Business Strategy Report: Analysis of Samsung's Strategic Approach

This report provides a comprehensive analysis of Samsung's business strategy, examining its vision, mission, goals, and core competencies. It delves into the role of these elements in strategic planning, considering both internal and external factors. The report utilizes tools such as SWOT and PESTEL analysis to assess Samsung's current market position and competitive landscape. It also explores the effectiveness of various techniques used in business plan development. Furthermore, the report conducts an organizational and environmental audit to determine Samsung's strategic positioning and identifies potential threats and opportunities. Based on these analyses, the report proposes a new strategy for Samsung, including alternative strategies, justifications for the selected approach, and recommendations for implementation, including roles, responsibilities, resource allocation, and the application of SMART objectives to achieve its goals. The report concludes with a summary of key findings and recommendations for Samsung's future strategic direction. This report is contributed by a student to be published on the website Desklib.

BUSINESS
STRATEGY
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TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................4
1.1Role of vision, mission, goals and core competence of Samsung in strategic planning.........4
1.2 Factors that should be considered while formulating strategy...............................................5
1.3 Effectiveness of techniques used while developing business plan........................................6
TASK 2............................................................................................................................................7
2.1 Strategic positioning for Samsung with the help of organizational audit..............................7
2.2 Environmental audit for Samsung.......................................................................................10
2.3 Significance of stakeholders analysis..................................................................................11
2.4 New strategy for Samsung...................................................................................................12
TASK 3..........................................................................................................................................13
3.1 Alternative strategies for Samsung......................................................................................13
3.2 Justification of selection of strategy....................................................................................14
TASK 4..........................................................................................................................................15
4.1 Roles and responsibilities for strategy implementation.......................................................15
4.2 Resources required to implement new strategy...................................................................16
4.3 Contribution of SMART objectives in achievement of goals..............................................17
CONCLUSION ............................................................................................................................18
REFERENCES..............................................................................................................................19
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INTRODUCTION
Business strategy is a business tool used by the management to attain its goals and
objectives. It assists business in planning and decision making for making the business
successful in the competitive market environment. The business strategy is a key function
performed by top level executives for the benefit of the company. This further help the
organization in attaining business goals smoothly which further aid in enhancing productivity
and profitability of the organization (Kourdi, 2010). However, there are different types of
business strategy like, growth, market entry, diversification etc which can be selected by the
marketing manager as per the current needs and scenarios. In the present research report,
different aspects of business strategy will be studied. In order to facilitate the study Samsung has
been selected.
The company was founded by Lee Byung-chul in the year 1938. Samsung is a
conglomerate which deals in clothing, electronics, telecommunications, and electronic
components, digital and other electrical equipment. The company has reached its target
customers with the help of wide range of own dedicated stores. Presently, Samsung has
diversified its operations in different areas like, insurance, financial services, advertising,
entertainment; hospitality etc, In addition to this, company is also providing retail, information
and ship building services.
Further, in this report, implication of mission, vision and objectives in making business
strategy will be described. Thereafter, the impact of external and internal environment on
business operations of the company will be illustrated. Further, a new strategy will be planned to
enhance market share, reputation and profitability of the organization in global and domestic
market. Thereafter, SMART objectives will be devised for Samsung to implement the strategy to
attain business goals.
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TASK 1
1.1Role of vision, mission, goals and core competence of Samsung in strategic planning
 Vision: The vision of company is to provide superior quality services and products to its
target customers. Thereafter, Samsung vision is to become highly valued company in the
society in which it serves. The vision statement of company reflects the desire of the
organization to have constant growth and development in the field of technology. Further,
Samsung is perceived as modern and innovative organization in market. Company further
wants to expand its business operations in every possible location of the globe.
 Mission: The core purpose of mission statement of Samsung is to enhance wealth and
profitability of its shareholders. Thereafter, company is to provide unique, innovative and
highly valued products and services to customer with combined efforts of its committed
and loyal staff (About us, 2015).
 Objectives and goals: The main objective of the company is to provide ethical products
to its target customers. Desire of the organization is to attain core competence in its
business by designing unique products. The key objective of Samsung is to inspire
communities in which they serve by focusing on its core strength, technology, innovation
and creative solution.
 Core competence: The core competencies help Samsung to stay a step ahead of its
rivals. The major core strength of company is to be creative and competent staff.
