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Apple and Samsung Capstone Assignment

Professor Amanda Manners


Pupil Eric Sewell
Business 599 Strategic Management
7 September 2014

Executive Summary
The global smart phone industry is one of the strongest and fastest growing industries today.
There is no sign of it softening anytime soon. The expanding growth and demand for
smartphones globally is emerging as developing countries come on line. Cell phones have gone
through major changes since their introduction in 1994. Companies like Apple, Samsung, and
many others, are engaged in a never-ending competition to see who will be the most innovative
and popular with customers around the world, in various markets and cultural settings. These
products are constantly evolving to meet customer expectations.
Volume sales of smartphones reached 97.7 million handsets in the US for 2012, with
volume sales increasing by 26%. The smartphone has emerged as a vital tool for personal and
business communications, quickly replacing basic feature phones as an essential purchase for the
majority of US consumers. 2012 saw the advent of low cost, affordable smartphones as the
ownership of handsets based on the Android operating system expanded rapidly.
Apple remained the leading player in smartphones in the US in 2012 with a 34% retail
volume share. The companys iPhone brand was rejuvenated with the launch of the iPhone 5 in
September 2012 and the iPhone 5S in September 2013. The iPhone remains the single most
desirable smartphone band available in the US and this is the basis for Apples status as the
leading company in the category.
Apple is able to command high unit prices for its consumers, even after wireless
subsidies. Having recorded staggering growth over the course of the previous decade, the rapidly
maturing category of mobile phones in the US is set to achieve maturity at some point in the next
few years.

Growth rates in mobile phones overall are expected to remain very low, with new
launches and short two-year replacement cycles the most likely drivers of new acquisitions
among the vast majority of US consumers who are existing mobile phone consumers. This all
points to the fact that all the amazing growth and increasing demand in the smart phone industry
is coming more from abroad than from within the US market.
It is expected that 4.55 billion people worldwide will use a mobile phone in 2014
(eMarketer). Mobile adoption is slowing, but new users in the developing regions of the AsiaPacific, the Middle East and Africa will drive further increases. Between 2013 and 2017, it is
expected that mobile phone usage will rise from 61.1% to 69.4% of the global population. This is
according to a recent eMarketer report, Worldwide Mobile Phone Users: H1 2014 Forecast and
Comparative Estimates.
The global smartphone audience surpassed the 1 billion mark in 2012 and will total 1.75
billion in 2014. It is expected that smartphone adoption will continue on a fast-paced trajectory
through 2017. Nearly two-fifths of all mobile phone usersclose to one-quarter of the
worldwide populationwill use a smartphone at least monthly in 2014. It is further expected
that smartphone usage among all mobile phone users globally will near 50% in the near future.
Markets with strong smartphone sales growth include Japan, China, Hong Kong, Turkey,
South Africa, Hungary, the Netherlands, Indonesia, UAE, Thailand, mother Russia, Morocco,
India, France, Taiwan, Malaysia, Germany, Portugal, Israel, Vietnam, Singapore, Mexico,
Greece, the USA, Saudi Arabia, Egypt, Sweden, and Denmark.
Markets with relatively weaker or declining smartphone growth (yet still worth marketing
to and holding onto market share) include Australia, Romania, Czech Republic, Spain, South

Korea, Italy, Austria, Norway, Venezuela, Argentina, Philippines, United Kingdom, Chili,
Ukraine, Brazil, Poland and Canada.
The only market where there really is no smartphone market worth mentioning only
includes North Korea and sooner or later even communist North Korea will have to join the rest
of the world.
If we consider Porters Five Forces, buyer power in the global smartphone market is
moderate to low which means that customers do not have much leverage in the price they
ultimately pay for a smartphone. The supplier power is moderate/low and that means suppliers
do not hold a lot of leverage when it comes to raising prices on smartphone parts. Too many
suppliers exist and they end up competing against each other essentially bidding down the prices
they can get for supplying smartphone parts.
The threat of new entrants into the smartphone market is low because it takes so much
capital and resources to be able to be competitive in the smartphone market and get in the
market. Only pre-existing companies or firms who have merged have any chance of making it in
the smartphone market. And smartphone substitutes are low, and rivalry is high with MNCs like
Apple and Samsung battling for market dominance.
The global mobile phone industry is best defined by overall market share and price based
upon product type. The industry can be further defined into three different segments: low-end,
middle, and high-end. In the global smartphone industry, scale and market share are everything.
The ability to expand globally is crucial as emerging markets arise and new potential customers
come forth. However, it is still possible to be profitable in the market without expanding rapidly
against fierce competition by creating a niche.

