BACKGROUND Samsung C&T is the parent organization of Samsung Group

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BACKGROUND

Samsung C&T is the parent organization of Samsung Group. Byung-Chull Lee, the originator, laid out Samsung Sanghoe in 1938, opening another section in its set of experiences. Cheil Industries, the foundation of the style business, was established laid out in 1954. Farmland opened in 1976 as Korea's first family amusement park, and Samsung Construction Inc. was established laid out in 1977. We have found a way to resolve took ways to further develop improve personal satisfaction across all area's parts of mankind.

Samsung's corporate mission prompts key objectives for excellent items and corporate citizenship. Mechanical development is suggested as a component of this statement of purpose. Likewise, the consideration of HR in the statement of purpose underscores the authoritative culture, as well as how Samsung's corporate construction is intended to help advancement and functional adequacy for worldwide improvement. Given these elements of the corporate mission, it is suggested that the organization keep improving its ability pool, which is a basic achievement factor that upholds the advancement fundamental for creating and delivering top-notch items for customer hardware, semiconductors, home apparatuses, and related enterprises and markets.

Samsung's corporate vision is that of a company business that plays an important role in satisfying the needs of a global society. Thus, the company sees its technological products as enriching lives and contributing contributors to social prosperity. To achieve this corporate vision, it is recommended that strategic management drivers must drive the company enterprise to new heights by improving current product offerings and offering new products, as well as intensifying the strengths identified shown in the SWOT analysis of Samsung. In addition, to follow this vision statement, the technology company must expand its global market presence reach, not only just to sell its products, but also to determine how the company business can improve its enhanced customers' experiences. To achieve fulfilling this corporate vision, customers' needs and expectations must be met through consumer electronics, semiconductors, home appliances, various equipment, and related products.

Samsung's leadership team is focused on its main business. Samsung's main business is so important that it contributes the most to South Korea's GDP (gross domestic product). The organization provides manpower and products to assist South Koreans in making critical decisions. Electronics, Automotive, Apparel, Chemicals, Home Appliances, Clinical Hardware, and Home Appliances are among Samsung's product categories. The organization also stands apart in terms of the products and services it provides. Samsung is well-known for its mobile phones. The firm, on the other hand, has more to offer than just a compass and a phone. Even though the fact that the phone is the most important aspect of the company, Samsung's strategy is highly dependent on the other companies it controls.

Samsung Electronics: Ownership: 13,462,673 shares Samsung Electronics: Ownership: 13,462,673 shares Samsung Electronics: Ownership: 13,462,673 shares Samsung Electronics: (percent) 19.58 percent: Purchase and sales relationship with the company's top shareholder/business partner: Shareholders The National Pension Service of Korea owns 6,049,314 shares (percent) 8.80%: Shareholders' relationship with the company's financial investors BlackRock Fund Advisors is a company that manages investments for clients.

The management of Samsung has 13 people including Kinam Kim (Vice Chairman and CEO, Device Solutions Division), Yoonie Joung (Executive Vice President, Mobile Business, Samsung Electronics America), Dong Jing Koh (Executive Vice President, Mobile Business, Samsung Electronics America), KS Choi (President and Chief Executive Officer, Samsung Electronics North America), Young Hoon Eom (President and Chief Executive Officer, Samsung Electronics North America), Jong-Hee Han (President and Head of Visual Display), Yoon-Ho Choi (President and CFO), Jae-Wan Bahk (Chairman of the Board and Independent Director), Curie Ahn (Independent Director).

