MBA 690 Final Project Submission
Project Management Plan
Yahaira Flatts
Professor: Thomas Timmins
Southern New Hampshire University
April 25, 2021
Table of Contents
The Life Cycle of The Business. 24
Samsung evolved from an unknown company into being one of the largest multinational companies in the global market. The company sustained its position as a world-class corporation and among non-American companies with the highest ranking and brand recognition. Over the years of its success, Samsung maintained unique operational management in its marketing, design, and production initiatives bringing technological innovations to their electronic products (Madani, Abdulla, & Koosawangsri, 2014). The evolving complexity in competition and increased globalization encourages Samsung to invest in opportunities to increase profitability and maintain its position in the global market. This essay examines forces that shaped Samsung’s operation management, key obstacles and issues faced over the years, changes in the company’s organizational structure and management philosophy, key trends in production, business operations, and impacts of Samsung’s key trends operations. It also focuses on the development and implementation of the face shield smartphone, which is a new technology aimed at protecting users from COVID-19. The face shield will provide real-time data on potential COVID-19 exposure, testing and up to date quarantine guidelines.
Operational Forces
Samsung has been managing its operations to maximize its business motive and rationality. Over the past decade, the technology world has been highly competitive due to the development of advanced devices forcing the electronics companies such as Samsung to evolve. Therefore, some of the forces that impact business operations at Samsung are changes in consumer demand, globalization, technology, and competition. Samsung focuses on intensive growth and generic strategies that will facilitate technological innovation and give the company a competitive advantage (Madani, Abdulai, & Koosawangsri, 2014). Samsung competes with giant-tech companies such as Intel, Sony, LG, Lenovo, Google, and Apple which create an aggressive competing environment characterized by rapid technological development. One of the operational strategies used by Samsung is product differentiation through the evolution of smartphones. The company focuses on investing in technological innovation to help secure its market position as the best in the home appliance industries, consumer electronics, and semiconductors. Samsung also organizes its operations to fit in the global industry.
Competition has been the primary force driving Samsung operations. Any efforts employed by the company aims at giving it a competitive advantage. Samsung is committed to maintaining the quality of its products, which is part of its operating principle. The company carries out benchmarking, continuous improvement, quality testing, and batch production (Song & Lee, 2014). The different levels of operations and its marketing strategies aim at unique product promotion and differentiation (Madani, Abdulai, & Koosawangsri, 2014). Another way in which competition has shaped Samsung’s operations in recent history through the implementation of strategies such as cost focus, differentiation focus, and cost leadership which makes Samsung among the best providers in the market. Expansion to global markets has also shaped Samsung’s operations; the company invests in intensive growth strategies to attract new customers and retain existing markets. The focus on quality and product differentiation gives Samsung a competitive advantage.
Samsung has always been committed to manufacturing imitative and inexpensive products. Over the years, technological innovation has driven changes in consumer demands; therefore, to keep up with the changing needs, Samsung restructured its operation, especially in the smartphone manufacturing sector. The company’s operation management focuses on maintaining reliability, scalability, and speed; it introduces unique features that match current technological innovations. Samsung’s change in its marketing and production decisions gave the company global success and boosted its competitive strategy (Song & Lee, 2014). In 2009 Samsung experienced a 200% increase in their brand value and took Sony’s position as the most valuable and popular electronics brand. Samsung’s operation management takes advantage of its strategic position in the market and invests in a leader in technological innovations and quality products.
Key obstacles and issues that confronted company management
One of the challenges that confronted Samsung during operation management evolution is the economic crisis. During 2008-2009, the company faced a crisis where it spent about 6% of its revenues in development and research. The crisis occurred due to an increase in technological innovation and competition from other pioneering companies such as Sony. Recently, Samsung also encountered obstacles and issues during the US-China trade war (“Samsung profits tumble as it warns of ‘challenges’ ahead,” 2019). The company’s operating profit was reduced by 56%. Samsung’s chip business operations were also disrupted by the trade issues between Tokyo and Seoul. Although the company succeeded in discovering consumer demand, Samsung still faces uncertainties in the global markets, especially in the face of the COVID-19 crisis.
Samsung’s launch of new products also begun with a shaky start due to the restrictions imposed by Japan on exports of some materials such as display screens and semiconductors. Such restrictions caused concerns about the dangers of the trade spat in global markets, which could negatively affect Samsung’s earnings. Samsung also faced a crisis following complaints on broken screens, which resulted in the company delaying the release of their foldable smartphone (“Samsung profits tumble as it warns of ‘challenges’ ahead,” 2019). Such defects have been subjecting Samsung to an unfair position in the market and lead to a decline in smartphone sales due to competition from other brands such as China’s Huawei. This has also become a barrier for Samsung because some organizations do not trust the products, making it difficult for the company to target organizational buyers.
