Samsung Family Business Management Assessment

84 views 12 pages ~ 3204 words
Get a Custom Essay Writer Just For You!

Experts in this subject field are ready to write an original essay following your instructions to the dot!

Hire a Writer

Managing is different from leading as it is all about getting all employees of an organization to operate efficiently and effectively together as a team. Managing is done through; planning, organising every operation, analysing key problems affecting an organization, building the organization and effectively using the management systems. In addition to that, allocating organizational resources appropriately, and providing feedback regarding the organization's performance. In other words, managing complements leading.

Organizational management systems and techniques differ from one organization to another. The effectiveness of the management of an organization can be found through conducting an assessment (Cusumano, 2013, p. 29). Academics and other researchers have been conducting business management assessment based on a wide range of assessment criteria on family-owned businesses. Samsung is one of the world’s largest the family-owned businesses that have been flourishing over time.

This paper is going to provide a discussion of the different criteria used by scholars in assessing the management of family-owned businesses with the key focus on Samsung Family Business. This paper will discuss assessment management of Samsung by two key assessment criteria commonly used by scholars around the world. These key criteria are; governance and decision-making process.

Family Business Management Assessment Criteria

The family business management assessment is a tool used to evaluate the management issues and capabilities of businesses that are the family-owned. Academics and other business researchers use a wide range of assessment criteria to determine the effectiveness of the management of family-owned businesses (Patterson, 2018, p. 45).

i. Decision-Making Process:

The major management assessment criteria for the family-owned business are; the decision-making process. The decision-making process of management assessment is aimed at evaluating the effectiveness of an organization’s decision-making process in a family business. Conditions for decision making at Samsung are vital as they enhance proper decision-making procedure. Based on the organization's characteristics, it is clear that Samsung follows a certain set of conditions that are considered to conduct an effective decision-making. These conditions are; the type of decision that is to be made, the time, resource and nature of the issue on which the decision is on and lastly, the setting type.

The information provided indicates that Samsung has a specific process through which its organizational decisions are made. Samsung uses the "Decision by Authority After Group Discussion" method also referred to as the democratic decision-making process. With regards to this process, the management team through leaders call for a meeting; listens to all issues at hand and the likely decision, deliberated until the department or employee is sure of the suggested decision, and lastly, the authority/top management announces the decision to the group the information concerns. This decision-making process is employed by a wide variety of commercial and government agencies around the world. It has proved to be the most effective decision-making process ever.

ii. Leadership Abilities:

The second assessment criterion is the organization’s leadership abilities ('Samsung SDS Co., Ltd' 2017, p. 98). The assessment through the leadership abilities is aimed at evaluating the effectiveness of the management team to lead the employees of an organization. Samsung has a great leadership ability as leaders are held responsible for everything they do. For instance, Group Chairman Lee Kun-hee of Samsung was indicted for tax evasion and breach of trust and as a leader that understands his moral and social responsibility, he had to publicly resign. This is a great move as it is aimed at preserving the name of the organization and its good reputation and has individual leaders be held accountable for their actions.

Leaders at different Samsung departments and officers have shown characteristics of good leaders. The key characteristics being; honesty and integrity; Samsung Group Chairman Lee Kun-hee depicted this trait by stepping down and asking the organization and society to give room for a fair investigation and assessment of the situation and find the truth. Confidence is another trait that he depicted, for, despite the claims against him, he managed to stand in public and put across the rightful procedure that will seek to clear his name off the allegations. Other leadership characteristics depicted by the management team of Samsung are; commitment and passionate, capability to effectively communicate with each other, capable of making the right decisions, and effective delegation of roles and empowerment of other employees.

iii. Governance:

The third assessment criterion is governance. The management of an organization is charged with the role of governing all operations in different departments (Venkateswara Rao, T 2016, p. 213). The assessment through the governance is aimed at evaluating the effectiveness of an organization’s management to govern the firm’s operations.

Governance at Samsung is under the CSR Committee and Governance committee. The Governance Committee was formed in April of the year 2017. The committee was established to work as an expansion of the CSR Committee with the aim of improving the organization’s social responsibility and better the value of its shareholders. The role of the risk management council of CSR is to oversee the internal management system at Samsung with the key focus on organizational risks and discuss the most appropriate ways these risks and issues can be resolved.

