Samsung as a Globally Acclaimed Brand - Article Example

Summary The article discusses Samsungs progress from a low cost imitator to a globally acclaimed brand. The article identifies the hybrid system initiated by the firm’s chairman as the cornerstone of its success. Built on the concepts of Japanese model of diversification and western model of focus, the firm has excelled in using the best from the two worlds to create a hybrid model that dwells on innovation and design. Culture emerges as a key concept in globalization for Samsung and any firm seeking to enter the global market. Leadership is also important in managing organisations. Good leadership from the Chairman as opposed to good management is responsible for developing Samsungs long term vision of steering the firm in the highly competitive market through innovation and design excellence. Samsung has also invested heavily in human resource development and training. The common theme in Samsungs operations is reengineering its business strategies and processes. This continuous process allows the firm to remain relevant both in the labour and products market. This article captures the following concepts from the unit. -Innovation -Market research -Managing human resources Quotes From the article, a major quote that captures the content of this course is; Into a homogeneous workforce, Samsung introduced outsiders who could not speak the language and were unfamiliar with the company's culture. Into a Confucian tradition of reverence for elders, Samsung introduced merit pay and promotion, putting some young people in positions of authority over their elders. It has been a path marked by both disorienting disequilibrium and intense exhilaration. This captures best the concepts of creativity in the mind of an entrepreneur. From inside the entrepreneurial mind: from ideas to reality” creativity is defined as “the ability to develop new ideas and to discover new ways of looking at problems and opportunities; thinking new things while innovation is defined as “the ability to apply creative solutions to problems or opportunities to enhance or to enrich people’s lives; doing new things. This exactly defines what Lee did with Samsung. The chairman developed new ideas of doing things at the firm by combining western business model with Japanese ones. It is indicated that Samsung prior to the introduction of the western ways of doing business, the firm relied on a Confucian ideology that was based on rewarding employees by virtue of age rather than merits. The creation of a hybrid model highlights Lee’s creativity; He challenged traditions and introduced western business ideologies. His innovative mind is also captured by introducing the concept on integrating culture by bringing in outsiders into Samsung and sending insiders abroad to learn more on management. The advent of globalization and mobility of labor did not go unnoticed by Lee as the head of SEC. according to Senge (2006) the cultural environment for entrepreneurs have defined their destiny. From this knowledge, Lee identified the need to integrate various cultures into Samsung in order to make the firm gain a global culture. Previously, Samsung was dominated by Korean culture in products and management strategies. Lee realized that for Samsung to succeed in the global market, it had to have a global outlook that is tandem with global market needs and trends. The workforce was the first stopover. This has been an ongoing process that has enabled the firm to identify opportunities in new markets, develop products that meet various regional markets and the like. For instance, one Samsung employee is credited with the firm’s success in Thailand. This was a product of Lee’s idea of sending insiders to new markets and countries to explore them. Critical analysis Samsung’s ascent to one of the world’s most popular brands has not been without challenges. The firm commenced operations as a low cost manufacture of origin electronic equipments. Since its establishment, many things have changed; technology, marketing tactics, globalization, lifestyles, global economy etc. the firm has had to respond to these changes and developments in the market. Wibbeke (2008) identifies change and resistance to change as some of the greatest impediments to progress in organisations. Lee has overseen radical change in SEC in various ways. He oversaw the change in Samsungs managing style transforming the predominant Japanese model by blending it with the western management models to create a unique hybrid. The hybrid model has been critical in allowing Samsung to operate well both in the western markets and the Korean and Asian market. There are a number of forces that are driving SEC progress as indicated in the article namely; good leadership, innovation and globalisation. Some of these drivers can be traced back to the four forces influencing business as indicated in unit two. The four forces are compressed time, vanishing distance, reduced need for physical assets and continual turbulence and change. Continued turbulence and change in the global stage has forced SEC to be innovative in order to remain relative. Combined with the force of vanishing distance, SEC has gone global. The changes in the global market have seen the firm diversify its product portfolio. The response to the changes has been facilitated by enhanced knowledge of market developments. The internet among other technologies has proved critical in monitoring movement of goods in the market, changes in consumer needs and lifestyles and also monitoring competition. In order to navigate these forces, there has to be good leadership. Leadership is a fundamental pillar in SEC success. Lee has served as chairman of the firm for a long time. He has been able to create continuity, cohesiveness and a long term vision for the firm which are ingredients for success. Wibbeke (2008) says that global firms have to contend diverse cultures around the world. This cultural diversity can mean failure or success for the firms according to the author. Adidam, Gajre