An Analysis of Operational and Quality Challenges Faced by Samsung

This report examines the operational and quality management issues faced by Samsung, particularly within the UK market. It identifies problems such as product defects, battery issues, inappropriate strategies, and high competition. The study explores the negative effects of these issues, including reduced sales, decreased profitability, and damage to the company's reputation and market share. The report suggests solutions such as implementing total quality management, lean methodology, six sigma, and digital marketing strategies to improve product quality, reduce waste, and enhance marketing effectiveness. The analysis also recommends differentiation strategies to introduce unique products, increase competitiveness, and regain market share. Overall, the report provides a comprehensive analysis of Samsung's challenges and offers practical recommendations for improvement in the international market.

Operational problem faced by
international firm

TABLE OF CONTENTS
Executive Summery.........................................................................................................................1
INTRODUCTION...........................................................................................................................1
Mainbody.........................................................................................................................................1
Task 1...........................................................................................................................................1
Task 2...........................................................................................................................................4
Conclusion.......................................................................................................................................5
References........................................................................................................................................7

EXECUTIVE SUMMERY
The current study is based on quality management issue of Samsung which can occur at
the time of operating business in international market. It is one of the major operational issue that
can affect the overall operational performance of the company in negative manner. Along with
this, study has discussed the major reasons behind this problem such as high defects and
wastage, inappropriate strategies, high use of unsuitable technologies, high competition and
inappropriate promotional techniques, etc. In addition, study has discussed that lack of sales and
profitability, low market share, high loss, decrement in the organization image are the major
effects of this quality issue of Samsung. Besides, research has suggested that Samsung should
use total quality management approach, lean methodology, six sigma, digital marketing and
social media marketing for managing these quality issues in effective manner.
INTRODUCTION
At the time of running business operations at international level organizations face
number of issues such as high cost, strong competition, quality issues, marketing problems,
customer’s issues, etc. All these issues affect the overall performance of the company such as
lack of sales and profitability, low market share, high loss, decrement in the organization image,
etc. so, for managing these issues in effective manner organizations need to use appropriate
strategies which can help in improving performance in effective manner (Rushton, Croucher and
Baker, 2014). The current research is also based on operational problems which can occur at the
time of operating in the global environment. Regarding this it has chosen Samsung which is one
of the leading company and operating its operations in number of countries. It is running
business in electronic industry. It has started its business in UK as well. But, at the time of
starting and running business in this country organization has faced number of issues. The
current research will discuss the operational problems, causes and effects on performance of the
company. Afterwards, appropriate recommendation and suggestions will also be describing in
the following paragraphs of the report.
MAINBODY
Task 1
Samsung has started its business at international level. Providing quality services and
goods is one of the major aim of this organization so, it focuses on the quality of product rather
1 | P a g e

than cost. So, it attracts those customers who wants quality products. But, at present operating
business in UK Samsung organization is facing quality issue (Kloppenborg, 2011). As per this
issue customers are complaining about the quality of products and services especially in the
smart phones. Company is facing quality problem in battery life and other features of the smart
phones. Along with this, Samsung is using different technologies for resolving these issues
which is increasing extra cost for the organization. As well as inappropriate strategies is leading
high wastage and defects in the final production of the company. Therefore, all these are
increasing the quality problems for the organization as well (Schönsleben, 2016).
Including this, there are different other quality issues also such as Samsung smart phone’s
batteries have got blast and due to this reason number of customers have faced physical injury.
Most of the airline organizations do not allow those passengers who have Samsung smartphones
because due to the blast in battery it can create problem for all passengers. So, it is one of the
major issue which can declined the image and trust of customers on Samsung smartphones
(Dekker, Bloemhof and Mallidis, 2012). Along with this, there are number of other electronic
organizations which are offering new smartphones with unique and different features from
Samsung which is increasing competition for the organization. Along with this, company is
facing issues in getting appropriate supply of raw materials also which is also have negative
impact on inventory management that leads issues in total quality of the operation and
production department of the organization (Christopher, 2016).
Major needs to customers regarding quality of products a are performance, appearance,
availability and delivery, reliability and durability, price and value for money. But, Samsung is
not capable enough to meet all these quality standards because performance of its smart phone is
not fit for the purpose of customers. But, it provides premium appearance products to its
customers but for getting smart look company uses high technologies which raise the total cost
and price of the product which is not valuable for the purchase money of customers because
consumers can get more effective products of other companies in low price (Top Five Quality
Management Mistakes Affecting Operational Excellence, 2016). Along with this, battery blast
and short life of batteries of smartphones has declined the reliability and durability of products.
So, overall, all these quality issues are creating high operational issues for Samsung in the
international market.
2 | P a g e