Samsung managed these obstacles by prioritizing its strategic operation management to focus on unique manufacturing capabilities that will give the company a competitive edge. Samsung no-longer uses the ambitious five-year plan due to changes in the market structure; instead, it follows new initiatives that will favor its position in the market. The organization has also invested in superior production and marketing strategies which are inaccessible by its rival companies through enhanced security (Song & Lee, 2014). Samsung uses a unique design approach based on innovation to establish mobilization, project initiation, and selectivity at various levels. Samsung has also succeeded in overcoming consumer-related issues through its commitment to corporate social responsibility, which has helped overcome the negative publicity (Song & Lee, 2014). The company also uses public relations to address the reports made against their product qualities and weaknesses. The investment of the open-plan design process also ensures that all products are critically evaluated before being released to the market. Samsung is also committed to winning the customer’s trust through innovative marketing strategies and quality-based production.
Operation management philosophies and organizational structures
Samsung has succeeded in maintaining its global market position by using the people-first management philosophy. Therefore, all of its operations are directed towards maximum customer satisfaction through highly investing in the production of superior products. Samsung underwent a radical change in its operations, forcing massive management changes to align the company into being a quality-driven one (Song, Lee, & Khanna, 2016). The organization invested in design capabilities and brand marketing, with a customer centric approach. Samsung’s management is based on a hybrid philosophy; the companies learning capacities allow it to optimize both American and Japanese management styles. The operation strategies focus on manufacturing competitiveness, vertical integration, product diversification, market share orientation, and organizational discipline. Horizontal and vertical diversification, intensive employee training, and product quality form Samsung’s management philosophy. The company also majors on frequent changes in design and soft capabilities to adapt to the evolving complexities in business operations.
Amidst the evolving complexity in business operations, Samsung’s organizational culture aims at acquiring innovative HR development strategies and technological innovation. The organizational culture involves traditions, core values, and customs applied by employees to achieve the overall company’s goal. Samsung’s culture is a combination of various areas, and the success of each operation is dependent on others. The HR department focuses on predicting product innovation outcomes, customer relationship management, and strategic implementation and planning of business aspects. The company benefits from the innovation-centered culture, which focuses on employees’ abilities, skills, and knowledge to build innovative products. Based on this function, the HR department will be responsible for analyzing the market and predicting potential outcomes for the face shield smartphone. The focus on innovation also supports the company’s vision and mission to improve social conditions and make life more comfortable. The primary characteristics of their organizational culture include constant change, emphasis on integrity and prosperity, passion for excellence, and providing employees with development opportunities.
The organization’s business operations have always aimed at ensuring that the company succeeds at a higher note, predominantly in the electronics sector. Samsung’s operation management principles have always helped it in the quality testing, batch production, benchmarking, and continuous improvement processes (Song, Lee, & Khanna, 2016). This also includes the planning, controlling, and scheduling of million components of the product during the manufacturing process. The first stage of the operations integrates multiple tests before assembling the right components accordingly. For this to be successful, the human resource team at the institution guarantees that highly expertise teams manage all processes to meet the specified time targets. The next level focuses on the market forces based on the demand for its electronic products. Samsung has always done its best, including integrating IT, to increase production and sales volume for the organization. IT visibility helps the company map its production and sales schedule, hence tracking operations progress in the institutions, which also helps in the decision-making process (Song, Lee, & Khanna, 2016). For the face shield smartphone, IT will be a key player in ensuring rapid production and global sales. 4Vs methodologies are also considered vital for mass production representing volume, variety, visibility, and variation. All operations are handled at the managerial levels by the plant head, supervisors, production, and inventory managers, who map the whole procedures accordingly through the help of information technology systems.
Business Operations
All these operations are done in accordance with the strategized procedures necessary to achieve the strategic plan, vision, and mission of the organization. In this case, Samsung has always worked hard to remain at the top, developing new technologies on a daily basis to meet the needs of clients. This is done to achieve the company’s main vision, which is to inspire the world through its innovative products, designs, and technologies, enrich the lives of people, and contribute greatly to social prosperity and steer in a new future (Song, Lee, & Khanna, 2016). To guarantee this success, Samsung always creates innovative products, uses new technologies, and invent creative solutions unique in the industry. This makes its products distinctive in the market, with the company’s vision being dynamic in changing technologies to match those needed to remain competitive in the global market. This has made it an innovative leader in the industry, with all its products proving effective in enriching clients to improve their lives for a better future.
