From Free Lunch To Black Hole Credit Default Swaps At Aig Harvard Case Study Help

Home >> Hrm >> From Free Lunch To Black Hole Credit Default Swaps At Aig

From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Solution & Analysis


Historically, the company's core clients consist of the Original Devices Manufacturers (OEMs), which used to offer From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Analysis products withtheir own brand name. Its customer circle consists of Original Equipment Manufacturers (OEMs), who used to sell Samsung items with their own brand name. He rearranged Samsung as an international brand and educated his divisional supervisors to understand marketing and its significance.

Issue Declaration

Samsung's transition from a product based to a marketing company is not going as efficiently as planned.Overcoming the hesitation of divisional managers to include marketing successfully is still a major challenge. Developing a consistent brand identity throughout the entire world and utilizing marketing techniques that finest fits the regional culture is no simple job. The M-net program analysis have been truly practical in figuring out the high and less possible development locations, however allotment of resources accordingly is not well received among the supervisors. There is no consensus among the hierarchy regarding the best matched future strategy.
Executive Summary
Situational Analysis

Yun had a quite clear picture in his mind about how From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Help can transform from a low end to a high end product service provider. He understood that improvement can only be done through placing Samsung as a company providing high-end products and this might only be done through high level of marketing.

In spite of having a clear vision about how to develop Samsung brand, with a potential support of its executives, Yun faced several marketing difficulties in early years of its efforts.

Among the marketing obstacles for Yun was the understandings of executives about the value of marketing. They thought about marketing and selling as very same tools and believed that quality items do not required marketing for increasing sales. As their focus towards marketing was quite low in their previous business practices, and the present marketing requirement was too much high, the gap was too wider and to fill this gap with wrong understandings about marketing was rather difficult for Yun.

As mentioned above, marketing focus was extremely low in previous practices, for that reason there were no appropriate marketing spending plans for each of the item on the portfolio. There was no marketing preparation provided for the existing items. Along with it the product range of the company was increasing with the ripening of brand-new item concepts by the R&D sector of Samsung. Yun had a challenge to perform marketing preparation and to develop marketing budget plans for existing along with for brand-new products from the very start, and this would take a huge time.

A big shift would be required in present marketing expenditures to construct the Samsung brand name. This would result in increased marketing expenditures for Samsung and might disturb the administration relating to increased costs, as they were unwilling to marketing expenditures previously and an abrupt huge shiftwould make them disturb.

Internal Analysis
SWOT Analysis

From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Solution strengths lie in its huge product portfolio. Samsung has largest number of patents in the market with overall number of 15499 patents given in United States( USP).

Another strength of From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Solution is its ability to develop ingenious products at a continuous rate. It significant proves for the innovation and item designing of Samsung is that the company has gotten many awards for its development and item style.

Unlike Apple and other rivals, Samsung is concentrated on producing gadgets which can be easily incorporated with any kind of open source Os (OS) and software. This provides Samsung an edge over Apple devices.
Porter's 5 Forces Analysis
Samsung's ability to produce luxury products at low cost of production is also among the significant strength of Samsung as it enables the business to capture more market by offering quality items with expense control.


Samsung's weaknesses are concealed in the company's dependence on outsourcing software application for its devices due to business's failure in developing software, unlike Sony. From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Solution also has low profit margins as compare to Apple due to substantial distinction in the rates of Apple and Samsung with a much lower distinction in quality.


Opportunities for From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Analysis lie in the growing Mobile phone market and the company's effectiveness in the market. Samsung currently runs in about 80 nations and the company has an opportunity to increase its geographical expansion by moving towards more emerging markets outside Asia.


The dynamic market environment of innovation industry position a severe hazard on Samsung's survival and require the business to spend much of its earnings share on R&D in order to make it through in the long run. The market saturation in developed nations i.e. saturation of mobile business is likewise a huge risk for the business's growth in the presence of strong competitors like Apple.

4 P's of Marketing
Swot Analysis

Samsung offers quality products and has a rather rich portfolio which caters to various sectors. LCD and mobile phones are the most significant products of Samsung, whereas DRAM is also not far behind in contrast of them.

• Laptops.
• Smart phone.
• Ac system.
• Computer.
• Hard disk drives.
• Washing machines.
• Fridges.
• Electronic cameras.
• Microwaves.
• Flash memory.


From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Analysis utilizes both market competitive and market skimming prices methods for its wide range of items. In competitive prices it changes the price according to the competitors in order to get advantage, whereas, it uses market skimming technique where the product has actually an included value and by selling a couple of products it can reach break-even.


It has one of the best supply chain networks, with retail distributors, their own sole distributors, E commerce channels like Amazon etc. All its products are prompt provided to the selling location/ delivered to the customers directly in case of online order.

