Reaction Paper – Samsung: A Management Revolution

Canlas, Harold Naldo G.

MGMT 201 – SXY

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REACTION PAPER – SAMSUNG: A MANAGEMENT REVOLUTION

        Wikipedia defines Revolution as a fundamental change in power or organizational structures that takes place in a relatively short period of time. Aristotle describes two types of revolution as to either a complete change to one constitution to another, or a modification of an existing one. Lee Kun Hee, chairman of Korea’s most successful business conglomerate, Samsung, may well now be considered a revolutionary and visionary leader, having turned around his company’s economic standing 180 degrees, in just a few years after he took over the management.

        It may not have been a simple task to do so, but I must say that he has been successful in pursuing his goals and objectives for his company.

        Having been educated in some of the elite universities in the world, Lee put all his learnings into good use. It is evident that he has mastered the science of management, which he applied in running his own company.

        I can say also that luck was on his side, partly because he did not have to start Samsung from scratch. The firm was originally founded by his father as a rice-trading company. In short, he inherited it when his father passed away. Unlike starting entrepreneurs who shell out a good amount of money, time, and effort to start a new venture, he had a relatively stable enterprise in his hands. All he had to do was to continue running the business that his late father established. To keep it afloat, to reach the company’s goals, were all he had to do.

        I admire Lee’s clear vision of what he wanted his company to achieve, and where he wanted it to go – to become one of the world’s ten largest “technological powerhouses”.

        Lee clearly had focus. Although he has a large company under his supervision, he capitalized on one particular group, which is Samsung Electronics Co., to be the leading one among the whole chaebol. He had plans. And he planned well.

        Planning, as a management function, is defined as a process that involves defining the organization’s goals, establishing an overall strategy for achieving those goals, and developing a comprehensive set of plans to integrate and coordinate organizational work.

        Lee wanted to reorder his company’s investment priorities, refocus its product development and marketing strategies, and radically improve quality to compete in the global market. He wanted a complete turn-around, to change everything. He wanted an overhaul.

        I think that Lee was being ambitious in what he wanted to be done. Given that the world is partial to American and Japanese companies in terms of technology, having to compete in these industry giants is almost far-fetched.

        But as many experienced and successful people say, dream big and aim high. Maybe in Lee’s case, it was “dream bigger and aim higher”.

        I liked the fact that Lee was able to see and identify the problems that the whole company was currently facing that time. And based on the article, he was able to treat those problems as challenges for his whole team to become better. He was analytical and conceptual enough to think of solutions to those problems, one of which was apparent when he himself took his top management team to the United States to show them how their brand is doing globally.

        Noting the different planning tools and techniques discussed in my current course, I think Lee particularly used the environmental and global scanning techniques.

        Environmental scanning, by definition, is the screening of large amounts of information to anticipate and interpret changes in the environment. It is likely to reveal issues and concerns that could affect an organization’s current of planned activities.

        Had Lee not have the idea of bringing his team outside of their comfort zones, his people might have not realized where their company is heading to in the long-run. Although Lee’s top management team may not have positively responded initially to what he has done and what he wanted them to see, I think that the global exposure that Lee initiated was a wake-up call to them, at the very least.

        Competitor intelligence, which is another area of environmental scanning, is an activity that seeks to identify who competitors are, what are they doing, and how their actions will affect the organization.

        It is no hidden fact who the biggest competitor of Samsung is. Nowadays, in the world of mobile technology, particularly on the so-called smart phones, it is enough to say that Samsung and Apple products are dominating the market.

        We can say that Apple products first came out of the market, and in return became famous first, but I think Samsung used this to its own advantage.

        In the area of competitor intelligence, information about a competitor may be obtained through advertisements, press releases, annual reports and industry studies. In Samsung’s case, I think one of the things that they are doing is reverse engineering – buying competitor’s products and having their own engineers study them to learn about new technical innovations.

        In my own point of view, Samsung, being the one that offered state-of-the-art mobile devices at a later time compared to Apple, had the benefit to identify its competitor’s items’ strengths and weaknesses, and used them for their own products’ improvements.

        Lee also exhibited a good deal of organizing skills.

        As I learned from my management course, organizing is an integral function of management that deals with the process of arranging people and other resources to work together to accomplish a goal. Its purpose is to create a division of labor and then coordinate results to achieve a common purpose.

        I liked the fact that Lee delegated his management team well enough, for them to have more authority and be more active in decision-making. He did not keep everything in his hands. He gave his managers tasks to let them be, to make them participate in the different management tasks in their company, to be accountable for their own actions and decisions, and to be self-reliant.