Samsung history has gone from a noodle and seafood company to one of the world’s most famous brands, survived wars, several economic crises and even corporate scandals, but remains the market leader in smartphones and electronics. Let’s think about the history of the corporation and why it owes its success.
History of Samsung
In 1938, Lee Byeong-chol founded Samsung Sanghoe, a trading company that mainly sold dried seafood, noodles and agricultural products. The Korean War in the early 1950s nearly destroyed business. Having lost most of his physical assets, Lee was forced to rebuild the company. Then it was transformed into a chable (family business conglomerate) called Samsung Group, and began to explore new areas, selling insurance and securities.
The postwar economy proved to be favorable for business. Local demand for raw materials and consumer electronics grew, and Samsung Electronics was founded in 1969, followed by other divisions.
Lee died in 1987, and his youngest son, Lee Gong Hee, became the head of the company. It is thanks to him that the Samsung brand is loved by millions of consumers around the world.
“The company’s most important assets are design and other creative abilities,” said Lee Gong Hee.
By the 1990s, Samsung had begun to strengthen its status as an international corporation. Samsung C&T has built one of Petronas’ two towers in Malaysia and Burj Khalifa in the UAE. In 1992, Samsung Electronics became the world’s largest chip maker.
Until the mid-2000s, Samsung was a leading player in the consumer electronics market. It sold a huge number of TVs, audio systems and household appliances, ahead of such serious competitors as LG, Panasonic and Sony.
In January 2021, the company’s CEO and grandson of Samsung founder Lee Jae-yen was arrested for involvement in the scandal surrounding former South Korean President Park Geun-hye and her friend Chhwe Sung-sil. However, this did not affect the corporation’s activities.
Samsung Group is currently managed by three CEOs: Kim Ki Nam, Kim Hyun Suk and Ko Dong Jin.
History of the company name
Lee wanted his business to be as strong and durable as heaven. So he chose the name Samsung, which in Korean means “Three Stars”. In this case, the symbol sam means strength and greatness, and sung – eternity.
Eventually, the three stars became associated with Samsung’s key activities: electronics, information technology and development.
History of the Samsung logo
The first brand logo appeared on the packaging of the noodles. Its main element was the three stars, which were preserved in subsequent versions. The three horizontal stripes meant rice noodles, one of Samsung’s main products, and the ears served as a reference to the company’s agricultural business.
Subsequently, the company launched new activities, and the symbols of food disappeared from the logo. The word Samsung appeared, the stars became quadrangular. Then the logo was still in black and white.
With the advent of color TVs in the logo added colors: now the stars had a red background in the shape of octagons. At the same time they tried to remove the inscription, but later decided to return it.
In 1993, Samsung was actively gaining ground in the international market and carried out a large-scale rebranding. The stars have been replaced by a blue oval, which symbolizes the universe. It was later simplified. Now the brand logo consists of a blue inscription, and the former version is used as a corporate symbol of the Samsung Group.
Samsung Group structure
Trade and investment group
The history of Samsung’s trading business began in 1938, when Samsung Sanghoe was founded. In 1951, the trade area was separated into a separate organization Samsung Mulsan (later – Samsung C & T Corporation).
In 1975, the Korean government selected it as the first “broad-based trading company” to be engaged in international trade. In 1995, it merged with Samsung Construction and operates in more than 50 countries.
In the 1990s, Samsung C&T Corporation transformed its business structure to focus on high-profit sectors. The fashion industry, resorts and entertainment, the electronics industry and the engineering and construction group have emerged.
Now the division works in the fields of civil engineering, development, finance and design.
Fashion industry group
In 1954, the textile company Samsung C&T Fashion Group was founded. According to Jean Colin, vice president of international expansion, the business portfolio explains the specifics of Korean culture. Until recently, the country’s workforce consisted mainly of men, and Samsung C&T Fashion Group specialized in the production of men’s suits and woolen fabrics.
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As South Korea became a market with potential for the luxury segment, many international companies sought ways to enter the region by entering into agreements with a local partner. It was Samsung C&T Fashion Group, which is now the largest player in the Korean fashion industry.
She now distributes brands such as Theory, Tory Burch, Rick Owens, Thom Browne, and rag & bone, and manages her own brands Galaxy, 8 Seconds, Beaker, Beanpole and Kuho.
Resort and entertainment industry group
Samsung C&T Resort Group was founded in 1963 and later became involved in the development of resorts, golf clubs, landscaping, as well as the supply of food and beverages.
In 1982, a division of Samsung Welstory was established, and in 2013 it was separated into a separate business. It is now Korea’s largest catering company.
Samsung C&T Resort Group operates Everland Resort with two amusement parks and 5 golf clubs.
Engineering and construction group
Samsung Heavy Industries was founded in 1974. She was mainly engaged in the construction of container vessels and tankers. Subsequently, gas supply facilities, drilling rigs, production facilities, support and ferry vessels were added to the project portfolio.