Samsung has been keen to develop areas that improve productivity and profitability at the organization. The main objective of the organization has been to stabilize its revenues and invent ways of increasing profitability. Recent efforts by Samsung to acquire DixonsCarphone and BestBuy have also had positive impacts on its marketplace. Its maximization of the product value guarantees its long-term sustainability in the market. Samsung has always aimed at being ahead of its competitors to increase its profitability rates, with this being possible through offering advances and new technologies that enhance their experience, including the quad and triple cameras wearable devices, hole in display panels, premium tablet PCs, and accessories such as Samsung Dex. In general, the company’s management is characterized by unrelated diversification, market share orientation, vertical integrations, manufacturer competitiveness, operational efficiency, employee loyalty, strict organizational discipline, and strong bond relations between employees, shareholders, and the management.
Key Trends
Samsung’s strategy is greatly shaped by technology and consumer trends in the industry. The company has claimed its aim to provide an experience over quality, checking on the global technologies that are likely to positively influence productivity and efficiency in the coming years. The organization’s leading innovation arm is based on purpose-built innovations and designs in the hardware, software, and service it delivers to clients (O’Regan, 2015). This includes start-ups, mergers, and entrepreneurship businesses steering its success. Technologies like artificial intelligence have guaranteed that it brings fresh opportunities and innovative technologies for the organization. In this case, the company has invested large funds, trying to open new opportunities and solve the technology’s existing challenges. The possibilities of AI to collect and store large volumes and data and analyze trends in the market have guaranteed its productivity success given its strategic planning effectiveness in the industry.
The management also guarantees that all resources are used efficiently. Innovative product design and development are achieved through the company’s effective allocation and use of resources and information management skills. The main aim has always been to produce high-quality products with substantial benefits to clients such that they find the price worth the purchase. The team of designers, manufacturers, and marketers have always perfected in understanding the customer trends in the market, with the company creating products designed to meet their needs (O’Regan, 2015). The management also ensures that information is distributed and shared effectively, with consolidated communications and advertising strategies aiming at building the brand image and technical sophistication and efficiency of products across diverse fields. Samsung has aimed at developing key trends to its production, resource, and information management to create superior and complex products and services that enhance a better society. The company is always looking for strategies, ideas, skills, and products to inspire and empower lives, innovation and enhance greater positivity in society.
Impact of Key Trends
Through the innovative trends in its business operations, Samsung has achieved tremendous success in its business products, services, among other dimensions. The company has become the leading world electronic innovator, manufacturing diverse quality and efficient electric products. The company has achieved a high brand value and recognition globally, with its dedication to increasing diversification in all its sectors (O’Regan, 2015). The company has always come up with new technologies that improve technology acquisition and infrastructure, with it offering customers innovative products that meet their needs. Over the past decade, Samsung has been heavily involved in launching new innovative products hitting clients’ trends, needs, and lifestyles, including the Sero TV, Galaxy Fold, and BESPOKE refrigerator (Song, Lee, & Khanna, 2016). The strong growth and innovation on new technologies, including artificial intelligence, 5G, the internet of things, have significantly improved its position in the market. Its market investment and leadership strategies have been successful in expanding its ecosystem through cultivated business environments and strategic leadership in diverse fields.
Strong support from the management and leadership positions at Samsung has guaranteed its successful trend over the years. The innovation processes involve research conducted by expertise engineers, designers, ethnographers, writers, marketers, and musicians searching for the unmet needs in the technology market amid identifying technological, cultural, and economic trends essential for the company to achieve success (O’Regan, 2015). In-house competencies are essentially guaranteed through product empathy, visualization, and experimentation in regard to technological changes and the needs of clients in the market. The company has also made every step in its growth and success unique, including its market penetration, development, segmentation, product innovation, and development in the market.
Conclusively, it is evident that Samsung has gone a long way to being the leading electronics company in the globe. Its strategic operations management has aimed at achieving competitive advantage, performance, and profitability in the market, targeting the middle and upper-class markets at a favorable price structure. This has made the brand a household name, with diversification across all its product lines to satisfy its customers’ needs. Despite the challenges, the company has always aimed at integrating new and innovative strategies to provide perfect solutions to guarantee its long-term success and sustainability in the market. The company is excited that its constant innovation efforts have been meaningful and delightful to clients, enabling them to live better lives in regard to its vision and mission. To further guarantee its competitive success in the industry, the company aims at learning and listening from its customers, integrating IT solutions to enhance strategic changes through innovation to guarantee its success in the market.
