Samsung Strategic Management and Strategic Competitiveness
Samsung Electronics was established by Byung-Chull Lee in 1969 in Suwon City in South Korea and was at the time referred to as Samsung electric industries. When founded, the company was designed to manufacture computer constituents, radios, televisions and other electronic devices. A decade into its establishment, the company began to manufacture telecommunication devices. Its initial product offerings consisted of switchboards. Subsequently, Samsung started manufacturing mobile phones (Samsung, 2017)
Assess how globalization and technology changes have impacted the corporation you researched
Globalization encompasses a practice by which state and regional economies, communities, and cultures have come to be assimilated through the international network of trade, communication, migration and transportation. In addition, in recent years, the world has experienced a substantial advancement in technology, which has had a major influence on industries and companies. These two aspects have largely affected Samsung Electronics. One of the influences of globalization on Samsung has been its business expansion to various markets across the globe (Hill et al., 2014). Samsung has various business units retailing different products and through globalization, the company has been able to retail these various products across the globe. Not only has this increased the revenue generated by the company, but it has elevated the company's status and brand to a wide consumer base. At the same time, globalization together with advanced technology have enabled Samsung to open increased number of sales networks and assembly and manufacturing plants in various nations. This has given rise to a wider network and more success for the company (Samsung, 2017).
Secondly, globalization has facilitated Samsung's business partnerships and strategic alliances. For instance, in entering the mobile and networks business market, Samsung has formed important partnerships with major companies such as Sprint, Verizon Wireless and T-Mobile. This has enabled the company to retail more products over the years, increasing its bottom-line. At the same time, globalization has created an increase in the number of key competitors faced by Samsung. For instance, in the mobile market, Samsung faces competition from key rivals such as Apple, Huawei, Sony and Nokia. In other business fronts such as electrical appliances, Samsung faces intense competition from competitors such as LG (Hoovers, 2017).
The advancement in technology has significantly influenced the success of the organization. In overall, technology changes have facilitated Samsung Electronics to become a leader in the market renowned for providing cutting-edge and innovative products and services Samsung has been able to retail a wide range of products and have a diversified product portfolio. In particular, Samsung Electronics is one of the leading and biggest semiconductor manufacturers in the world. Through the modern innovations, the company has elevated itself to become one of the top retailers of electronics. Samsung has been able to manufacture more cutting-edge products such as digital televisions, LCD panels, semiconductors and also printers. In the same manner, technology can be attributed to the major success that Samsung has enjoyed in the smartphone industry. Samsung has been able to create major competition to Apple Inc. in the mobile market by constantly unveiling cutting-edge smartphones such as the Galaxy series smartphones. These mobile devices have provided consumers with inventive solutions and satisfied their constantly changing preferences. Through technology, the company has also been able to unveil inventive...
In addition, this has facilitated Samsung in accomplishing sustainability in the community and relating with the societal groups at large (Samsung, 2017).
Apply the industrial organization model and the resource-based model to determine how your corporation could earn above-average returns
A strategy is the amalgamation of actions to make the most of core competencies through which a company forms its own competitive edge. A strategy provides insight on the direction an entity should take to succeed and prosper. Strategy takes into account differentiation of an organization from its competitors. In order to sustain a competitive advantage within its industry of operation, an organization has to lay emphasis on renovating resources in order for the product offerings to hold value whether external changes take place or not (Olsen and Sadfar, 2014). The industrial organization and the resource-based models are the leading models in strategic management.
1. Industrial Organization Model
The Industrial Organization (I/O) Model espouses an external perspective to provide insight that external forces influencing the organization signify the dominant impacts on an organization's strategic actions. The I/O model is centered on four key assumptions. The first supposition is that the model is reliant on the external environment. In particular, the overall industry and competitive settings lay pressures and restrictions on organizations and ascertains strategies that give rise to superior above-average returns (Poudel, 2016). The second assumption is that majority of the organizations in an industry or within a segment of an industry control identical sets of strategically pertinent resources, and therefore pursue the same strategies. Third, resources utilized to carry out strategies are highly mobile across organizations. The final assumption is that the decision makers within the organization are assumed to be sensible and devoted to acting only in the best interests of the organization (Olsen and Sadfar, 2014).
In applying the I/O model to determine how Samsung Electronics could earn above-average returns, the external influences and forces, obtained in its external environment, are fundamental and pivotal in ascertaining the suitability of strategic actions. One of the key aspects encompasses the intense competition the company faces from other companies in various fronts. For instance, in the mobile sector, Samsung faces intense competition from Apple, Sony and Huawei. Another aspect that influences Samsung with regard to above-average returns is bad reputation. In recent periods, Samsung has been associated with manufacturing explosive mobile phones. In particular, a number of Samsung Note 7 smartphone devices manufactured by the company burst into flame while charging and this has had an adverse and detrimental impact on its bottom line (Pham, 2017).
2. Resource-Based Model
The Resource-Based model espouses an internal perspective to provide insight on how an organization's unique and distinctive internal resources and capabilities act as a foundation for earning above-average returns. This particular model is based on three suppositions. First, every organization encompasses a set of distinctive resources and capabilities that offers the framework for its strategy and is the main source of firm returns. Basically, that is to say that features of the organization itself restricts the scope of strategies that may be fitting. Secondly, in the course of time, firms obtain different resources and develop distinctive or dissimilar capabilities. As a result, there is a likelihood of organizations to espouse and carry out different strategies in their endeavors to attain strategic competitiveness. Lastly, different from the I/O model, resources may not be highly mobile across organizations (Grant, 2001).
In applying the Resource-Based model to determine how Samsung Electronics could earn above-average returns, the resources and capabilities, obtained in its internal environment, are more vital to ascertaining the suitability of strategic actions. Samsung has several different strategic business units, including network technology, video, audio and most recently, the smartphone division. This has enabled the company to attain…
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