Samsung Mobile: Market Share and Profitability in Smartphones SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study SWOT Analysis Solution
Case Study Description of Samsung Mobile: Market Share and Profitability in Smartphones
In December 2015, South Korean technology giant Samsung announced a new head to its mobile division. The announcement came on the heels of a challenging year for Samsung. Two handset launches that year had received criticism in the press for the way they were handled. The appointment was interpreted by many in the industry as Samsung signalling a desire to further intensify innovation in an increasingly commoditized product area. This was a time of intense challenge but also great promise. Complex questions involving significant trade-offs had to be answered. Should the mobile division push for profitability or market share? Were those objectives mutually exclusive? What was the best strategy for obtaining the chosen objective? And, how could Samsung differentiate itself in an increasingly crowded, competitive, and commoditized market? John Dinsmore is affiliated with Wright State University.
Swot Analysis of "Samsung Mobile: Market Share and Profitability in Smartphones" written by John Dinsmore includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Samsung Commoditized facing as an external strategic factors. Some of the topics covered in Samsung Mobile: Market Share and Profitability in Smartphones case study are - Strategic Management Strategies, Mobile, Research & development, Strategy and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Samsung Mobile: Market Share and Profitability in Smartphones casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, increasing government debt because of Covid-19 spendings, cloud computing is disrupting traditional business models, increasing transportation and logistics costs, geopolitical disruptions, technology disruption, increasing inequality as vast percentage of new income is going to the top 1%,
there is backlash against globalization, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Samsung Mobile: Market Share and Profitability in Smartphones
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Samsung Mobile: Market Share and Profitability in Smartphones case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Samsung Commoditized, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Samsung Commoditized operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Samsung Mobile: Market Share and Profitability in Smartphones can be done for the following purposes –
1. Strategic planning using facts provided in Samsung Mobile: Market Share and Profitability in Smartphones case study
2. Improving business portfolio management of Samsung Commoditized
3. Assessing feasibility of the new initiative in Sales & Marketing field.
4. Making a Sales & Marketing topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Samsung Commoditized
Strengths Samsung Mobile: Market Share and Profitability in Smartphones | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Samsung Commoditized in Samsung Mobile: Market Share and Profitability in Smartphones Harvard Business Review case study are -
Analytics focus
– Samsung Commoditized is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by John Dinsmore can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
High brand equity
– Samsung Commoditized has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Samsung Commoditized to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Highly skilled collaborators
– Samsung Commoditized has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Samsung Mobile: Market Share and Profitability in Smartphones HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High switching costs
– The high switching costs that Samsung Commoditized has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Samsung Commoditized digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Samsung Commoditized has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Ability to recruit top talent
– Samsung Commoditized is one of the leading recruiters in the industry. Managers in the Samsung Mobile: Market Share and Profitability in Smartphones are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Superior customer experience
– The customer experience strategy of Samsung Commoditized in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Innovation driven organization
– Samsung Commoditized is one of the most innovative firm in sector. Manager in Samsung Mobile: Market Share and Profitability in Smartphones Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Operational resilience
– The operational resilience strategy in the Samsung Mobile: Market Share and Profitability in Smartphones Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Cross disciplinary teams
– Horizontal connected teams at the Samsung Commoditized are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Learning organization
- Samsung Commoditized is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Samsung Commoditized is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Samsung Mobile: Market Share and Profitability in Smartphones Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Samsung Commoditized is present in almost all the verticals within the industry. This has provided firm in Samsung Mobile: Market Share and Profitability in Smartphones case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Weaknesses Samsung Mobile: Market Share and Profitability in Smartphones | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Samsung Mobile: Market Share and Profitability in Smartphones are -
Slow to strategic competitive environment developments
– As Samsung Mobile: Market Share and Profitability in Smartphones HBR case study mentions - Samsung Commoditized takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Samsung Mobile: Market Share and Profitability in Smartphones, is just above the industry average. Samsung Commoditized needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Products dominated business model
– Even though Samsung Commoditized has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Samsung Mobile: Market Share and Profitability in Smartphones should strive to include more intangible value offerings along with its core products and services.