The Governance Committee of Samsung meets at least once in every six months. At the committee meetings, issues shall be discussed and the resolutions shall be arrived at by a majority of member votes in the meeting. The key agenda of committee meetings at Samsung are; the committee is responsible for matters related to the corporate social responsibility of the organization, matters related to enhancing the value of the organization’s shareholders, and other vital issues delegated by the organization’s Board of Directors.

iv. Wealth-Preservation:

The fourth assessment criterion for the management of a family-owned business is wealth preservation. Under this criterion, the assessment aims at assessing the effectiveness of an organization's management to preserve the wealth of its shareholders. The last assessment criterion is philanthropy (Lee, 2006, p. 24). Through this assessment criterion, the assessment seeks to evaluate the effectiveness of the management to promote the wealth of the organization. Samsung has in place great operational strategies ranging from production strategies down to marketing strategies.

These strategies are aimed at improving the organization’s competitive advantage in the industry and thus, improve its profits. A company with poor competitive strategies can hardly survive the challenge in the industry and thus, can easily lose its wealth when the company collapses due to making greater losses.

Applying two of the criteria to Samsung Family Business

In the 1980s, Samsung was not a popular organization, but in the past decades, it developed better operational strategies that helped the organization grow to become one of the world's leading electronic manufacturers.

1. Leading Abilities:

Samsung is a world leading company when it comes to digital media and computerized convergence technology. Samsung has its branches spread out to over fifty countries globally. The headquarters is in South Korea, in Seoul. The president of the company is known as Mr. Kun Hee Lee which is Korean can be translated into English to mean ‘tri-star’ (Venkateswara Rao, T 2016, p. 213). The branding of the Samsung Company is such that they are white words written on a blue background which signifies the ability for people to depend on it, its strong foundation and the heat. Some of the electronic goods that the company manufactures include microwaves television sets, washing machines, computers, USB drives, cameras, etc. Samsung has a dip in other sectors such as the real estate business in which their input is specialized in tube piping, electronic log piping, and phone log. The need for cheap labor and cheap raw materials has had Samsung move most of the company to countries such as China, Asia, India, etc (Jaeyong, Kyungmook, & Khanna, 2016, p. 132).

As the third successful company emanating from South Korea in 1969, at the start of the Samsung corporation company, it has exports to thank for the rapid growth. Samsung had initially decided to venture into the manufacture of television where the first production was in 1972 where they produced black and white television sets for the locals. Samsung looked into the global market and wanted to venture there, so he went back and reviewed feedback he had gotten from employees and customers of the challenges they were facing with the product. The company then amended the existing brand concepts and gave Samsung a new face in a bid to change the hearts of the customers with this new image (Patterson, 2018, p. 45).

In 1988, Samsung decided to become the official sponsors of the Olympic games that were held in Korea (Michell, 2010, p. 32). This way Samsung did not only achieve a link between sports and wireless technology but also established itself as a global brand.

Henceforth Samsung was recognized, and all the countries that attended the Olympics became a brand ambassador for Samsung. Samsung has since had a fair share of customers all over the world, with over 25 production quarters all over the world. Samsung targets Africa, regions of Southern Eastern and Central Asia, China, Latin America, Europe and the United Arab Emirates. "Leading the digital convergence revolution" is the Samsung brand vision which is set apart from other companies such as Sony, LG, and Panasonic.

Good leadership is one exercised by a leader or leaders that know what to do, how to do it and take part in doing the right thing. It is clear from the above information on how Samsung employees are led by the management team that the organization is under good leadership. The organization’s management team meets the key qualities of great leadership which are;

a. Accountability

The management team of Samsung does everything right as depicted in the above information regarding the leading role of the management team. In case of anything, the management team is held accountable. The management team constitutes of heads from different departments whereby each is held accountable for what goes on in their departments. It is true what Arnold Glasow said, "A good leader takes little more than his share of the blame and little less than his share of the credit.” All subordinates in the organization’s management are accountable for the actions they are in charge of (Lee, 2006, p. 24).