 

SWOT

The strength for Samsung is market leader. Samsung had controlled the Smartphone market for years. On year 2020, Samsung has maintained the first place in the world with an 18.5% market share. Samsung is a popular branded in many country.  Research and development- Samsung has always been creative in research and development. Their company has a wide range of products among its competitors. The products include mobile phone which is their signature product, tablet, camcorder, camera, television/video/audio, Memory Cards, PC, and other accessories. Samsung had centre operating worldwide which is 34 R&D. Award winning brand-Samsung Electronics today announced that it has won 48 awards at the world-renowned International Design Excellence Awards (IDEA) 2021, including seven Silvers, three Bronzes and thirty-eight finalists. Samsung Electronics also announced that it has received a record high of 71 awards at the world-renowned International Forum (iF) Design Award 2021. Samsung won two Gold Awards as part of 36 prizes for Product Design, 10 for Professional Concepts, 11 for Communication Design, 5 for Packaging Design, and 9 for User Experience (UX), User Interface (UI) and Service Design. Synergistic support among divisions or subsidiaries is the fourth strength- Samsung Electronics benefits from the conglomerate's semiconductors business. This synergistic support is based on the divisions and subsidiaries in Samsung's organizational structure. The internal factors in this aspect of the SWOT analysis are used in the enterprise's strategies for growth and to compete in the saturated global market for consumer electronics.  Strong hold in many markets- Samsung retains a stronghold in the Asian market, especially in India and China. Because the markets of this two country is growing fast which is why Samsung has taken advantage of the opportunity and incentivize in these countries accordingly.

Samsung also has its own weakness. The weakness of Samsung includes heavily dependent on the American Markets-Majority of Samsung revenue are derived from US market. American market is known to be volatile, which is why Samsung needs to expand its market to other regions such as Asian and European. Decline in Smartphone sales- Samsung sales has been declining since 2017 due to price sensitivity of competitor Smartphone from China. China is very aggressive by dumping its Smartphone at very low prices in the Indian market. Product failures- Samsung had came out with several substandard products such as exploding Samsung Galaxy A20e which could endanger consumer lives. There were also some issues with its foldable Smartphone. Dependence of low-end Smartphone- The bulk of Samsung sales are derived from low-end Smartphone sales instead of high-end Smartphone sales. Bribery scandal- In 2015, Samsung's reputation had been tarnished following the one year jailed sentence imposed on the president of the company for offering bribe to the South Korea government to facilitate a merger. This had cause loss of public confidence over its brands.

There are opportunities for Samsung too. It includes Triple Protection Proposition- Samsung F series TV has triple protection against damage due to lightning, humidity and power surge that caters to a certain specific customers.HR Management- Samsung is a world renowned brand in which a lot of high calibre and talented people are keen to work with them and this would improve employee performance and productivity. Diversification and acquisition- Samsung cannot be just relying on one market where political interest come into picture and risk from economic perspective. Samsung needs to enlarge its customer's base through diversification and acquisition of other business. Introduced Innovative Product- Samsung continue to innovate products by creating solution that are flexible and intelligently connected, and the use of AI to understand context to make daily life seamless.5G Technologies-Samsung has taken leads to engage discussion with network operators in the EU to supply 5G and 6G network equipment.

Lastly will be threats. The threats for Samsung are Patent Infringement Controversies- Samsung had lost a lawsuit claim filed by Apple over patent infringement which lasted seven years. This suit had tarnished the company's reputation and its sales. The company paid $1.049 billion in damage to Apple. Increase competition- Other brands such as Xiaomi, Apple or Huawei, all the technologies competitors trying to outperform each others. This only increases the pressure for Samsung in both competition and finances. Legal and Regulatory Threats- As the world is moving into globalization and digitalization, many government authorities have issued stringent guidelines which are increasing legal and regulatory threats to companies around the globe. Failure to abide will cause the company to completely shut down operation in a respective market which is fatal to the company operation.  Economic Uncertainty- Poor economic has led the consumers to change their spending habit. In order to cut cost, they will use second hand phone or delay their spending by repair their own phone rather than buy new phone. Rise of Counterfeiting - Samsung tops the list of counterfeit phone, for example: Samsung Galaxy S7 Edge holds the record of the most counterfeited Smartphone model.

 

Grand Strategy

Samsung has been employing growth strategy for the previous few years. It involves growth in a variety of areas, including sales income, market share, employee count, customer count, and clients served. Samsung is one of the largest smartphone manufacturers in the world. It not only manufactures and sells smartphones, but also home appliances, computer processors, and displays. About the market share, Samsung is still in top place in the third quarter of 2021, with a share of 23 percent, or 8% more than the second-place iPhone.