Due to COVID-19, the market has uncovered gaps in our healthcare systems and introduced key opportunities for the development of new technology. At the start of the pandemic, testing was not efficient, and the implementation of the face shield can close that gap by providing an alternate way to identify and reduce COVID-19 exposure while providing real time updates on social distancing and quarantine guidance. Given that Samsung is a leader in the technology landscape, by offering the face shield smartphone at an affordable price, making is widely accessible, the face shield is guaranteed to be well received on the market.
Samsung’s operationalization has focused on constant innovation to guarantee its success in its corporate business strategies. The company is among the world’s largest and leading producers of electronics in the industry, providing digital media devices, memory chips, and semiconductors, among other appliances. The main aim and philosophy of the company is to devote human resources and technology to produce high quality and superior products contributing to the development and positive enhancement of the society. Its penetration into the global market has been unique given that the company was started in South Korea proves its aggressive strategy to become successful. The company’s unique operational management strategies are implemented in the design, marketing, and production initiatives in regard to their electric production. Samsung also does its best to maintain high profitability through its strategic investment in the market, with this marking its success in the global market.
Samsung has always put a lot of efforts in the innovation of new products. For example, the face shield smartphone which is expected to be implemented in the market soon. New concepts are always developed in light with innovating the new product and services in the market. The Project Innovation Team is responsible for steering these processes, also providing more insights on the market structure. The investments and leadership strategies of the company attracts more customers in the market given its competitive activities. The products have not yet been introduced in the market, with Samsung Company doing its best to ensure that all production operations are coordinated to achieve positive outcomes. The company also strategizes on collaborating with Value Stream Mapping for a couple of years to help with cutting down on costs and sourcing quality materials in the industry. To guarantee its success in the industry, the company interacts with prospective clients to analyze their opinion on the new technology, including its acceptability in the market. This helps in the production operationalization procedure as the company understands the procedures needed for its success.
Potential Costs and Risks
Samsung intends to inspire the world and shape the future through the new face shield product development on phones. In this case, the company is willing to shape and transform the technologies through investing the face shield inputs. A complete phone with the technology is expected to be produced at an average cost of $300. The product is expected to go at a sale of $650, hence providing the company a profit of $350 per sale. Cost components in the electronic industry have shown that Samsung’s cost of materials and production has been continuously trending upwards. In this case, choosing the higher end cost spectrum guarantees that the organization attracts high quality clients in the market. The technology is also expected to put the company at the top of the competitive stretch in the market given its ability to deliver the extra-ordinary. In this case, the resources provided will be essential for the completion of the project. The development of the new technology requires that the company integrates a new $65 per product fee. With the technology being brand new to the technological landscape, the company is dedicated to ensuring that every procedure meets the expectations of the production procedures. The company plans to use recycled components to make the product as a way to cut costs and reduce emissions and distractions on the atmosphere. The company is also determined to streamline the operational management of the production and distribution procedures, also providing technical support and maintenance as it is vital for customer satisfaction.
The strategy has however encountered multiple risks in the market including multiple uncertainties of its effectiveness and success in the future, management of overheads, response to competition, and the competitive advantage of the market by then. Given that the technology is new, Samsung wishes to understand the problems and issues that may deter it from achieving success in the global market. In this paradigm, the company listens to the feedback to ensure that it shapes its operations to meet the needs of clients. It is unfortunate that some of the customers may not resonate effectively with the new product, with this resulting to reduced costs than the expected. Some of them are worried that the new technology will open loopholes that will result to increased threat for attackers.
Work Breakdown Structure
Identify key milestones, deliverables, and resource requirements.
– Hold meetings with all stakeholders.
– Discuss the development and trend of face shield technology
– Idea generation and screening
-Planning on investment
This discovery phase entails meeting with all stakeholders and pitching the idea of the face shield technology. A SWOT analysis would be helpful for idea generation and screening by providing a solid understanding of current market trends, opportunities and a thorough screening process. In addition, this phase should also outline the high-level plans for investment and the proposed development and sales targets of the face shield technology.
– Research on face shield technology.
– Investigation
– Idea Screening
– Discussions with Stakeholders
The “ideate” phase entails deep research on the face shield technology and identifying key factors such as the functionality of the technology, development needs, best practice and labor resources. It is imperative to present this research to stakeholders to ensure that everyone has the same understanding of the development of the face shield technology.
This phase focuses on the creation of the production and operational budgets which will incorporate expenses such as personnel (base salaries and payroll taxes) and non-personnel expenses such as cost of materials, contractual expenses for the development and implementation of the face shield technology. In addition to the budget, a project plan should be created which outline a clear timeline and milestones for development to launch. This phase also focuses on product development and identifying a division of labor which makes sense for the teams.
