Magazine

No. 9: Samsung Electronics


INDUSTRY

Electronics

SALES

$79.0 billion

PROFITS

$10.4 billion

SEAN GALLUP/

GETTY IMAGES

It's hard to stay on top in business without constantly adjusting to changes in the marketplace. Samsung Electronics Co. CEO Yun Jong Yong's philosophy for coping with those changes boils down to two key principles: Get constant customer feedback, and instill a sense of urgency in your employees. That thinking grew out of Yun's appointment as chief executive just as the late 1990s Asian financial crisis got under way and Samsung came close to collapsing under a huge debt load. Yun vowed never again. ``Once you grow complacent, you can easily fall into a crisis,'' warns Yun. ``But learning to live with a sense of crisis will make you more competitive.''

Keeping the company's 113,600 employees on their toes has helped Samsung become a more nimble player. Few other electronics companies adapted as quickly to the industry's sudden shift from analog to digital. That transformed Samsung from a maker of me-too products in the '90s into a leading innovator today. ``Speed in sensing and responding to market needs makes all the difference,'' Yun says. One example of that hypercompetitiveness: Samsung outsources one-third of any given product's components to rivals. That forces the company's in-house part-making units to innovate like crazy and slash costs to remain competitive. The craziness works: Samsung is now a leader in flash-memory chips, flat-screen panels, and mobile phones.


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