Samsung Group is a South Korean multinational conglomerate company headquartered in Samsung Town, Seoul. It comprises numerous subsidiaries and affiliated businesses, most of them united under the Samsung brand, and is the largest South Korean chaebol. Notable Samsung industrial subsidiaries include Samsung Electronics (the world’s largest information technology company measured by 2011 revenues), Samsung Heavy Industries (the world’s second-largest shipbuilder measured by 2010 revenues), Samsung Engineering and Samsung C&T (respectively the world’s 35th- and 72nd-largest construction companies), and Samsung Techwin (a weapons technology and optoelectronics manufacturer).
Other notable subsidiaries include Samsung Life Insurance (the world’s 14th-largest life insurance company), Samsung Ever land(operator of Ever land Resort, the oldest theme park in South Korea) and Cheil Worldwide (the world’s 19th-largest advertising agency measured by 2010 revenues). Samsung produces around a fifth of South Korea’s total exports and its revenues are larger than many countries’ GDP; in 2006, it would have been the world’s 35th-largest economy. The company has a powerful influence on South Korea’s economic development, politics, media and culture, and has been a major driving force behind the “Miracle on the Han River”.
SWOT Analysis of Samsung
If you think your business could be doing better, why not try a SWOT analysis?
S.W.O.T stands for:
Strengths, Weakness, Opportunities and Threats.
By putting your firm under the magnifying glass you may find the way to grow their company or increase Samsung’s earnings.
Samsung Strength as Turnaround strategy
* Becoming a world known brand (over 200 countries)
* R&D (investing on scientific talents)
* Innovation (new digital technology)
* Customization (new products every year)
* New allocation of marketing resources (M-Net)
Samsung enjoys the widest range of product portfolio which includes
* TV/Audio/Video, Camera, Camcorder
* Home appliance
* Pc, Laptop, Peripherals, Printer, Memory Cards.
Well diversified and differentiated product line to meet changing customer needs. Samsung electronics has 4 business areas to cover customer electronics needs. * Brand value through multiple sponsorships
* Practice the good leadership theory.
* High market share that continues to grow (Mobile Phones and memory chip)and LCD.
* Design with an attractive styling that interests the customer, as the result of the development of Samsung’s new products that involve team of product designers. What is Samsung’s competitive advantage?
* Technologically driven niche products
* Strong Infrastructure
* High investment for R&D
* Wide range of products
* High brand value
* Higher economic scale and economic scope
* Horizontal and vertical integration (EG. Samsung’s own stores, SRAM for their own mobile phones) Michael Porter’s 5-Force,
* Samsung is a large buyer and can use that towards their advantage
* Higher yield than competitors
* R&D facility located at one single site
* Attractive pay, bonuses and incentives
* Allowed employees to fail.
* Financially strong, large resources at disposal.
* Product variation by introducing unique products and existing products with variety.
* Introduce user friendly mobile phones at affordable price
* Could launch sub brands to the company
* open more stores more customers
* Launch creative products “New Technology,” “Innovative Products,” and “Creative Solutions. * offer additional services to retain existing customers and attract new ones. Samsung’s Weakness.
* Average prices of products seem to be a low quality products- * Not proactive in introducing a new product Not user friendly * Differences between cultural and language which lead the group into conflicts * Insufficient software or talent engineer to create their own software * Heavily investing into development of newer markets and not focusing on any one of core competencies.
Threats arise when conditions in external environment jeopardize the reliability and profitability of the organization’s business. * Threats are uncontrollable. Examples of threats :-macroeconomic matters-technological change-legislation-price wars-changes in the competitive marketplace. For Samsung, the main threats are :
1. low cost competitors in China
2. legal war between Samsung and its competitors such as Apple.
3. Low-cost competitors Samsung is facing threats from many other low cost companies in China. While Samsung was busy competing with others, Huawei a company which focus on low cost products; is now a leader in fixed-line networks, mobile-telecommunications networks, and budget smart phones. Vizio, LCD TV supplier that overtook the premium brands in five years to become the North American market leader in large-format TVs.
Emulation mobile phone-In 2010 the numbers of emulation mobile phones imported from China to India has reached 38 million-these low-cost competitors rise more quickly than premium players anticipate-these low cost competitors may face the risk of being sued for violation of valuable intellectual property rights In 2012, Apple temporarily managed to stop the sale of the Samsung Galaxy Tab 10.1 in all of Europe, and now Apple is going after the whole Samsung Galaxy production line. Since 2011, Apple has filed a lawsuit against Samsung, Apple claims that Samsung infringes patents in terms of how it’s Galaxy products operate Can Samsung survive? To survive in the market:
1. Time 2. Resources Apple and Samsung are involved in ongoing copyright disputes in 10 countries, as competition in the smart phone and tablet sectors grows ever more intense. If the injunction of Samsung smart phone could not be lifted, it may create a certain impact on Samsungs earnings.
Conclusion SWOT analysis
Best used by Samsung’s managers as a way of clarify the thought processes that goes into a business decision. The entire SWOT analysis can, and should, make the managers think more deeply and systematically into the business evaluation process. A careful and thoughtful analysis should bring into the balance of Samsung’s advantages and vulnerabilities Recommendation should review and check their marketing strategy, should use just-in-time (JIT) inventory management.