There are number of negative effects of all these operational problems such as poor sales
performance, loss of profit, reputation damage and decrease in share value, etc. For instance due
to low quality products and services organizations face problem in attracting products (Bozarth
and Handfield, 2016). Low number of customers decline the overall sales of the company in the
international market. At the time of starting business in international market other strategic issues
such as high competition, inappropriate marketing strategies also affect the customer’s relations
of Samsung. Inappropriate relations with customers reduce the total sales of the company. Along
with this, use of high technology increases the total expenses of the organization due to this
reason in the international market Samsung needs to charge high price of products and services
in UK market which also reduce the demand of Samsung product and decline the total sales of
the company (Toth and Vigo, 2014). Low level of sales also reduce the overall net income and
profitability of the organization. High cost of goods sold increases the total operating cost of the
organization which reduce the gross and net profit of the Samsung. Therefore, it can be said that
quality issues affect the overall sales and profitability of the Samsung in negative manner
(Goetsch and Davis, 2014).
As per the above discussion issues in battery and blast increases the threat for customers.
So, these issues can reduce the image of the organization in front of customers which damage the
reputation of the organization and decline the goodwill of Samsung in international market.
Overall, quality problems decline the image of products and services in customer’s mind which
reduce their attraction towards the Samsung products. Therefore, all these impacts have negative
effects on overall performance of the company (Martin and Guerin, 2006).
In addition, there are number of other effects such as declining in the share value and
competitiveness of the organization. There are number of competitors which are operating their
business in UK and providing number of products and services to customers with low price and
different features. It has negative image on Samsung and reduce its level of competitiveness.
Along with this, it also declines the market share of organization and due to this reasons
investors and shareholders do not want to invest in share of Samsung (Sallis, 2014). Therefore,
all these effects have negative effects on share value of the organization. Overall, quality issues
have all these negative effects on Samsung which reduce the overall performance of the
company.
3 | P a g e

There are number of reasons behind these issues such as Samsung is facing quality
problems due to the lots of defects and wastage of raw materials. Along with this, due to
inappropriate use of technology company is facing quality problems. Including this, use of latest
technology require huge investment in technical equipment which increases the total expenses
and cost of the organization. So, it is also one of the major reasons behind the quality and cost
issue. Further, at the time of starting business in UK high competition from local electronic
companies is also one of the major reasons because of them Samsung is facing issues of low
competitiveness (Operations Management, 2016). In addition, at the time of starting the
business Samsung needs to use number of promotional techniques which helps in increasing the
marketing performance of the organization. Therefore, inappropriate promotional methods affect
the marketing performance of company which reduce the awareness of customers about the
electronics product of Samsung. Thus, low awareness of customers reduce the share value and
total sales of the organization. Overall, these are considered as major reasons behind the quality
issues of Samsung in international market which is reducing the overall performance of the
company (Zwikael, 2009).
Task 2
As per the above discussion there are number of quality issues which have negative
impacts on overall performance of Samsung in international market. For resolving these issues
organization needs to take appropriate strategies which are described as under:
Total quality management principles is one of the major approach which helps in
managing quality of the products and services of Samsung (Walker, 2007). This approach
focuses on the customer’s needs and requirements and skilled employees. Along with this, as per
this approach Samsung needs to focus on appropriate allocation of resources which also helps in
maintaining quality. Further, monitoring and controlling each and every activity on time also
plays important role in managing quality. Therefore, total quality management is one of the
appropriate approach which needs to be used by Samsung because it will help in producing those
products and services which will satisfy all needs and requirements of customers. It will also
help in attaining all quality standards as well so, company needs to implement total quality
management approach for maintaining quality in operation and production department (Levy,
2009).
4 | P a g e

