Managing Innovation, Creativity & Change at Samsung - Case Study Example

Managing innovation, creativity & change at Samsung Table of Contents Introduction 3 Brief History of Samsung 3 Vision and Mission 3 Current BusinessSituation 3 Discussion 4 Samsung’s Way of Innovation 4 Samsung’s definition for Innovation 5 Strategy of Samsung for new product development 5 Innovation and customer satisfaction 7 Analysis 9 Critically evaluate the factors that are responsible for creativity and innovation at Samsung organization 9 Findings 10 How innovation changed the business of Samsung? 10 Conclusion 11 References 13 Introduction Brief History of Samsung The organization of Samsung is recognised as a multinational company headquartered in Seoul of South Korea. However, after being establishment in the year 1938, but the organization of Samsung expanded its operations within a very small period of time. Due to which the total revenue and net income of the organization of Samsung increased by US$ 268.8 billion and US$ 30.1 billion by the year 2013. This is mainly due to its wide range of product lines such as television, IT, telecom products etc. This helped the organization to amplify its brand image and reputation in the market among many other rival players. Hence, the organization of Samsung enhanced its portfolio in the market mainly for its innovativeness and its qualitative equipments (Samsung, 2014). Vision and Mission The vision of the organization of Samsung is to create and develop a new future. This might be possible only by inventing highly innovative products and services so as to satisfy the changing demands and requirements of the customers. By doing so, the brand image and prosperity of the organization of Samsung increased to a significant extent thereby amplifying its distinctiveness in the market among many other rival players. Moreover, the prime mission of the organization is to offer qualitative products at a competitive price in order to satisfaction rate of the customers. So, the organization always tried to offer high attention over research and development in order to amplify its productivity and profitability in the market among many other existing contenders (Samsung, 2014). Current Business Situation The current business situation of the segment of consumer electronics and telecom is extremely competitive, so it tried to offer high concentration over research and development. Only then, it might prove effective for the organization to develop varied types of new product lines that may easily satisfy the bargaining power of the buyers. Moreover, in order to increase the demand of its products such as Galaxy S3, Note 2, LCD Television, microwave, PC’s etc, the organization became successful in enhancing its image and portfolio in the market among its substitute products and rival players. In addition, due to the introduction of such type of inventive products, the threat of new entrants also reduced to a significant extent. Thus, it might be clearly revealed that innovation and development of new technologies is the most effective strategy that may amplify the portfolio and reputation of the organization in the market among many other existing contenders (Samsung, 2014). Discussion Samsung’s Way of Innovation The prime desire of the organization of Samsung is to amplify its position and sustainability in this competitive market. However, in order to do so, the CEO, MR. Kwon Oh Hyun, Jong Kyun Shin and Boo-Keun Yoon decided to create distinctive or unique products through extensive research and development. Due to such extensive research and development, the organization of Samsung became successful in developing varied types of inventive products lines such as tablets, Smart-phones, PC, LCD television etc. Such types of differentiated product lines with inventive and advanced technology helped the organization to amplify its brand image and position in the market among many other rival players. Other than this, in order to develop a differentiated image and reputation in the market, the organization offered high attention over the features like prominent and sharp definition of display. Such type of features or inner qualities of the product lines of the Samsung acted as a boon thereby amplifying its prosperity and demand in the market (Samsung1, 2014). In addition to these criteria’s, the organization created the products, keeping in mind, the idea of ‘international orientation’. This means, the products of Samsung are developed in such a way that may surely satisfy the inner qualities and desires of the international clients effectively. This strategy helped the organization to amplify its productivity and brand value in the market that increased its dominance and reputation. Moreover, most of the products lines of Samsung include the strategy of Eco-friendliness or Eco-innovation so as to enhance its position and reliability within its target customers. For example, the LED televisions of Samsung do not comprise of mercury that may affect the environment and so it is designated as the most outstanding product. Thus, it might be stated that extensive involvement and thinking power of the CEO of the organization of Samsung proved extremely effective for it long run that amplified its portfolio and market share (Samsung1, 2014). Samsung’s definition for Innovation For Samsung organization, innovation is not just to attain competitive position rather to satisfy the changing demand and requirements of its target customers. Moreover, as per Samsung organization is to amplify its range of customers by offering high advanced and technical products, that may amplify the reliability and confidence of the customers over the brand among others. Hence, it might be clearly revealed that, customer