This final phase includes a final analysis of the market trends and testing of the face shield in the market through focus groups and studies. In addition to the actions, there should be a meeting with stakeholders to unveil a finished product and a walk through of the functionality and merits of the face shield technology. After these steps are complete, the product will then be launched and offered for sale in the market.
The company is committed to ensuring that they closely monitor all changes in the organization, ensuring that they adhere to the deadlines and project milestone as required. This includes having a clear definition and evaluation of every phase, including its completion in regard to the expectations. In this case, the work breakdown structure will consist of multiple phases including the understanding phase; ideate phase, concept development, and concept finalization before its introduction in the market.
The first milestone of the work breakdown structure for the face shield phone is an understanding of the product. The team hold meetings with all stakeholders, discuss the development and trend of face shield technology, facilitate idea generation and screening, and plan on investment of the product to guarantee that they have an articulated goal. The first step is expected to take a period of one month. The next milestone is ideating the idea through research on face shield technology, increased investigation and idea screening to ensure that it is the right project at the time. Discussions with stakeholders will also be evident during this stage. It is expected to last for two months. The next milestone is on the concept development, with the need to allocate more time, about 4 months given the need to specialize duties and responsibilities, developing a perfect budget for each gadget, and providing a specified timeline for completion of all these duties. At this stage, the stakeholders come into an agreement on brainstorming ideas that are necessary for the success of the project. The concept development state is also whereby the team gathers all the information that is accumulated over time. This includes identifying a solid base that guarantees the business project is divided into smaller units that are achievable within the time speculated. The concept finalization stage is the most important one, with the short deadline of a month to complete it. This will involve constant meetings with very essential stakeholders of Samsung and the producers, retailers, and marketers of the face shield smart phone. The process will also include a month test experiment of the product in the marketers, with the success of these procedures guaranteeing its commercialization in the market.
Potential Obstacles
Some of the potential obstacles in meeting and measuring the scope of the project include poor definition of objectives and goals, inadequate team skills, unrealistic deadlines, and teams deviating from the primary objective. This project requires team cohesion and advanced design and engineering skills to aid in development of phone face shield which meet the market criteria. The hindrance to scope of the project involves limitations in producing the expected outcomes and using the wrong process. The project scope refers to the initial purpose set for the project. Therefore, the team members might also fail to meet the scope of the project if there are internal changes in the structure of management. Poor project management and planning is a potential barrier and unrealistic deadlines might result in development of products that do not meet their primary objective of protecting medical practitioners from the Coronavirus.
Time is the estimation given on the period for project completion. Often time is a major challenge which is reflected through incomplete deliverables and missed deadlines. Some of the potential obstacles that might hinder the team from meeting the time objective include shortage of resources or labor, lack of cooperation leading to tasks taking longer to complete than usual, lack of motivation to work towards the project goals and objectives. A poorly managed team often displays conflicts either with the management or among them; therefore, this becomes a barrier to effective work collaboration. Conflicts experienced also lower individual motivation, resulting in low productivity and slower delivery of the project milestones during the project. Failure by the management can also hinder achieving of the time object, especially if tasks were unevenly distributed and presence of ineffective communication. Another obstacle in unprepared team where members lack clear direction, inadequate training, and misunderstanding of time-schedule and task delivery processes.
Poor budgeting is one of the potential obstacles to meeting the cost objective in this project. Under-estimation of cost of resources, raw materials, and labor might raise financial issues which is one of the biggest challenges to effective project completion. Lack of efficient cost management exposes the management to complications about how to acquire funds or complete the project without exceeding the given budget. Another obstacle is failure to engage the stakeholders during all stages of development. Therefore, this might result in need for modifications or other problems that might arise towards the project complication. Modifications can be costly and also time consuming, especially if the stakeholders are unpleased by the deliverable. Another uncontrollable obstacle is inflation of the cost of raw materials and unreliable suppliers.
Cost, time, and scope objectives are the fundamental components to successful project completion. However, often the estimations made might not meet the actual project implementation; thus, resulting either in shortage of resources or incomplete deliverables. The major obstacle that could interfere with the successful completion of the project is the nature of the team. The employees will be acquired through contracts, some of them might not have worked with Samsung in the past making them unaware of the company’s goals and values. Using subcontractors such as those delivering raw materials or outsourcing labor might also be problematic and might be a hindrance to achieving the cost, scope, and time objectives of the project. Irregular deliveries and delays from the subcontractors will also interfere with the timely completion of the project.