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Illustration 1: Dedicated store of Samsung
(Source: About us, 2015)

Thereafter, technology leadership helps in creating superior quality products. In addition
to this, company has competence to produce different types of products with various
configurations. Thereafter, global brand image and companies strength in building value
to customers and innovative culture within organization are some core competence of
Samsung.
1.2 Factors that should be considered while formulating strategy
Strategic planning is important function that helps Samsung in designing effective and
best suited business strategy. Strategic planning refers to well defined procedures which are used
for developing strategies that further give overall direction to the company (Ferrel, 2012). This
further help in attaining set goals and objectives aligned with the vision and mission of Samsung.
However, there are certain internal and external factors which impact the strategic planning of
the company. They are described as follows:
Internal factors:
 Human resources: It is significant for Samsung to maintain inventory of competent and
qualified personnel within the organization. In order to ensure success of strategy it is
important for the company to ensure engagement of all level of staff throughout the
enterprise. It is the responsibility of employee to implement strategy within organization
so that they must be involved in the strategic decision making (Factors affecting
strategic planning, 2014). However, the skills, knowledge, potential etc of workforce is
also an important role in formulating strategy.
 Organization culture: The positive working environment within Samsung is very
crucial for facing different business challenges, adapting changes and attains the goals
and objectives of organization. Therefore, the culture is significant factor which facilitate
in formulating strategy and implementation. Organization structure: The strategies are developed at different levels; business,
corporate and functional. The top level executives formulate corporate strategy while
middle level managers design business strategy (Reich and Benbasat, 2013). Thereafter,
supervisors or line managers formulate functional level strategy. Therefore, for effective
formulation of strategy at various levels it is important for Samsung to have well defined
organization structure.
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External factors:
 Technology: With the fast changing technology it is crucial for Samsung to upgrade its
current technology. There are various strategic plans which involve designing new
product, adding new attributes in existing product etc where technologies act as a key
factor. Therefore, to formulate such kinds of strategy it is important for company to
upgrade its technology and do market research to find innovative techniques (Lafley and
Martin, 2013).
 Market rivals: The ability of the company to perform in market also depends upon the
extent of market rivalry. Therefore, while developing new strategy it is important for
Samsung to consider strategy of market rivals. This will also assist the organization in
sustaining intense market competition.
1.3 Effectiveness of techniques used while developing business plan
Samsung uses different tools and techniques for developing business plan. To ensure
success in strategic planning and formulation the company uses various tools such as, SWOT
analysis, competitor and Pestle analysis. They are further explained as follows:
SWOT stands for strength, weakness, opportunity or threat. It is important tool which is
used by Samsung to understand its capabilities, drawbacks. Further, company utilizes its
strengths to take benefit of future coming opportunities (Andersson, 2011). It also helps in
identifying the way in which company uses its strengths in overcoming its weaknesses.
Thereafter, company use SWOT analysis to identify future threats and take measures to
minimize their adverse impact. Therefore, on the basis of this analysis strategic formulation is
done, business decisions are taken etc.
PESTEL analysis is important tool used by the company to study the impact of political,
economical, social, technological, environmental and legal factors on the operations of Samsung
in different markets. This analysis further helps the organization in making important decision.
Further, it assists the company in taking action which is important for the survival of business.
These evaluation further aids in taking measures that determine future success of the
organization (Muller, 2011).
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Competitor’s analysis is important tool used to identify strength and weakness of target
rivals. This evaluation further assist in making competitive business strategy that help Samsung
in enhancing productivity and profitability in the market.
In addition to this, there are different planning tools and techniques which are explained as
follows:
Tools and techniques Explanation
Budgeting It is a quantitative plan that helps in allotting
resources to different functions.
It assist the company in determining deviation
between planned and actual activity
Scheduling tools
(Gantt, load charts and linear programming)
It is important tool used by Samsung for
planning its production process. They help in
taking important decision regarding
production. It also assists in coordinating
different business activities (Piccoli and Ives,
2005).
Project planning tools
(flow chart, PERT diagram, tree diagram)
They are important tools that are used by
company for planning different projects,
allocating resources and time period for
project.
Forecasting It further helps company in predicting the
rapidly changing business environment. This
further aid the organization in making
important business decisions.