Samsung has stuck to its mission statement. Samsung doesnt have an official mission but
express it through the companys philosophy: At Samsung, we follow a simple business
philosophy: to devote our talent and technology to creating superior products and services that
contribute to a better global society. Its mission statement responds both to its own change, and
to new developments in the world.
Samsung's current Management Philosophy is "We will devote our human resources and
technology to create superior products and services, thereby contributing to a better global
society." Samsungs management philosophy represents strong determination to contribute
directly to the prosperity of people all over the world. Samsungs competition includes Apple of
course, but also Nokia, Intel, LG, Sony, Texas Instruments, Levono, HP, Sanyo, Toshiba, SK
Hynix, and Western Digital to name the main ones.
There are a couple of strategies Samsung should pursue in the future. Samsung should
provide the latest in technology, innovation, and product design concerning its smart phone
segment. Samsung should pursue this while attempting to be first to market and potentially
create a differentiation advantage from a cross platform development perspective. And secondly,
Samsung should compete for market share on a global level while recognizing the potential of
emerging markets.
Apples history is marked by technological advances and innovation like the world has
never seen before. Apple, Inc., formerly Apple Computer, Inc., is an MNC that has created
consumer electronics, personal computers, computer software, commercial servers, and is a
digital distributor of media content. Apples core products are the awesome iPhone, the equally
amazing iPad, and the Macintosh computer line. Apple was founded by the late and great Steve
Jobs and the equally gifted Steve Wozniak back in 1976 in Cupertino, California.

As of 2012, Apple was the largest publicly traded company in the world based upon
market capitalization. It had an estimated value exceeding US $600 billion as of September
2012. Apple had a market capitalization larger than Google and Microsoft put together. And
Apples worldwide revenue in 2010 was $65 billion, which increased in 2011 to over $127
billion, and then in 2012 had exceeded 155 billion. The future strategies Apple should pursue
include utilizing its distribution and process methods to continue its success of capitalizing off of
emerging markets.
1, Analyze the existing business strategies, domestic and global environments, industry,
and internal capabilities for both Apple and Samsung. Assess the significant manner in which
each companys mission and vision align with the long-terms goals and strategic direction of the
organization.
Apple and Samsung use very different business strategies and business models. For
example, Apple releases relatively few, but highly advanced, quality high-end products. On the
other hand, Samsung bombards the market with a wide variety of its products that do not achieve
the same high levels of perfection and quality Apple attains.
In the beginning, Apple was very careful about its mobile and tablet releases by originally
allowing for long development cycles. These protracted development cycles would increase
anticipation for Apples new products.
The strategy of Apple was to develop and sell brand new, innovative iconic products that
married functionality and technology. This resulted in providing a simpler and more streamlined
user experience. This straightforward business strategy pushed Apple to the frontline of
smartphones. The result was that Apple became a leader in the smartphone market with the
beginning of their original release of the iPhone in 2007.

Apples strategy during CEO Steve Jobs tenure was to use a long development cycle that
produced at least one large innovation each cycle. Apple would release these products usually in
a yearly selling period. Apple did this while also marketing the earlier models at bargain prices.
This strategy allowed Apple to generate a large amount of customer excitement and anticipation
for its new products.
Apples customers, like Pavlovs dogs, eventually came to expect something new and
innovative every time Apple announced a new product. Apple was also able to attract and keep
many consumers by bundling its other product offerings, such as iTunes, together with the use of
the iPhone and iPad. The iPhone also could double as an iPod if the customer desired. After
Steve Jobs relinquished his position as CEO of Apple, the succeeding CEO, Tim Cook,
seemingly adopted a new business model for Apple that was not necessarily the same as what
Steve Jobs had created.
Tim Cook may have agreed with Steve Jobs methods of new and innovative products.
However, he began using Apples large market share of loyal customers to provide only
incrementally changed products. Cook knew the companys large and loyal customer base would
upgrade to the newest devices being produced even if the new products were only marginally
improved upon.
The business model of Apple shifted from the time of Steve Jobs to Tim Cook. Jobs
prioritized the construction of brand new, innovative, technologies. Tim Cook basically milked
the previous innovations for as long as he could. Cook produced marginally improved upon
versions of previous and current Apple products.
Under Cook, Apple focused on strengthening its already created products and
marginalized innovation and technological advancements. For example, instead of having any

