they exert on the organization is mixed in nature (Biemans
2018).
Threats of the substitutes – The technology or white goods market is filled with
organizations that are able to provide huge number of choices. An organization like Huawei
has been quite successful better feature based substitutes to the consumers (Cui and Wu
2016).
Rivalry among the firms – The different multinational smartphone organizations that
have their operations in the industry are able to provide tough competition to Samsung. The
rivalry levels in the industry are thereby high (King and Baatartogtokh 2015).
2. Stakeholder analysis of Samsung
The major stakeholder groups that have been identified by Samsung include, investors
and shareholders, local communities, customers, business partners, employees, government
and media.
Strategic stakeholder analysis – The investors and the employees are considered to
be strategic stakeholders of Samsung.