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Morgan Components 3 Harvard Case Study Solution

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Morgan Components 3 Case Study Solution & Analysis


Introduction

Historically, the business's core consumers consist of the Original Devices Manufacturers (OEMs), which utilized to sell Morgan Components 3 Case Study Analysis products withtheir own brand name. Its customer circle includes Original Devices Manufacturers (OEMs), who used to sell Samsung products with their own brand name. He repositioned Samsung as a worldwide brand name and educated his divisional supervisors to comprehend marketing and its importance.

Issue Statement

Samsung's transition from an item based to a marketing company is not going as smoothly as planned.Overcoming the unwillingness of divisional managers to include marketing effectively is still a significant challenge. Creating a constant brand name identity across the whole world and employing marketing strategies that best fits the local culture is no simple job.

Situational Analysis

Yun had a rather clear image in his mind about how Morgan Components 3 Case Study Analysis can change from a low end to a high end product supplier. He understood that transformation can only be done through positioning Samsung as a company providing high-end products and this might just be done through high level of marketing.

In spite of having a clear vision about how to construct Samsung brand name, with a possible support of its executives, Yun faced numerous marketing challenges in early years of its efforts.

Among the marketing challenges for Yun was the understandings of executives about the value of marketing. They thought about marketing and selling as same tools and thought that quality products do not required marketing for increasing sales. As their focus towards marketing was rather low in their previous organisation practices, and the existing marketing requirement was too much high, the gap was too broader and to fill this space with wrong perceptions about marketing was quite challenging for Yun.

As mentioned above, marketing focus was really low in previous practices, for that reason there were no proper marketing spending plans for each of the item on the portfolio. There was no marketing planning provided for the existing items. In addition to it the item range of the business was increasing with the ripening of new product concepts by the R&D sector of Samsung. Yun had a challenge to perform marketing preparation and to produce marketing budget plans for existing as well as for brand-new items from the very beginning, and this would take a substantial time.

A huge shift would be required in current marketing expenses to develop the Samsung brand name. This would result in increased marketing expenses for Samsung and could disrupt the administration relating to increased costs, as they were hesitant to marketing expenditures previously and a sudden huge shiftwould make them disrupt.

Internal Analysis
SWOT Analysis
Strengths


Morgan Components 3 Case Study Analysis strengths lie in its substantial product portfolio. Samsung has biggest number of patents in the market with overall number of 15499 patents granted in United States( USP).

Another strength of Morgan Components 3 Case Study Help is its ability to develop ingenious items at a continuous rate. It major proves for the innovation and product designing of Samsung is that the business has actually gotten many awards for its innovation and product style.

Unlike Apple and other rivals, Samsung is concentrated on producing gadgets which can be quickly incorporated with any type of open source Os (OS) and software application. This supplies Samsung an edge over Apple gadgets.

Samsung's ability to produce luxury products at low cost of production is also among the major strength of Samsung as it makes it possible for the business to record more market by offering quality items with expense control.

Weaknesses

Samsung's weak points are hidden in the company's dependence on outsourcing software application for its devices due to company's failure in establishing software application, unlike Sony. Morgan Components 3 Case Study Analysis likewise has low revenue margins as compare to Apple due to big difference in the rates of Apple and Samsung with a much lesser difference in quality.

Opportunities

Opportunities for Morgan Components 3 Case Study Help lie in the growing Mobile phone market and the company's effectiveness in the market. Samsung presently runs in about 80 countries and the business has a chance to increase its geographical expansion by moving towards more emerging markets outside Asia.

Threats

The vibrant market environment of innovation industry position a severe risk on Samsung's survival and force the company to invest much of its profits share on R&D in order to survive in the long run. The market saturation in developed nations i.e. saturation of mobile company is likewise a huge threat for the company's development in the existence of strong competitors like Apple.

4 P's of Marketing

Product

Samsung provides quality items and has a rather abundant portfolio which caters to different segments. LCD and mobile phones are the most significant products of Samsung, whereas DRAM is likewise not far behind in contrast of them.