true innovation with the newly released iPhone 5, Cook focused on tightening up many aspects
of the existing smart-phone model, the iPhone 4. Cook increased the iPhone 5s size, allowing it
to compete with other larger smartphones such as those created by rival Samsung. Cook also cut
Apples contract with Google for its Maps service and replaced it with an Apple proprietary map
system.
As a result of Cooks divergent, status quo philosophy, a new dynamic emerged within
Apple. The innovation pattern became a two to three year cycle for significantly new and
improved products. The first product that was usually released was the new hardware upgrade.
This upgrade brought new changes such as a larger screen, a better camera, and a faster
processor, etc.
Around a year later, Apple released an updated version of this hardware. The upgrade
mainly consisting of slight upgrades and new chips. Apple often added new bells and whistles to
each iPhone release along with a hardware upgrade, e.g. Siri, cloud storage, etc. In essence, the
new two to three year cycle of large hardware upgrades was augmented with small yearly
hardware and software enhancements.
Samsungs marketplace strategy, on the other hand, has been to inundate the market with
a plethora of new products in a short period of time. Samsung appeals to more markets by
providing a slew of gadgets such as cell phones, smart-phones, tablets, etc. to both low and highend markets meaning at least one of their products will, presumably, appeal to a person. This is a
strategy to try to offer something to everyone. Apple on the other hand focused on creating a
single awesome product. Samsung has become a jack of all smartphones and a master of none.
While Apple became a jack of none and a master of one, the iPhone.

Samsung has done well in the low-end market, but has only recently begun increasing its
presence in the smart-phone market and has enjoyed a good amount of success thus far as a
result. Samsungs rapid market share increase in the smart-phone marketplace can be attributed
to Samsungs large amount of different devices as compared to Apple and other competitors.
Lastly, Samsung is not only the biggest adopter of Googles Android software, but they
also have smart-phones running the Windows Phone OS as well. While Apple is focused and
restricted to its own iOS, Samsung is not held by these same boundaries. Samsung has flooded
the market strategy works so well because they are able to not only diversify their hardware, but
the software that runs on their smart-phones as well. Whether appealing to many markets or
focused on a single one is best remains to be determined.
Apple is earning greater operating profits than Samsung. This is probably due to the fact
that Samsung operates in a lot of other business areas and its products are highly differentiated.
Samsung further breaks its overall earnings into three market segments: Consumer Electronics
(TVs and appliances), IT & Mobile communications (handsets, smartphones, tablets, PCs and
network equipment) and Device Solutions (LCD and OLED screens, memory, and System LSI,
the fab that builds Apple's A-series chips for iOS devices).
2, Analyze the business-level strategy of each company by conducting a SWOT
(Strengths, Weaknesses, Opportunities, and Threats) analysis. Next, determine the fundamental
way in which each sector influences its competitive position within the industry. Provide
rationale to support the response. 3, Analyze the central manner in which the strategies of each
companys business leaders have adapted to cultural differences in order to both facilitate
effective operations within global markets and drive new strategic initiatives with improved

innovation excellence. Provide one (1) example of such strategies in use from each company to
support the response.
In conducting a SWOT analysis of Apple it becomes apparent that the companys
interfaces are technically more advanced than the competition. This makes sense given Apples
focus and pursuit of high-end products; both in hardware and software.
Apple has a very powerful brand image associated with quality and superior design.
Apple has an extremely loyal customer base. Apple invests billions of dollars annually in its
research and development. Apple invests in the future and it invests in innovation. Because
Apple has differentiated its products as high-end, it is able to charge more. Apple has expertise in
hardware, software and services.
Apples OS is perceived to be the most stable OS on the market. Apple has the best
designed smartphone in the market resulting in further reinforcing its product differentiation.
Apple enjoys, and has earned, an excellent branding and marketing image. Apple has produced
an abundance of high-end applications and features for its iPhone. Apple launched its iPhone 5
with a bigger screen. And Apple also launch its latest operating system in a timely manner to
keep the interest in the iOS 7 strong and robust.
Apple also has weaknesses. Apple has a limited number of products so users with specific
needs may switch to the products of Samsung. Apple has a policy of forcing its customers to
switch to the latest product by reducing support for the older products and applications.
Apples high prices compared to other smart phones with similar abilities may not help its
sales in developing markets like the Philippines. Apple has been experiencing a decline in its
personal computer sales. Apples personal computers come without expandable memory. Its

