Samsung Marketing Case

Case #2:  Samsung Electronics Company: Global Marketing Operations

1. What are the ingredients of SEC’s corporate turnaround strategy?

Samsung for several decades has set its sights on being one of the 10 leading innovation brands in the world.  They have climbed steadily.  The Asian financial crisis was a big setback for Samsung, but after major cuts in response to the financial crisis, Samsung re-emerged on track as an up-and-coming technology brand. All of this was made possible by some key decisions that Samsung took like:

* Its decision to transition from analog to digital technology in the late 1990s

* Focus on hardware and devices and collaborate with content providers when necessary

* Hiring Eric Kim

One of the central foundations of Samsung’s ability to be a leading brand is its commitment to maintaining manufacturing as a core competency.  Samsung did not just give manufacturing a large budget but also managed its incentives and organization so that manufacturing would always stay on its toes and strive to remain nimble and flexible.  Some examples of this are:

* Flexible choice of plant locations, including low-wage regions in China and India

* Forced plants to compete with outside companies for internal business

* Customized production as much as possible to customer needs to avoid commoditization

* Samsung had a relatively diverse range of products, each branch of which was a leader in its competitive area

This advantage in manufacturing technology paid off in a number of ways, including:

* Its diversity in manufacturing chips allowed it to ride out chip cycles

* It had flexible control over the manufacturing and production process.  This give it a much shorter product development time than its competitors.  Samsung could put out a prototype in 5 months, while it took competitors a year.

With this leadership in manufacturing technology, it was able to climb from being a maker of low cost appliances, into a brand...