• LCD/ TV
• Laptops.
• Mobile phones.
• Air conditioning system.
• Personal computers.
• Hard drives.
• Washing machines.
• Fridges.
• Electronic cameras.
• Microwaves.
• Flash memory.
• DRAM.

Cost.

Morgan Components 3 Case Study Help utilizes both market competitive and market skimming rates methods for its variety of products. In competitive pricing it changes the cost according to the competitors in order to get benefit, whereas, it utilizes market skimming strategy where the product has an added worth and by selling a couple of items it can reach break-even.

Place.

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

Promotion.

It wasn't a popular company beyond Korea till 1993. The management effort taken by their CEO has actually pushed them to market more effectively outside the borders and now it has gone into the league of leading 25 business in the world in simply 9 years. This is an exceptional achievement regardless of the ongoing arguments among the managers about embracing marketing practices. It utilizes both offline & online channels of promo to market their items. Paid product advertisements, social promotion and digital ads are utilizes to create awareness about Samsung products.

Value Chain Analysis.

It's an analytical structure for identifying service activities that add worth or competitive benefit for the business.

Incoming Logistics.

It has one of the most effective and effective supply chain network and has more than 2700 providers throughout various industries all over the world. Almost 80% of which is based in Asia and the remaining worldwide. For its incoming logistics it owns various logistics companies as it subsidiaries. It takes care of its suppliers and develops an unified relationship with them and even minimized their payment cycles to enhance this relationship further which includes worth to their chain network.

Operations.

Samsung's core competency is its mass producing it produces 90% of its items internal. Divided into 3 various departments its operations are namely IT & Mobile Communications, Device Solutions and Customer Electronics. It is keeping operation hubs worldwide to further add worth to its value chain network.

Outbound Logistics.

Its outbound logistics system efficiency is among the main factors Morgan Components 3 Case Study Analysis has the ability to compete with Apple. Samsung's own Electronic Logitec system plays a major role in the outgoing logistics operations. It even carries out the tasks of collection of payment, settling insurance claims, etc. on behalf of Samsung.

Marketing and Sales.

Drawing in target customer attention towards the product is done through marketing and sales to communicate with them the value and competitive benefit the item uses. Morgan Components 3 Case Study Analysis advertising budget is continuously on the rise because they started their repositioning worldwide and will continue to do so as they are continuously looking to expand and invest in high potential development markets. The budget is invested in occasions, print and media ads, public relations and so on.

Samsung Service. Samsung put their clients on top and constantly strive to provide unmatchable customer service standards. As after sales service is becoming extremely essential to keep consumers pleased and engaged, they even carry out studies through third parties to learn their client's feedback and implement it in the positive method to lower or if possible completely remove their customer issues. By including a direct assistance line to call them 24 hr they have actually further increased the added value of Morgan Components 3 Case Study Analysis service.

Segmentation.

Morgan Components 3 Case Study Solution has actually diversified market segmentation, based upon its provision of large range of products to large number of consumers. Samsung target client sections can be divided into 3 categories i.e. Morgan Components 3 Case Study Analysis IT and Mobile Communications, Samsung Consumer Electronic Devices and Samsung Device services.

Geographical.

Morgan Components 3 Case Study Help geographic division is based upon 2 criteria i.e. region and density. Samsung serves about 80 nations worldwide with its items provided to Urban in addition to Backwoods of the country. The Samsung is also growing its worldwide existence and the business's flexibility in finding its plants encourages worldwide expansion of Samsung.

Group.

Samsung produces items that can be utilized by both females and males. The target customers for Samsung IT and mobile interaction products have an age range of 18-65 with bulk at a young or freshly wed life cycle stage. Apart from it, Samsung Consumer Electronics are targeted to a customer segment with an age variety of 25-65.

Psychographic.

The psychographic division of Morgan Components 3 Case Study Help s based upon the social class and the lifestyle of the customer. Samsung target customers on the basis of social class are primarily upper middle, middle and working class consumers, as Samsung offer products like cell phones very little cheaper i.e. Motorola in addition to not much pricey i.e. Apple. It provides quality items to middle level consumers at a somewhat high cost than others targeting the exact same sector.