batteries are fixed. The accessories are expensive for Apple products. Apple products lacks
features such as Bluetooth transfer, and SMS forwarding.
Apple has many opportunities. Its smartphone and tablets have been enjoying increasing
and growing demand. Apple products are appealing to companies. Apple enjoys easy integration
with iCloud. Apple has a huge untapped market outside of the business arena. And Apple is much
more innovative with the features and models it does produce.
Apple also has threats to contend with. Other smartphone makers, such as Samsung, are
cutting into Apple's market share both in the US as well as abroad. Apple products offer very
limited choice or customization ability. Economic turmoil will cause Apple to raise already
higher prices and that will not be a PR plus. The mobile manufacturers of smartphones are not
using the Apple OS but rather are using the Android OS. Apple suffers from a lack of product
choices for consumers to select from among. And Apple is threatened from a plethora of cheaper
smartphone substitutes.
Apples main competitor is Samsung. Samsung has many strengths. Samsung enjoys the
widest range of products which includes mobile phones, tablets of numerous sizes and features,
televisions, audio and video products, cameras, camcorders, home appliances, PCs, laptops,
peripherals, printers, memory cards, and numerous, countless other accessories. Samsung enjoys
strong hardware integration with its OS and software.
Samsung has built a strong brand value through multiple sponsorships. Samsung has
gained a reputation for excellence in engineering and production of hardware. Samsung has
proven itself to be innovative and well designed. Samsung has achieved low production costs.
Samsung has achieved the largest global market share in mobile phones and is a strong second in

smartphones due to the lower prices. And Samsung has the ability to effectively market its brand
around the world.
Samsung also has weaknesses. Samsung has been guilty of patent infringement. Samsung
suffers from low profit margins. Samsungs main competitor, Apple, is also the largest buyer of
smartphone components. Samsung is focused on producing too many products. Does it really
know who its main market segment is? Samsung suffers from a lot of strong competition as I
mentioned, and listed, earlier. Samsung suffers from consumer perception that it has low quality
products.
Samsung has many opportunities. Indias growing smartphone market is attracted to the
lower prices of the Samsung products. Samsung has an opportunity to take advantage of the
growing mobile advertising industry. There is a growing demand for Samsungs application
processor. There is growth in the tablet market and Samsung offers many models. Samsung also
has the opportunity to obtain patents through acquisition and avoid patent infringement lawsuits.
The threats for Samsung are significant but not insurmountable. Samsung has saturated
the smartphone market in many of the developed countries such as Canada, the US, Europe,
Australia, etc. Samsung is threatened by the low cost of Chinese production. Samsung is
threatened by the new nanotechnology which may replace Samsung's technological advantages it
currently enjoys. And the launch of Apples iTV is a threat to Samsung television products.
The overall threat of new entrants into the global mobile and smartphone industry is low.
The capital requirements for a start-up mobile or smartphone company are high. An extremely
large sum of money must be available for investment for a new company to be able to attain
economies of scale that the five leading companies thrive on. The top five firms dominate over
76% of the market.

Much capital needs to be acquired and invested into research and development,
technology, and production facilities before any new kid on the block has a chance (Marketline,
2009). The easiest way for a new company to enter the market would be if it was already
involved in similar operations and then diversified through mergers and acquisitions into mobile
production. This would reduce the impact of spreading the companys assets too thin and keeping
its structure stable. Also, most raw materials used in production are the same (Marketline, 2009).
This strategy was demonstrated by Apple in 2007 with the addition of the iPhone into the
marketplace, targeting the smart phone segment.
4, Evaluate the superiority of each companys organizational competencies in terms of
entrepreneurial capabilities, organizational design capabilities, and strategic capabilities geared
toward increased performance and profitability. Include one (1) example of such superiority from
each company to support the response. 5, Recommend one (1) appropriate new business strategy
for each company that may maximize profitability and improved competitiveness in the industry.
Provide a detailed rationale for this strategy.
Economies of scale play an important role in the top performing companies in the
industry. One major absolute cost advantage in the industry is a patent. Patents are abundant in
the mobile and especially the smartphone industry. All top competitors hold various patents, and
continue to invest in intellectual property to stay competitive.
Apples iPhone is a good example of cost advantages through patent holding. Apple has
successfully filed lawsuits against HTC for infringing on twenty different Apple patents related
to the iPhones user interface, architecture and hardware. We think competition is healthy, but
competitors should create their own original technology, not steal ours, said the late Steve Jobs,
CEO of Apple (Dowling, 2010).

