The Nature of the Relationship between Firms: Samsung and Apple - Essay Example

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The Nature of the Relationship between Firms: Samsung and Apple Contents Contents 2 Introduction 3 The benefits from the nature of the relationship between the two firms 3 Learning 4 Apple vs. Samsung litigation 5 Global Collusive Oligopoly 6 Opportunity Cost 7 Flexibility and Control 8 Dominant Element 9 Apple and Samsung 10 Conclusions 11 References 13 Bibliography 15 Introduction Samsung and Apple have turned out both ardent competitors in the mobile gadget industry…
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The Nature of the Relationship between Firms: Samsung and Apple
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Download file to see previous pages The paper in turn focuses on understanding the contractual benefits gained from the relationship between the two firms through the use of theoretical underpinnings to bring out potential inferences. The benefits from the nature of the relationship between the two firms Apple and Samsung, the two firms tend to gain mutual benefits by dearth of their relationships. Kogut and Zander reflect to this end that each of the different firms tend to become a large repository of knowledge developed by mode of interactions of the individuals employed. The tacit knowledge of the individuals or groups is transformed into explicit knowledge such that the same is shared with the external stakeholders in the form of effective outputs. People employed in an organisation focus on generation of ideas that thereby contribute in the generation of a large database of knowhow needed for gaining competence in the marketplace (Kogut and Zander, 2003, p.519-520). Samsung tends to become a large repository of knowledge through large scale investment in research and development activities. ...
Research and Development being in the list of core priorities for Samsung tends to attract firms like Apple that get inclined on forming a contract with the same (Samsung, 2012). Apple tends to gain support from Samsung on a considerable scale pertaining to the production of iPhones. Samsung is found to be the largest supplier for essential components required for production of iPhones thereby making Apple dependent on the latter for essential knowhow (The Economist, 2011). On the contrary Samsung focuses on enhancing its component sales in terms of becoming the potential suppliers for the most important components for manufacture of iPhones. Out of the 70 percent market share relating to the supply of components for innovative mobile gadgets possessed by Samsung the supply chain activity rendered to Apple amounts to around 40 percent. Thus the above data reflects that Samsung’s supply chain activities for components in the production of iPhones by Apple are a strategic outlook developed by the company to enhance both its revenue and profit margins. Estimates and forecasts made further reflects that during 2013 the sale and supply of components for mobile phones and gadgets by Samsung would contribute in generating total sales of around $13 billion with a total operating profit estimated to be around $2.2 billion (Kim, 2012). Thus in where Apple tends to depend on Samsung for needed technical knowhow and expertise for production of iPhones and iTabs the latter tends to depend on the former for gaining on in further revenue and profit potential. Learning Employees pertaining to an organisation tend to reflect different sets of technical knowhow and skills that in turn tend to differ ...Download file to see next pagesRead More
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