Samsung Organisational Structure

Samsung was called by Lee Byung-chul, architect of Samsung Electronics back he accustomed the Samsung Trading Aggregation on March, 1938. Sam in Samsung is authentic as strong, abounding and big; while “Sung” agency aerial and bright. (Chnag, J. H., 2010) Interestingly, Samsung’s agent was not involving electronics. Initially, Administrator Lee set up a barter consign aggregation in Korea that awash fish, vegetables, and bake-apple to China. Start from 1958, Samsung began to aggrandize into alternative industries such as media, financial, address architecture and chemicals and Samsung Electronics was accustomed beneath accessory of Samsung Accumulation in 1969. (“Samsung History”) The aggregation again broadcast to semiconductor business and became the aboriginal chip-making accessories in the country during that time. Samsung Electronics focused on four areas which are agenda media, semiconductor, telecommunication arrangement and LCD agenda appliances. (“Wikipedia”, 2012) In 1993, the “lightest” adaptable buzz of its era was developed. (“Samsung History”) Finally, it surpassed Sony to become world’s twentieth-largest and best accepted brand. Samsung was the world’s bigger architect of OLEDs with 40% bazaar allotment worlds advanced and 90% allotment of all-around AMOLED market. Added than 600 American patents and 2800 all-embracing apparent are endemic by Samsung Electronics in 2006 that makes it as the bigger buyer of AMOLED technology patents. The aggregation additionally became the second-largest mobile-phone maker assault Motorola in 2007 for the aboriginal time. In 2009, it became world’s bigger technology aggregation overtaking Hewlett-Packard admeasurement by sales. In 2010, it produces 30 nm-class DRAMs and 20 nm-class NAND flashes which were the aboriginal time in the world. At 2011, it is the world’s bigger adaptable buzz maker and second-largest semiconductor dent maker. Samsung Electronics became the bigger smartphone bell-ringer due to sales of Galaxy SII and Galaxy Note devices. (“Wikipedia”, 2012)


Mechanistic alignment is a authoritative alignment which adheres to the chain-of-command principle, with anniversary actuality controlled and supervised by one superior. The anatomy of this alignment is taller than amoebic organization. Also, abounding rules are developed and the accommodation authoritative action is centralized. Anniversary agent has anchored duties and the advice channels are formalized in such adamant hierarchical relationship.

Samsung Electronics is a blazon of mechanistic authoritative anatomy because it has adamant hierarchical relationships.

Figure 1 and bulk 2 appearance the alternation of command in the company, which extending from high authoritative levels to lower akin that clarifies who letters to whom. Bulk 2 shows that there are lots of departments beneath the ascendancy of Chief Executive Office. Advisers acquire their anchored duties in corresponding department. For instance, advisers who are specialized in bearing chips are alive beneath chips architect admitting advisers who are awful accomplished in bearing adaptable phones are alive beneath adaptable buzz manufacturer. (Robbins, DeCenzo, and Coulter, 2012) These two abstracts additionally acutely appearance that Samsung Electronics is composed of alpine authoritative structure. All of the able authorities are captivated by the top administration of the aggregation which is Lee Kun Hee , the administrator of the Samsung Electronics with the advice of the Appointment of Secretaries and sometimes referred to as “emperor management” or “dictatorship”. (Chang, S. J., 2008) Appointment of Secretaries helped administrator to ascendancy and absolute the alone affiliates. Their capital action are accounts and accounting, auditing, planning, accessible relations, and animal adeptness management, including the hiring and battlefront of all admiral aural the organization. Alike the important cardinal accommodation and ample advance accommodation acquire to be advised by the appointment first. The allotment of accommodation fabricated by the administrator is 20%; by Appointment of Secretaries is 40%; by associate presidents is 40%.(Chang, S. J., 2008)In alternative word, all of the important decisions are absitively by the chairman, Appointment of Secretaries and associate presidents. As such, Samsung Electronics apparatus centralized accommodation authority.

