Samsung

Samsung: A Giant in the Global Market

Imagine a company that started as a small trading firm with just forty employees dealing in dried fish, groceries, and noodles, and grew into one of the world’s largest multinational conglomerates. That’s Samsung Group, a South Korean manufacturing powerhouse with a rich history dating back to 1938.

The Genesis: From Trading to Electronics

Lee Byung-chul founded Mitsuboshi Trading Company in 1938, which later became Samsung Sanghoe. The name ‘Samsung’ itself is a metaphor for something big and powerful, meaning three stars. This small trading company expanded into various sectors under Lee’s leadership, eventually entering the electronics industry in the late 1960s.

Expansion and Diversification

The group was divided into five business groups after Lee’s death in 1987: Samsung, Shinsegae, CJ, Hansol, and JoongAng. Each of these divisions has its own unique story of growth and innovation. For instance, Samsung Electronics Devices and Samsung Semiconductor & Telecommunications were formed during this period.

The First Product: A Black-and-White Television Set

One of the earliest products from Samsung was a black-and-white television set. This humble beginning laid the foundation for what would become one of the world’s leading electronics manufacturers.

Achievements and Challenges

Samsung has achieved remarkable milestones, such as becoming the world’s largest producer of memory chips in 1992 and establishing a joint venture with Sony to provide LCD panels. However, it hasn’t been without its challenges. The company faced controversies related to labor abuses, including complaints of child labor in its supply chain from 2012 to 2015.

Union-Busting and Bribery Scandals

The company’s no-union policy and engagement in union-busting activities worldwide have been criticized. In 2007, Kim Yong-chul uncovered Lee Kun-hee’s slush fund, which included bribes to officials. This scandal led to Lee Kun-hee being sentenced to three years’ imprisonment and fined ₩11 billion.

Union-Busting Scandals

In 2016, video footage appeared to show Lee Kun-hee paying prostitutes for sex acts. Six suspects were detained, and investigators stated they extorted ₩500 million from Samsung. Lee Jae-yong was arrested in 2017 for bribery, embezzlement, and perjury. He was accused of paying ₩43 billion to secure government approval for a merger of two Samsung affiliates.

Global Presence and Innovations

Samsung has a significant influence on South Korea’s economy, politics, media, and culture. The company’s revenue is equal to 22.4% of South Korea’s GDP in 2022. Key affiliates include Samsung Electronics, Samsung Heavy Industries, Samsung Engineering, and Cheil Worldwide.

Key Affiliates

Samsung Electronics produces air conditioners, computers, digital TV sets, mobile phones, display monitors, and more. It has a global market share of 25.4% in Q1 2012. Other key affiliates include Samsung Biologics, Samsung Engineering, Samsung Heavy Industries, Samsung Life Insurance, and Siam Samsung Life Insurance.

Research and Development

Samsung has invested heavily in research and development, building several plants around the world. In 1996, it opened a facility in Austin, Texas, which became the largest foreign investment in Texas and one of the largest single foreign investments in the US.

Future Outlook

In recent years, Samsung has faced challenges such as declining memory chip production due to projected operating profit. However, the company continues to innovate and expand its global presence. As of 2024, Samsung has the world’s fifth-highest brand value, with key affiliates including Samsung Electronics, Samsung Heavy Industries, Samsung Engineering, and Cheil Worldwide.

Conclusion

Samsung Group’s journey from a small trading company to one of the world’s largest multinational conglomerates is nothing short of remarkable. Its history is marked by innovation, expansion, and challenges, but it remains a significant player in the global market. As Samsung continues to evolve, its future looks bright, driven by ongoing research and development and a commitment to excellence.