Samsung’s Strategy

A- Samsung’s Mission Statement & Vision Statement

Samsung is a technology conglomerate whose corporate mission and vision statements
focus on innovation for global societal improvement through technological products. The
company’s mission statement indicates superiority, which implies excellence and leadership
in the semiconductors, electronics, and other markets. On the other hand, Samsung’s vision
statement promotes an inspiration-focused
inspiration focused strategic objective that makes the business
busines an
influencer among people and societies around the world.
world Samsung’s mission statement is
“We
We will devote our human resources and technology to create superior products and
services, thereby contributing to a better global society.”
society.” This corporate mission was
published in the 1990s, when the company was undergoing rapid global expansion in various
semiconductors, electronics, and related technology markets. Based on its business
operations and current international industry positioning, Samsung focuses
focuses on the following
components in its corporate mission: Human resources and technological resources- resources
Superiority of products and services-
services Improvement of the global society.
society

Samsung’s corporate vision is to “Inspire

“Inspire the world with our innovative technologies,
technolo
products and design that enrich people’s lives and contribute to social prosperity by
creating a new future.”” The company follows this vision statement to maintain profitable
technology business operations that contribute to the improvement of people’s
people lives.
Samsung frequently refers to a shortened version of this corporate vision: “Vision
“ 2020:
Inspire the World, Create the Future.”
Future.” The company extensively implements this statement
throughout its subsidiaries’ operations in the consumer electronics, computing technology,
and semiconductors industries. The following components are contained in Samsung’s vision
statement: Global inspiration - Innovation - Improvement of lives and future social
prosperity.

B- Samsung’s Organizational Structure & Its

Characteristics
Samsung’s organizational structure is designed to promote technological innovation
throughout the enterprise. Technological innovation is at the heart of the company’s
strategies, as seen through rapid innovation involving smartphones and other o
consumer electronics. Structural facilitation contributes to the effectiveness of
implementing Samsung’s generic competitive strategy and intensiveintensive strategies for
growth.. The corporate structure is also a manifestation of the evolution of the
business from a small trading firm into a diversified multinational enterprise that offers
advanced technologies. Samsung has a product-type type divisional organizational
structure.. This structure type uses product categorization as the basis for
determining which resources and business operations belong to certain divisions,

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such as the company’s Device Solutions division. The entire corporate structure is
unified via Samsung’s headquarters, which are located in Seoul. Strategic
management directions from the corporation’s headquarters are implemented
through strategic objectives specific to the structural divisions’ contexts, such as the
context of the U.S. market for consumer electronics. Samsung’s corporate structure
has the following main characteristics: Product-type divisions - Centralized
corporate hierarchy- Geographical groupings

C- Samsung’s Generic Competitive Strategy & Intensive

Growth Strategies
Samsung’s generic strategy and intensive growth strategies continue to push for
technological innovation as a critical factor for competitive advantage. Headquartered
in Korea, the conglomerate competes against technology-intensive firms, such
as Apple, Google, Lenovo, LG, Sony, Intel, and other firms that create strong
competitive forces, as determinable through a Five Forces analysis of Samsung. The
industry environment imposes aggressive competitive behavior that typically involves
rapid technological innovation for product differentiation, as seen in the evolution of
smartphones available in the global market. To effectively compete, Samsung’s
generic strategy and growth strategies must involve investment in technological
innovation. The resulting competitive advantages enable the company to keep its
competitive position as one of the best performers in the semiconductors, consumer
electronics, and home appliances industries. Samsung applies the broad
differentiation generic competitive strategy. Based on Michael E. Porter’s competitive
strategy model, the strategic objective of broad differentiation is to maintain
competitive advantage by providing unique (or differentiated) products targeting a
wide market, which in this case is industry-wide, involving practically every person or
group that buys smartphones, laptops, and other equipment. To achieve Samsung’s
strategic plans for growth and expansion in the global market, this generic strategy
requires the application of product development as a main intensive growth strategy
to compete against technology firms like Apple, Google, Sony, and LG.

Market Penetration (Primary). Samsung’s revenue growth depends on market penetration

as the primary intensive strategy. In Igor Ansoff’s matrix, the strategic objective of market
penetration is to grow the technology business by increasing its revenues from the sale of
current products in current markets, such as the European Union’s consumer electronics
market, where the corporation already has operations. Competitive advantages and business
strengths identified in the SWOT analysis of Samsung combat negative forces from competition
in these markets.

Product Development (Secondary). Considering the emphasis of product superiority

in Samsung’s corporate mission and vision statements, product development is a major intensive
growth strategy of the enterprise. A strategic objective of product development in this case is
to grow the business through new products, such as new electronic gadgets. Also, this
intensive strategy grows Samsung’s operations through iterative innovation, which leads to
improved versions or variants of existing products. For example, the company regularly rolls
out new smartphone models, similar to what Apple Inc. is doing in its product development
strategy. The implementation of product development as an intensive growth strategy is
based on Samsung’s differentiation generic competitive strategy, which requires product
development for uniqueness that differentiates the business from the competition.
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Economies of scope based on the conglomerate’s various subsidiaries support product
development and competitive advantage by providing technological expertise and material
inputs from the subsidiaries.

Market Development. The global scale of Samsung’s operations makes market

development a minor intensive strategy for business growth. Market development’s strategic
objective is to enter new markets using the company’s existing products, such as introducing
new Galaxy tablets in Latin American markets after these products’ introduction in the United
States. As an intensive growth strategy, market development’s success depends on product
value and competitive advantage, which in this case comes with Samsung’s differentiation
generic strategy via technological innovation. For example, effective innovation for cutting-
edge technological design makes the corporation’s products more competitive when rolled
out in target markets. With this intensive growth strategy, introducing products to new
markets may come with changes in Samsung’s organizational structure.

Diversification. Samsung Group’s diversified business operations maintain multiple revenue

channels and spread risk across industries and markets. This intensive growth strategy’s
implementation is infrequent in the technology conglomerate, considering regulatory hurdles
and other barriers. With the strategic objective of establishing new profitable businesses, the
diversification strategy grows Samsung typically through acquisitions of smaller firms, such
as Harman International Industries. The minor role designation of this intensive growth
strategy limits the risks of establishing new business operations. In implementing
diversification, the differentiation generic competitive strategy is also applied for
competitiveness and strategic alignment among Samsung subsidiaries’ business operations.

Discussion points on the case

1. What are the characteristics of samsung's mission? Explain the

link between samsung’s mission and vision?

2. What is the nature of samsung's organizational structure? what

is the impact of this structure on samsung’s corporate strategy
?

3. What is the nature of samsung’s corporate strategy ?

4. Wat are the key elements to highlight regarding samsung’s

business strategy ?

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