Samsung Electronics' strategy for portable device innovation and market leadership

Samsung Electronics

How well is the present strategy working?

The present strategy is working better than the management of Samsung had anticipated. This is because they are finding ways, to innovate in a number of different areas of consumer electronics. Their main focus has been delivering high quality portable devices that are in demand. This strategy has allowed the company to shift from manufacturing low cost electronics, to becoming one the top corporations, selling a variety of innovative devices. ("Case 26 Samsung Electronics," n.d.)

What is the current strategy and goals?

The current strategy is to focus on providing portable electronic devices that can be used for a number of different activities. Where, these various products can be utilized in conjunction with one another, to make life easier for everyone. For example, Samsung introduced the Nexio to provide consumers with the power of a lap top from a device the size of a smart phone. What made this product so unique is it offers the same kind of applications as a traditional lap top. To achieve this goal, means that the company must deliver more cutting edge products, to consumers quickly. ("Case 26 Samsung Electronics," n.d.)

Compare performance via benchmarks

Samsung has changed from being a small electronics manufacturer, to becoming one the top producers for a host of electronic devices. This has allowed the company to be able to surpass the size of various rivals in the industry. ("Case 26 Samsung Electronics," n.d.)

Industry Average

The industry has been experiencing above average growth since the late 1990's. This is when there would be a shift in the way information was stored and recorded, as there was more of an emphasis on the use of digital technology (through various portable devices). (Cheidozie, 2008) The average size of the industry, based upon market capitalization is $99.78 million. ("Sony, " 2010) This is below the market capitalization for Samsung, which is over $100 billion. ("Case 26 Samsung Electronics," n.d.)

Key Rivals

Samsung Electronics is larger than the any of their different key rivals. Evidence of this can be seen by comparing the size of the market cap for various competitors to include: Sony (having a market cap of $32.34 billion), Panasonic (which has a market cap of $29.61 billion) and Sanyo (having a market cap of $10.15 billion). ("Sony," 2010)

Examine Critical Trends

The critical trend in the industry is: various electronic devices are becoming smaller and more powerful. This means that all manufacturers must be able to deliver products that offer the same features as competitors and including additional applications. (Cheidozie, 2008)

What are the resource strengths and weaknesses, and the external opportunities and threats?

Measures of strengths and capabilities

Samsung is interested in proving the best products and service to customers. As a result, they utilize a merit-based performance system, where there is an emphasis on having everyone sharing their ideas with top management. This establishes a system to addresses the different areas of competence within an organization. ("Case 26 Samsung Electronics," n.d.)

Evaluation of Resources

The most valuable resources that Samsung would have are: their employees. This is important, because the staff can help management be able to improve their products and services. At the same time, they can help increase quality and how long it will take to introduce a new product to the market. ("Case 26 Samsung Electronics," n.d.)

Competitive Liabilities

When you analyze the various KSF weaknesses in comparison to other competitors, it is clear that the biggest weakness facing Samsung is: innovation. Where, a rival could develop a product that is the equivalent of the I Phone. Once this takes place, it could put the company at a distinct disadvantage, in trying to catch up with the innovations introduced by a competitor. ("Case 26 Samsung Electronics," n.d.)

Are the prices and costs competitive?

The prices and costs for the different products that Samsung Electronics sell are competitive.

Value Chain Analysis

When you conduct a value chain analysis, the value is added through: quality and innovative ideas. During the manufacturing process, this allows the various devices to be seen as superior to competitors. At the same time, the flexibility of the process allows the different departments to work together, in improving the quality of the product and the time it takes to introduce them to the market. ("Value Chain Analysis," 2010)

Critical Activities and Combinations of Activities

The critical activities are improved collaboration. This is important, because it is combining the various functions of different departments (through combined activities) to have an impact on the end products that are delivered to consumers. ("Case 26 Samsung Electronics," n.d.)

What Activities are Strategically Important

The biggest activities that have the most significance are: improved collaboration, flexibility and the ability to understand the demands of customers. These different elements have allowed Samsung to rebrand itself over the last ten years. ("Case 26 Samsung Electronics," n.d.)

Is the company stronger or weaker than key rivals?

Samsung Electronics is stronger than key rivals. Evidence of this can be seen by looking no further than: the market cap of the company (which is $100 billion), the way their business model is structured, numerous awards that the firm has received for outstanding quality / innovation and their ability to continue to innovate beyond that of rivals. A good example of this can be seen with the company introducing the Pixon 12. This was the first camera phone that would have a memory of 12 megapixels. Where, they would be the first to introduce this phone in comparison with its rival the Sony Ericson Satio. ("Samsung Pixon 12," 2009)

What issue or issue(s) merit front-burner managerial attention?

The biggest issue is being able to continue with the high levels of growth and innovation that are occurring. Where, the company could become so successful, that they may have trouble finding new areas to innovate and expand. Once this takes place, it could mean that a culture of complacency will begin to take shape. As the hunger for constant innovation will begin to wane; with the company facing this inevitable challenge.