Samsung Electronics Company

1. There were various ingredients to SEC's corporate turnaround strategy, it focused on five areas: vertical integration, focus on hardware, product breadth, digital product innovation, and digital convergence. With vertical integration instead of outsourcing it kept production in house and kept the production as its core competency. This provided an advantage to SEC because it was able to provide customized and reliable products in a timely manner, with that provided it was able to provide higher than average prices, as much as 17% higher than industry standard. Samsung was able to keep costs low by building facilities in locations with lower costs. Through vertical integration Samsung was able to have greater control over its products and become a leader in OEM sales. While other rivals were not only producing hardware, they were also in the market of proprietary software and content like music, movies, and video games, Samsung was not. Samsung executives believed that this allowed consumer's to have access to more software than its competitors who consumer's had to go through their software. This also provides an advantage to Samsung because the technological world is constantly moving at a fast pace with new products coming out very quickly, if it can focus on just hardware it is able to allocate more of their resources to just that as opposed to hardware and software. Samsung's research and development and manufacturing included many products. This is an advantage to Samsung because more product breadth it was able to offer multiple products to different types of consumers. Samsung was becoming a leader of innovation spending $2.4 billion annually on research and development. This was an important move for Samsung because it kept them ahead of their competitors. Samsung was creating a better brand image by continuously introducing new products. With the large amount of money being spent on research and development as well as fewer levels of organizational bureaucracy, Samsung was able to release products twice as fast as some of its rivals, this kept Samsung ahead of the game. Through digital convergence Samsung wants to bring their products together so that they all work together and can all be controlled by one remote. With this strategy Samsung