The advice approach of Samsung Electronics is formalized. Analogue describes how an organization’s jobs are connected and the admeasurement to which agent behavior is guided by rules and procedures. This aspect makes the action of assumption accepted and regular. Thus, there will be basal agitation to an alignment action if there are bodies actuality replaced. In Samsung, the cadre action is beneath CFO while CFO letters to and receives orders from CEO. (Chang, S. J., 2008) For instance, back the aggregation needs to accomplish an investment, the angle is accounting by the accompanying business unit. Then, the angle is advised by the accounts department, which is again anesthetized to accounts aggregation of Appointment of Secretaries afterwards CFO letters the angle to CEO. Finally, the angle is accustomed by Appointment of Secretaries and Chairman. (Chang, S. J., 2008)

Many rules could be begin in Samsung Electronics and this bout with the appropriate of mechanistic organization. According to Samsung Electronics All-around Cipher of Conduct, all the advisers should chase the codes and the business attempt to accede with laws and ethical practices as able-bodied as to accurate their charge to amusing responsibility. (Samsung Electronics Co., Ltd. [SECL], 2006) The all-around cipher of conduct is served as behavioral guidelines and judgmental standards for the employees, which beset the abolishment of allegiance or gender discrimination, cellophane acknowledgment of business information, chump advice aegis and accomplice collaboration. For example, according to assumption 2-2-2 from the All-around Cipher of Conduct, the aggregation will ensure that any proprietary advice acquired through its business activities shall be recorded and cautiously kept and managed as bookish property. In 2011, zero-tolerance assumption was declared in all cases of delinquency and bent business on “Law Day”. All advisers and admiral acquire to assurance a agreement of acquiescence to accede of demography albatross for any abuse or misconduct. (Soung, S. S., Eui, H. J., Dae, S. P., Jin, Y. L. & Yun, J. S., 2012)


Planning includes defining goals, establishing strategy, and developing affairs to alike activities. In Samsung, their eyes is set by the top administration that is “Inspire the world, actualize the future”. This eyes 2020 shows that their charge in alarming the apple by convalescent their three key strengths which are “New Technology”, “Innovative Products”, “Creative Solutions” and additionally promotes Samsung Electronics’ bulk arrangement which are industry, ally and advisers with the accomplishment to accord a bigger apple and with lot of adventures for all. Besides, Samsung additionally aims to accomplish one of the top bristles brands in the apple by 2020 and accustomed three cardinal approaches in administration which are creativity, affiliation and talent. (“Vision”, 1995-2012)


Leading includes affective employees, administering the activities of others, selecting the best able advice channel, and absolute conflicts. Appointment of Secretaries takes the arch role in Samsung as they backpack out allocation whenever there are conflicts happen. (Chnag, J. H., 2010) However, the synergies may be created via automatic cooperation or authorization as the business units acquire to acquire its resolution. (Chang, S. J., 2008) Also, the Secretarial Offices advance aggregation aesthetics and advance business allocation and information, which are aggregate amid affiliates. (Chnag, J. H., 2010) The advisers of this aggregation are motivated by the aesthetics of active by able belief is the key to acceptable business. Those belief beset people, excellence, change, candor and co-prosperity, calm with the Samsung cipher of conduct are the abolitionist for them to accomplish every decision. (“About Samsung”, 1995-2012)


Organizing includes free what tasks are to be done, who is to do them, how the tasks are to be grouped, who letters to whom, and who will accomplish the decisions. Samsung Electronics has a able business analysis anatomy that is managed apart by business assemblage managers. The aggregation is disconnected into bristles sectors, which are Agenda Media, Semiconductors, Telecommunications, Agenda Accessories and LCDs. Aural these sectors, there are 13 All-around Business Managers (GBM) who amenable to adapt the close forth above artefact capacity in agreement of personnel, sales, and assembly aural their corresponding divisions. (Chang, S. J., 2008) Advisers are disconnected according to their specialize and abilities into altered tasks to access appointment output. (Robbins et al., 2012) Any angle of advance that is accounting by GBM should be advised by the accounts department, followed by CFO. Then, CFO letters to CEO. Finally, the angle is accustomed by Appointment of Secretaries and Chairman. (Chang, S. J., 2008)


Controlling includes ecology performance, comparing it with goals, and acclimation any cogent deviations. In Samsung, the all-embracing performances of BOD, CEO and advisers are controlled by Analysis Committee, which has a ample ambit of analysis appropriate from top to bottom. (“Ethics Management”, 1995-2008) For example, they acquire the appropriate to analyze about banking letters from the BOD and advisers at any time, the appropriate to affirmation to append actionable action of the aggregation BOD member, the appropriate to alarm a accepted shareholders’ affair and so on. There are additionally abstracted analysis teams that beneath the absolute ascendancy of CEO with the amenable of auspicious advisers to attach to the convenance of administration by ethics. (“Ethics Management”, 1995-2008)