and Kejriwal (2009) say that, “The causes of business failure internationally are rarely financial, economic or technical. Failure arises from serious errors and misjudgment concerning the social, cultural, and political environment of the international countries” (p. 667). A look into SEC shows that cultural matters have been given precedence. However, this did not start outright. The firm had to first familiarise itself with the local Korean culture. Buoyed by success at home, entrepreneurs are encouraged to venture out. This scenario is evident in many multinational corporations which first secure home markets before venturing beyond national borders. SEC has been able to look at culture beyond language. The article claims that “Samsung's regional specialist program, arguably the company's most important globalization effort.” This program aimed at enriching SEC’s culture by familiarizing the firms culture with other cultures of the world. Employees fired from outside the country brought in cultural diversity. The chairman had foreseen the benefits if such a strategy. Schachaf (2008) writes that MNE’s benefit widely from cultural diversity in the decision making process given the different approaches to a common problem. Nonetheless, the author acknowledges that communication suffers greatly. This implies that MNEs operating for example in Asia cannot be assured of effective communication in their Asian operations by only learning Asian languages or hiring translators (Brock, et al 2008). There is need to learn the different cultures of the Asian people for effective communication Implications Etisalat is UAE based firm that has dominated the local market in the telecommunications industry. However, this domination has been as a result of high level government involvement that has awarded the firm a monopoly to provide telecommunications and internet services in the UAE. The firm can be compared to Samsung in various ways though there are also gaping contrasts. Most apparent similarity is the cultural distance from the west of their home countries hence their organizational cultures. The west has dominated global business and hence the western culture is used as the standard of measure. In this regard, Etisalat operates in a confided Islamic culture in the UAE. This is the same kind of environment that Samsung operated in South Korea before it ventured into the global market. Samsung ventured into the global market to expand its market share in line with its growth strategy. Etisalat is slowly coming to that point with expansion into Nigeria, Sudan and Saudi Arabia. It is easy not to note that the firm has targeted expansion into countries with a relatively high percentage of Muslim population. This is indicative of the firm’s awareness of cultural proximity with the markets. The same case applies to a number of multinational corporations when it comes to culture. Firms such as Barclays bank of the UK began their expansion into western countries where cultural distance was very minimal. Fast forward into modern times, the bank has been forced to introduce Sharia compliant banking in Islamic countries. Such strategies are evident at Samsung where products are designed to target specific niche markets. The article gives an example of a regional specialist in Indonesia who developed products that Samsung could use to gain entry into that market. As such, Samsung offers a perfect example for firms seeking to venture into the global market. The core idea is to synchronise the firm’s organisational culture and products with the culture and lifestyle of the target market. This however exposes firms to cultural inconsistencies. It is for this reason that Firoz et al (2008) write an article called “think globally manage culturally.” The authors of this article highlight the central role of culture in organisation and the dilemma of responding to individual cultures in a globalized market. Problems Samsung has faced challenges on the way to where it is now. The firm has reported financial losses in the past. This did not stop the firm from investing in research and development. With a long term vision under the leadership of the chairman, the firm stuck to its belief that innovation would steer the firm ahead of its competitors. Modern day entrepreneurs lack the self belief, passion and zeal to go through hard times. Passion according to Kacou is an integral skill of entrepreneurship and leadership. Where entrepreneurs lack passion a business venture is bound to fail. A vision also comes in handy. A vision allows an entrepreneur to have long term goals. Insight Change is the only constant thing in business. This is a recurrent theme is Samsungs history as shown in the article. The firm has been reinventing and rediscovering itself in various capacities. Innovation is one of the key drivers of the firm powered by investment in research and development. It has ventured into unconventional markets such as manufacture of laptops and hard discs. This is response to growing market needs. The firm also recognised the transformation from the analog to the digital market. Thus market research allows the firm to predict future trends and respond to these trends by developing products that will satisfy consumer needs. Leadership is also a key element in entrepreneurship. References Adidam, T, Gajre, S. & Kejriwal, S 2009, ‘Cross-cultural competitive intelligence strategies’, Marketing Intelligence & PlanningI’, vol. 27, no. 5, pp. 666-680. Brock, D, Oded S, Amir S & Ilene S 2008, ‘National culture and expatriate deployment’, Journal of International Business Studies, vol. 39, no. 2, pp.1293–1309. Firoz, N, Ahmad M & Ki K 2002, ‘Think globally manage culturally’, International Journal of Commerce and Management, vol. 12, no. 3/4, pp.32-50. Shachaf, P 2008, ‘Cultural diversity and information and communication technology impacts on global virtual teams: An exploratory study’, Information and Management, vol. 45, no. 2, pp. 131-142. Wibbeke, E. (2008). 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