Samsung Heavy Industries is now one of the largest shipbuilding companies, along with South Korean Hyundai and Daewoo, which fulfills orders for Shell, Eni and the world’s leading energy companies.
The direction of the electronics industry
In 1969, Samsung Electronics was founded, which began to create devices, semiconductors and telecommunications equipment.
Samsung Electronics’ first development was a small black-and-white TV that went on sale in the early 1970’s. Later, the company began producing a wide variety of products, from home appliances and motors to smartphones and solar panels.
In 1978, a subsidiary of Samsung Semiconductor and Telecommunications was established to enter the semiconductor market. To compensate for the lack of expertise, the company actively involved foreign experts, and in 1983 acquired patented technologies from Micron (USA) and Sharp (Japan). As a result, Samsung was the first in Korea to produce inexpensive and relatively simple 64-kbit DRAM memory chips.
In 1994, the company introduced 4 Mbit chips, and by the end of the year its revenue grew from $ 173 thousand to almost $ 1.3 billion. As a result, by early 1995, Samsung became the world’s leading manufacturer of DRAM chips.
Already in 1996, due to market oversaturation, semiconductor prices fell, and in the fall of 1997 the Asian crisis began. Samsung had to change its strategy and restructure its business.
If in 1995 chips accounted for half of sales, by the end of 1999 their share had dropped to 20%. The company is firmly established in the markets of telecommunications and mobile phones.
An agreement was reached with Apple in 2005: until 2014, Samsung was a key supplier of components for the iPhone.
Samsung has regularly released new products ahead of the market. Recently, the company even presented a report on the potential of 6G technology.
History of Samsung phones
The company introduced its first SGH-100 mobile phone in 1988. In 1998, the SGH-600 was released, which helped Samsung enter European markets.
In 1999, she developed a phone with a wireless Internet connection (smartphone).
In 2010, a line of Galaxy smartphones based on the Android OS was launched. Released in 2013, the Samsung Galaxy S4 is still considered the most commercially successful Android-based model: more than 80 million units were sold.
In 2016, there was a scandal with the model Galaxy Note 7. Smartphones exploded and exploded among users from around the world. By the fall, phone sales of the company fell by 15%. The company immediately acknowledged the problem and made the investigation as public as possible to restore consumer confidence.
In 2018, the company launched the world’s largest smartphone factory in the Indian city of Noida.
In 2019, Samsung introduced the Galaxy Fold, launching a new category of mobile devices. The corporation regularly demonstrates interesting concepts, for example, in 2020 it introduced an expanding telephone.
Now the company maintains a leading position in the smartphone market. According to the results of 1 sq. Km. In 2021, Samsung was the leader with a market share of 21.8%.
Features of Korean management
Under the influence of economic crises in recent history, the style of government in South Korea has been transformed. It harmoniously combines two models:
Japanese – harmony within the company, work in one company for life and salary, which depends on seniority,
American – emphasis on performance.
South Korean companies often use a hybrid approach. At the same time, the influence of Confucianism is preserved in corporate culture, the main values of which are wisdom, loyalty, humanism and justice. Although the common approach of “boss is always right”, the decision is often a combination of management and middle managers.
The society is characterized by close ties: the search for employees is often conducted among relatives, those who attended the same school or were born in the same region.
Samsung’s management model is carefully thought out: it combines competition between employees, a focus on product quality, intensive training aimed at harmony in the team, as well as the requirement of strict discipline and loyalty. The most Americanized is the semiconductor manufacturing division, in which hundreds of employees annually undergo internships at Toyota and get acquainted with the main models of the Japanese company.
Sponsorship of Samsung
Samsung has been a sponsor of the Olympic Games since 1998. Later, the company began supporting the Asian, Paralympic and Youth Olympic Games, as well as the international federations of skiing, hockey and football. In addition, the South Korean giant sponsors teams from various countries, such as Chelsea Football Club.
In 2014, Samsung sponsored the 86th Academy Awards. Viral was a selfie with the participants of the event, made by the leading Ellen DeGeneres on a smartphone Samsung Galaxy Note.
Recently, the company has turned its attention to video games. Having signed a contract with Twitch, Samsung has become a sponsor of the Rivals platform, which will host tournaments with mobile games. Thus, it is planned to promote Galaxy smartphones.
Secrets of Samsung success
The history of the company is an example of colossal success. From a small business, it has grown into a global corporation with one of the world’s most recognizable brands. What is her secret?
- Samsung has managed to transform effectively during the crisis. In 1993, Lee Gon-hee proposed a new strategy inspired by the major trends of the 1990s: globalization, the democratization of South Korea, and digitalization.
- Samsung has regularly launched new profitable business lines. The lack of expertise is filled by acquisitions or partnership agreements.
Samsung combines best management practices. It is a hybrid of American and Japanese approaches: a Western focus on income, frequent changes of course and products combined with Eastern discipline, loyalty and hard work.
Samsung responds quickly to incidents. A clear example of this is the story of the Galaxy Note 7