It Is a Power Point Presentation Of New product development strategy of samsung

2. Introduction To New Product Development
 New product development is one of the most important aspects of a new enterprise start up
and is the activity that will most influence and guide the direction of the firm throughout its
life. The process of new product development and the success of the product in the market
will primarily determine how well the company will sustain itself and be the key to
developing any competitive advantage of the firm over others. The new product development
function has been neglected in entrepreneurship literature, yet it is an extremely important
key to success in the new venture and an extremely difficult process considering new
entrepreneurs may not as yet developed the all round expertise, experience and resources of
large companies. Another area of neglect in new product development and entrepreneurship
literature is the actual formulation, design, packaging and manufacturing process
development of a new product, which is the link between technology and the market in any
new venture creation.
 One of the keys to successful new product and process development is the design and
production of a new product with the minimal resources possible without sacrificing any
quality of the finished and marketable article. For the entrepreneur, this process must be
undertaken in a heuristic manner (discussed later), rather than through any strict
disciplinary approaches, advocated and practiced by large companies. This is one of the ways
a new venture can gain competitive advantage over larger companies, if the product and
process can be designed and built for a fraction of the cost that more established enterprises
can achieve. Thus product development is one of the most important processes of new
venture creation. New product development is a discipline where the technical aspects are
learned as you go along the process, as most of these aspects are not in any text books, but
come from people’s lives and experiences. This is a reality of new product development that
even MNCs have to face. New product development is both a manifestation and extension of
strategy in terms of what the company puts into the marketplace, steering the direction of
the enterprise and at the same time, an influence upon strategy or a restraint upon strategy
because founder and/or team capabilities limit the set of options available to the new
venture in terms of what can be done in the marketplace in terms of product.

3. The Role Of Product Development
In The Enterprise
 As mentioned in the introduction, new product development is the manifestation of the
idea to exploit the chosen opportunity. It is the centre of all strategies and the vehicle that
will get the enterprise going in the market. New product development is the chosen basis
of growth for companies like Siemens, Nokia, Sony, Apple and Glaxo of which they have
completely relied upon as a strategy. These companies are what they are today because of
new product development. The place of new product development in the web of
company strategies and operations is shown in figure 1.1.
Growth
Sales
Survival
Profit
s
Marketing
Finance
Production
Purchasing
Accounting
Strategic
Management
Supply
Chain
Management
Resources
New Product
Development
Regulation Product Design
Intellectual Property
Standards
Process Development
Skills & Learning
Strategy

4. Invention Verses Innovation
 Many people relate new product development to invention. However invention only makes up a small part of new
products and less than 2% of all patents are actually commercialized. Inventors are usually good at developing ideas
into concepts and tangible items, but not all inventions satisfy consumer wants and needs. It is particularly difficult for
an inventor to successfully develop a product in the market by themselves because of the tremendous resources needed
to develop the market to make consumers aware and educate them about the new product. Many inventions, although
novel, fail to solve any real consumer needs, or fail to satisfy them effectively and thus fail to gain much interest from
consumers.
 1. Personal Computers
 2. Microwave oven
 3. Photocopier
 4. Pocket Calculator
 5. Fax machine
 6. Birth Control Pill
 7. Home VCR
 8. Communication
 Satellite
 9. Bar Coding
 10. Integrated Circuit
 11. Automatic Teller
 12. Answering Machine
 13. Velcro Fastener
 14. Touch-Tone
 Telephone
 15. Laser Surgery
 16. Apollo Lunar
 Spacecraft
 17. Computer Disk Drive