Behavioural.

Morgan Components 3 Case Study Solution majority target clients have unique behavioural attributes. It has clients with an ambitious, stylish and determined character with moderate level of loyalty towards the brand name. Its consumers have some degree of shift towards other prominent brand names i.e. Apple. The majority of Samsun clients want quality in addition to cost control. They are attracted towards Samsung because of its moderate rates with an extent of quality.

Quantitative analysis.

Sales of Samsung has increased astonishingly from 16 billion $ in 1997 to 44.6 billion $ in 2002, and the net revenue of.48 billion $ to 5.9 billion $. It has also minimized its financial obligation from 15 billion $ to 4.6 billion $. Digital media is the largest selling category of Samsung with sales of 13.9 billion $, whereas, Telecommunication and Semiconductors sectors both reached 11 billion $ in sales. Because of the high overhead cost, profits/ sales are increasing but net earnings is not increasing appropriately. New expansions and working with's were the primary factor of the boost in the overhead costs, with china currently not offering any revenue to Samsung, but there is a lot capacity in the current market with 75 % yet to be explored.

Qualitative analysis.

Yes, this choice is based upon the objective of Kim to target the younger audience and create a global brand image of the business. Whereas, the core strength of the business is presently producing however long gone are those days when great products were offering themselves. In the current age marketing is extremely essential and companies can not succeed without it. Kim has actually already begun to enhance the marketing activities of Samsung and soon it will turn into one of its core strength like producing if not much better.

VRIO.

Value.

Samsung operates styles, produces and sell a vast portfolio of customer electronics. It operates in a very competitive environment and has successfully placed itself as the maker of quality items. The response is yes.

Rarity.

As, stated earlier that Morgan Components 3 Case Study Help operates in a highly competitive environment, which means all the business have comparable items. The response for rarity is no.

Imitability.

Due to the nature of the market, it is very simple for competitors to understand the functionality of the items and easily make their own models. Yes, Samsung is just behind IBM in signing up new patents yearly, but the benefit is very short term in this market.

Organization.

Chairman Lee has completely turn-around Samsung, from going almost insolvent throughout the Asian monetary crisis of 1997 to the top 25 company in the world. Definitely yes there appertains company in the business and the results promote themselves.

External Ecological Analysis

PESTLE Analysis

Political

Being a multinational brand name spread nearly in every country worldwide, majority of the environments like U.S.A., Europe, China and so on, are really conductive for its operations. However, it faces some political pressures in less developed countries where order scenario is not good. Latin American, African and some Asian nations fall in this classification, where political instability do have an effect on Morgan Components 3 Case Study Solution operations.

Economic

Purchasing power of customers is crucial for companies like Samsung to succeed and grow. Emerging markets like India, middle-eastern nations and so on provide growth chances, whereas, due to recession even the clients of industrialized nations suffer badly. Hence it is really essential for the business to watch on the continuous financial situation of the country before going into the market.

Socio-Cultural

Multinational companies need to face numerous social and cultural issues throughout its operations in a foreign country. Samsung has actually also dealt with numerous problems however have adopted to the local environments of most of the countries remarkably well. It has tailored its products, practices, policies and so on accordingly in order to be successful.

Technological

With an annual expense of 2.4 billion dollars in Research study & Advancement, and with consistent ingenious item launches, Morgan Components 3 Case Study Analysis is one of the top ingenious companies of the world. With a clear objective to be ahead of the rest when it concerns technological developments, Samsung has increased to the no 25 of the top successful business of the world.

Legal

Each nation has their own laws and policies, being an international company Samsung need to strictly follow those laws in their jurisdictions. Failure to do so, will result in severe legal effects. It has to study or employ a regional law professional prior to beginning its operations in a specific country.