Vrio Analysis
It wasn't a widely known company beyond Korea until 1993. But the management effort taken by their CEO has pressed them to market more efficiently outside the borders and now it has actually entered the league of leading 25 companies on the planet in just 9 years. This is an impressive accomplishment despite the ongoing arguments amongst the supervisors about adopting marketing practices. It utilizes both offline & online channels of promo to market their items. Paid item advertisements, social promo and digital ads are utilizes to develop awareness about Samsung items.

Value Chain Analysis.

It's an analytical framework for recognizing business activities that include value or competitive advantage for the business.

Incoming Logistics.

It has among the most reliable and efficient supply chain network and has more than 2700 suppliers throughout numerous industries around the world. Nearly 80% of which is based in Asia and the staying around the world. For its inbound logistics it owns different logistics companies as it subsidiaries. It looks after its suppliers and creates an unified relationship with them and even decreased their payment cycles to enhance this relationship even more which includes worth to their chain network.


Samsung's core proficiency is its mass making it produces 90% of its products in-house. Divided into 3 various departments its operations are specifically IT & Mobile Communications, Device Solutions and Consumer Electronics. It is preserving operation hubs worldwide to even more add worth to its worth chain network.

Outbound Logistics.

Its outgoing logistics system performance is among the primary factors From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Help has the ability to take on Apple. Samsung's own Electronic Logitec system plays a significant role in the outgoing logistics operations. It even performs the jobs of collection of payment, settling insurance claims, etc. on behalf of Samsung.

Marketing and Sales.

Attracting target client attention towards the product is done through marketing and sales to communicate with them the worth and competitive benefit the product provides. From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Solution marketing budget plan is constantly growing because they began their rearranging internationally and will continue to do so as they are continually wanting to expand and invest in high possible growth markets. The budget is spent on occasions, print and media ads, public relations etc.

Samsung Service. Samsung put their consumers at the top and continually aim to deliver unmatchable customer service requirements. As after sales service is ending up being extremely essential to keep consumers happy and engaged, they even conduct surveys through third parties to discover their client's feedback and execute it in the positive method to lower or if possible completely eliminate their customer concerns. By adding a direct support line to contact them 24 hr they have actually even more increased the added value of From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Help service.


From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Help has diversified market division, based upon its arrangement of large range of items to large number of consumers. Samsung target client sections can be divided into 3 categories i.e. From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Analysis IT and Mobile Communications, Samsung Consumer Electronics and Samsung Gadget solutions.


From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Help geographical segmentation is based upon two criteria i.e. area and density. Samsung serves about 80 countries worldwide with its items supplied to Urban along with Rural areas of the nation. The Samsung is likewise growing its worldwide presence and the business's flexibility in locating its plants motivates international expansion of Samsung.


Samsung produces items that can be used by both women and males. The target consumers for Samsung IT and mobile interaction items have an age variety of 18-65 with majority at a young or newly wed life cycle phase. Apart from it, Samsung Customer Electronic devices are targeted to a consumer section with an age variety of 25-65.


The psychographic segmentation of From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Analysis s based upon the social class and the lifestyle of the consumer. Samsung target customers on the basis of social class are mainly upper middle, middle and working class customers, as Samsung offer products like cellular phone very little more affordable i.e. Motorola along with not much expensive i.e. Apple. It supplies quality products to middle level consumers at a slightly high price than others targeting the very same section.


From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Solution bulk target consumers have special behavioural qualities. It has customers with an enthusiastic, fashionable and figured out personality with moderate level of loyalty towards the brand name. Its clients have some degree of shift towards other renowned brands i.e. Apple. Most of Samsun clients desire quality as well as cost control. They are drawn in towards Samsung due to the fact that of its moderate rates with an extent of quality.

Quantitative analysis.

Sales of From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Analysis has actually increased astonishingly from 16 billion $ in 1997 to 44.6 billion $ in 2002, and the net earnings of.48 billion $ to 5.9 billion $. Digital media is the biggest selling category of Samsung with sales of 13.9 billion $, whereas, Telecommunication and Semiconductors sectors both reached 11 billion $ in sales.

Qualitative analysis.

Yes, this choice is based on the mission of Kim to target the more youthful audience and produce a worldwide brand name image of the company. Whereas, the core strength of the company is currently producing however long gone are those days when excellent products were selling themselves. In the current age marketing is extremely crucial and companies can not prosper without it. Kim has actually already begun to strengthen the marketing activities of Samsung and very soon it will turn into one of its core strength like making if not better.



Samsung runs styles, makes and sell a huge portfolio of consumer electronic devices. It runs in a very competitive environment and has successfully positioned itself as the maker of quality products. So, the response is yes.


As, said earlier that From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Analysis operates in a highly competitive environment, which indicates all the companies have comparable products. So, the response for rarity is no.