Risk Mitigation
The company plans on introducing a new product into the market which means that it must be prepared to buy confidence and reduce the perceived risk to the target consumer. Consumers might have different degrees of risk tolerance; therefore, the company wants to make a buying decision for the face shield cell phone practical, substantiated, and safe. One of the risk mitigation strategies that the company should use is branding. Having a stronger and well-recognized brand will ensure that the target consumers accept the face shield cell phone. The company should proceed with its plans to partner with Samsung Company since it is a renowned brand; therefore, the consumers will trust the new device. A strong brand will help the company to establish a positive customer experience, longevity, migration paths, and stability for the new product to the market.
Another strategy the company should use is to establish sincere and strong relationships with the customers. This will be achieved by the sales and promotion team. The customers do not buy a product or pay for a service just for the sake of buying; they must feel the importance of buying. Therefore, the sales team must enlighten the customers on the importance of buying a face shield smartphone, especially during the COVID-19 pandemic. Another strategy the company should use is to focus on the benefits, not the risks. Today’s market is full of different types of customers; therefore, it is not promised that every customer will accept the face shield smartphone. Given that Samsung has already amassed major success of their smartphones, gaining customer acceptance of the new face shield technology should not be a major hurdle. Therefore, the company should evaluate the target market and determine what it wants to minimize unnecessary risks and barriers to product success. Unnecessary barriers add cost and increase the time the product takes to get to the market. Therefore, the company should major more on improving the benefits the product will offer to customers.
The company should also assume and accept all the risks of introducing a new product to the market. For instance, the company should be aware of risks such as poor budgeting and conflicts among employees. This strategy will require collaboration between employees to identify the potential risks while introducing face shield cell phones into the market. This strategy will help team members to have a shared understanding of the consequences and risks involved. Another strategy that can be useful is avoidance of the risks involved. This strategy provides the assumed and accepted risks and consequences of the project and presents ways of avoiding these risks. For instance, the company may advise the project team to implement product testing to avoid the risk of product failure before approving the final production.
The company might also decide to control the risk. This strategy will require the company to consider the identified risks and then take actions to eliminate or reduce these risks’ impacts. For instance, the company may decide to control poor budgeting by hiring a proficient team with good knowledge of planning for costs of introducing a new product to the market. Another effective risk mitigation strategy that the company can use is to watch and monitor the risks. This means that the project team will watch and identify changes that can alter the risk’s impact. Some of the aspects that can be considered for risks that may evolve during the completion of a project may include productivity, performance, scheduling, and cost. Therefore, the company may require the financial and project teams to give constant and frequent updates on the project’s progress in terms of cost and performance.
Financial risk management is also vital for the company to minimize the credit risks, market risks, and liquidity risks that might slow down the completion of their product innovation. The company should hence evaluate any hedges and risks that may periodically affect the institution. Some of these include the price risk, whereby the strategized cost may be too high for the clients to afford and develop profitability for the organization or be too low to guarantee profitability in the future. The company also wishes to maintain liquidity risks whereby they can estimate and measure the income forecast in a way that balances effectively with minimal operational and running cost. To the company’s profitability, Samsung ensures that it generates a capital risk management policy for the next financial year, also ensuring that all capital is provided.
The Life Cycle of a business is the gradual progression of a business since it is introduced into the market up to the period of decline. The business life cycle is subdivided into five different stages. These stages include the development stage, launching stage, growth stage, maturity stage, and finally, the decline stage. During the growth of a business, it is expected to go through several changes that make up the business cycle and face the different challenges requiring different approaches to solve them. To successfully launch the new face shield smartphone through Samsung Company into the market, the company must project its future through a business life cycle analysis (Hansen & Tout, 1933).
Development stage
The face shield smartphone is a new technology that is expected to entertain and a new way of protecting its users against COVID-19. The viability of the face shield smartphone in the current market is expected to be high due to the pandemic and will be appropriate mostly among healthcare workers in the first line of defense against the pandemic. Also, the technology will be one of its kind in the market, thus creating a platform for easy marketing and sales among the target population. In the development stage of the face shield smartphone, partnering with Samsung Company will be beneficial in that the company has previously introduced new products into the market successfully. Through the guidance of the Samsung Company, it is expected that the new face shield smartphone will be acceptable in the new market mainly due to the technology that it has incorporated to help in battling the COVID-19 pandemic globally. Also, the product will fit in the business structure of Samsung Company, where the company pushes their new products globally using different marketing strategies for every population (Hunkeler, 2000).
Launching Stage
During the launching stage, the face shield smartphone’s sales are expected to be low as the product is being introduced into the market. The face shield smartphone is a new concept in the market as it has not been initially used by any company before. Therefore, the launching process may take a while due to creating awareness of the target population. To ensure that the information concerning the new product has reached a large population and especially in the medical field, the launching process will focus on medical practitioners. Since the face shield smartphone will be easily acceptable by the medical practitioners, it will help protect them against COVID-19. After creating the product’s popularity among medical practitioners, the second launching step will be introducing the product to the general public. Using the two-phase launching step will be cost-effective and understand further the dynamics of the market and what the market needs. Therefore, the launching period will take a longer time, thus low sales of the face shield smartphone (Hunkeler, 2000).