Patents add to the high barrier of entry for the industry, and are the core technology
around mobile phones, which makes the smartphone industry both profitable and attractive; but
the barriers to entry are enormous all around (Foxtrot, 2009). Hardware differentiation has
played a decreasing role in the value of mobile phones and towards the development trends of
smart phones.
The major emphasis has recently been put on differentiation in operating systems,
applications, and content services. Application stores have also become popular with Apples
App Store leading the way. The application store business strategy is to compete for developers
by making money off its popularity to obtain competitive advantages in content and services (My
News Desk, 2010).
Manufacturers have the ability to use their own proprietary software packages and
software platforms also adding to the high barrier of entry (Foxtrot, 2009). Chipsets for mobile
phones are developed and processed by multiple companies which normally dont manufacture
for a single cell phone manufacturer.
Apple recently started making in-house processors for its mobile devices. Trademarked as
the A4, Apples processor boasts a 1GHZ speed, over 10 hours of battery life, and was featured
in its latest iPhone 4 (Miller, 2010). Exit barriers are somewhat high based on the high costs that
are involved with attempting to exit out of this industry.
This in turn increases rivalry (Foxtrot, 2009). Specialized assets such as early mentioned
spectrum licensees for network providers will maintain a higher resale value. The biggest and
most influential resources for Samsung are the expertise of its employees and the determination
of its management.

As I stated before, Samsung takes a lot of pride in its employees and their contributions
to the company. Samsungs experienced and well-trained employees utilize the resources and
assets they are given efficiently and effectively, leading to a positive ROA.
The result is the extensive list of innovative and state of the art products. Samsung has
even established an educational system for the entire company that touches on all aspects of the
environment, products, and facilities. Fields of study include, but are not limited to,
environmental awareness, legal education, and job-specific education.
This in turn cultivates a common ground mentality and in stills a green management
mindset in all of Samsung employees. The determination of its management is also what allows
Samsung to excel in the industry. Creativity, collaboration, and excellence are the hallmarks of
leadership and management at Samsung.
It is managements constant goal to attract the worlds most talented, and continuously
evolve the companys culture to support them. It is managements belief that this will bring
innovative ideas that advance technology and the companys strategy of creating the newest
products that improve the lives of Samsungs customers.
The Samsung Company has several integrated strategies. One of Samsungs strategies has
been to provide cutting edge technology, value-adding innovation, and functional product design.
Samsung is focused on continuous smart phone evolutionary improvements. Samsung is also
striving to be the smartphone market leader and establish, and maintain, a credible and lasting
differentiation advantage over Apple and its other competitors
Samsung is also endeavouring to gain global market share by valuing and targeting the
immeasurable potential of the numerous emerging markets.

Samsungs patent applications have increased dramatically regarding Wireless


Communication Networks (WCN). Apple has been similarly pursuing an aggressive patent
acquisition and application strategy. Samsung has filed more than a total of 1,140 cases of patent
application in the field of WCN over the previous decade.
During 2007 to 2011, the number of WCN patent applications was nearly 14 times more
than during 2002 to 2006. Samsungs semiconductor technology is the main business activity of
Samsung, but its patent application has decreased by 74% during the year 2002 to 2006. Instead
of the Semiconductor area, Samsungs mobile patent applications field; such as WCN.
Near Field Communication (NFC), and Cellular Phone Web Browsing Technology, have
increased in recent years. It is also worth noting that fields such as Fuel Cell, Robotics, Image
Processing, and Nanotechnologies have also increased rapidly. These technologies are highly
related to Samsungs top five future business activities; Solar Cell, Batteries, LED, Biomedicine, and Medical Devices apps.
Apples strategies are also notable. Apple has been concentrating on securing design
patent rights to safeguard its iPhone platforms. Apple has applied for nearly 100 patents related
to screen displays and icon design fields. Apple has further applied for another 186 patents
relating to data processing equipment as well as peripheral apparatus and devices design fields
over the past decade. It is worth noting that the design patent including UI parts has increased 9
times during 2007 to 2011 than 2002 to 2006.
While having higher market share of any given market is not necessarily the best strategy,
not having a mid-priced smartphone just may hamper Apples ability to get users into the Apple
ecosystem. Since its users have a high likelihood of sticking with Apple, the potential launch of
an entry level smartphone could have major long-term benefits for Apple.

