TO: Samsung Management
FROM: Team 3
DATE: March 27, 2014
SUBJECT: Samsung Case Analysis
Samsung Electronics Company (Samsung) is a South Korean multinational electronics manufacturer with headquarters in Suwon, South Korea. It’s a flagship subsidiary of the Samsung Group and by the end of 2004 was responsible for $78.5 billion of the group’s $135 billion revenue (Chang & Siegel, 2009). It is a major manufacturer of component electronics such as batteries, semiconductors, hard disks and optical drives, logical chips, as well as flash and RAM memory for its many clients. Through innovations in both technology and corporate management lead by Chairman Kun Hee Lee, the company has become an industry leader and one of the most recognized brands in the world. As of late 2004, however, Samsung’s semiconductor and memory division is facing an increasing threat from international competition, especially from the Chinese electronics manufacturer Semiconductor Manufacturing International Corp. (SMIC). Samsung’s executive management is in need to make a decision that will keep the company competitive in this rapidly changing business environment. The following memo serves as a report of the internal analysis using SWOT and VRIO models as well as the external analysis of Samsung’s operational environment using Porter’s Five Forces and PESTEL models. It also delivers recommendations to the executive board regarding the firm’s future strategy regarding their semiconductor business division.
Strengths - Korea-based Samsung is the world’s leading memory producer for all types of PCs, digital cameras, game players, and other electronic products (Chang & Siegel, 2009). The company holds the second-largest net profit of any electronics company outside the United States. In both size and profits, its memory division especially has overcome its Japanese competitors. It has accomplished
Bibliography: Chang, J. J., & Siegel, J. J. (2009, February 27). Samsung Electronics. Harvard Business Review, 1-25. Hoover 's Inc. (2014). Industry 360: Business Challenges. Retrieved March 14, 2014, from Hoover 's Online: Hoover 's, Inc. (2014). Industry 360: Trends & Opportunities. Retrieved March 14, 2014, from Hoover 's Online: SAMSUNG. (2014). Samsung: Global Citizenship. Retrieved March 26, 2014, from http://www.samsung.com/global/business/semiconductor/aboutus/global-citizenship/gree Retrieved March 16, 2014, from IBIS World: http://clients1.ibisworld.com/reports/us/industry/competitivelandscape.aspx?entid=752#B Retrieved March 16, 2014, from IBIS World: http://clients1.ibisworld.com/reports/us/industry/operatingconditions.aspx?entid=752#RA