Samsung rocks - as simple as that

There are a lot of write-ups about Samsung in this blog, with all the justifications behind it. It is a great company, with a great culture, a lot of firsts in a variety of markets from cameras to the development of a hard-drive phone to - I believe we can lose track easily. Do a search in this blog and you will find plenty.

The company has its customers in mind when it develops products and it doesn't push its products - which is important - but let customers experience the feel of its products. With the amazing by-product that customers really, really don't need to buy - just experience the product. So much for great confidence.

BusinessWeek runs an article this about Samsung's winning formula this week - design and committed leadership.

Let me describe some of the many, many keypoints in this article.

How did Samsung get so far? BusinessWeek writes that "the change started in 1993, when Chairman Lee Kun Hee visited retailers in Los Angeles and saw that Samsung products were lost in the crowd, while those from Sony Corp. and a few others stood out. So he ordered his managers to concentrate less on cost saving and more on coming up with unique products."

I love this - cost savings or its worse cousin, cost cutting, is one of the core competencies of many companies - but it is the company that invests in its future today that succeeds tomorrow. Look at Intel and its behaviour throughout the last rececession. As a sign, they hired when others went down.

As it is often the case in companies, leadership makes a difference and the way they use words is important in describing their aspiration.

Samsung's CEO Yun Jong Yong says that

"We want to be the Mercedes of home electronics."

How does this sound?

And design became them - "since 2000, Samsung has earned a total of 100 citations at top design contests in the US, Europe, and Asia." BusinessWeek also mentions the five awards in the Industrial Design Excellence Awards (IDEA) that Samsung won in 2004 and which made the company the first Asian company to win more awards than any European or American rival. And of course - a great company attracts knowledge worker - Samsung Electronics was one of Asia's most admired knowledge enterprises.

What is the CEO saying now about design?

"Good design is the most important way to differentiate ourselves from our competitors."

And where do their designers look? Not inside their industry - if you are a market leader or even if you intend to become a market leader, you might want to look outside your industry to see, what could inspire your future customers.

"Samsung started sending designers abroad to spend a few months at fashion houses, cosmetics specialists, or design consultancies to stay current with what's happening in other industries. Lee Yun Jung, a senior designer who works on colors and finishes, spent last autumn in residence at a furniture designer in Italy."

Now this is a marketing lesson for oh so many of the boring companies out there that don't produce much else than products that look the same as the products of their competitor, that hire people from the same industry and franatically benchmark practices without realising that benchmarking alone does not differentiate them from the next company.

Of course, there is a danger that Samsung is going to be overtaken. But they invest in their future and run fast and hard. The company has doubled its design staff, to 470, adding 120 of those just in the past 12 months. And since 2000, its design budget has been increasing 20% to 30% annually. And, by the way - they also have the post of a chief design officer.

Will they survive the run? Well, may be not - giants tend to fall from time to time and not many get up and run some more, but may be they do, for a while at least - but whatever it is, it is a pleasure to watch it now, today.

(By Asia Business Consulting)