Skills based hiring
– The stress on hiring functional specialists at Samsung Commoditized has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Lack of clear differentiation of Samsung Commoditized products
– To increase the profitability and margins on the products, Samsung Commoditized needs to provide more differentiated products than what it is currently offering in the marketplace.
High cash cycle compare to competitors
Samsung Commoditized has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Need for greater diversity
– Samsung Commoditized has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
No frontier risks strategy
– After analyzing the HBR case study Samsung Mobile: Market Share and Profitability in Smartphones, it seems that company is thinking about the frontier risks that can impact Sales & Marketing strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
High operating costs
– Compare to the competitors, firm in the HBR case study Samsung Mobile: Market Share and Profitability in Smartphones has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Samsung Commoditized 's lucrative customers.
Capital Spending Reduction
– Even during the low interest decade, Samsung Commoditized has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Slow decision making process
– As mentioned earlier in the report, Samsung Commoditized has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Samsung Commoditized even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Opportunities Samsung Mobile: Market Share and Profitability in Smartphones | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Samsung Mobile: Market Share and Profitability in Smartphones are -
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Samsung Commoditized can use these opportunities to build new business models that can help the communities that Samsung Commoditized operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Using analytics as competitive advantage
– Samsung Commoditized has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Samsung Mobile: Market Share and Profitability in Smartphones - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Samsung Commoditized to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Manufacturing automation
– Samsung Commoditized can use the latest technology developments to improve its manufacturing and designing process in Sales & Marketing segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Sales & Marketing industry, but it has also influenced the consumer preferences. Samsung Commoditized can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Loyalty marketing
– Samsung Commoditized has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Better consumer reach
– The expansion of the 5G network will help Samsung Commoditized to increase its market reach. Samsung Commoditized will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Creating value in data economy
– The success of analytics program of Samsung Commoditized has opened avenues for new revenue streams for the organization in the industry. This can help Samsung Commoditized to build a more holistic ecosystem as suggested in the Samsung Mobile: Market Share and Profitability in Smartphones case study. Samsung Commoditized can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Samsung Commoditized can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Buying journey improvements
– Samsung Commoditized can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Samsung Mobile: Market Share and Profitability in Smartphones suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Samsung Commoditized is facing challenges because of the dominance of functional experts in the organization. Samsung Mobile: Market Share and Profitability in Smartphones case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Sales & Marketing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Samsung Commoditized can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Samsung Commoditized can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Building a culture of innovation
– managers at Samsung Commoditized can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Sales & Marketing segment.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Samsung Commoditized can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Samsung Mobile: Market Share and Profitability in Smartphones, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Threats Samsung Mobile: Market Share and Profitability in Smartphones External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Samsung Mobile: Market Share and Profitability in Smartphones are -
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Samsung Commoditized needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
High dependence on third party suppliers
– Samsung Commoditized high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Consumer confidence and its impact on Samsung Commoditized demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Samsung Commoditized.
Environmental challenges
– Samsung Commoditized needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Samsung Commoditized can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Samsung Mobile: Market Share and Profitability in Smartphones, Samsung Commoditized may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Sales & Marketing .
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Samsung Commoditized can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Samsung Mobile: Market Share and Profitability in Smartphones .
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Samsung Commoditized business can come under increasing regulations regarding data privacy, data security, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Samsung Commoditized with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Shortening product life cycle
– it is one of the major threat that Samsung Commoditized is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Samsung Commoditized in the Sales & Marketing sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Samsung Mobile: Market Share and Profitability in Smartphones Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Samsung Mobile: Market Share and Profitability in Smartphones needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Samsung Mobile: Market Share and Profitability in Smartphones is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Samsung Mobile: Market Share and Profitability in Smartphones is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Samsung Mobile: Market Share and Profitability in Smartphones is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Samsung Commoditized needs to make to build a sustainable competitive advantage.