International Business: Globalization of Samsung - Assignment Example

International Business: Globalization of Samsung Definition of Globalization: Globalization can be defined as integration and interaction among people, organization and different nation’s government for international trade, investment and sharing of technology is known as globalization. This process has a lot of effects on culture, the environment, political and economic development and betterment of human beings in different societies of the world (Levin Institute, 2014). Globalization helps the organizations and the nations to increase their economic and financial assimilation of economics around the globe (Charles University, n.d.). Now days, every nation and organization are trying to globalize to strengthen their economic and financial condition. Likewise, Samsung globalized themselves as an international company around the world and selling their electronics goods in every nation. Globalization of Samsung: The first step of Samsung towards globalization was in 1993, at that time Samsung obtained a new corporate identity and changed their logo and modified their words as Samsung Electronics, which is written in English so that it would be easy to read globally (INTERNATIONAL CASE STUDY CONFERENCE, n.d.). Through these modifications, Samsung gave messages to the world consumers about their new technology, innovative products and creative solution into electronic sector. In current market scenario, Samsung is most leading electronic company in to the world market. They produces various range of electronic goods such as television, washing machine, computer, mobile phone, tablets etc. The products of Samsung are very unique and its features and quality are one of the best among the electronic industry. The presence of Samsung is throughout the international market for their best strategy in electronic sector. The mobile phones of Samsung are most selling products in the global market. Comparative Environmental Framework: If an organization is willing to be globalized, then they should learn about the cultural environment of particular nation. Since, it is a vital factor for any organization to understand about the different culture of a nation so the organization will able to understand the behaviour of consumer of that nation and the company can contribute to that market of the nation. Therefore, Samsung sends their employees to abroad for a year, which helps the company to understand about different culture and behaviour of consumers. For instance, employees of Samsung visited malls of the United States to understand the international taste like culture and behaviour of consumers of the nation (Pearson Higher Education, n.d.). A unique strategy of Samsung helps them a lot to establish themselves in to the international market as a big brand and huge organization. Since, they able to understand the needs of the international consumers and understand the culture of different nation’s market so the Samsung is count as big threat of a global company i.e. Apple. Forces driving globalization: To being globalization, an organization needs key driving forces to make presence of their in to the international market. For this an organization need to develop their transport system and communication channels to reach among the consumers of different nations so the company can impression into the international market. In current market scenario, Samsung is a huge organization and known as global brand in to electronic segment of the world. The products of Samsung are available globally. This shows that Samsung has utilized this strategy in a well manner and that’s the reason Samsung is very popular among the consumers, and the reason behind this is the availability of Samsung’s products in to the international market and its reaches to consumer via good communication channels. Regionalisation and localisation: An international company not only share their technology or goods with other nations, they also increase the opportunities of job in to that nation. This factor helps to enhance the economic conditions of nations. Even though, the international companies can build a strong trust among the consumers of nations. For instance, Samsung has good presence in to the international market and good connections with consumers of the every nation; they have opened a lot of retail stores in every nation to distribute their goods. In these retail stores, the most of the employees are local people of the nation, who have better understanding of local market and language (Dedrick & Kraemer, 2008). This activity helps both Samsung and the consumers while dealing with each other. For the international companies, it is very essential to satisfy their consumers and this process helps the consumers to discuss issues related to the goods of Samsung, on other hand it will become easier to Samsung to sort the issues of their consumers in a perfect moment. International Business Strategy: To enter in a new market or nation to expand the business, it is necessary to choose best business strategy. A good business strategy should be adopted by the top management of the organization so the company can work smoothly in a new market or nation and can earn more profit. The international business strategy of Samsung was very unique during globalizing their business. In China, Samsung used a basic strategy to expand their business. In 1990, Samsung entered into the China market and footholds in major cities of China like Beijing, Shanghai, Dalian, and Qindao. To build the public relations, they hired Chinese speaking employees and with the help of good market research and good relationship with local governments of China. These factors help Samsung to trade in China. To make strong impression in China market, Samsung had established productions subsidiaries, which help them to fulfil the market demand instantly and reduced the operational cost too (Lin, 2007). Even though, Samsung had used a lot of marketing strategy to promote their products in to the China market. They advertise their products trough televisions, news papers and magazines, which helps to create awareness among the consumers of the China market. For instance, Samsung had presented a TV program, which was related to digital knowledge and