Samsung External Environment

Internal Environment of Samsung

Tangible resources

In 2009, Samsung Electronics has reached $ 110.2 billion market capitalization, for the first time beyond Intel, the world's largest semiconductor manufacturer revenue, Samsung in 2009 to $ 117.8 billion in annual sales, revenue has surpassed HP as the world's largest electronics company, is the world's first two big chip plant, second in size only Intel 2008 is to have up to 21 products in the world market share in the market up to the first supplier. Financial resource

Through financial analysis of Samsung, we can see that it is now in a strong financial position. As the data shows, Samsung has high amount of total assets and net sales .Although its debt isn’t in a very low level, its net income still keeps growing, reaching to13.8 billion dollars in 2009. Organizations in such a strong financial position can be more responsive to new opportunities and new threats.

Technological resource

Innovation is crucial to Samsung's business. As new technologies are being constantly introduced to the market, speed is essential for remaining competitive in today's digital era. In case of that, Samsung’s R&D centers are set up all over the world. The R&D network spans six Samsung centers in Korea and 18 more in nine other countries, including the United States, the United Kingdom, Russia, Israel, India, Japan and China, as well as other research centers and universities. These centers are tasked with hiring top-notch local talent, investigating the latest local technology trends, and bringing to life those technologies that make the greatest benefits.

Physical resource

The component businesses of Samsung Electronics come together as Device Solutions. As a leading company in the global electronics industry, Samsung Electronics has one of the widest product ranges of key component businesses Memory, System LSI and LED, which compose essential parts of the company's well-balanced business portfolio. Samsung's System LSI Business designs and manufactures a variety of large scale integrated circuit (LSI) products and System-on-Chip (SoC) solutions, as well as offering foundry services.

In the SoC area, Samsung is a leader in the creation of application processor (AP) for mobile devices such as smartphones and tablets. The Foundry Business Team offers differentiated custom fabrication services utilizing advanced process technology, as well as a broad range of IP, DFM, and design services. Samsung's leading LSI products include CMOS image sensors (CIS), display driver IC (DDI), smart card IC, microcontroller units (MCU) and near field communication (NFC) IC. Intangible resources

Human resource

One of Samsung's strongest assets is the team of talented researchers and engineers. More than a quarter of all Samsung employees—42,000 people—work everyday in research and development. When employing people, Samsung puts his focus on employees’sense of responsibility as it is the core value outlook of SEC. Samsung select people who have good morals and be innovated. Anyway, employees need to be fit with Samsung’s culture. Samsung not only puts his focus on the process of selecting employees, but also the process of training and educating employees.

As statistics shows, Samsung costs about 63,000,000 dollars every year on the training of employees. In order to attract people with abilities and retain them, Samsung even programs an all-around incentive system and a scientific performance appraisal system. Those experts who have excellent performance even gain higher annual salary than top executives and managers. 

Reputation resource

Samsung’s reputation is based on its corporate culture.As we all know, its vision is to lead the digital convergence revolution growing to be the best and its mission is to become a best Digital-εcompany. Here, εmeans most efficient productive management. Furthermore, Samsung’s service conception is to keep strong contact with customers and make their best efforts to satisfy with customers. All these operating philosophies gain a lot of reputation for SEC.

Innovation resource

To put the principles of Open Innovation into operation, Samsung adopts a multi-pronged approach that involves participation in global consortia, forging links between the industry and top universities, cooperation with vendors, and operation of successful overseas research centers. Samsung is committed to producing best-in-class research in the materials and technologies of tomorrow. To foster a culture of ongoing, results-oriented innovation, the organization provides attractive remuneration for research activities.

Participation in Global Consortiums

Samsung actively participate in multiple industry consortia at regular intervals. By synthesizing divergent viewpoints from multiple participants, consortia help achieve consensus on important issues, such as drawing up standards and guidelines, identifying potential technologies, and fostering a beneficial business ecosystem. Samsung is a key player in the agenda of 13 international consortia, such as SEMATCH and IMEC. By leveraging the advantages of participating in global consortia, Samsung is well poised to prepare cutting-edge technologies and next-generation infrastructure.

Cooperation Between Industry and Academia

Samsung has a long-term vision of developing a robust network of next-generation technologies, infrastructure, and personnel. To achieve this, we create strategic alliances between the industry and top universities at home and abroad. We strengthen the industry-academia cooperation by promoting various activities, such as independent research in universities and sponsored training for students and employees in local and overseas universities.