6, Evaluate the success of both companies corporate-level strategies in terms of


horizontal integration, vertical integration, strategic outsourcing, or diversification. Next,
determine the type of strategy that contributed most effectively to the creation of a successful and
profitable multi-business model. Provide a detailed rationale to support the response.
Vertical integration dictates that one company controls the end product as well as its
component parts. In technology, Apple for nearly forty years has championed a vertical model,
which features an integrated hardware and software approach.
For instance, the iPhone and iPad have hardware and software designed by Apple, which
also designed its own processors for the devices. This integration has allowed Apple to set the
pace for mobile computing. This integration involves different hardware and software
competencies and skill-sets in areas such as manufacturing, as well as procurement and supply
chains.
The tech industrys success in this type of integration is mixed. Samsung, a large
technology conglomerate, has thrived by making everything from LCD panels to processors,
televisions and smart-phones. Samsung, as I mentioned earlier, has tried to make something for
everyone. Whereas Apple has focused on doing a few products extremely well.
In its current form, Apple has found a way to balance vertical integration with an
outsourcing model. For instance, Apple focuses on design and integration. Apple has deployed a
hybrid model, where it has control over the product and supply chain, but uses contractors in
many areas.
In the current time, corporate level strategies are adopted by both Apple and Samsung for
the overall success and to achieve competitive advantages in the industry over the competitors.
By taking the example of Apple, with the help of horizontal integration, all the employees are

satisfied effectively because this helped the employees in providing the freedom and autonomy.
On the other hand, the horizontal integration allowed Samsung for greater control of both prices
and costs such as better economy of scale (Wambui, 2013).
In addition to this, with the help of strategic outsourcing, operational, administrative and
other expenses are reduced by the both companies that helped the organizations in improving the
returns and profits effectively. Due to these, a lot of strategic advantages are gained by the both
organizations in the internal market. Innovation strategy is used by the both organizations in the
organizational processes as well as product and services. For example, multi-sided business
model is used by the both organization in order to achieve the organizational goals effectively
(Segall, 2012).
7, Analyse the strategies that the internal leadership of both Apple and Samsung has taken
to discourage unethical behaviour. Provide at least three (3) examples of such leadership in
action from both companies to support the response.
Apple and Samsung have worked on implementing various actions and strategies in their
organizations in order to avoid unethical behaviour and to create a good image in the global
market. There are a lot of strategies used by the leadership of both Apple and Samsung to
discourage unethical behaviour (Schneiders, 2010).
The different strategies used by Apple in discouraging unethical behaviour include the
development of a written code of conduct. A well-written and effective code of conduct
statement has been developed by Apple. This statement puts the company on record for taking a
stance on what is acceptable and what is unacceptable. An ethical position in writing by Apple
encourages ethical behaviour.

For example, most employees who know what the companys ethical position is will
strive to abide and adjust their conduct accordingly. A code of conduct outlines what behaviours
are acceptable and what measures may be taken if an employee violates the code of conduct
(Katie, 2013).
Apple also has implemented regular training to foster ethical thinking which hopefully
yields ethical behaviour. The ethics trainers hired by Apple use role-playing, motivational
speaking, videos and hand-outs to illustrate the importance of ethics in the workplace (Sheehan,
2011).
Having a written and circulated code of conduct as well as training that reinforces the
companys ethical stand is a recipe for success. Simply writing something and hanging it on a
wall by the water cooler does little to foster sincere ethical decision making among staff. But
when a firm backs it up with training and action then that will send a positive message that
encourages and builds a healthy corporate culture.
Furthermore, Apples HR team must incorporate the code of conduct into the orientation
of new Apple staff. The ethics trainers hired by Apple who use role-playing, motivational
speaking, videos and hand-outs to illustrate the importance of ethics in the workplace should also
be used by HR to inform all new hires. Apples HR must develop a hiring policy that reflects the
value system. For example, when the HR teams of Apple hire employees, they must educate the
new employees regarding ethics (Sull, 2005).
The Samsung Company also has implemented several strategies to get its ethical message
across to its management and employees. Samsung has created a checks and balances system.
This is one of the most important strategies that are used by Samsung to encourage ethical