Environmental

With the increasing awareness amongst consumers about the ethical & ecological violations of business, Samsung needs to make sure that it follows all the safety standards. Ecological damages, ethical misbehaviors are not acceptable and in some nations the repercussions can be extremely severe. On the other hand it has to do some Business Social Duty practices to reveal the locals that it appreciates their environment and people.

Porter's 5 Forces

Risk of Substitution

Danger of replacement for Samsung's each item classification is rather substantial. Aspects for high danger of substitution for Morgan Components 3 Case Study Analysis Mobile phone consist of the presence of high number of suppliers and Market saturation in industrialized nations, which make the expense of changing for customers practically zero. Along with it, Samsung printing services items are threatened by the increasing destination of customers towards cloud storage.

Rivalry Amongst Existing Firms:

The rivaly among Samsung and its close rivals is intense. The significant reason behind this is the method of market saturation in different number of product categories, forcing Samsung to present more innovative functions in existing products and brand-new ingenious items to keep its development. The significant rivals for Morgan Components 3 Case Study Solution samrtphones consist of Apple, Motorola, LG, Nokia, Huawei, OPPO etc.

Morgan Components 3 Case Study Help has a huge supply chain consisting of about 2700 providers throughout the world.( Samsung Sustainability Report, 2016) Supplier's bargaining power for Samsung is low as Samsung runs economies of scale and its orders are of prospective size and worth. These big orders enable Samsung to negotiate costs with its providers. Due to incapability of Samsung to develop its own software, it has to outsource its software advancement to Google, which becomes a prospective supplier of software application for Samsung, resulting in high bargaining power of Google. Although, in most of cases Samsung has a power to work out costs, however it provide substantial prices to its providers to develop a strong supply chain and to have strong relationships with its suppliers.

Bargaining Power of Buyers:

Market saturation in many of the product classifications also make the bargaining power of purchasers more extreme in for Samsung. In spite of igh bargaining power Samsung is rather capable of selling its items at a higher cost than much of its rivals, due to high end quality product and a reasonable brand name image.

Hazard of New Entrants:

Danger of brand-new entrants for Morgan Components 3 Case Study Solution is quite low. Along with it, requirement of big knowledge and research study and advancement expenses for survival in the market likewise make brand-new entrants hesitant to enter in the market. Market saturation is also one of the barrier of entry in technology market.

Competitive Analysis

Samsung's high item diversity offers it differentiation from its rivals. Unlikely to its close competitors consisting of Sony, Intel and Nokia, who focus bulk on a single item classification with Sony focusing on consumer electronic devices, Nokia on cell phones and Intel on chips, Morgan Components 3 Case Study Solution had a big R&D spending on all of its item categories which allow the business to earn prospective earnings from sales of nearly all of its products.

The company ranks first in 4 product classifications i.e. DRAM Chips, LCD Displays, Big Screen TVs and Microwave ovens, in terms of worldwide market share, amongst 8 various item categories. Samsung was the worldwide leader in making DRAM, SRAM and NAND flash chips. Although, Samsung profits from chips was less than Intel however its profits from chips was growing quicker than Intel and has actually grown near to the profits levels of Intel, as given in the case Exhibition 2.

In addition to the chips Samsung mobile market was likewise growing at a high rate than its rivals i.e. Motorola and Nokia. Samsung's cellular phone's sales development was 51% as compare to Motorola with only 4% and Nokia with zero sales development. The significant reson behind Samsung's high development despite of higher prices than Nokia and Motorola was the company's high-end quality mobile phone.

Samsung was likewise profiting from increasing market share of high-end LCDs as given in case Display 3. The significant reason, making the company make it possible for to avail the opportunity is its mass production at low cost. Sony was the greatest rival for Morgan Components 3 Case Study Solution in LCD market, however, it had actually also begun joint venture with Samsung in 2003 for LCD making, decreasing the competitors for Samsung.

Porter's Competitive Method

Low Cost Management technique of porter is totally executed by Samsung the method they attain economies of scale by reinforcing their core competencies of manufacturing. They constantly bring something innovative and new whether it's an item or a service.