Growth Stage
The growth stage of the business will occur after creating awareness for the target population. During the growth stage, the company will use the feedback already gathered during the launching stage to ensure that the product is gradually improved based on the customers’ needs. The growth stage will also be a stage where the target market grows to capture a larger market population, increasing new and different designs for the face shield smartphones. Since the company will have broken even at this point, incorporation of new technologies is important to lengthen the growth curve for the business, thus maximize on profits for the company. By gradually improving the face shield smartphone’s technological makeup, the company will be able to improve the overall performance of Samsung Company.
Maturity Stage
During the maturity stage, the face shield smartphone’s sales are expected to stagnate as it has been saturated in the market. Also, it is expected that competitors will have created similar face shield smartphones. During the maturity stage, a company needs to keep advancing the technologies used to develop the product to remain viable in the market. Therefore, the product’s improvement will be necessary to gradually capture the additional market for the product (Peltier & Naidu, 2012).
Decline Stage
Since Samsung Company has been able to survive in the market for a longer period due to technological advancement capacity, it will be essential that the company’s strategies are replicated for the face shield smartphones. This way, the company can delay reaching the decline stage that translates to reducing sales and minimum profits (Peltier & Naidu, 2012). Also, since the face shield smartphone is highly focused on providing a solution for individuals during the COVID-19 pandemic, it is expected that the product will reach the decline stage as soon as the war against COVID-19 has been won. Therefore, the company aims to develop the products to remain competitive and acceptable in the market even after the pandemic.
Profit Generation and Cost Cutting
For a business to grow, a company must develop strategies that can help cut the overall production cost (Challenges of cost-cutting, 2010). When it comes to technology, there are several sources that a company can get raw materials at competitive prices. Samsung Company is one of the largest producers of electronics globally. For the company to be in a position to remain competitive and especially in the creation of smartphones, the company has to source raw materials at affordable prices, thus making it possible to compete in the global market. Therefore, by partnering with Samsung Company, the face shield smartphones will be designed using affordable raw materials and cheap technology.
Secondly, to be able to cut costs during the production process of the face shield smartphone, the company must be able to shop around for supplies for the production process. Shopping around for materials ensures that the company has the latest technologies in the market, thus allowing the competitiveness of the products in the market (Challenges of cost-cutting, 2010). Also, the company can find lower prices for the raw materials as different suppliers source their raw materials from different sources. The quality of the raw materials also varies; therefore, shopping around for the products helps the company find the best raw materials at competitive prices, thus enhancing the final product’s competitiveness. Samsung Company has, over the years, been able to produce high-quality electronic devices at relatively affordable prices. Therefore, through a similar raw materials source, the face shield smartphones will be of high quality while maintaining competitive and affordable prices for the targeted population.
Also, creativity is important while trying to cut costs and generate profits for the company. Samsung has been known for creativity, thus being able to remain competitive in the overall market. Several products have been introduced to target a wider market and increase profitability for the company. During the production process of the face shield smartphones, creativity ought to be high to capture a larger market share. Also, creativity in cutting the overall production cost is necessary for the company and especially for the new products that are being introduced in the market. Cutting costs will make it possible for the company to easily break even and also research on the product and how to make it more desirable for the market.
The company should be in a position to lower the overall expenses that may be unnecessary. Partnering with Samsung Company has helped reduce financial expenses such as the general marketing strategy, distribution expenses, and funds for market survey. For instance, one of the distribution strategies will make it possible for the company to use the already existing Samsung Company resources such as display shops. This means that the cost for marketing and distribution will be reduced, maximizing profits for the company at large. Other strategies that Samsung Company has incorporated to reduce financial expenses will be replicated to the company during the production process of the face shield smartphones.
Finally, by cutting down the running as well as the production costs, the company can maximize on profits, thus the overall progress of the product in the market. Also, the company will be in a position to use minimum resources used to develop the product, launch it in the market through strategies that will help promote the growth of the company, the product, and finally delay the product from reaching early maturity as well as decline stage. Increasing profits for the company will also make it possible for the company to also have measures in place that help cushion the face shield smartphone as it enters a competitive market. Also, minimizing costs will help prevent major losses incurred when the COVID-19 pandemic is no longer present (Challenges of cost-cutting, 2010).