Samsung Electronics surpassed Intel's $14.76 billion in revenue in the second quarter of 2017 to become the world's new dominating player in the semiconductor chip business. Besides, after overcoming the Galaxy Note 7 mobile phone battery fire disaster in the same year, Samsung Electronics rated sixth in Interbrand's global brand rating, making it into the top ten world brands for the sixth year in a row. This demonstrates that Samsung's business has been steadily expanding. Moreover, Samsung's ability to innovate, as well as the high quality of its products, has also aided in its continued growth. Because of its focus on consumers with various needs all around the world, Samsung is a market leader in the smartphone sector. As a result, it is able to compete with the iPhone. Samsung Electronics became the world's No. 1 in the global TV business in 2006, with a market share of 56 percent, and has maintained that position for the past 14 years. The Consumer Electronics Division, the Mobile Communications Division, the Display and Semiconductor Division, and Harman are the four segments that make up the company's operations. The corporation also has 212 abroad subsidiaries in the United States, Africa, Asia, and Europe, in addition to its 28 unlisted domestic subsidiaries. Manufacturing, sales, and research and development are all handled by these subsidiaries. 

Samsung implemented the defensive strategy during the peak of pandemic in the early 2020. Samsung has decided to reduce the total cost of the company and attempt a turnaround. Samsung cut the smartphone production by more than half in a month and not restart normal output until May. The reason for this is because Samsung's smartphone sales have dropped significantly in recent months, and since the number of devices produced exceeds the number of sold out, lowering production is the only option. Samsung's cell phone sales are also declining for a variety of reasons, including a lack of customer demand on the one hand, and market cannibalism by competitors on the other. During that period, an employee at one of the company's smartphone factories in Gumi, southeastern South Korea, tested positive of corona virus. Subsequently, Samsung temporarily closed the plant. Samsung's 19.1% market share in the first quarter of 2019 fell to 18.5% market share, according to its first quarter earnings report for 2020. Its growth rate for 2020 was -22.7%. While Samsung still holds the top spot in global smartphone sales, the brand's negative impact by the epidemic cannot be ignored.

However, in just within one year, Samsung has gone from defensive strategy to growth strategy. Samsung's electronic chips have helped Samsung generated record revenue in the fourth quarter of 2021, Intel was dethroned as the world's leading chipmaker. While the corona virus wreaked havoc on worldwide businesses, the semiconductor industry profited from the scarcity of supplies. In the third quarter, Samsung's net profit increased by 64% to 10.84 trillion won ($9 billion), up from 6.6 trillion won a year earlier. Samsung's semiconductor sector was responsible for the company's earnings rise. According to reports, sales for the quarter ending December 31, 2021, achieved a new high of 76.57 trillion won. This follows a quarter in which the Korean currency reached 61.6 trillion won. 

 

Porter's Five Competitive Forces

Porter's Five Forces is a micro-environmental framework for analysing the level of competition within a particular industry. Porter's Five Forces include threats of new entrants,  bargaining power of suppliers, bargaining power of buyers, the threat of substitutes products and services, and rivalry among competitors.

Firstly, threats of new entrants imply that new competitors can affect an industry by taking away customers from existing organizations. Threats of new entrants entering the business are medium. Samsung operates in a highly competitive industry. The competitors are competing for price, creativity, and uniqueness so it is hard for new entrants to enter this industry. This is because the new companies need to develop customer knowledge and branding. There are many existing companies that are well-known and well-established such as Samsung and Apple are considered to be able to produce high-quality products. In contrast, the products of new companies will have to be considered as cottage and low-quality. However, the history of Samsung demonstrates that it is possible for a company to become a global leader. As a result, the greatest threat for Samsung is the new entrant, who has the potential to produce products that are significantly different from those currently available. There are numerous barriers to entry into the industry, including the necessity to swiftly develop a significant customer base and brand awareness, the reality that many customers have strong brand loyalty, the capital needs for entry, government regulations, and retribution by the industry's existing leaders. Samsung must be aware of any new companies that emerge in its industry, as well as observe the strategies of any new companies that emerge.

