Samsung is a South Korean multinational corporation that manages distinct smaller businesses. Samsung being a multinational company has a product-type divisional organization. Let us know more about that the Samsung Organizational Structure-Know More.
It is a multinational company which makes it complex in functioning. To simplify that and understand its setup and working, it is necessary to first understand the company’s organizational structure and its distinct characteristics. To know more about organizational structure and other factors assisting Samsung. Read the article below.
Samsung Organizational structure: Succinct Description
Samsung or any company or industry’s corporate structure revolves around organizational structure. Samsung is one of the top companies in the world and has a product-type divisional organizational structure. Simply put it is a structure considering its product as its center and using them to choose how or when the resources and business operations will take place.
However, not all products are centralized as only a few including – consumer, Electronics, IT, and device solutions. And along with products several career levels are surrounded by leadership functions based on experiences in distinct fields such as – assistant, professional, junior, senior, and so on.
Samsung is a centralized leadership corporation, as the main branch or headquarters of the company is situated in Samsung Town, Seoul, South Korea manages, plans operates, and lunge its sister and subsidiary companies around the globe forward.
This is all done by using boards of directors, executives, heads of departments, and so on, as they instruct plans and ideas through distinct divisions and so forth.
Understanding Samsung and Its Organizational Structure
Samsung’s organizational structure unlike other organizations and corporations was made to promote technological devices for the corporation. And as products, technological innovation is the core of the multinational company.
All the rapid innovations, strategies, and planning implementing effectiveness are contributed by structural facilitation and are done considering the products as cores as seen in Samsungs, devices including – smartphones, laptops, and various other home and private use devices.
With the help of Organizational structure implements distinct strategies and operations for different markets and industries. The corporate and organizational structure helped the company to overcome various problems and complications and develop strategies to provide an edge over the competition and support business continuity, and growth of the company.
Samsung Pvt. Ltd, Samsung mobiles, sister companies, and distinct subsidiaries of Samsung group forms the organization structure, through research it has been proved that Samsungs corporate structure works as one in all of its sister companies and subsidiaries. This method helps the company in the smooth working of operations and planning implementation along with providing a competitive edge over other firms and corporations like – Apple, Huawei, Intel, Dell, and so on.
Samsung product-type corporation is divisional and the main reason behind this is because of the company’s large variety of products and differences in the portfolio the Korean company also is expected to provide not only excellent quality goods but also services in distinct markets all around the world.
According to Samsung, each unit and division in the corporation is managed and operated separately according to their products and marketing, sales, planning, and various distinct factors considered.
Samsung’s entire product-type organizational structure includes several divisions based on product category which are then further divided into business units such as –
Consumer Electronics (CE)
These units include electronic appliances, digital devices, visual displays, health, and medical equipment, and many more. These electronic types of equipment are usually for daily or private use in homes, offices, and other areas.
IT and Mobile Communications (IMC)
Mobile communication allows us to have access to others and makes it easier to communicate from distinct locations without being physically available.
To increase the speed and make it easier to communicate Samsung developers created and set up 5G services for its customers and clients.
Device Solutions (DS)
Device solutions include memory and Large-scale integration (LSI – A chip circuit created by combining billions of MOS transistors.) Large-Scale integration holds card controllers, LANS wireless and wired, and display drivers.
Distinct divisions or units have different roles and responsibilities focusing on different goals centralizing Samsung’s Visions and missions. Despite all these products affiliated units, the Korean company has a non-product unit that instead of revolving around products is based on research and development.
Even though not a part of the corporate structure research and development department consists of 60,000 + employees around the globe. This division’s roles and responsibilities include – Robotics, Security, Media, Artificial Intelligence (AI), Lifecare, and new experiences and visions.
Organizational Structure Characteristics and Types
As mentioned above, Samsung’s structure type uses products as cores to determine, plan and execute any business operation in any division. And the entire corporation works as one including its various subsidiaries and all the management directions from headquarters are implemented through strategic objectives.
There are different types of characteristics used by Samsung for distinct purposes. Some of the characteristics are as follows –
Product Type Divisions
The first characteristic of Samsung is Product-type Division, according to this each division and unit is operated and managed differently according to their resources, planning, and visions.
Here, each division represents a product category and has different roles and responsibilities such as – Resources planning, operations, sales, distribution, production, and many more.
To achieve the corporates goals and mission statements, the corporate structure majorly focuses on technological innovation and development. The corporation product-type division may add distinct sister companies and others, depending on the development of the organization, including – strategy, operations, and other factors.
Here, are some of the basic product-type divisions –
- Customer Electronics,
- Device Solutions,
- IT and mobile Communications.
Samsung has distinct groupings and divisions, and they are considered minor characteristics of the technology firm. According to the organizational strategy these geographical groupings fall under product-type divisions characteristics, however, they are mostly considered a characteristic of the corporation.
Like, Samsungs North and South American divisions are in geographical groupings with one of Samsungs sister companies – Samsung Electronics. And as the company strategies and implements distinct plans they are also implemented in American Samsung divisions.
Centralized Corporate Hierarchy
Samsung’s corporate structure also involved a hierarchy model by using the firm’s headquarters as a leader figure. And this hierarchy headquarters ensures corporations’ operations and ideas are unified and effective for each subsidiary or sister company.
The Centralized Corporate hierarchy involves centralizing several factors and strategic planning, around the core and the headquarters or any centralized hierarchy is relied upon for providing commands and planning.
The centralized figure also has absolute authority over strategy and other business units, even daily operations in customer electronics, Device solutions, and mobile communications also take strategic directions from them.
Organizational Structures: Advantages and Disadvantages
Like every other factor affecting the companies have advantages and disadvantages similarly, the organizational structure of Samsung also has advantages and disadvantages such as –
Among many advantages of organization structure the first is that for technology innovation it has extensive support for product development. The company’s adaptability is also considered one of its advantages as it strategizes and operates according to its competition and market characteristics.
Geographical grouping or product-type divisions are the main reason behind the smooth adaptability of the company as IT and mobile communications make it easier and faster.
Organizational structure also made it easier to implement efficient decisions making and specialize the roles and responsibilities of not only lower-level but higher-level employees including – the CEO, director, head of departments, managers, COO, and many more.
These are some of the advantages that help Samsung compete in fierce market competition, and because of this and several other organizational strategies a Korean Corporation from being a small firm became a company competing with the best in the markets such as – Apple. Inc, Sony, Huawei, Motorola, Redmi, and many more.
Samsung’s organizational structure has many disadvantages such as it limits the autonomy of product-based divisions, for instance – Due to the Centralized Corporate Hierarchy, not only the product-based division but the whole corporation including its sister and subsidiary companies must follow strategic instructions from the headquarters. Also, it provides single control over all the sister and other business units.
However, it is necessary to keep the corporation intact and running smoothly according to the corporation survey.
The corporate structure provides various challenges while ignoring and low prioritizing the geographical groupings and divisions, nonetheless, because of organizational structure there is a higher drop in negative effects caused due to these divisions and groupings.
Like every other company, there are benefits and losses but due to these strategies, the current global success rate of Samsung has increased effectively as the advantages of the structure outweigh its disadvantages.