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Saturday, January 22, 2005

Samsung Obsessed With World-First Title

I wrote plenty of times about Samsung as a company that sets the pace in many areas. And the results actually speak for it in the sense that their profits are soaring to record highs.

It is dangerous, however, if a company falls in love with their own achievement. It is then when complacency can set in and failure dooms. This was the case with the old IBM, way back in the late 1980s, beginning 1990s, when the company didn't foresee the change in its business environment and the emergence of disruptive technology in their space. It was then when they tought that they were the Untouchables, so to speak.

Apparently, many companies challenge Samsung in their claim to be a first in many markets.

"During the first 19 days of this year, Korea’s electronics juggernaut issued 20 press releases including seven about new merchandise of chips, computers and mobile handsets.

Among the seven items, Samsung, the world’s largest memory-chip and liquid crystal display maker and runner-up handset vendor, asserted it unveiled five times faster than any other global competitor.

The five goodies include speech-to-text conversion phone (Jan.6), eight chip-stacked multi-chip package (Jan.10), motion-recognition phone (Jan.12), Sonoma-equipped notebook PC (Jan.18) and 512-megabit mobile memory (Jan.19).

The company also announced its digital TV receiver chip, named S5H1406, has the world’s highest TV broadcasting signal reception rate on Jan. 12.

Only its QWERTY phone disclosed on Jan. 7 with a computer-like keyboard failed to get a world-first title. Instead, Samsung labeled it as the first with such a unique user interface in Korea.

However, Samsung’s domestic rivals, which have been silent so far, started to challenge the market leader’s claims from late last year."

Apparently, inside pressure is also mounting. The newspaper reports that "when contacted, a Samsung insider confided that staff members are under great pressure to accelerate the roll-out ceremony of new products to keep the target of being the world’s first and the world’s best.

Experts point out that Samsung needs to change its strategy and give itself some leeway if the outfit wants to become a bona fide world leader."

This is dangerous for the company - internal pressure that is applied too strong might lead to failing products, or higher turnover. A great corporate culture is important to nurture innovation. Innovation specialists, let's me call them so, need their space to develop new products. They need to be able to fail, and they need to have time and the creative freedom to innovate products.

So let's take a step back and see how the juggernaut develops in the months to come. It would be sad if they fail because of a wrong obsession.

(By Asia Business Consulting)