Overall, cost-cutting is of utmost importance to the entire life cycle of the product. While it plays a huge role in the development stage, cost-cutting mechanisms should be adhered to throughout the life cycle, especially as the product hits the maturity and decline stages. As the product grows and matures on the market, demand for the face shield technology will stagnate to the point where profitability begins to plateau. As such, by maintaining cost-cutting techniques, Samsung will be able to maintain realistic profitability targets as it prepares for the decline stage.
Phase-Out Plan
Creating a long-lasting business product is often the mission of every company. During the Face Shield Smartphone product development process, the company has majorly relied on Samsung Company. For instance, the resources necessary for the development of the product were to be purely dependent on Samsung’s technology as well as their expertise. The company is also expected to provide the resources necessary for marketing, distribution, and gradual improvement of the product. To ensure that the product has a long-life cycle before the product reaches the decline stage, a phase-out plan needs to be rolled out for the overall development of the project (Peltier & Naidu, 2012).
The Phase-Out plan should incorporate four steps: identification, decision, communication and unwinding the business. The identification step includes determining when the product has reached the declining stage and planning for its eventual phase out of the market. This requires in-depth analysis of the current market trends and identifying whether the product can be improved to continue its competition in the market. Once this analysis is complete, a decision is made to “kill” the product if it is determined that the upgrades will not strengthen the product and the associated costs are too prohibitive. This decision is communicated to all stakeholders and then, a plan is rolled out to start unwinding the business. This includes greatly reducing or outright cutting of production and the implementation of a plan for final distribution is put in place.
Lack of planning for a sustainable business plan is likely to lead to failure as technology is often a dynamic aspect in the current generation, and different companies have been able to come up with different products that are competitive in the market. Therefore, the development of a healthy phase-out plan ensures the sustainability of the company and especially when funds are no longer channeled into the business when it reaches the growth stage. To develop a healthy phase-out plan, a company should develop strategies that make it possible for the product to lengthen a business’s life cycle, especially the growth process of the product.
After the development of the face shield smartphone, marketing as well as creating awareness of the product in the target population would help in introducing the product, thus beginning the life cycle of the product. To maintain the product in the market and aid in its sustainability, the right strategies must be used to introduce it into the market. Therefore, through marketing the product among health practitioners, the product will be considered as a safety measure even after the COVID-19 pandemic. The product will also be considered a necessity in other fields for safety purposes, thus making it a requirement in the long run. The life cycle will be expected to stagnate longer and especially during the maturity level and delay before reaching the declining level.
Other developments such as the gaming software are expected to be done on the face shield smartphone during the growth stage to ensure that the product can capture the young generation, thus widening its market share. Other technologies meant for entertainment will be incorporated to ensure that the product is acceptable to people from different walks of life. Gradual technological advancement will make it possible for the company to widen the overall market share, thus promoting the product’s growth. To ensure that the product remains competitive even in cases of the emergence of a competing product, it is important that the company constantly does research that will help place the face shield smartphone by Samsung Company a notch higher, thus remaining competitive (Peltier & Naidu, 2012).
Also, constantly reviewing the customers’ needs that may arise, it is important that the company maintains a good communication system between the consumers as the recommendations will make it possible for the company to provide what is needed in the market. Also, in case of complaints, the company can make the necessary adjustments to the product, thus maintaining customer loyalty.
In a case where the product reaches the declining stage, several technological advancements will be undertaken so that they are in line with the initial purpose of the product, which is, ensuring the safety of the user while setting the pace in technological development. Finally, product differentiation will be necessary for ensuring that the company can capture a wider market share. For instance, differentiation will be useful in creating face shield smartphones that will be highly preferred by medical practitioners while also creating a different set of face shield smartphones that will attract individuals in the corporate world and the youths who use technology as a source of entertainment. Through product differentiation, the company will also capture individuals belonging to different social income groups. Samsung will aid in developing technologically differentiated face shield smartphones that will attract people with different levels of income, thus promoting profit accumulation for the company’s development.
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Hansen, A., & Tout, H. (1933). Annual Survey of Business Cycle Theory: Investment and Saving in Business Cycle Theory. Econometrica, 1(2), 119. doi: 10.2307/1907087
Hunkeler, D. (2000). Life cycle profit optimization a business opportunity. The International Journal Of Life Cycle Assessment, 5(1). doi: 10.1007/bf02978562
Madani, F., Abdulai, M., Ha, J., & Koosawangsri, R. (2014). Samsung’s Innovation Strategy in Smart Phones Market. Available at SSRN 3023595. DOI: 10.2139/ssrn.3023595
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Peltier, J., & Naidu, G. (2012). Social networks across the SME organizational life-cycle. Journal Of Small Business And Enterprise Development, 19(1), 56-73. doi: 10.1108/14626001211196406
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