Scenario planning It is important tool used by Samsung to predict
uncertainties. It helps in exploring future
business opportunities. Therefore, it aids the
company in responding to upcoming changes.
Hence, it can be said that aforementioned tool play a crucial role in developing business
plan that further assist in attaining overall business goals.
TASK 2
2.1 Strategic positioning for Samsung with the help of organizational audit
Organizational audit is important tool used by Samsung to determine the impact of
internal factors on operation of the company. The organizational audit helps company in
enhancing its strategic position in the market (Joseph and Eshun, 2009). The main aim of
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organization audit is to help company in aligning its internal structure, processes, resources and
system with strategy while fulfilling requirements of external environment. Therefore, with the
help of SWOT and product positioning Samsung can conduct business audit that is described
below:
SWOT Analysis
Strengths
 Creative and qualified staff
 Large range of products, cell phones,
electronics, shipping components,
financial instruments etc.
 Diversified network
 Strong technology
 Strong brand image
 Best use of android technology
 Innovation and design
 High market share; 21.4% in
telecommunication sector.
 Brand loyalty among customers
 Powerful marketing and advertising
teams.
 Strong manufacturing capacity
Weakness
 Intense market competition from
Apple, Nexus in telecommute sector
 Competition from Chinese
manufacturer producing cell phones at
low price
 Manufacturing defects in some
products
 Labor cost is 30% of production cost
 Increasing customer complaints and
dissatisfaction for some products.
 Decreasing market share.
Opportunities
 Intense market research to develop new
technology
 Development of customized product
 Diversification into new markets
especially, developing countries
 Use of online market for selling
products.
Threat
 Intense market competition
 High dependence on supply chain
administration
 Negative impact of About us,
2015economic policy
 Increased bargaining power of
customers
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 Deregulation
 Economic development
 Failure of product line may result in
brand dilution.
 Legal actions by government against
company.

Further, with the aid of SWOT analysis, Samsung can make best use of its strength to
overcome its weakness (Bohm, 2009). Thereafter, company can use strength to take maximum
advantage of the upcoming opportunities.
Brand Positioning
It is a process that helps in building strong reputation in the minds of customers. Samsung
uses this aspect to develop distinct image in market as compared to its rivals. It further helps in
attracting customers to make purchase. The different strategies used by the company in this
aspect are explained as follows:
 Functional positioning: It refers to varied range of products and services offered by
company. Thereafter, it also involves quality of products offered by the company. For
example, Samsung is offering superior quality products and services at affordable price
by using functional positioning strategy. The company focuses on quality of its wide
range of product while doing marketing (Lafley and Martin, 2013). This helps Samsung
in attracting more customers.
 Symbolic positioning: It refers to ethical values, beliefs, demand and preferences of
target customers. The company uses symbolic positioning while designing products. For
instance, while manufacturing electronic products company use symbolic positioning.
 Price positioning: This positioning strategy play an important role in determining market
position of Samsung (Sekhar, 2009). The company uses price positioning to attract
customers of different class. Further, this strategy is applied by the company in its
telecommunication and digital products such as, cell phones, laptops, televisions, etc.
2.2 Environmental audit for Samsung
Environmental audit is important technique used by the company in determining impact
of external factors on its strategic positioning and business operations. For environment audit,
Samsung can use PESTEL analysis which is described below:
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PESTEL Analysis
 Political factors: It refers to impact of political factors on operations of Samsung. Being
a global brand, company is required to consider laws and regulations laid by different
countries. For this aspect, it is mandatory for Samsung to consider, tax rate, legal
policies, laws and regulations of foreign country where it is operating. The company also
faces adverse impact of political instability in the country (Montgomery, 2011). In this
aspect, company has suffered a lot due to tension in Korea. Thereafter, company faces
political pressure in different countries like, America, Africa etc. Therefore, it is
important for Samsung to consider political laws and regulations to avoid political action.
The company has faced political action in the form of suit and penalty for copying some
features of Apple.
1. Economic factors: The economic factors impact the economic policies, conditions and
constraints like, GDP, disposable income, recession, unemployment etc on the
functioning of company. For instance, the reduction in disposable income of population
of UK may result into decline in demand of high priced products (Teece, 2010).
Thereafter, the recession in a particular country can affect sales of Samsung products. In
this aspect, the recession of America in year 2007 led to reduction in sales of cell phones.