b. Delegation and Empowerment

The management team cannot do everything, and that is why as a key characteristic, the team is good at delegating and empowering employees to play their part. As leaders, the heads of departments at Samsung are charged with the responsibility of planning what is to be done, how and by who and then leave it to their juniors. Most of the departmental managers of Samsung operate from the organization's headquarters whereas their departments operate in different countries around the world. They do not micro-manage operations at every departmental office thus improving trust between workers and their managers (Jaeyong, Kyungmook, & Khanna, 2016, p. 132).

c. Creativity and Innovation

In technology-related organizations such as Samsung, creativity and innovation play a vital role. Customers are always up for innovations and products quality improvements. Samsung has managed to stay at the top of the competition because its management through the design and production department does a good job. The organization hires highly trained and well-experienced designers and product builders (Michell, 2010, p. 32). Their creative thinking and constant innovation are what makes them able to come up with new and unique products that impress customers all the time.

d. Decision-Making Capabilities

Decision-making capability is an important trait of a good leader. Samsung management team has a sophisticated decision-making system that ensures that all major decisions are made democratically. The management team is aware of the importance of departmental managers and the need to consult each skilled and professional personnel in the firm regarding important issues before making final decisions (Michell, 2010, p. 32). As such, the top management team might be responsible for making final decisions, but they must first consult the departments the issues concerns and make sure they have the right information to make appropriate decisions.

e. Good Communicator

Communication is very important in sharing information, and ideas in an organization. Samsung values communication, and that is why the organization has set up a good communication system linking employees at departmental as well as organizational level. The information shared at the management meeting is effectively conveyed to other employees it concerns through emails, office computers, and departmental meeting. This has made it easy for the management to communicate the visions of an organization.

2. Governance: Operations Management at Samsung:

Governance is the key role of the management team. Governance implies the process through which the management team of Samsung runs its operations.

Electronic management of Samsung operation:

Operation management’s task is to ensure organized product processing and dispensation of services. Most of the responsibilities carried out by operations are the creation of goods, developing the products, producing and dispensing the goods (Gattorna, 2016, p. 247). An operations manager should be able to partake of the following roles; ensure that the product has met the clients’ requirement both in quality and in quantity, monitor storage, logistics and evaluation of the product. Operations depend wholly on the product and service.

The performance of employees takes a collaboration of decision and action direction which determines the performance of the employees this type of management is called the strategic management ('Samsung Electronics Co., Ltd' 2017, p. 6). The success of the business is highly dependent on the management operation that is why it is important for any organization to set a separate and different operation strategy company. They should be aware of emerging national and international threats to their markets. The company gains competitive advantage through product development and strategic promotion when the consumer in particular on the company brands and quality of the products, as well as the price the product is selling and product.

Operation Manager

Samsung electronics operations Manager is governed by the following responsibilities:

1. They are in charge of managing the day to day activities of the supply chain as well as the selling and marketing of the product.

2. They are in charge of selling the inventory to different accounts, monitoring stock levels and plan on behalf of the management ('Samsung Electronics Co., Ltd' 2017, p. 6).

3. They directly are in charge of purchases in the company and buying and selling of things in the company.

Operation and analysis the management strategy at Samsung

Any internal factors of a company are managed by operations management. These internal factors it manages include; finances, marketing of products, employee insurance and the skills employers term as good employee skills, the amount of product to be manufactured and the needs and makes sure the customer is satisfied. Any company must function on rules and regulations, and an agreement between the employer and employees for the sake of the customer, the management of operation creates these things and manages them such that he follows through to see they are adhered.

Management of operation is directly in contact with the process of production from the manufacturing to the marketing of the goods and services (Gattorna, 2016, p. 247). Operational strategy is always in action since it assists and gives direction to the smooth operation and management of any enterprise. Strategic business lights the way for management of the operation.

The focus of the operational management at Samsung is to amass lots of money while its objectives are to provide quality at an affordable cost this way they know they have delivered to the best of their capability and leave a satisfied customer. It should also be able to conform to the ever-changing trends in technology (Jaeyong, Kyungmook, & Khanna, 2016, p. 132). The focus of the company is centered on five sectors, which are; multimedia, digital applications, semi-conduction, telecommunications and LCD networking and globalisation and commercial advancements of operation of Samsung electronics within a decade.

