SAMSUNG LOOKING FOR ICONIC PRODUCT-FOCUS AREAS

• Premium Product-Globally Competitive

• Excellent Design

• Brand Enhancement through Marketing Plan

EMOTIONAL CONNECT

FUNCTIONAL BENEFITS

TECHNOLOGY EXCELLENCE

STRATEGIC FOCUS BY CHAIRMAN LEE ON SECOND DESIGN REVOLUTION AT MILAN

KOREAN MIRACLE-Growth Story

• Technologically Advanced

• 80 percent of households wired for high-speed Internet service

• High Mobile phone penetration

• Ideal Laboratory For Consumer Electronics Firms Like Samsung

• Government Support by means of direct financial subsidies and trade advantages

• Korean Firms imitated Japanese Model

SAMSUNG ELECTRONICS-BACKROUND• 1969-70:Samsung-Sanyo and Samsung-NEC established

• 1972:Started to make black-and-white television sets

• 1977:After acquisition of Korea Semiconductor, started making memory chips

• 1980:Acquisition of Korea Telecommunications

• Mid 1980’s:3 Product AreasDomestic appliances

Telecommunications

Computers

ENGINEERING DRIVEN CULTURE ONLY 10 PEOPLE IN DESIGN TEAM Sole Focus on ROI WEAK BRAND POWER

• Frankfurt Declaration By New Chairman LEE in 1993:

Superior Quality

Emphasis on Design, R&D and Technological development

• Product Planning and Design Center - Enhanced User Trend Research

• Mass Production of LCD Displays

• Burned phones and products worth 15 billion.

• FIRST DESIGN REVOLUTION-1996.

• 1997-IMF CRISIS: Samsung divesting 100 businesses and downsizing by 50000

NEW MANAGEMENT NEW STRATEGY

SECOND DESIGN REVOLUTION-2005• FOUR ACTION AREAS:

• Create remarkable designs and establish a user interface (UI) identity

• Recruit and secure the world’s best designers

• Nurture a creative corporate environment

• Reinforce its molding technology infrastructure

Communication Channel b/w business and customers

Expression of its core philosophy and culture

Personifies the spirit of those employees

SAMSUNG CORE COMPETENCY : VERTICAL INTEGRATION:

In house production of chips,memory,circuit

Geographical Reach

BUSINESS SEGMENTS:STRUCTURINGDIGITAL MEDIA

•Color

TVs,Audio,Video,Compu

ter

•Led in global market

share in both TVs and

DVD/VCR

TELECOMMUNICATION NETWORK

•Product lifecycle was

less than six months

•Environmentally

friendly paint for cell

phones

DIGITAL APPLIANCES

•Long life cycle.

•Main products

refrigerator,AC,

Microwaves.

•Different products for

different ptoducts

•High transportation cost

SEMICONDUCTOR

•Leading Manufacturer

•Enhanced its time-to-

market in such volatile

fields as mobile phones

LCD

•Monitors, notebook PCs,

LCDTVs, and mobile

phones,

•Joint venture between

Samsung and Sony

Decentralised Operations Throughout the World R&D investment grew from$1.81 billion in 2001 to $5.34 billion in2005—9.4

percent of sales and 25% workforce in it 27 manufacturing plants in 13 countries: Human-oriented production system

with cell lines MARKETING: Samsung brand with unified and holistic communications and

sports marketing

DESIGN TEAM

• Design planning, Design innovation, and User-interface strategy

• Advanced design and user-sensing or strategic in-depth research into consumerbehavior

Developing Design Capability

•

DESIGN EDUCATION

1993: Design Membership program.1995: Samsung Art and design institute.(SADI)1996: Innovative Design Lab of Samsung(IDS)2003: Design Power program

Design research focused on user behavior and user experience.

Focus on three factors market trends, competitors and technology.

Research market trends and competitors twice a year and analyzing market four times a year.

User centered design lab. Marketing team started

listening to Design team.

Design research(getting close to consumers)

Developing international presence

• 1992: Design center in Tokyo

• 1993: Design center in Germany.

• 2000: Global design centers in San

Francisco and London.• 2004: Design Center

in China• 2005: Design center in

Italy

Multi Disciplinary task-force system and a dedicated

value innovation program(VIP): Helped in

resolving conflicts between design and marketing team

Design Initiated product development

Creating Differentiation:- Television sets for style conscious consumers• L7 a T shaped large screen digital

light processing projection TV.• Creating distinctive Samsung

identity with the shallow V shape on the bottom of the screen box.

• Circular spot on many of the TV models as identification of Samsung.

• Bordeaux project to make a unique LCD TV for premium end of mass market.

• A TV designed to develop emotional buying pattern.

• Designing in such a way that TV looks like a one piece.

MARKETING: -> Focus on communicating emotion and lifestyle rather than communicating the technology.ENGINEERING:->Thickness of only 79.6 mm even less than 83 mm in design specificationsMolded speaker holes into the frame, rather than attaching the piece with thousand of tiny holes.Glossy finish through new injection molding technique which reduced cost. As high gloss is expensive through spray paint.

Launched in 2006

Design Initiated product development

Quatro Project

• Developed four door premium refrigerator unique in the segment.

• Challenge was whether customers would accept this product or not.

• Focus groups were held in US to know consumers view about four door concept.

• Designers, Engineers and marketers all worked in coordination.

• Quatro was launched October 2005 in US .

Twist Mobile phone project• Challenge was how to differentiate Samsung mobile phones in a volatile mobile market where every company had mastered the basics.

• People wanted a small phone yet a large LCD and for watching multimedia content and big keypads.

• Samsung decided to place the screen in landscape mode to make it easier for people to watch TV programs.

• Key issue was enough space to twist the screen when clamshell was closed. Verifying parts, 3-4 times reliability testing and various mock ups led to the development of the product.

• Launched in 2004, Horizontal instinct phone won Presidential prize, prize from Korea association of industrial designers.

RECOMMENDATIONSLINE-UP Design(12

months out)

Designers in the business unit shape

the company offerings by

• Developing new products and user

interfaces• Developing a

competitive analysis of new and

existing products

ARCHETYPE DESIGN(18-24 months)

Next generation design 5-10 Years

Designers in business units with the help of CDC

centers create product and platform archetype by:

• Planning for specific new products.

• Investigating details such as materials

Develop a new business investment plan in emerging

economies like China and India.Investigating in new enabling

technologies.Creating technology roadmap by

studying user megatrends.

THANK YOU