Samsung Company Analysis
Samsung Electronics is a South Korean brand manufacturing electronics and household appliances. The company constantly improves the accuracy and speed of its information systems (IS) to meet today’s business requirements. Beforehand, each company or division used autonomous IS. This impeded the rapid exchange of information and slowed down operations. Therefore, Samsung began to build a unified information network, which assumed the widespread implementation of Enterprise Resource Planning (ERP), and in some organizations – and Supply Chain Management (SCM) systems. The introduction of an effective SCM system in Samsung has significantly influenced the level of the company’s competitiveness.
There are several IS that Samsung uses; regarding enterprise systems, Master Data System (MDS) serves as a basis for entire Samsung production. The system registers product numbers, details, sales office, suppliers, customers, and invoices (Song & Lee, 2014). Therefore, it facilitates searching and identifying any item in the company’s production (Cain, 2020). Samsung Electronics uses a product life-cycle management (PLM) system to develop a new product. For procurement, the company adopted a supplier relationship management (SRM) system that enables batch processing of component purchases, product delivery, invoicing, and payments (Song & Lee, 2014). Moreover, the SRM provides information and recommendations regarding the price and quality of details (Cain, 2020). Such data is applied in preliminary forecasts about the quality and cost of future products.
The global manufacturing execution system (G-MES) facilitates the manufacturing process. It calculates a weekly supply chain index for each facility and provides the results for processing in SCM (Song & Lee, 2014). Afterward, the global control center develops an orders network for production lines and employees. The material requirement planning (MRP) system predicts the demand for details required and informs suppliers (Song & Lee, 2014). Another system called the global logistics system (G-LS) offers partners the demand trends and optimizes the supply chain (Song & Lee, 2014). Consequently, logistics organizations can gather operational information and improve their schedules to deliver materials to manufacturing sites and finished products and goods to the customer. Regarding the customer relationship management (CRM) system, it concerns marketing, sales, and service (Cain, 2020). It connects Samsung sales offices with corporate clients such as telecom providers (Cain, 2020). As a result, customers can receive reliable information about Samsung’s products, while Samsung Electronics obtains data about each customer and can create individual marketing strategies.
Moreover, for knowledge management, Samsung has established a worldwide trade network (WTN) in Korean and overseas operations. Due to the Internet, the isolated ERP systems of various Samsung organizations can be connected (Cain, 2020). Hence, this benefits the automation and exchange of management knowledge. For instance, the implementation of a single trading network allows the managers to decrease the time and significantly advance order fulfillment accuracy (Cain, 2020). Furthermore, the adoption of standards reduces errors and additional costs while mutual understanding and transparency of operations grow. For these purposes, a global ERP system has been created, managing finance, logistics, and inventory information for all overseas offices (Song & Lee, 2014). This leads to the fact that the company’s weekly consolidated financial statements may be accomplished in a couple of days.
To sum up, IS is considered a set of information in databases and information technologies and means ensuring its processing. Almost all Samsung systems connect suppliers, factories, production lines, sales offices, and customers together; the exception is the PLM system. The supply chain management system combines all these isolated IS, being parts of the value chain. Thus, product development, production, quality assurance, logistics, marketing, sales, and after-sales services are considered one process in the company’s output.
Cain, G. (2020). Samsung rising: The inside story of the South Korean giant that set out to beat Apple and conquer tech. Broadway Business.
Song, J., & Lee, K. (2014). The Samsung way: Transformational management strategies from the world leader in innovation and design. McGraw-Hill Education.