As rightly mentioned by John Chambers in this week’s article, “The best indication of when to make the jump frequently comes from our customers.” One particular company that I can think of is the Samsung Group which has had a huge transformation right from its foundation to date by using innovation as their key metric and understanding their customer’s needs.
Samsung has witnessed tremendous growth from starting out as a grocery store to now becoming a tech giant. The biggest factor that we can attribute to this enormous transition is innovation at the right time and for the right consumers. Samsung is one of the finest examples of how evolving strategic solutions are the need of the hour for organizations who want to survive and profit in this rapidly changing world.
Founded in 1938 in South Korea, Samsung was a grocery store which traded fruits, vegetables and dried fish throughout the country as well as exported it to China.
1st Evolution: After the Korean War, Samsung expanded to textiles and setup the first Woolen mill in Korea. This not only helped nation’s economy but also generated lot of jobs.
2nd Evolution: Understanding the customers need and changing preferences, Samsung entered the electronics market and produced household appliances. Capturing the consumers shifting habits and seeing the rise of the electronics industry, Samsung entered this domain at the perfect time and made huge profits.
3rd Evolution: Not wanting to be left out in the emerging field of heavy industries which was growing with the needs of new industries, Samsung opened subsidiaries like Samsung Heavy Industries and Samsung Shipbuilding. It also ventured into investing in Chemical and petroleum industries. Even though Samsung tried to diversify in different fields they ensured that they identified the potential market sooner than the rest.
4th Evolution: This advent of technological evolution changed the dynamics of the company and placed them as the market leader in memory chips and the world’s biggest manufacturer of semiconductors. Knowing that semiconductors are needed in almost all electronic equipments, Samsung made a smart strategic move to capture this market soon before anyone else tried to monopolize it.
In spite of emerging as a major manufacturer, Samsung was left with a reputation of not making high quality and long-lasting products. Even though Samsung was becoming a market disruptor, it was time for a pause in order to rethink its own existing strategy for the upcoming evolution.
5th Evolution: Samsung underwent a major transformation and reinvented itself as a major manufacturer of “Quality Technology Products”. This was their biggest evolution which accelerated their growth manifold. Samsung started making quality mobile phones and faced stiff competition from Nokia. But over the years by staying ahead in technology and developing their products with the growing needs of consumers, it disrupted the mobile segment and displaced Nokia out of the market. Its first commercial success was Galaxy S phones which sold more than 25 million units.
Even amidst controversies and numerous failures during the evolutions, Samsung is now the 15th largest company in the world. As Chambers mentions, “Even great companies are imperiled if they miss a market transition”, In my opinion Samsung exemplifies that with evolving strategies, cutting edge technologies and adoption of changing market trends at the right time not only makes them successful but also undisputed amongst conglomerates. Had they not been this agile in adopting new technologies, Samsung would have faded into oblivion akin to Nokia.
References :
1. https://www.businessinsider.com/history-of-samsung-2013-2
2. https://hbr.org/2011/07/the-globe-the-paradox-of-samsungs-rise
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