Cording to the evaluation of the operational problem study has reflected that high number
of wastage of raw materials is also one of the major issue which is creating problems in quality.
So, for reducing the level of wastage Samsung needs to use Lean methodology. It is one of the
major method which reduces the overall wastage of materials because it helps in allocating all
resources as per the needs and requirements of activities. Along with this, lean methodology also
focuses on skilled and experienced employees which also helps in managing every activity and
resources in effective manner which decline the total wastage of resources (Dekker, Bloemhof
and Mallidis, 2012). Therefore, it is also an appropriate methodology which needs to be followed
by Samsung for managing wastage of resources.
High defects in finished goods increases the unnecessary cost of the organization and
reduce the total quality of production process. So, six sigma analysis is one of the appropriate
process which helps in reducing the total defects in final production process. So, it needs to be
followed by Samsung.
Inappropriate promotion in international market can affect the total performance of the
organization (Bozarth and Handfield, 2016). So, Samsung needs to use digital and social media
marketing for promoting products and services in effective manner. Because, it includes number
of communication channels such as mobiles, sms, emails, video conferencing, internet, etc.
Including this, Samsung can also use social media marketing technique because it helps in
making strong communication with mass number of customers with less time and cost. In
addition, these techniques are also important for making customer to customer communication
which plays important role in increasing awareness of customers about the new products and
services of Samsung. Therefore, it is also one of the important strategy and solution for resolving
issues of Samsung.
For increasing market share and competitiveness organization needs to introduce some
different and attractive products in the market. Regarding this, differentiation strategy will be
appropriate for this purpose (Schönsleben, 2016). Because, it focuses on producing new and
unique products which have different features from existing products of customer. It will help in
attracting customers and augmenting the market share of the organization. Along with this, it will
also plays important role in attaining competitive advantages in international market as well.
Therefore, all the above discussion strategies are appropriate for resolving all issues of
Samsun which are associated with the quality of products and services. As well as these
5 | P a g e

strategies will also resolve operational issues of Samsung which are facing by organization at the
time of operating business in the international market (Toth and Vigo, 2014).
CONCLUSION
The current research project has concluded that Samsung is facing the quality problems at
the time of running business in other countries. These issue has negative impact on total sales,
profitability, market share and competitive image of the company. Major reasons behind this
issues are inappropriate allocation of resources, unsuitable quality management strategies,
wastages and defects, etc. So, for managing all these issues Samsung needs to use Total quality
management, six sigma, Lean methodology and digital marketing, etc.
6 | P a g e

REFERENCES
Books and Journals
Bozarth, C. B. and Handfield, R. B., 2016. Introduction to operations and supply chain
management. Pearson Higher Ed.
Christopher, M., 2016. Logistics & supply chain management. Pearson Higher Ed.
Dekker, R., Bloemhof, J. and Mallidis, I., 2012. Operations Research for green logistics–An
overview of aspects, issues, contributions and challenges. European Journal of
Operational Research, 219(3), pp.671-679.
Goetsch, D.L. and Davis, S.B., 2014. Quality management for organizational excellence.
pearson.
Kloppenborg, T., 2011. Contemporary Project Management. 2nd ed. Cengage Learning
Levy, B., 2009. Legal Project Management: Control Costs, Meet Schedules. Manage Risks, and
Maintain Sanity.
Martin, S. C., and Guerin, A. D., 2006. Using research to inform design solutions. Journal of
Facilities Management. 4(3). pp.167 – 180.
Rushton, A., Croucher, P. and Baker, P., 2014. The handbook of logistics and distribution
management: Understanding the supply chain. Kogan Page Publishers.
Sallis, E., 2014. Total quality management in education. Routledge.
Schönsleben, P., 2016. Integral logistics management: Operations and supply chain
management within and across companies. CRC Press.
Toth, P. and Vigo, D. eds., 2014. Vehicle routing: problems, methods, and applications (Vol.
18). Siam.
Walker, A., 2007. Project Management in Construction. Wiley.
Zwikael, O., 2009. Critical planning processes in construction projects. Construction Innovation:
Information. Process, Management. 9(4). pp.372 – 387.
Online
Operations Management. 2016. [Online]. Available through: <
http://www.referenceforbusiness.com/small/Op-Qu/Operations-Management.html>.
[Accessed on 28th November 2016].
Top Five Quality Management Mistakes Affecting Operational Excellence. 2016. [Online].
Available through: < http://www.qualitydigest.com/inside/quality-insider-column/5-
quality-management-mistakes-affecting-operational-excellence.html#>. [Accessed on
28th November 2016].
7 | P a g e