Alternatives

Alternative Service 1

The Chief Marketing Officer (CMO) of Morgan Components 3 Case Study Analysis would produce a new brand name image by targeting the younger generation of the specific country. As, especially mobile phones of Samsung are very popular amongst the more youthful demographic.

Pros

1. It is the very best strategy to build Client Life time Worth (CLV) by creating a long-lasting relationship with customers. Build loyalty through providing value and reap the benefits for long-lasting, as research has revealed it is more affordable to retain present consumers than to attract new ones.
2. Another pro of this option is that word of mouth spread more quickly among younger individuals and which in turn will bring in brand-new customers for my products.

Cons

1. Old customers who were connected with Samsung prior to might not like this brand-new image the company is attempting to depict.
2 It will sustain more expenses to reposition some products and it may not even bring success as the trends change very rapidly among the younger group.

Alternative solution 2.

Samsung has actually made manufacturing its core proficiency for the a lot of part of their company and due to which its managers are not afraid to completely get out of their convenience zone. It would be done by arranging training workshops throughout which significance of marketing will be taught and numbers will be given. Failure to get the passing scores will get demoted. Marketing environment ought to be produced internally first as genuine marketing starts inside the corporation.

Pros

1. Its pro will be that all the marketing method advocates will come out and likewise the opposite ones.

Cons

2. Its con can develop an extremely unhealthy environment in the workplace, as individuals typically resist change due to the fact that they fear it.

Determine the best alternative

Option is the best as it clearly has more pros due to the fact that as soon as a Client Life time Value is built the company will profit from it till that client is alive and has acquiring power. Plus, our target clients are the more youthful generation which are bound to live longer than the existing old age people. However, Samsung's primary goal is to develop loyalty among its customers and make them redeemed it from them and even purchase their different items also.

Execution Plan

• Targeting more youthful generation through social marketing, producing a relate to them like Pepsi finish with music. And set the expectations realistic and possible.
• A team including best marketing and sales professionals need to be put together, and both views must be considered before protecting the resources required to implement the strategy.
• Thorough interaction of the plan must be done as it is really essential for everyone to be on the exact same page to make it work.
• Tasks and timelines need to be develop and communicated accordingly to each person responsible.
• The manager must use a dashboard which shows the progress of all the tasks which have been done or about to be done and by whom.
• The manager must keep an eye on and keep a continuous examine the general and private performance.
Since any brand-new trend or policy may come in due to which all the things currently planned have actually to be changed, • Everyone ought to be willing to adapt midway. It's better to have contingency strategies already prepared.
• At the end of the campaign the supervisor should communicate the outcomes and if successful should commemorate with the group.

Budget

The M-net program revealed engaging analysis about the low and high growth potential locations and just how much advertising spending plan must be designated appropriately. This change the spending plan allowance of many managers and various countries were unhappy and argued however the analysis done by the program was accurate and revealed figures like The United States and Canada and Russia development potential warranted a 35% allowance while they were receiving 45%. Whereas, China and Europe should be receiving 42% however were rather provided 31%. It truly helped to fairly distribute the resources and capture more clients by investing more on ads on the high growth capacity areas of the world.

Conclusion

Morgan Components 3 Case Study Analysis is a leading 25 business on the planet now and plans to get ahead of Sony who sits presently at no. 20. Its constant investment in R&D and ingenious practices have propelled them to new heights however for them its' just the start and they wish to be among the leading 3 brand names worldwide. They entirely turnaround from nearly declaring bankruptcy during the Asian Financial Crisis to a world prominent brand name, understood for quality and innovation. Their worth chain and their core proficiency their production ability, along-with global brand image structure have actually seen their sales go from 16 to 44.6 billion $ from 1997-- 2002. With additional expansion in China and other emerging markets those numbers will only increase even more in the future. Their marketing efforts ought to be directed towards younger demographic amid the internal arguments about marketing and need to develop Client Lifetime Worth as it will not just give them benefits now but will continue to reap it till the consumer life time. As the cost of retaining the customer is much cheaper than bring in a brand-new one.