satisfaction is the prime criterion for Samsung rather than competitive position. This vision helped the organization to amplify its growth and prosperity in the market as compared to many other rival players (Thomas, 2010, pp. 256-267). Strategy of Samsung for new product development The organization of Samsung offered high concentration over sharpness and quality aspect of the product lines in order to amplify its ranking and competitiveness. This is because; in this age of aggressiveness, maximum extent of the customer craved for high definition or sharpness. Due to which, the organization of Samsung tried to satisfy the preferences of its target customers in order to amplify its ranking and reliability. Other than this, the organization of Samsung implemented the strategy of cost leadership by presenting the inventive products at a quite lowest price. As a result, the organization became successful in amplifying the demand of its products in-spite of environmental fluctuations. This strategy of cost leadership proved extremely effective for the organization of Samsung that helped it to develop varied types of differentiated products such as high definition LED television, Smart-phones, Ipads, Personal computers, laptops, microwaves etc. Due to which, the brand value and market share of the organization of Samsung increased to a considerable extent that amplified its productivity and profitability in the market (University of Leicester, 2012, pp. 289-312). Other than this, effective teamwork is another important cause that helped the organization to develop new products. This became possible mainly due to active participation and encouragement of the CEO, Mr. Kwon Oh Hyun. He motivated all the employees to preset their decisions at the time of preparation of a new product such as laptops. Due to active participation in the decision making process, they realised that develop of new products such as laptop might help the organization to enhance its sustainability and reduce the upcoming threats such as challenges of new entrants, substitute products, change of customer preference etc (Kazmi, 2010, pp. 522-534). As a result, al the employee became highly motivated and committed over the research and development processes in order to create unique product lines. This strategy of teamwork proved positively over the organizational growth that amplified its prosperity and demand in the market among others (Beardwell & Claydon, 2010, pp. 223-234). Furthermore, long-term commitment to learning and education also enhanced the inner skills and talents of the employees. As a result, they became more devoted towards their assigned tasks that amplified their level of performance (Kotler & Keller, 2012, pp. 442-454). However, due to improved performance, the organization became successful in developed highly advanced and technologically superior products that fascinated the attention of the customers. Moreover, extensive communication among the members or the higher employers of the organization also proved effective in developing the product lines. This is because; at the time of communication, varied types of doubts and queries became entirely cleared that enhanced the implementation of varied types of new technologies and techniques within the products (University of Leicester, 2012, pp. 115-214). Thus, due to the use of such type of unique strategies, the organization became successful in amplifying its prosperity and market share among other rival players (Forbes, 2013). Innovation and customer satisfaction For Samsung organization, customer satisfaction is the prime vision. In order to fulfil it, the organization offered high concentration over products development strategy or innovation. By doing so, the brand value and market share of the organization enhanced surely along with improvement of its trust and leadership as stated by the business model of innovation, named disruptive innovation (Forbes, 2013). Disruptive innovation is recognised as one of the most successful strategy implemented by the organization of today’s era in order to amplify its customer base and new markets. This might help the organization to amplify its dominance and ranking in the market among many other existing rival contenders (Kotler, P. 2012, pp. 423-434). However, in order to fulfil the desire of increasing customer base and new global markets, the organization of Samsung offered high attention over innovation strategy that proved effective in developing various new product lines such as LED televisions, Ipods, laptops, smart-phones etc. Thus, the strategy of innovation proved extremely worthy for the organization that amplified its demand and total sale in the market among many other rival players. Hence, due to disruptive innovation, the target group of customers of Samsung also increased that enhanced its profitability and market value among others (Ellis, 2011, pp. 876-888). This increased the inner strengths and reduced the weaknesses of the organization in this competitive market condition. Furthermore, confidence and trust of the customers over the product lines of the Samsung also increased as depicted by the theory of diffusion of innovation (Kotler & et. al. 2012, pp. 345-356). This became possible mainly due to high acceptance of the product lines of Samsung in the market as compared to its rival products. As a result of which, the brand value and dependency of the organization of Samsung enhanced among the customers of varying cultural background and economic standard and lifestyle. Therefore, in order to know the feedbacks of the customers of varying cultures and income groups, online sites are introduced (Porter, 2010, pp. 210-223). This helped the organization to analyse the requirements of the