Samsung Electronics was established in 1969 in Korea and has since grown to become a global leader in electronics, with 193 offices and facilities in 66 countries. The document summarizes Samsung's history and transformation from a producer of low-cost goods to a highly innovative technology company through strategic investments in R&D, design, and building strong brands. Key highlights include laying off 30,000 employees and closing factories in 1997 to pivot to a "Digital Vision" strategy focused on leadership in areas like memory chips, displays, smartphones and TVs through continuous innovation.

1. SAMSUNG ELECTRONICS
Seoul, Korea
Ali Soltani
Spring 2011

2. Agenda
• Samsung Group – History & Structure
• Samsung Electronics
– History
– Company Focus
– Financial Overview
– Strategy
– Organizational Structure
– Challenges

3. Samsung Group
• Founded in 1938
– exporter of dried fish, vegetables, and fruits
– flour mill and confectionery machines
• 1950’s Economic Stabilization
– Korean War - Samsung lost all assets
– aimed to help rebuild Korean economy; entered the
manufacturing industry (sugar, fabrics)
– became a leader in modern business practices (recruiting
from outside)
• 1960’s Expansion of Key Industries
– entered electronics and chemical industries
– 1969 established Samsung Electronics Co.

4. Samsung Electronics
• Established in January, 1969
• 1970’s: Bet the future on electronics
– laid the groundwork for electronics in Korea
– helped the domestic economy grow
– paved the way for exports
• 1980’s: A more comprehensive electronics company
– established plants in Portugal and US
– established Semiconductor and Communication corporation
– began memory chip business
• Early 90’s: Integration and Globalization
• Mid-Late 90’s: Implementing new management
strategies
• New Millenium: Digital Vision

5. HistoryHistory
1969
Company established
1969
Company established
1980
Korea Telecommunications
Corp. acquired
1980
Korea Telecommunications
Corp. acquired
1972
Production of B/W TV sets began
1972
Production of B/W TV sets began
1995
TFT-LCD mass production began
1995
TFT-LCD mass production began
1992
Company ranked world’s top DRAM supplier
1992
Company ranked world’s top DRAM supplier
1974
Wafer fabrication started
1974
Wafer fabrication started
1988
Samsung Semiconductor &
Telecommunications merged with
Samsung Electronics Co.
1988
Samsung Semiconductor &
Telecommunications merged with
Samsung Electronics Co.
1994
256Mb DRAM
developed
1994
256Mb DRAM
developed
1996
CDMA cellular services
commercialized
1996
CDMA cellular services
commercialized

6. HistoryHistory
2004
 S-LCD Corp., LCD joint venture with Sony established
 World’s 1st to develop and demonstrate Mobile WiMAX
2004
 S-LCD Corp., LCD joint venture with Sony established
 World’s 1st to develop and demonstrate Mobile WiMAX
1997
Worldwide Olympic
Partner contract signed
1997
Worldwide Olympic
Partner contract signed
2002
Production using 300mm wafer and
90nm processing technology started
2002
Production using 300mm wafer and
90nm processing technology started
2003
Company became leader in
flash memory
2003
Company became leader in
flash memory
1999
 World’s 1st to offer full line-
up of digital TVs
 Developed watch phone,
MP3 phone and TV phone
1999
 World’s 1st to offer full line-
up of digital TVs
 Developed watch phone,
MP3 phone and TV phone
2006
 World’s 1st Blu-ray
Player launched
 World’s 1st 50nm
1Gb DDR2 DRAM
developed
2006
 World’s 1st Blu-ray
Player launched
 World’s 1st 50nm
1Gb DDR2 DRAM
developed
2007
World’s 1st
64Gb NAND
flash memory
developed
2007
World’s 1st
64Gb NAND
flash memory
developed
2005
 World’s 1st Satellite
and Terrestrial DMB
terminals launched
 World’s 1st 102”PDP
TV, 82”LCD TV,
and 71” DLP™ TV
developed
2005
 World’s 1st Satellite
and Terrestrial DMB
terminals launched
 World’s 1st 102”PDP
TV, 82”LCD TV,
and 71” DLP™ TV
developed
2009 ~ 2010
 Reorganized into stand-alone
businesses
 Acquired Samsung Digital
Imaging Co.
2009 ~ 2010
 Reorganized into stand-alone
businesses
 Acquired Samsung Digital
Imaging Co.

