Tuesday, April 24, 2012

Implementing Different Strategies in the Smartphone Industry

This week’s articles discussed strategy implementation and the importance of clearly articulating strategy.  In particular, the article “Can You Say What Your Strategy Is?” tells of the importance of having a consistent, unambiguous strategy.[1]  I read an interesting article in the Wall Street Journal today that focused on Apple and Samsung’s rivalry in the smartphone industry.  These two companies are dominating this industry, each with approximately 25% global market share, yet they have two vastly different strategies.  Together, these two companies obtained 91% of operating profits in the industry in fourth quarter last year.[2]
Apple prizes an excellent design for their one and only smartphone model and chose to focus of profitability versus sales.  Samsung takes a very different approach in the smartphone space.  Samsung has chosen to focus on volume and market share.  The company has multiple different smartphone models to meet users’ differing needs.  Samsung controls its own manufacturing, which in turn, enables it to control prices. [2]
This is an interesting example to highlights the fact that companies can have success in the same space while having completely divergent strategies.  It will be interesting to see how the smartphone market evolves.  How do you think other companies in the space will strategically position themselves in order to compete with the two current market giants, Samsung and Apple?  Will Apple be able to maintain its position with its single-product strategy as the smartphone industry continues to grow? 

[1] Collins, D. J. & Rukstad, M. G. (2008, April). Can you say what your strategy is? Harvard Business Review.
[2] Vascellaro, J. E. & Ramstad, E. (2012, Apr 24). The two-horse smartphone race. The Wall Street Journal. Retrieved from http://online.wsj.com/article/SB10001424052702303978104577362140799316460.html?mod=WSJ_hp_MIDDLENexttoWhatsNewsSecond

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