Synergy with Equipment and Materials Vendors

Samsung cooperates with its equipment and materials vendors at home and abroad. This cooperation makes it possible for us to better shape and control the manufacturing and quality processes of vendors, which leads to ultimately increasing the competitiveness of our products.

Operation of Overseas Research Centers

Samsung has set up multiple research centers in various countries. These overseas R&D hubs perform valuable research in emerging materials and technologies in the spheres of hardware, software, and packaging. The centers also help Samsung establish a credible market and mindshare presence in their respective countries. With the help of the overseas centers and their research excellence, Samsung is able to increase the volume of R&D operations, concentrate researching application-specific technologies, and finally, put the results of the overseas research projects to practical use.


Financial Samsung Electronics, the market value beyond Intel , reaching $ 110.2 billion , compared with Intel's $ 860 million higher than the market value , as the world's largest semiconductor manufacturer revenue . Samsung Electronics , according to statistics released on the October 4th 2013 , in the third quarter ( July to September ) sales of 59 trillion won ( about 337 billion yuan ) , operating profit amounted to 10.1 trillion won ( about RMB 575 billion) , this value was even higher than the record 5.98 percent in the second quarter. Thus , the profits of Samsung Electronics has been single-season record highs for two consecutive quarters.


Samsung has nearly 20 kinds of products in the global market share to get the first, ranking first in global enterprises.U.S. market research firm Strategy Analytics recently released report, the second quarter of the global smart phone shipments grew 47% , reaching a record 229.4 million , of which 76 million sales of Samsung Electronics , the market share expanded to 33.1% and Apple's share was 13.6%, iPhone sales in the second quarter of 31.2 million

The data also show that the first half of this year, Samsung Electronics turnover of 110.33 trillion won (U.S. $ 99.3 billion ) , an increase of 19% ; operating profit of 18.31 trillion won (U.S. $ 16.5 billion ) , an increase of 51%. Samsung Electronics stakeholders also said that with the second half of the season will go into IT products , Samsung Electronics will continue to increase in the second half performance , parts department based on the competitiveness of high value-added products and specialty products , is also expected to bring more profits for the company.

Core Competencies

Innovation Speaking of Samsung’s resplendence, almost every manager or ordinary employee will refer to the well-known remarks by Kun-Hee Lee, the chairman of Samsung Group, “Except wife and children, all the things have to change.” In 1993, Kun-Hee Lee conducted the “New Management” program.

Through continuous indoctrinization of the consciousness of crisis and the concept that only those who change can possibly survive, Samsung’s core business begun to change from mass imitational production to independent brand development based on digital technology. During its course to become a world-class company, Samsung has never stopped innovation and transformation.

In 2001, in order to cope with the fast-changing information age, the program of “Digital Management” was carried out. In 2002, Samsung implemented the Wow Product System in order to maintain its leading position through the development Profit Operations Inbound Logistics Outbound Logistics Marketing and Sales Service “Samsung type” industrial park use high-end technologies offer unique and thoughtful service work in marketing guiding principle

Multinational company system all over the world set up strong marketing team and extensive marketing relationships massive and high quality skill training strong R&D capability chances for personal development Administration HRM Technology Development Procurement of a series of high-tech. Innovation now has become part of Samsung’s spirit and culture and has become the driving force of Samsung’s firm and continuous transformation.

Triangle Management Structure

Samsung Group creates a “triangle management structure” in the “New Management” program aiming at the integration of knowledge capital. In such a structure, CEO Kun-hee Lee is at the vertex of a triangle. Another point is the “structural adjustment department” itself. The third triangle point is the Chief Executive Group. CEO at the vertex is in charge of guiding management direction and deploying strategic target, leading his workers struggling to create products. “Structural adjustment department” not only assists President to carry out the strategic decisions but also acts as the role of monitor in charge of regulating a few branches of the operation.

Chief Executive Group is responsible for carrying out specific strategic plan regarding to how to develop the actual business activities. “Triangle Management Structure” increases Samsung’s market competitiveness, considered as Samsung’s management work milestone. Because of this structure,management responsibility is strengthened and management efficiency also improved.

Human Resource Program

In order to be better in the 21st century, Samsung strengthens human resources management system, building up South Korea's biggest talent library to promote the operation”s sustainable development. Additionally, Samsung pursues the principle of “people first”, always believing that enterprise success lies in the quality of employees. Samsung divide technology into four terms: basic technology, advanced technology, core technology and future technology. As for these technologies, Samsung is equipped with corresponding personnel and establish suitable training system for each level talent. 

SWOT Analysis