On top of that, the bargaining power of suppliers defines that some companies are readily able to switch suppliers in order to get components or services, but others are not. In the industry, there are numerous competitor component suppliers. Samsung has many supplies, that have low switching costs and offer a wide range of products. According to the news, Samsung has announced its latest core supply chain list for 2021, which includes 101 suppliers. South Korean companies are the most numerous in Samsung's supply chain, with 40 companies accounting for approximately 40%; Japanese and American companies follow, with 22 and 17 companies accounting for approximately 22% and 17%, respectively. The remaining five companies are from Singapore, Germany, Switzerland, the United Kingdom, and Mexico, and they account for about 14% of the total. Therefore, the companies are easy to switch to another supplier if the price of products is too expensive. Moreover, suppliers will not affect the company's bottom line. Unlike other technology companies, Samsung is able to supply many components, so it does not need to rely on suppliers and avoid the price changes that are related to this. Samsung is a key supplier of electronic components for Apple, Sony, HTC, and Nokia, including processors, lithium-ion batteries, display, image sensors, and camera modules.  Therefore, suppliers' bargaining power is reduced. This is because increases in raw material prices can readily be passed on to customers. As a result, suppliers' overall bargaining power is low, and Samsung Electronics is free of supplier demands. Samsung has become the largest competitor's supplier.

On the other hand, the bargaining power of buyers is customers who buy a lot of products or services from an organization have more bargaining power than those who do not. In this day and age, buyers have many choices because there are a lot of competitors in this industry. Even though innovation is important to buyers, price is still a vital consideration. Thus, buyers will easily switch from one company to another company that offers more options and lower prices. In addition, the products of Samsung can be consumed by people from all walks of life. Consumers have strong bargaining power because companies in the industry are all appealing to the same group of customers. For example, as global TV OLED competitors, Samsung and LG. According to Samsung's official figures, the company plans to increase its share of high-end TV sales to 27 percent, or 13 million units, in 2022, with OLED expected to account for 1.5 to 2 million units. In 2021, LG Electronics shipped 7 million high-end TVs, with plans to increase that number to 10 million by 2022. Shipments of OLED TVs will increase from 4 million in 2021 to 5 million in 2022. This means that Samsung and LG still have a lot of room to grow in the OLED premium market, with many consumers willing to pay a premium for high technology and quality. However, the buyers will not purchase many electronic items at once so they will depend on the options accessible when the buyers make every purchasing decision. Furthermore, Samsung must keep aware of the needs of its customers as well as the various options available from its competitors. In order to Samsung can remain the strong brand loyalty of buyers and will not switch to consume products of another brand. Strong brand loyalty means that many buyers are willing to accept higher prices and fewer services than they would otherwise. As a result, the company is allowed to remain competitive even while knowing how to best exploit its market.

Apart from that, the threat of substitutes products and services is the availability of other products from outside an industry that a customer could buy. There are many substitutes to the products, including smart phones, laptops, tablets, Plasma TVs, LCD TVs, and so on. Smart phones have become more popular now because they provide a variety of advantages such as can video calls, voice messages, applications, playing online games, and reading online books. Due to a lot of substitute brands in the industry such as Huawei and LG, it will decrease the ability of Samsung to control the market. This is severe for Samsung because buyers will easily switch to another brand. For instance, LG aims at establishing a leadership position in this emerging market, where competition is expected to heat up, by selling 400,000 3D TVs in 2010. Sony also intends to enter the 3D television market and capitalize on its strengths. By March 2013, Sony expects 3D TVs to account for half of its total TV sales, according to a press conference. Panasonic also announced its plans to release 3D televisions in 2010. Besides, In 2021, Samsung scrapped its Galaxy Note line up and shifted its top-end flagship focus to the folding screen Galaxy Z series. At the same time, Huawei, in an effort to maintain its premium image and its position in the folding screen phone market, iterated its folding screen phone line normally and released its first "shell" folding-screen phone, the P50 Pocket. Xiaomi entered the folding screen phone market in March 2021 with the release of its first folding-screen phone, the Mix Fold. Moreover, everything which has the same functions as smart phone of Samsung is considered a substitute product such as laptops and tablets. However, laptops and tablets lack the functions of smart phone so they cannot be used as a substitute product.