A) What assume to be the best important things arch to the success of the Samsung


To be successful, Samsung Electronics is activity global. Samsung Electronics is blame the Galaxy S smartphone to claiming Apple Inc.’s iPhone and attenuated the gap with baton Nokia Oyj. It helped Samsung Electronics quadruple anniversary acquirement to139 abundance won ($ 116 million) in the 10 years that concluded in 2009. Samsung Electronics shares rose 10-fold during that time. (Lee, Y., 2010)

Also, Samsung Electronics has the acceptable planning abilities as they able to see the business befalling in the industry and set the accurate goals to pursue. They able to atom the areas, which are baby but growing fast. (“Samsung”, 2011) Such areas that spotted by Samsung are capital-intensive. Thus, it is difficult for their rivals to accumulate up. First, Samsung will edge into the technology in the industry to get accustomed with it. Then, they will adjournment for the acceptable moment that the ‘window of opportunity’ opens. For example, in 2001, Samsung bolt the befalling of accelerated advance of the liquid-crystal displays that account the dive of the price. They angry the liquid-crystal displays into televisions. (“Samsung”, 2011)

Samsung Electronics is avant-garde in software and David Yoffie, a assistant at Havard Business School in Boston said “Leading abolitionist addition in the technology apple today requires backbone in software, not aloof hardware.” (Lee, Y., 2010). Samsung Electronics has developed by belief their rivals to advance accomplishment and design. Samsung electronics additionally assassin a accumulation of Japanese Architecture Consultant to appraise Samsung designers. Besides, their accomplished designers are beatific to appointment abroad in assorted industries. By accomplishing this, Samsung architecture action could absorb several initiatives and they began to apparatus a all-around cast advice strategy. As new technologies are actuality consistently alien to the market, Samsung engineers strive to acquire what barter charge advanced of competitors and acclimatize their cerebration to advance aboriginal and avant-garde articles that will accommodated those needs as able-bodied as new technologies to advance the approaching market. Thus, the new markets had pioneered continuously by them. (Samsung Electronics: Success By Design, 2008)

B) What do you see as the above challenges adverse by Samsung Electronics over the next

five years?

The above claiming that will be faced by Samsung Electronics over the abutting bristles years is how to body a stronger and bigger all-around brand. This is why the Samsung’s all-around business administrator charge to appraise in how to body the all-around cast acceptability of the aggregation added and advancement the company’s common cast angel to attempt with Apple cast which has bedeviled the bazaar allotment abnormally in Western Europe. The claiming of Samsung’s business administrator is the branding strategies in all-around markets and the business aggregation has to appraise the authoritative dynamics to advance a stronger all-around cast that accustomed by worldwide.

Another claiming that will be faced by Samsung Electronics is the antagonism over the bazaar allotment abnormally in acute phone. In this fast paced bread-and-butter conditions, Samsung charge to abide aftermath added and added of the acute buzz with bigger adaptation and adorable architecture to accommodated with the accelerated bread-and-butter growth. The aggregation needs to advance and acquaint added of the new technology and absorb the software and appliance into the new accessories so that it will not lose out to addition competitor. Addition and adroitness are important in this to allure the apparatus lover and if the aggregation fails to appear out with a new and ambrosial product, they will be affected by addition adversary such as Apple, HTC or Nokia.


Samsung electronics acquire a centralized anatomy authoritative the top administration own the authorities and admiral over all the important decisions. This accomplish the accommodation authoritative action fast and abrupt and can backpack out quickly. In this way, alignment is added able as accomplishing of any plans, account or behavior can be agitated out bound after any adjournment and this is actual important abnormally to accord with the fast paced bread-and-butter and antagonism in market. This is accurate by a abstraction in account by Choong Y.Lee. (Choong, Y. L., 2012) However, ever absorption in alignment is additionally not acceptable for the company. All of the important decisions are fabricated by the top administration while the average and aboriginal band administration cannot articulation out their opinions but to chase the adjustment of the top. If the accommodation fabricated by the top administration is incorrect, it can affect the aggregation business and appropriately blurred the aggregation profits. Therefore, a acceptable administration is important to advance the company. This is accurate by the assistant Chang Sea-Jin which declared there is no agreement that acceptable baton will sustain and alike they can accomplish aberration as able-bodied in his book review. (Chang, S. J., 2008)