Due to the nature of the industry, it is very simple for competitors to comprehend the functionality of the products and easily make their own designs. Yes, Samsung is only behind IBM in registering brand-new patents every year, but the benefit is extremely short-term in this industry.


Chairman Lee has entirely turnaround Samsung, from going almost bankrupt throughout the Asian monetary crisis of 1997 to the top 25 business in the world. Absolutely yes there is proper organization in the business and the results speak for themselves.

External Ecological Analysis

PESTLE Analysis


Being an international brand name spread almost in every country worldwide, majority of the environments like USA, Europe, China etc., are very conductive for its operations. It faces some political pressures in less developed countries where law and order circumstance is not great. Latin American, African and some Asian countries fall in this category, where political instability do have a result on From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Solution operations.


Purchasing power of clients is important for business like Samsung to grow and prosper. Emerging markets like India, middle-eastern countries and so on offer growth chances, whereas, due to economic crisis even the customers of developed nations suffer badly. Hence it is extremely crucial for the company to keep an eye on the continuous financial scenario of the country prior to entering the market.


International business have to deal with various social and cultural concerns during its operations in a foreign country. Samsung has actually also faced numerous problems however have actually embraced to the regional environments of the majority of the nations incredibly well. It has actually customized its items, practices, policies and so on accordingly in order to succeed.


With an annual expense of 2.4 billion dollars in Research & Advancement, and with consistent ingenious item launches, From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Help is one of the top innovative companies of the world. With a clear mission to be ahead of the rest when it comes to technological developments, Samsung has risen to the no 25 of the top effective business of the world.


Each country has their own laws and policies, being an international business Samsung need to strictly follow those laws in their jurisdictions. Failure to do so, will result in severe legal repercussions. So, it needs to study or employ a local law expert prior to starting its operations in a specific nation.


With the increasing awareness among customers about the ethical & environmental violations of business, Samsung needs to guarantee that it follows all the safety guidelines. Environmental damages, ethical misconducts are not acceptable and in some countries the effects can be very severe. On the other hand it has to do some Corporate Social Obligation practices to reveal the locals that it appreciates their environment and individuals.

Porter's 5 Forces

Danger of Substitution

Threat of substitution for Samsung's each item category is rather substantial. Aspects for high risk of replacement for From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Help Smart device consist of the presence of high number of suppliers and Market saturation in developed countries, which make the cost of changing for customers almost no. Along with it, Samsung printing solutions products are threatened by the increasing tourist attraction of customers towards cloud storage.

Rivalry Amongst Existing Companies:

The rivaly amongst Samsung and its close rivals is intense. The major reason behind this is the method of market saturation in different number of product classifications, requiring Samsung to present more innovative features in existing products and brand-new ingenious products to preserve its development. The significant competitors for From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Solution samrtphones consist of Apple, Motorola, LG, Nokia, Huawei, OPPO and so on.

( Samsung Sustainability Report, 2016) Provider's bargaining power for Samsung is low as Samsung runs economies of scale and its orders are of potential size and worth. Due to incapability of From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Help to build its own software, it has to outsource its software application development to Google, which becomes a prospective supplier of software application for Samsung, resulting in high bargaining power of Google.

Bargaining Power of Purchasers:

Market saturation in most of the product categories also make the bargaining power of purchasers more intense in for Samsung. In spite of igh bargaining power Samsung is rather capable of offering its products at a higher cost than much of its rivals, due to high end quality product and a fair brand name image.

Hazard of New Entrants:

Hazard of brand-new entrants for From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Analysis is rather low. Along with it, requirement of big proficiency and research and advancement expenses for survival in the industry also make brand-new entrants reluctant to enter in the market. Market saturation is also one of the barrier of entry in innovation market.

Competitive Analysis

Samsung's high product diversity offers it differentiation from its competitors. It is among the three top brand names by market share. Unlikely to its close competitors consisting of Sony, Intel and Nokia, who focus majority on a single product classification with Sony focusing on consumer electronics, Nokia on cell phones and Intel on chips, Samsung had a substantial R&D costs on all of its product classifications which allow the company to earn prospective profits from sales of practically all of its items. (See Display) Nevertheless, due to the broad item range the company faces high variety of competitors.

The company ranks first in 4 product categories i.e. DRAM Chips, LCD Displays, Big Screen TVs and Microwave, in terms of global market share, among 8 various product classifications. Samsung was the worldwide leader in producing DRAM, SRAM and NAND flash chips. Samsung earnings from chips was less than Intel however its incomes from chips was growing much faster than Intel and has actually grown close to the income levels of Intel, as provided in the case Exhibition 2.