Last but not least, the rivalry among competitors is a measure for determining the level of competition among existing companies. Price cuts, increased advertising expenditures, or investing in product enhancements and innovation are all examples of competitive forces that might limit profitability and lead to competitive forces. Within the current market, there is a lot of competition, especially among the huge and powerful companies, such as Huawei, Oppo, Panasonic, LG, and so on. Due to the products, they manufacture being similar in function and appearance, competition among these companies is extremely fierce. For instance, Samsung and LG are two of the most well-known OLED TV manufacturers in the world. With the launch of its new OLED panel in 2021, LG made its first profit in nearly a decade. Sales increased by 23.1% over the previous year, exceeding market expectations, and operating profit was US$1.86 billion in 2021, reversing a large loss in the previous year. OLEDs for the premium TV market drove LG's growth, with sales increasing by more than 60% year over year. OLED TV sales in the high-end TV market increased by more than 60% year over year. Samsung, on the other hand, set a new record for revenue in the fourth quarter of 2021, with KRW 76.57 trillion (roughly RM268 billion), up 24.4% year on year. In particular, in the field of small and medium-sized businesses. Besides, some cases among these companies have emerged from the competition. For example, in 2016, Huawei was sued by Samsung for allegedly violating the principles of fairness, reasonableness, and non-discrimination. Huawei, for its part, sued Samsung for unauthorized use of its technology, which primarily involved 4G communication technology and smartphone operating software. Due to the importance of rivalry among these companies, Samsung should be continually aware of its competitors' plans in order to enhance brand awareness, loyalty, and market share.

 

Porter's Four Competition Strategies

Differentiation is the first porter's competitive strategy displayed on Samsung. Differentiation means the company is offering unique and superior value products to the wide market. The main source of Samsung's advantage over other brands is the innovation of their products. It is one of the industry's top investors in R&D. Differentiation has been challenging in the smartphone sector, primarily due to the congestion of companies. 

As Mr. Eric Kim, the Manager of Samsung Global Marketing Operations Department said that "The most important point of our success is to learn from our competitors' 'cooler than you' marketing strategy". The design, functional configuration, and addressing the needs of consumers in terms of fashion, taste, and spiritual experience have all been meticulously considered by Samsung. Samsung has created many "world firsts", such as the world's first pearl white mobile phone, the first mobile phone to hang around the neck, and the first mobile phone to increase the human circadian rhythm. 

Samsung, on the other hand, and its main product, the Galaxy smartphone, stand out from the crowd. For example, the latest Galaxy S22 Series, and the Samsung Galaxy Z Flip3. Besides, the corporation has gained substantial distinctiveness through technological innovation in various other product categories as well, including televisions. Samsung TVs are equipped with solar-powered remote controls that support indoor light, outdoor light, and USB charging, a huge innovation for Samsung in remote controls. According to internal estimates, this move will save 99 million AAA batteries in 7 years. In terms of customer service, it also offers customer assistance through a large network of service centres, online technical support, online complaints, live chats, and phone support. 

Furthermore, Samsung is not only focused on product innovation, but also places a strong emphasis on marketing. This gives them a distinct image and brand identity in the marketplace. Samsung distinguishes itself from its competition due to its superior product quality and marketing strategies. Furthermore, in order to maintain their competitive edge, Samsung must invest a significant amount of money in research and development each year. After all, the smartphone and home appliance markets have now surpassed all previous records.

Secondly, cost leadership is the second Samsung's competition strategy. Cost leadership means the strategy for keeping costs and prices low for the wide market. For Samsung, it uses cost leadership strategy to acquire a competitive edge and increase market share. Samsung, on the other hand, does not rely totally on this method and only employs it to a limited extent in its business plan to increase sales. It is always focusing on innovation in order to achieve cost efficiency and provide efficient yet competitively priced products. 

