This is all about Samsung and its Diversification Stategy

1. Company gone for
Diversification

2. Company gone for Diversification
By,
 Prashant KV
 Praveen Kumar
 Prathyaksha Shetty
 Praveen Devadiga

3. SAMSUNG
Samsung is one of the company that gone for Diversification. Samsung adds
new or unrelated product lines to penetrates new markets, such as : Textiles,
insurance, securities, construction, Solar cells, rechargeable batteries for hybrid
cars, LED technology, Smartphone, biopharmaceuticals and medical
equipment's in its line of Production. he success of the diversification
originated from Samsung's creative understanding of Core Competence.

4. About Samsung Company
• Samsung is a South Korean multinational company headquartered in Samsung
Town, Seoul.
• Samsung is known as worlds largest information technology company.
• Samsung was founded by Lee Byung Chul in 1938 as a trading company.
• After Lee's death in 1987, Samsung was separated into four business groups –
Samsung Group, Shinsegae Group, CJ Group and Hansol Group.
• Samsung Electronics has assembly plants and sales networks in 88 countries and
employs around 370,000 people.

5. Diversification Strategies
• Samsung has been successful in diversifying strategy due to a powerful and well-
known brand name, advanced technology, extensive distribution network
• In horizontal diversification, Company creates or acquires production units for
outputs which are alike - either complementary or competitive
• It is the diversification through establishing structure and systems that are most
suitable to itself
• The success of the diversification originated from Samsung's creative understanding
of Core Competence

6. • R&D investment will be positively associated with a change in diversification strategy
• In 1993. after it has made success in semiconductors Samsung made a great effort to
develop LCD technology
• LCD has become world's mainstreams products due to its excellent quality, and
maintained it at the top for eight consecutive years
• In 2011, Samsung electronics is diversifying into bio pharmaceuticals by joint
venture with investment of around $264.4 million
• During 2013, Samsung has merged its home grown Bada operating system (OS) with
Intel's open source Tizen

7. Challenges
• The markets are certainly promising, but they entail huge risks
• In the consumer electronics industry, fierce competition, short life cycles
products, always requires focused investments to catch up with changes in
technology
• Working with partners entails sharing information and a view of joint
success that is at odds with its insular corporate culture

8. Achievement
• The 83 firms that are tied together in Samsung's remarkably complex structure
provide 13% of South Korea's gross exports
• Notable Samsung industrial subsidiaries include Samsung Electronics, Samsung
Heavy Industries and Samsung Engineering
• Other notable subsidiaries include Samsung Life Insurance, Samsung Everland
Resort, Samsung Techwin (an aerospace, surveillance and defense company) and
Cheil Worldwide (the world’ 16th largest advertising Agency)
• Samsung has a powerful influence on South Korea's economic development,politics,
media and culture. Samsung's revenue was equal to 17% of South Korea's $1,082
billion GDP

9. Rivals
• Competitors of Samsung Electronics such as Apple, Sony, LG, Nokia,
Panasonic, and some Chinese firms had started investing heavily in R&D and
product design
• In medical devices Samsung will be up against firms like Philips, Siemens,
Toshiba, Hitachi and GE(for which Samsung made medical equipment
between 1984 and 2004)

10. Conclusion
• Innovation is at the heart Samsung's business success
• Research and Development Protect its innovations
• Samsung maintains and strengthens its market dominance through the speedy
introduction of new technology.
• Samsung has made efforts to develop environmentally-friendly products which
consume low level of energy and which contains no hazardous material
• The company has also modified its assembly processes to cut down carbon
emissions substantially