customers as well as the satisfaction ratio as well. Due to which, the financial position and market share of the product lines of the organization of Samsung increased to a significant extent that reduced its weaknesses and upcoming threats. Thus, it might be clearly revealed that the strategy of innovation proved effective in enhancing the market share of smart-phone of Samsung among others as presented below: (Source: Forbes, 2013) Analysis Critically evaluate the factors that are responsible for creativity and innovation at Samsung organization The organization of Samsung is surely the most inventive organization as it became successful in fulfilling the changing needs and demands of the customers. This is mainly because of the fact that, they offered high preference to customer feedbacks and requirements. Due to which, the definition of innovation as per the CEO of Samsung is to develop products as per the demands of the customers so as to retain them for longer period of time (Jones, 2010, pp. 332-343). Only then, the organization might become successful in amplifying its prosperity and position in the market among many other rival contenders. Other than this, due to high technical knowledge and thinking power of kwon Oh Hyun, the organization, easily developed numerous product lines that satisfied the inner desires and motives effectively. Furthermore, the strategy of cost leadership also acted as the catalyst in enhancing the brand position and market share of Samsung in this aggressive market among the other rival players. This is because; the organization presented the products at a very low price to its customers in order to enhance its sustainability and competitive advantage in the market. This strategy helped in improvement of the dominance and profitability of the organization of Samsung (Robbin, 2010, pp. 312-323). Findings How innovation changed the business of Samsung? The implementation of the strategy of innovation proved extremely effective for the organization. It amplified the product lines of the organization of Samsung that increased its customer base and portfolio in the market. Other than this, due to the implementation of the innovation strategy, the conditions of the market and the customers improved significantly. Market: Due to implementation of innovation strategy, the sustainability of the market enhanced. The market share of the organization has been increased with up increased demand of its innovative products. The level of competition subsidised and the threat of substitute products reduced. People: Due to introduction of varied inventive product lines, a wide range of customers became attracted. The rate of retention of the customers enhanced to a significant extent as compared to its rival players. Moreover, the employees of the organization of Samsung became encouraged towards the assigned tasks and presented various praiseworthy product lines. Due to which, the financial position of the organization increased that amplified its reliability and trust. This increased the profitability and productivity of the organization of Samsung as compared to its rival players. However, such a position is attained by Samsung also due to effective support and coordination of the CEO, Mr. Hyun. He motivated the members of Samsung to work co-ordinately and uniformly in order to amplify its product lines. As a result of which, the organization became successful in satisfying the demands and changing requirements of the customers (Schumpeter, 2012, pp. 189-223). Due to which, the profitability and brand value of the organization increased in the entire globe. Furthermore, the implementation of the strategy of eco-innovation also proved extremely effective for the organization thereby attracting a wide range of customers that amplified its financial condition to a considerable extent (Ellis, 2011, pp. 567-578). Hence, it might be depicted that, the organization of Samsung is recognised as the most innovative and creative organization as it easily fulfilled the changing demands of its target customers. This is mainly due to its inventive technologies and strategies that helped its product line to amplify its demand and position in the market among many other existing rival players such as Apple Inc, Sony, Motorola etc. Conclusion Conclusively, it might be depicted that in order to improve the level of sustainability and competitiveness in the market, innovation is the most important strategy or approach. Keeping this idea in mind, the organization of Samsung implemented the strategy of innovation within its organization. However, in order to make the idea successful, the organizational CEO, offered high attention over training and development programs. This is because; due to constant training program, the inner skills and talents of the employees might get enhanced that may prove effective in developing inventive product lines or ideas. However, effective coordination and team work is also extremely essential for an organization to improve its portfolio and reputation in the market among other rival players (Adair, 2010, pp. 123-134). Other than this effective support and leadership style of Kwon Oh Hyun also helped the organization to improve its reliability and market demand. Thus, it might be stated that high preference over customer demands and requirements helped the organization of Samsung to amplify its corporate image and ranking among others. Thus, innovation and creativity is recognised as the inner pillars of success of the organization of Samsung that enhanced its brand image and sustainability in the market among other rivals. References Adair, J., 2010. Effective Motivation: How to Get the Best Results From Everyone. 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