Samsung Electronics: Value Chain Analysis

Samsung Electronics: Value Chain Analysis

Introduction

Samsung Group is basically a multinational conglomerate corporation that has its headquarters in Samsung Town located in Seoul, South Korea. Samsung electronics has around 144 consolidated subsidiaries and 18 of them were established and consolidated at the end of year 2011 (Samsung, 2012). Samsung group has been divided into different business division or electronic divisions that are namely Samsung Electronics Devices Co., Samsung Electro-Mechanics Co., Samsung Corning Co., and Samsung Semiconductor & Telecommunications Co. Basic aim of Samsung was to introduce innovative technologies and processes that create new markets of products by providing people with experience of enrichment when using their products and also maintain their position as a market leader that is trusted by all. Currently it has around 111 subsidiaries that can be divided into production, sales, distribute, researcher and different overseas business divisions that are present I different geographical locations such as North America, Europe, China, Southeast Asia, North America, Europe, China, Southeast Asia, Southwest Asia, Central and South America, CIS, the Middle East and Africa. We will be employing value chain analysis for the purpose of analyzing the strategy formulation of the company and use additional information with regards to its supply chain management system and global value chain system which is its major competitive advantage over other competing firms in the industry.

Discussion

Global Value Chain

It has been suggested that global value chain plays a very important role especially in case of developing countries and is an effective way of gaining access to international markets through entering the networks of international design, production and marketing of different firms. Research suggests that global value chain results in acquisition of skills and capabilities to marketing channels which is require in order to gain access to global village and once this access is gained it gives rise to a learning process as a result of supplier buyer interaction. All in all entrance in to global value chain will have positive impact not only the enhancement of technological capability of the company but will also help and promote the learning process of the firms involved in the process. (Gereffi et al., 2001; UNIDO, 2002)

Samsung Background

Samsung Electronics sales exceeded in 150 billion USD in t year 2011 which is a 7 percent increases from the figures of year 2010. In the year 2010 it employed around 190,464 employees directly and around 800,000 employees globally through sub contract (Samsung Electronics, 2011). It invested heavily in the production of dynamic random access memory chips and liquid crystal display screen as well as in mobile phones, which proved to be a successful decision and is obvious from its current technology and success of mobile phones and paid off handsomely (Samsung Electronics, 2011). It is planning to expand and branch out further in different fields such as solar panels, energy saving light emitting diode, medical services, biotech drugs and batteries for electric cars. By entering these new fields Samsung will be able to grow rapidly due to ...