Lee Kun-hee: A successful enterprise needs a strong sense of crisis

Kun-hee Lee Kun-hee, chairman of Samsung, wrote in a 1997 book that a successful business needs a strong sense of crisis so that it can move forward in the good times and react quickly to changes in the market. This is to make Samsung a

In a book published in 1997, Samsung chairman Lee Kun-Hee wrote that a successful business needs a "strong sense of crisis" so that it can move forward in good times and react quickly to changes in the market Kun-hee.

This is the creed that makes Samsung the world's highest-selling technology company – Samsung's televisions, smartphones and memory chips are shipped more than any other company, and Samsung has become a learning object for Chinese companies learning South Korea's successful experience.

But last month a US jury ruled that Samsung copied the key features of Apple's iphone and ordered Samsung to compensate for more than $1 billion trillion in economic losses. Samsung's Top-down management and decision-making processes are seen as the culprits for curbing innovation.

The mechanism for quick decisions-such as bold decisions to invest heavily in chips and display panels-may not be the most appropriate for a company that needs to be transformed by "fast followers" to innovators. Inside Samsung, some designers feel that they are not being paid enough attention and many employees are demanding a change in the situation.

The crisis corporate culture, which helped Samsung overtake Japanese companies such as Sony, Sharp and Panasonic in chip, TV and display business, ended the 10-year seat of Nokia's biggest handset maker, with smartphones shipping more than Apple. But it is also accompanied by a huge reputational risk-Samsung is thought to produce only shanzhai products.

"This is a design crisis," said the Samsung mobile division's interior memo, which was presented to a US court in a trio of internal memos. Influential outsiders clearly point out that Samsung is dozing off. We have focused all our attention on Nokia, focusing on the design of ' flip ' and ' Slide '. Our user experience is vastly different than the iphone. Samsung was developing the first Galaxy series.

According to an unnamed Samsung designer, the crisis and sense of urgency that overtook Apple prompted Samsung's designers to choose a similar look and feel to the iphone, "designers have many unique and creative ideas, but these ideas must be favored by top decision-makers." The problem is that because of the high level of the Apple design, our creativity is not enough to satisfy the high level. I think that in other companies the manager will respect the chief designer's decision, but in Samsung, the manager can overturn the designer's design and make a decision on the product design, which limits our ability to innovate. To not only become a fast follower, Samsung needs a more flattened corporate culture, giving designers greater power.

One unnamed Samsung executive retorted that Samsung had little innovation at first – as was the case in the production of simple black-and-white television, where, at present, the company is promoting internal innovation through incentives, Lee Kun-hee himself is interested in new technologies and designs.

A recent example of Samsung's top-heavy management structure was less than two weeks before the launch of the Galaxy S III smartphone in May, when G.S., the vice chairman, ordered the Gee-sung of 500,000 sets of blue mobile phones to be discarded because of unsatisfactory design.

Some analysts pointed out that after a lot of adjustment, G.S. Sunday approved the mobile phone shell design, and here only 10 days away from the product release, resulting in the initial demand for products, the impact on shipments reached about 2 million.

Documents submitted to the United States court show that when G.S. inspected Samsung's US telecoms business a year ago, the department's managers feared there was no plan to impress G.S., "Our overall plan is good, but we have no good ideas to report to G.S., and we lack the confidence to beat Apple in our plans."

This kind of quick-reaction philosophy is different from the way Apple operates. Christopher Stringer, a designer who worked for 17 years at Apple, testified in court that about 16 "lunatics" from the company's global divisions often Christopher Ster around the table to discuss the company's mobile products.

Samsung's design department, by contrast, is very similar to other departments. A good workplace, with the founder's "police" on the wall, for example, "developing products for human benefit" (create product that Contribute to humanity), "challenge the world, create the Future" (Challenge, Create the Future).

Samsung's corporate culture is a top-down, vertical structure that is not suitable for innovation, the Samsung designer said. I don't think it's a problem that is unique to Samsung, but a problem that plagues the entire society of South Korea. Samsung is trying to change that, but it's still a top-down structure. What we need is a creative environment that makes Silicon Valley proud. ”

Samsung's mobile product life cycle is getting shorter, releasing a new product every 6 months. In Wednesday, Samsung unexpectedly released a smartphone using Microsoft's latest version of mobile software, a few days ahead of Nokia's announcement of a new product.

"Samsung will continue to produce excellent and unique innovative products, whatever the difficulties," Shin said at the Berlin Consumer Electronics Show. ”

"We have a real crisis, and the top companies around the world are having problems, and I'm not sure what will happen to Samsung," Mr Lee said at two degrees. Most of the products and businesses that represent Samsung appear 10 years ago. We should start again and we can't waste any more time. ”

Samsung's profits fell by half during the summer, as Apple products were favored by consumers. But by launching the Galaxy series, Samsung quickly reversed its woes, after a record annual profit. Samsung's profits could reach $22 billion a year, up 45% from 2010.

But for some Samsung employees, the culture of crisis is growing dim. "It does keep people sharp and alert, but people joke that once they have worked in Samsung for more than 5 years, they will experience aesthetic fatigue in the culture of crisis," said one unnamed Samsung chip designer. ”

Even Mr Lee's attitude may be softening. A person familiar with the matter said that after the jury's announcement last week, Mr Lee simply said, "deal with the problem properly".