The year 2007 was remarkable for Samsung Company as a factory for mobile phones as it was named the second largest producer worldwide. Many in the market such as the manufacturers as is the customer is concerned about strategic success (Minagawa, & Monden, 2016, p. 23). The progress of the company is also as a result of the Samsung DRM product being developed. Before these, the company management was scared since they did not have an advantage of companies in countries in China that enjoyed a low cost in production and their interest in venturing into a similar field. The DRM performance put them in a better position than the competition.

To retain profitability of the production and management of the product, Samsung improved extensive r&d. The DRAMS capacity is one of the fulfillment and benefit cost employers achieved through the company’s plan for success and operation management of innovation. Samsung’s electronic accomplishment embellished on the world market and the quality of their products at premium rates is what the consumers trust. Nowadays, the approaches and systems to achieve the innovation process are numerous.

Samsung electronics banks on client diversity in order to be a step ahead in providing the client with an adaptation of what suits their diversity in lifestyle and environment (Cusumano, 2013, p. 29). Samsung’s design and quality have gained it worldwide recognition and respect.

The above information regarding the governance aspect of Samsung’s management indicates that the organization is effectively governed. The governance system demonstrated above meats the characteristics of good and effective governance. The governance of Samsung has the following characteristics;

i. Clear strategy

ii. Effective risk management

iii. Discipline

iv. Social responsibility

v. Transparency

vi. Self-evaluation

vii. Accountability

Considering the criteria for assessing how a family business is professionally run, Samsung demonstrates an effectively run business. The successfulness of the company in the global scale can be attributed to the effective attention to the main aspects of running a successful family business. Samsung is clearly run professionally and the management clearly undertakes adequate research to make informed decisions and come up with strategic choices that have positioned the company better in the global market and allowed the company to compete more effectively in the market.


Cusumano, MA 2013, 'Technology Strategy and Management: The Apple-Samsung Lawsuits', Communications Of The ACM, 56, 1, pp. 28-31, Business Source Complete, EBSCOhost, viewed 28 April 2018.

Gattorna, J 2016, Gower Handbook of Supply Chain Management, Milton Park, Abingdon, Oxon: Routledge, eBook Collection (EBSCOhost), EBSCOhost, viewed 28 April 2018.

Jaeyong, S, Kyungmook, L, & Khanna, T 2016, 'Dynamic Capabilities at Samsung: OPTIMIZING INTERNAL CO-OPETITION', California Management Review, 58, 4, pp. 118-140, Business Source Complete, EBSCOhost, viewed 28 April 2018.

Minagawa, Y, & Monden, Y 2016, Lean Management Of Global Supply Chain, Singapore: World Scientific, eBook Collection (EBSCOhost), EBSCOhost, viewed 28 April 2018.

Patterson, B 2018, 'Samsung Notebook 7 Spin: A solid 8th-gen 2-in-1 with plenty of battery life', Pcworld, 36, 4, pp. 45-51, Business Source Complete, EBSCOhost, viewed 28 April 2018.

'Samsung Electronics Co., Ltd' 2017, Samsung Electronics Co., Ltd. SWOT Analysis, pp. 1-8, Business Source Complete, EBSCOhost, viewed 28 April 2018.

'Samsung SDS Co., Ltd' 2017, pp. 1-16, Business Source Complete, EBSCOhost, viewed 28 April 2018.

Venkateswara Rao, T 2016, Performance Management: Toward Organizational Excellence, Thousand Oaks: Sage Publications Pvt. Ltd, eBook Collection (EBSCOhost), EBSCOhost, viewed 28 April 2018.

Michell, T. 2010. Samsung Electronics and the struggle for leadership of the electronics industry. Singapore, Wiley.

Lee, D. 2006. Samsung Electronics: the Global Inc. [Seoul, Korea], [YSM, Inc.].

January 19, 2024

Business Family



Number of pages


Number of words




This sample could have been used by your fellow student... Get your own unique essay on any topic and submit it by the deadline.

Eliminate the stress of Research and Writing!

Hire one of our experts to create a completely original paper even in 3 hours!

Hire a Pro