Further, the fluctuation in currency can also impact the sales of wide range of Samsung
products in the market.
 Social factors: It refers to changing trends, population, cultural and health aspects of
country which can impact product demand of the company. For instance, the increasing
trend of using gadgets, mobile phones, laptops etc for personal and corporate purpose has
led to increase in demand of large range of products of Samsung (Wankel, 2008).
Further, the prevalent trend of online shopping has stimulated company to provide its
product through online stores.
 Technological factors: It represents the technical factors, processes and functions that
determine success of Samsung in the market. With the rapid changes in technology it is
important for company to upgrade its present technology. Samsung is already recognized
for providing innovative and unique products. For instance, Samsung is using its
upgraded technology to make continuous improvements and adding new products in its
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Galaxy mobile range. This further helped in increasing productivity and profitability of
company in the market.
 Environment: With the growing concern about environment and business ethics among
customers, it is important for Samsung to develop ethical products without damaging
environment. For adhering with the business ethics, it is important for company to give
fair wages, proper working conditions etc to employees.
 Legal factors: It is important for Samsung to consider legal policies while making
important business decision. Failure of the company to follow legal rules and regulations
can cause law suits, actions against company. In this aspect, Samsung have to pay huge
penalties for imitating Apple Company’s product. This also causes negative impact on
reputation of brand.
2.3 Significance of stakeholders analysis
Stakeholders refer to those groups and individual which can impact or are affected by the
operations of Samsung. The stakeholders can impact strategy of company therefore, it is
important for the organization to consider their interest while formulating strategy. This can be
further detailed out with the help of key stakeholders which are as follows:
 Government: They play a crucial role in determining market position of Samsung.
Further, they determine legal framework within Samsung will perform its operations.
Thereafter, it is significant for the company to consider policies framed by different
governments where it is operating its business. It includes, tax policy, labor laws,
employment and competition policy etc. Therefore, to prevent the legal consequences it is
important for Samsung to consider these policies (Yousif and Hassan, 2013).
 Employees: They help in implementing framed strategy within the organization
therefore, it is important for Samsung to consider interest of employees while framing
business strategy. Therefore, the major concern of employee is regarding safe working
conditions, fair pay, job security and respect etc.
 Customers: They play a vital role in the success of business enterprise in the market. The
major concern of customers is about quality, price, professional assistance and customer
care services etc (Reich and Benbasat, 2013). Thereafter, Samsung should consider
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needs, preferences and demand of customers while developing products. This will also
help in increasing satisfaction level among customers.
 Suppliers: The goods and services provided by suppliers is important input for
manufacturing products of Samsung (Wickramasinghe and Jayaweera, 2011). Therefore,
it is important for the company to consider interest of suppliers while making important
business decisions. The major concern of suppliers is regarding timely payment, good
term with company and profitable business opportunities. Therefore, to avoid the
monopoly of suppliers it is significant for the company to maintain good relation and
involve suppliers in specific strategic decisions.
2.4 New strategy for Samsung
For continuous progress and growth in competitive market environment it is important
for the corporate to frame new strategy from time to time. This will also help the company in
ensuring profitability in long run. Thereafter, with this aspect company can maintain its market
position. Samsung is ranked at first number for its android applications and smart phone market.
Therefore, to ensure growth and development in it operations new strategy is designed which is
as follows:
Growth strategy: This strategy refers to introducing a brand new product in the market
or adding unique attributes to its existing products. Thereafter, Samsung can increase its product
line to compete with the rivals and meet the expectations of its customers. At present, the
company is perceived as most innovative company who always come up with new products and
services (Zachariassen, 2008). Therefore, to maintain reputation, company can modify its
product line. This will also prevent its customers from shifting to another brand. However, for
this aspect it is important for Samsung to do intense market research and identify new
technology and processes that will assist the organization in developing new product or service.
Thereafter, the biggest competitor Apple is continuously adding new technology and new
features in its product. Therefore, to match the competition it becomes more crucial for the
organization to grow by developing new products and attributes. Further, various ways which
can be used by company for implementing growth strategy are explained as follows:
 Growth in existing product line: Samsung enjoys global brand image which can be
used by company in growing in its existing product line of, smart phone, tablets etc. di. It
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