Samsung ― leader or follower?
By Oh Young-jin
Assistant managing editor
Last week, I wrote about Samsung Electronics being too self-conscious to realize its transformation from fast follower to innovator. It was one of three subjects in one column so I felt not enough was said and decided to revisit it.
To recap, I said the Samsung-Apple patent war ironically showed Samsung’s maturity as an industry leader. I argued Samsung may be one of the dwindling few who remain in a state of self-denial. My opponent countered Samsung is still a follower.
He said that Samsung is behind Apple, citing a lack of the intensity in popularity Apple enjoys.
Perhaps reflecting his sense of Samsung not being a leader, he observed that it keeps hammering home a message that its employees are not good enough so they need to work harder. This perpetual self-chastisement starts at entry level and becomes habit when they reach mid-level management positions.
To rebut this self-imposed inferiority complex, it is worth pondering what Apple’s strongest point under its late co-founder Steve Jobs was.
There may be hundreds of reasons for Apple being a leader and Samsung a follower but they boil down to two elements: Jobs and his American ingenuity. If pressed to simplify this magic formula further, it would be a rare kind of confidence that identifies one as No. 1. In a sense; i-Product buyers pay for the vicarious sense of being No. 1.
The sense of being the best engenders arrogance as witnessed in Jobs’ life and can be an unhealthy self-conceitedness.
But it can’t be denied that the spirit of supremacy is pivotal to doing what others don’t dare in the way Jobs did. It gets one’s creative juices overflowing.
For Samsung, its leader Lee Kun-hee once challenged his employees to change everything except their wives and children as part of his campaign to make Samsung a world leader.
It requires Lee to declare Samsung as No. 1 in order to get the same creative juices going for Samsung employees and replace Apple at the top.
Lee must know of ways to get his message of approval across without being so conspicuous, if he wants to stick to his principle of Confucian modesty.
Sending the message to Samsung employees is of critical importance to taking the next step in industrial evolution so as to assume what pace-setting role Apple has played. But not saying it at this critical juncture may forgo Samsung’s chance to be No. 1. It means being stuck in the mental box of being a perpetual No. 2.
Rationalization is also a key to turning Samsung into No. 1.
Currently, Samsung Electronics is the group’s flagship that manufactures everything from semiconductors, TVs and refrigerators to displays and mobile phones.
This “superstructure” may be too cumbersome. I expect from inside a strong argument of “if it ain’t broke, don’t fix it.”
They would say the current structure has so far worked well.
It worked in the past but sticking to the status quo doesn’t help in the future.
It is true that employees of one affiliate feel those of others are competitors. But it is “friendly” competitiveness, not a cut-throat, no-holds-barred fight for greater profits as called for in today’s market.
Besides, the leadership is bound to take a holistic approach. In other words, if one affiliate performs poorly, the top brass will try and find other better-performing affiliates and heave a sigh of relief. But, this is no good. Samsung can learn from LG, its former rival.
LG Electronics was once ahead of Samsung Electronics.
But the last couple of years of mismanagement that culminated with a late start in the smartphone business is serving as a drag on the group’s morale and business outlook.
LG brought in Koo Bon-joon, younger brother of the group’s leader Koo Bon-moo as LG Electronics CEO, but the “smart” gap between LG and Samsung has not been narrowed.
At present, it is hard to say whether LG Electronics will be able to recover and get back in the race as an industry power. What is worrisome is that its leadership has buried its head in the sand, trying not to see what is inevitable ― reorganizing the corporate apparatus around its new cash cow, LG Chem.
The LG lesson, which is not greatly different from the cases of Nokia and Motorola, is centered on the survival of the nimblest and lightest that reacts fastest to a rapidly-changing situation.
If applied to Samsung, it means that it should split so each affiliate finds ways of becoming stronger on its terms, with their interdependence to be minimized.
There are odds stacked against such a transformation with opposition coming from a variety of sources but Samsung knows of rewards that come with it ― making its affiliates more competitive and recalibrate them around its core competencies.
It is like creating more competitive firms like Samsung Electronics. Remember Sun Wukong, also known as the Monkey King, from “Journey to the West” in ancient Chinese class, who could replicate himself by breathing into a strand of hair he pulls from his head or a sentient Agent Smith multiplying exponentially in the movie “The Matrix.”
But knowing is one thing and acting is another. It remains to be seen whether Samsung can translate its knowledge into action. I bet it can but my more considerate opponent at the dinner table apparently doesn’t.