Along with the chips Samsung mobile market was also thriving at a high rate than its competitors i.e. Motorola and Nokia. Samsung's cellular phone's sales development was 51% as compare to Motorola with just 4% and Nokia with zero sales growth. The significant reson behind Samsung's high development despite of greater costs than Nokia and Motorola was the company's high-end quality cell phones.

Samsung was also reaping the benefits from increasing market share of luxury LCDs as given up case Exhibition 3. The significant factor, making the business allow to get the opportunity is its mass production at low expense. Sony was the biggest rival for From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Help in LCD market, however, it had actually also started joint venture with Samsung in 2003 for LCD producing, decreasing the competition for Samsung.

Porter's Competitive Method

Low Expense Management technique of porter is fully executed by Samsung the method they achieve economies of scale by strengthening their core competencies of manufacturing. Even to the point that their competitor SONY decided to form an alliance with them to manufacture for them, since they were unable to compete with them on low cost. Differentiation is another method well executed by Samsung by continuous financial investment in the R&D and staying ahead of the competition. They constantly bring something innovative and new whether it's a product or a service.


Alternative Service 1

The Chief Marketing Officer (CMO) of From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Analysis would create a brand-new brand image by targeting the younger generation of the particular country. As, especially cellphones of Samsung are very popular among the more youthful demographic.


1. It is the very best strategy to develop Client Life time Worth (CLV) by developing a long-lasting relationship with clients. Construct commitment through delivering worth and reap the benefits for long-term, as research study has revealed it is more affordable to maintain existing consumers than to attract new ones.
2. Another pro of this option is that word of mouth spread more quickly amongst more youthful people and which in turn will bring in new clients for my items.


1. Old customers who were connected with Samsung prior to may not like this brand-new image the company is trying to represent.
2 It will sustain more costs to rearrange some products and it might not even bring success as the trends change extremely quickly amongst the younger market.

Alternative solution 2.

It would be done by organizing training workshops during which significance of marketing will be taught and numbers will be provided. Marketing environment must be produced internally initially as genuine marketing starts inside the corporation.


1. Its pro will be that all the marketing approach supporters will come out and also the opposite ones.


2. Its con can produce an extremely unhealthy environment in the work environment, as individuals often withstand modification since they fear it.

Recognize the best option

Option is the best as it clearly has more pros due to the fact that when a Customer Life time Value is developed the company will profit from it till that consumer is alive and has buying power. Plus, our target consumers are the more youthful generation which are bound to live longer than the existing old age individuals. Nevertheless, Samsung's primary objective is to create loyalty amongst its consumers and make them redeemed it from them and even purchase their various products also.

Execution Strategy

• Targeting more youthful generation through social marketing, producing a link with them like Pepsi finish with music. And set the expectations practical and attainable.
• A team including best marketing and sales professionals must be put together, and both views should be taken into account before securing the resources needed to carry out the plan.
• Thorough interaction of the strategy need to be done as it is very essential for everyone to be on the exact same page to make it work.
• Tasks and timelines should be develop and interacted accordingly to each individual responsible.
• The supervisor need to use a dashboard which reveals the development of all the jobs which have actually been done or about to be done and by whom.
• The supervisor need to monitor and keep a constant examine the total and individual performance.
Since any new pattern or policy may come in due to which all the things currently planned have to be changed, • Everyone ought to be prepared to adapt midway. It's better to have contingency strategies already prepared.
• At the end of the project the manager ought to communicate the outcomes and if successful should celebrate with the group.


The M-net program exposed engaging analysis about the low and high development potential areas and just how much advertising spending plan ought to be allocated accordingly. This modification the spending plan allowance of various countries and many supervisors were dissatisfied and argued but the analysis done by the program was accurate and showed figures like North America and Russia growth prospective merited a 35% allowance while they were receiving 45%. Whereas, China and Europe must be getting 42% however were instead provided 31%. It actually assisted to relatively distribute the resources and record more consumers by investing more on advertisements on the high development potential areas of the world.

From Free Lunch To Black Hole Credit Default Swaps At Aig Case Study Analysis is a leading 25 company worldwide now and prepares to get ahead of Sony who sits presently at no. 20. Its constant investment in R&D and ingenious practices have actually moved them to brand-new heights however for them its' only the start and they wish to be amongst the top 3 brands in the world. They entirely turn-around from nearly declaring bankruptcy throughout the Asian Financial Crisis to a world prominent brand, understood for quality and innovation. Their worth chain and their core proficiency their manufacturing capability, along-with worldwide brand name image structure have seen their sales go from 16 to 44.6 billion $ from 1997-- 2002. With additional growth in China and other emerging markets those numbers will only increase further in the future. Their marketing efforts ought to be directed towards younger market amidst the internal arguments about marketing and should produce Consumer Lifetime Worth as it will not just give them advantages now but will continue to enjoy it till the client life time. As the cost of maintaining the client is more affordable than drawing in a new one.