Question

A client report that describes an organization that will provide an organizational intervention. Needs organizational change for performance improvement, sustainability or increase its profitability. Evaluation as a change agent.

Q. Identification of what exactly needs to be change in organization like Samsung Industry through using a diagnostic model.

Answer 1

Introduction to Samsung

Samsung is a large conglomerate, while most consumers only know the brand from its smartphones, consumer electronics, and household appliances, the South Korean technology also produces electronic components, screens, and displays or other brands like Apple, semiconductors, telecommunication infrastructure and equipment & medical equipment. Samsung electronics generated a revenue of $ 221.6 Billion with a net income of $40.3 Billion with a market cap of $267.1 Billion. Samsung has the largest global market share for smartphones at around 30.8 %. This means that 30.8 % of all smartphones in the world are Samsung devices.

In order to identify areas of change, we'll be using the GE McKinsey 9 box matrix model as a diagnostic tool

The reason why I've selected this particular diagnostic tool is that two of the objectives for change are performance improvement and an increase in its profitability. Since Samsung is a such a large conglomerate, we'll only be looking at Samsung's consumer electronics division in order to effectively identify areas of change. The tools are quite simple, it uses two metrics on the X & the Y-axis. The Y-axis represents the overall industry attractiveness of a product or a service that Samsung offers while the Y-axis represents the overall competitive strength of Samsung.

The rule of thumb for this to is to focus on products or services which offer the best chance of success and return on investment by finding products that have the right mix of industry attractiveness and competitive strength. I've listed a set of products based on their combination of industry attractiveness and whether or not they're a part of Samsung's core competency or competitive strength. In order to find out which are the attractive industries, we'll need to map their market size and match it with Samsung's core competencies

Consumer Electronics Category	Consumer Electronics Revenue by category (In $ billion)
Smartphones	484
PC's or Laptops	169
TV's	117
Smartphone Accessories	77
Tablets	25
Electronic Wearables	25
Game Consoles	15
Smart Speakers	9
VR Headsets	7

For eg Smartphones: Global smartphone revenue and market share have outpaced every other consumer electronics segment. The global smartphone market is worth $ 484 Billion with over 1.56 billion handsets sold annually, out of which over 1.32 billion units use Google's Android operating system. Samsung has the largest global market share for smartphones at around 30.8 %. This means that 30.8 % of all smartphones in the world are Samsung devices. This is why this business unit has the best mix of industry attractiveness and competitive strength.

Based on the diagnostics that we've carried out using the GE McKinsey 9 box matrix model, it's clear the Samsung should focus on Smartphones first followed by Televisions, Electronic Wearables & Smartphone accessories. This would mean an increase in R&D & sales and marketing spending in these areas would help improve its performance and overall profitability.