The company has introduced a variety of low-cost products in a variety of product categories, including smartphones and household appliances. With a number of well-known companies vying for market share, the smartphone sector has become increasingly competitive. In addition to its higher-priced Galaxy smartphones, the business has introduced a wide selection of low-cost handsets to compete with the competition. Samsung Galaxy A02, for example. Unlike Apple, which concentrates only on its high-end iPhones, Samsung has released a wider range of products at various price points, attracted low-income consumers, catering to a diverse set of consumer wants and needs. Samsung's low-cost strategy may be able to attract even more customers in the future. Samsung is now available in practically every country on the planet. Samsung is unquestionably the greatest winner in the smartphone business in terms of shipments.

Moreover, Samsung can become the cost leadership due of its low labour costs. When compared to non-Chinese producers, it is 35 percent less expensive. The majority of Samsung's components are manufactured by subsidiaries, which significantly reduces the company's cost overhead. Improved sourcing of raw materials, better production processes, and better quality control are some of the other strategies the company employs to attain cost leadership.

Utilizing Strengths and Opportunities & Overcome Weaknesses and Threats

            Samsung is a smartphone market leader. The company can expand demand of their smartphone by finding new users and discovering products new use. Samsung is a company that very hardworking in doing research and development. Company able to use their creativity to modify and refine their smartphone. For example, they had come out a smartphone which is Galaxy S22 Ultra. They are combined Note series and S series to a product. Past of the S series product had no Samsung pen like Note series. Besides, Samsung had won many awards at the International Design Excellence Awards (IDEA). Samsung is suggested to use the popularity to explored market. Samsung grabs the markets for developing countries like China and India, their economic grow fast and people that can afford high end smartphone are more and more these years, Samsung can come out product that can satisfy their taste.

            Samsung is grabbing the opportunity of television markets. Although in year 2021 global television market reduce, Samsung and LG rely on high class television hold steadily in first and second place. According to research company Omdia, Samsung's income market share and sales volume is 29.5% and 19.8%. In 2021, Samsung sold 9.43 million of QLED television, total sold is 26 million in 5 years. Samsung is a successful company because of their HR management. Their management method is able to make their productivity higher and talented people would full use in innovated the product. Over the past few years, Samsung had come out Bixby which is a voice assistant help the user to control the phone while the user have no hand to touch the screen. The mature of the AI technology can help Samsung to stay competitive in smartphone market. Finally, 5G is the way can Samsung recommend their product in Europe market when they had a cooperate with local network operators to support 5G.

            To overcome problem of heavily depend on America market. Samsung use to be expanded their market to other area like for example Southeast Asia, Africa. Nowadays almost everyone got a smartphone. The decline of smartphone sale cannot be deniable. To solve this problem Samsung can advertise their latest product and more important is adding some function that can attract the customers. About the product failure, Samsung can be cover by brand new smartphone. Samsung can appropriate reduce the low-end smartphone and most of the smartphone company do so. 

            Others company like Huawei, Xiaomi and Apple had competitive with each other. The only way to increase their competitiveness is publicize their product to let people more know about Samsung. Samsung smartphone product has been counterfeiting by other brand for so many years. The company should design a high quality or have own characteristic so other company will not copy the style of products. Lastly, nowadays economic is unstable most of the people refuse to spend money on buying luxuries, Samsung can come out a relative high-end smartphone but still can affordably buy customers.

COMPONENTS MARKS 1. Introduction . Company background 10 2. Planning and Strategic Management . Analyze SWOT analysis 20 . Analyze the grand strategy of the company . Assess the Porter's 5 competitive forces used by the company 20 . Assess the Porter's 4 competitive strategies used by the 10 company 3. Recommendation . Utilizing the identified strengths and opportunities & 10 overcome the identified weaknesses and threats 4. Conclusion . Assess the overall achievement of the company 10 5. References and Appendices 5