Samsung Electronics are accepting hierarchical administration anatomy which reflects the accent of advantage in the Korean culture. The hierarchical anatomy brings synergy back things are activity able-bodied but could potentially be adverse if one allotment of the action goes abroad from planned. (Kim, J.C., 2012) This is accurate by Assistant John Kotter in his commodity “Havard Business Review” that hierarchical authoritative are generally inflexible. Hierarchical alignment appointment in connected processes but does not advantageous in activating environments. They are apathetic to acknowledge to new opportunities, which generally crave transformative change. (Basu, C., 2012)

Also, according to advisers G.M. Stalker and T. Burns, mechanistic organizations use hierarchical top-down structures while amoebic organizations use added adjustable structures and appointment best in aqueous and capricious business climates. Organic structures depend on claimed interactions rather than a academic alternation of command that acquiesce the alignment to acknowledge bound and finer to alteration affairs in means that the hierarchical anatomy cannot. Samsung Electronics should accomplish it business to acquire such anatomy so that it can acquire the allowances of both. (Thompson, S., 2012)

Samsung Electronics has abounding rules and regulations that are absolute by the top managers of the organization. Back the top managers are clumsy to ascendancy the lower-level activities, they themselves will acting the rules and regulations. Since they acquire the ascendancy to appoint and blaze the admiral and advisers in the alignment anytime, the advisers acquire to acquire the tasks accustomed by the managers and chase whatever they said. Advisers are consistently empiric and monitored by top managers during their alive aeon to ensure that they are not authoritative any mistakes or actionable the rules. Consequently, fatigue are accumulated back advisers are alive beneath such abundant pressures that accepted as authoritative fatigue.

Moreover, advisers of Samsung Electronics acquire to accede the All-around Cipher of Conduct, which consists of a cardinal of principles. (SECL, 2006) For instance, beneath assumption 1-4-1, it declared that ’employees shall not aspect their claimed political opinions and conduct to the company, or account such opinions or conduct to be attributed to the company’. Besides, assumption 2-4-3 showed that ‘the aggregation will not acquiesce its admiral and employees, while in office, to act as cardinal of boards of aggregation with conflicts of absorption or participate in aggressive business activities.’ (SECL, 2006) There are still a ample bulk of rules and attempt that the advisers should accede with and that can be referred from the All-around Cipher of Conduct, 2006.

The administration of Samsung Electronics is accepted as ‘fear-based management’. The advisers acquire to be loyal to their aggregation in adjustment to break in the company. However, authoritative fatigue will accompany abrogating furnishings to the company. If the advisers or admiral are absolved adjoin their wills for any affidavit by the top managers such as the administrator or the Appointment of Secretaries, their acrimony will advance to their betrayal and accident their loyalty. (Chang, S. J., 2008) There were several cases on which the advisers of Samsung Electronics approved to advertise the proprietary technologies to Samsung’s competitors and to alternative companies. (Chang, S. J., 2008)


In a nutshell, Samsung Electronics has a mechanistic authoritative anatomy as it has adamant hierarchical relationships and alpine authoritative structure. In the company, anniversary agent has anchored duties and they acquire to chase lots of rules. Also, the accommodation authoritative action is centralized and the advice approach is formalized. In Samsung, the goals or visions are planned by the top management. Appointment of Secretaries takes the arch role as they amenable to break the conflicts as able-bodied as advice the administrator to ascendancy and absolute the alone affiliates. Besides, they additionally advance the aggregation aesthetics to actuate the employees. Samsung Electronics is disconnected into Agenda Media, Semiconductors, Telecommunications, Agenda Accessories and LCDs, which are managed by business assemblage managers. The all-embracing performances of Samsung Electronics alignment are controlled by Analysis Committee.

In this assignment, we acquire abstruse the characteristics of the two types of authoritative structures, which are mechanistic alignment and amoebic alignment that affair the appointment specialization, departmentalization, ascendancy and responsible, absorption and decentralization, amount of ascendancy and formalization. Afterwards allegory these factors and analytic all the accompanying advice of Samsung Electronics, we could achieve that this aggregation is a mechanistic organization. Thus, our allegory adeptness could be strengthen back backpack out this assignment. Besides, we acquire a bigger compassionate to admit and differentiate these two alignment models. Furthermore, added ability about this aggregation could be acquired during the research.

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