behaviour. For example, the company creates a system of checks and balances to minimize the
opportunities for unethical behaviour (Srinivaas, 2014).
Samsung has also worked at building a corporate culture of transparency, openness, and
communication with the employees and management. Such actions helps the Samsung Company
in fostering and promoting the creation of ethical behaviour in the employees as well as
management, especially management (Katie, 2013).
The Samsung Company also employs various systematic policies and practices to
enhance ethical behaviour. For example, various processes and procedures are used by the
companys HR department regarding ethics violations by defining, identifying, and reporting
them (Sheehan, 2011).
8, Assume that both Apple and Samsung are in need of organizational change and must
alter existing strategies. Recommend three (3) specific ways in which Apple and Samsung could
change functional, business, and corporate strategies, as well as organizational structure and
control in order to improve business performance and competitiveness in their industry. Provide
a rationale to support the response.
In todays more competitive business era, there are various innovative and effective ways,
methods and strategies used by the business organizations. These various innovations, methods
and strategies may improve the organizational structure, culture and alter existing strategies that
are not proving to be effective. It should also be noted down that, if company wants to improve
its overall organizational structure in order to make it more effective and appropriate, there
would need to be modification or alteration in its existing strategies so that desired objectives can
be fulfilled (Lewis, 2011).

In the same way, different ways can be adopted and used by both Apple and Samsung for
the organizational change. In addition to this, both the organizations such as: Apple and Samsung
would be able to change functional, business, and corporate strategies, as well as organizational
structure and control in order to improve business performance and competitiveness in their
industry (Hielkema, 2012). For case, both the business organizations should focus on the given
below ways/methods and techniques for the overall organizational change.
Reengineering the companys processes and procedures is one of the most effective and
comprehensive methods that should be used by Apple and Samsung in pursuing meaningful
change. Both companies must focus on the work needed to accomplish such change. That means
the companies would need to consider the options available in moving forward. I believe slowly
but surely is the proper attitude.
In addition to this, Apple and Samsung should also implement the steps necessary for
implementing changes little by little every day. For example, this strategy will help the
organization in focusing on substantially improving productivity, efficiency, and quality or
customer satisfaction (Davies, 2011). Leadership must move forward purposefully but not rashly.
All change should be embraced with maximum staff buy-in as well as with senior management
working for the process to involve everybody. All employees should feel they are a meaningful
part of the growth forward. Leave no one behind.
Change should be implemented incrementally and with patience. On the other hand,
analysis paralysis must be avoided. Once the CEO has received all the needed feedback and has
heard from all involved then the plan must be selected and everyone must support and help with
the incremental implementation. For example, Apple and Samsung would need to put effort into
getting every employee focused on making these small changes.

Senior management at the direction of the CEO, should consider that being creative and
resourceful in adopting new ways and methods to motivate the employees with buy-in and with
creative ideas in the context of organizational change should be pursued and a priority (Lewis,
2011). Thinking outside the box may be a clich but the concept has considerable value and
should be part of the creativity used to find meaningful answers and achieve as close to 100%
buy-in as possible.
Both Apple and Samsung must anticipate and shape the future with strategy. This is an
extremely important and widely used strategy required to implement meaningful and lasting
organizational change. The Apple and Samsung management must take responsibility for
effecting the organization with positive change.
The people of both Apple and Samsung need to create (brainstorm) alternative scenarios
of what they want their future to look like. If we can conceive then we can achieve. Along with
this, the management would also need to define opportunities based on these possible future
scenarios. Then assess the strengths and weaknesses in these scenarios and how each will impact
each organizations mission. By doing this, both Apple and Samsung have a greater realistic
chance or opportunity to achieve competitive advantages through their organizational changes as
they move forward into the 21st century (Hielkema, 2012).

Eric Sewell

References:
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