called as “Samsung Electronic Cup” (Lin, 2007). Samsung also sponsored many live events like “Digital Man”, 10,000 persons marathon in Beijing Olympics 2008 (Lin, 2007). These activities helped Samsung to foothold in to China market and able to create a strong relationship with consumers. As like this strategy, Samsung had entered in every nation and created a strong impression in global market as leading electronic industry. Another best strategy of Samsung was selection of country or market. With the help of good market research, Samsung had chosen best nation for their business expansion. The market research helped Samsung to identify the best market in respect of low cost of work force and the behaviour of consumers towards electronic good. Other factors of market research were political issue, cultural issue etc. These strategies helped the Samsung to expand their business globally. Competitors and Competitive Advantage: SWOT Analysis of Samsung Samsung is one of the world leading companies in electronic sector. It has various ranges of electronic products which are available in the market as consumer goods. The products of Samsung are known for the quality and its features as compare to its competitors. The main product of Samsung is mobile phone, which is most popular among the international consumers and most profitable segment of Samsung group of electronic (Samsung, 2013). However, there are many organizations who deals in mobile phone like Nokia, Motorola, Sony etc, but the main competitor of Samsung is Apple, who also deals in electronic products like tablet, phone, laptop as like Samsung do. The both organization is known for innovations and quality and they have a huge competition among them in mobile phone segment. Low cost of production of Samsung’s mobile phone helps to beat the Apple iPhone in to the international market. However, the OS and software of Samsung is open source which make it unique from its competitors. The best part of Samsung is their excellence engineering to develop new products. Global Production Networks: For any international company, the production network should be strong globally so they cvan fulfil the urgent demand of market instantly. Even though, a global production network of the company helps to reduce extra cost in transportations of goods from one nation to another. Even though, the company will not depend on suppliers too. For instance, in electronic market Samsung was a late entrant and has evolved from OEM to ODM (own design manufacturing) and now the company is converted in to OBM (own brand manufacturing) (ERNST and KIM, 2001). Now the company is building own semiconductors memory chips, display, flat panel and certain technologies of telecommunication (ERNST and KIM, 2001). Therefore, the company is not depending upon the other suppliers for the productions of goods and helps them to supply the finished goods in to the market with low price. Even though, the delivery time of products of Samsung are much faster in respect to other electronic industries. This strategy helps the Samsung to produce their product in low price with high quality of hardware and features. Ethical Dimensions in International Business: Ethics in international business is very essential factor to build trust among the consumers and the government of different nations. Since, an international company has deal with a lot of factors while doing business with other nation. They have to pay tax to nation’s government. They have to follow the rules and regulation of that particular nation according their international trading act. Even though, every nation has their own laws related to the consumer and the international company should follow the laws to satisfy the consumers and maintain loyalty among them. Samsung is one of the most ethical companies in South Korea (Irwin, 2010). Samsung is following all terms and conditions of trading act of South Korea. That’s the reason the reason Samsung able to build a strong relationship with their consumers and employees. Impact on the Environment and Sustainability: The Samsung group has great impact on the environment and sustainability. Most of the products of Samsung are eco-friendly, which shows that the Samsung has concerned towards the environment. They have produces harmless product, which do not emits any harmful gas or toxic substances that could affect the environment badly or destroy. Even though, the Samsung has done a lot of eco-friendly projects to protect the environment. References: Charles University, C., n.d. HSC Online - What is globalisation?. [online] Available at: http://www.hsc.csu.edu.au/economics/global_economy/whatis_globalisation/tut1whatisglobalisation.html [Accessed 1 Aug. 2014]. Dedrick, J. and Kraemer, K., 2008. Globalization of Innovation: The Personal Computing Industry. [pdf] Available at: http://web.mit.edu/is08/pdf/Globalization%20of%20Innovation%20PC.PDF [Accessed 1 Aug. 2014]. ERNST, D. and KIM, L., 2001. GLOBAL PRODUCTION NETWORKS, KNOWLEDGE DIFFUSION, AND LOCAL CAPABILITY FORMATION A CONCEPTUAL FRAMEWORK. [pdf] Available at: http://www.druid.dk/conferences/nw/paper1/Ernst_and_Kim.pdf [Accessed 1 Aug. 2014]. INTERNATIONAL CASE STUDY CONFERENCE, n.d. Samsung - The Making of a Global Brand | Marketing Case Study|Case Studies. [online] Available at: http://www.icmrindia.org/casestudies/catalogue/Marketing/Samsung-Marketing%20Case.htm [Accessed 1 Aug. 2014]. Irwin, J., 2010. Doing business in South Korea: an overview of ethical aspects. [pdf] Available at: http://www.ibe.org.uk/userassets/publicationdownloads/ibe_occasional_paper_2_doing_business_in_south_korea.pdf [Accessed 1 Aug. 2014]. Levin Institute, 2014. What Is Globalization?. [online] Globalization101. Available at: http://www.globalization101.org/what-is-globalization/ [Accessed 1 Aug. 2014]. Lin, H., 2007. Marketing-Resources Based Competition: Strategies for the Catch-up of South Korean Firms, the Latecomers in the Chinese Market. Pearson Higher Education, n.d. The Cultural Environments Facing Business. [pdf] Available at: http://www.prenhall.com/managementzone/danielsis9/pdf/ch02.pdf [Accessed 1 Aug. 2014]. Samsung, 2013. Welcome to the Samsung Global Strategy Group. [pdf] Available at: http://sgsg.samsung.com/Introducing_Samsung_GSG_final.pdf [Accessed 1 Aug. 2014]. Read More