7. June 2010
Manufacturing Subsidiaries 33
Sales Subsidiaries 50
Distribution Centers 2
Design Centers 7
R&D Centers 20
Branch Offices and Other 81
Total Facilities and Offices 193
Global NetworkGlobal Network
66 Countries

8. Worldwide Olympic
Partner since 1997
Leader in semiconductor,
telecommunication and digital
convergence technologies
193 offices and facilities
in 66 countries and
174,000 employees worldwide
Net Sales (2009): US$116.8 billion
Net Income (2009): US$8.3 billion
Second biggest US
patent winner in 2009 (IFI)
19th in
BusinessWeek/Interbrand’s
100 Best Global Brands
Samsung TodaySamsung Today
Named one of World’s 50
Most Admired Companies
by Fortune
Magazine
Selected for the Dow Jones
Sustainability Index
Ranked 4th globally and
1st in Asia among
corporations on the Carbon
Disclosure Leadership
Index

9. | 9
LCD
Business UnitsBusiness Units
Visual
Display
Semiconductor
Telecom
Systems
Digital
Appliances
IT
Solutions
Mobile
Communications LCD
Digital
Imaging

10. 2005 2006 2007 2008 2009
Strong revenue growth
Revenue
(Consolidated basis)
(Billion US Dollars)
Net Income
2005 2006 2007 2008 2009
(Billion US Dollars)
(Consolidated basis)
Financial PerformanceFinancial Performance
$79.6
$92.0
$105.0
$96.5
$116.8
$7.5
$7.9
$4.4
$8.3$8.5

11. Financial Overview

12. Financial Overview

13. Strategy
Samsung Market Strategy
before 1997

14. Strategy
Strengths
Long-time experience in producing technical
components and low cost manufactured products for
well-known companies.
High –quality products
Weaknesses
Low-price and down-market image
Its capital eroded by the Asian financial crisis in 1997
Distribution via discount chain at very low price
Communication messages were not consistent due to
using so many advertising agencies with more than
20 slogans

15. Strategy
• Opportunities
– Development of digital technology
– New powerful advertising channel: Internet
• Threats
– The global memory chip market dramatically
decreased due to the shrinking demand and
excess supply
– Chinese cheap products

16. Samsung Market Strategy
After 1997

17. Strategy
Digital Vision: “A Company that leads the digital
convergence revolution”
SOLUTION:
1.1.Lay off 30,000 employees
2.2.Close down some of Samsungs factories for 2
month
3.3.Sold about $2 billion worth businesses (pager &
coffeemaker)

18. Design
Consumer-brand awareness
Global leader in several products
High price products
Fastest growing brand
Brand value : $ 15 Billion
Hardware
Develop all components used in its own products

19. Strategy
2000 : design-led management
2001 : design labs : Los Angeles , London
2002 : Usability Laboratory
2003 : 33 awards at top design
2006 : market value rises above $100 billion
2007 : world's second-largest Mobile Phone maker
2008 : take the No.1 spot as the world’s largest technology
company
2009 : Entered the top 10 list in the world’s top 100 global
brands

20. Product Category Market Rank
Memory Chips 1
Computer Monitor 1
LCD Display 1
Big Screen TVs 1
DVD-VCR Combos 1
Projection TVs 2
DVD Players 2
Laser Printers 2
Mobile Phones 2
Microwave Ovens 3
Plasma TVs 4
Camcorders 4

21. Wow Products

22. • “We have to combine computers , consumer electronics and
communications as Koreans mix their rice with vegetables and meat”
• “We want to be the Mercedes of home electronics”
• “They’ve got the products , a growing reputation as the innovator , and
production lines to back that up”
• Creating chief design office

25. $7.5
$5.3
$6.2
$5.5
$6.3
$6.0
2005 2006 2007 2008 2009
Investment in R&D
(Billion US
Dollars)
Technological CompetitivenessTechnological Competitiveness
R&D Commitment
(as a % of parent company sales)
Innovating technologies by sustaining investment in R&D

26. Culture
• Entrepreneurial
• Profit focused
• Decisive
• Different from other firms in Korea and within
chaebol

27. Thank you