5. New Product Development By
Technology
 Intellectual property must be defined widely to include trade secrets and commercially confidential
information, which can also be called proprietary technology. Patents as a form of intellectual property rights
have issues related to their scope of protection, are sometimes hard to justify in terms of costs due to the small
market the novelty will serve, are expensive to gain registration and take a long period of time before they are
accepted through process and review procedures. Jaffe and Van Wijk state that in many jurisdictions patent
enforcement is very difficult due to slow court systems, bias against foreign plaintiffs, lack of technical
competence and a general inability to enforce judgements. A survey undertaken by Lessor found that
companies tended not to patent their innovations in many cases, due to the fear that waiting would allow
other companies to copy and counterfeit the product first in developing countries that had markets too small
to justify the cost of registering a patent. Grubb argues that in biotechnology, patents as a form of intellectual
property rights do not serve the same purpose as in the electronics industry, where patents are used as
‘bargaining chips’ in cross licensing agreements and patent pooling as there are common product standards
imposed by necessity and regulation.
 There are other alternative forms of intellectual property protection used by companies that maintain trade
secrecy and advantage over competitors. Trade secrets can be guarded and protected within an organisation
by maintaining employment contracts with secrecy agreements that can be enforced through contractual
remedies. These include specifically tailored production processes, mode and control of reactions and
formulations used in the production of products by a company. Under legal license agreements, this
technology, although unpatented can be protected as proprietary knowledge under contract law. The rapid
changing nature of technology and continual improvement upon processes and product, is itself a mode of
protection, as long as the company maintains pro-active R&D in process and product development. Patents
applications can often become redundant before the application is even reviewed by the patent office in an
environment of continual technology change.
 Nogus, N., Patents and Pharmaceutical Drugs: Understanding Pressures on Developing Countries,
Washington DC, World Bank, Sept. 1990, WPS 502.
 Jaffe and Van Wijk, The Impact of Breeders’ Rights in Developing Countries, University of Amsterdam, Inter-
American Institute for Co-operation of Agriculture, October 1995. http://www.wipo.int/about-
ip/en/studies/pdf/study_jaffe.pdf
 Lesser, W., Role of IPR in Biotechnology Transfer – Corporate Views, Undated, P.5.
http://www.wipo.int/about-ip/en/studies/pdf/ssa_lesser_biotech.pdf
 Grubb, S., Patents for Chemicals, Pharmaceuticals and Biotechnology, Oxford Clarendon Press, 1999, P. 377.

6. Introduction Of Samsung Company
 Over the past 39 years, Samsung Electronics Company (SEC) has evolved
from a low cost manufacturer of black and white televisions, to one of the
most technologically advanced and prestige companies of modern day
time. Throughout the 1990’s, SEC’s chairman, Kun Hee Lee, demanded
that the company as a whole re-think their key fundamentals and set the
stage for long-term commitments to investment in innovative, premium
products and brand value. As a result of the recognized opportunities,
Samsung pursued a bold combination of strategies to re-define
themselves. Many of these methods were unconventional but lead to great
success over the next several years (Exhibit 1). As Samsung continued to
grow, Executive VP of Global Marketing, Eric Kim, was forced to make a
difficult decision. Should Samsung continue to offer a “one size fits all”
product promotion or shift their focus towards more complex customer
segmentation? The most important factors in determining whether or not
Kim should pursue more customized devices in his marketing planning
revolve around Samsung’s ability to continue to reduce manufacturing
costs and increase marketing costs, and their ability to make the brand
name more personal through customer insight and exposure.

7. History
 Samsung Group was founded in 1938 as exporter of dried fish, vegetables, and fruits
and flour mill and confectionery machines.
 Samsung Electronics in 1938
 In Korean War, Samsung lost all assetsaimed to help rebuild Korean economy;
entered the manufacturing industry (sugar,fabrics). It became a leader in modern
business practices (recruiting from outside) In 1960’s expansion of key industries,
entered electronics and chemical industries
 In January 1969 Samsung Electronics Co.was established.
 In 1970’s bet the future on electronicslaid the groundwork for electronics in Korea
which helped the domestic economy grow and paved the way for exports
 In 1980’s, a more comprehensive electronics company; it established plants in
Portugal and US. It also established Semiconductor and Communication
corporation and began memory chip business

8. Methodology
Planning
Research (e.g.
patents)
Samsung
design lab
(e.g. GUI/
Interfaces)
Standard
Product
Development
(in Korea)
Customized
Product
Development
Regions
(India /US/
Vienna)
Testing
(alpha/ beta)
Improve and
Version
releases

9. Samsung’s Investment for R&D
In 2010, Samsung Electronics invested $ 0.01 trillion, or 6.1% of consolidated sales in R&D. Currently, has 50,084 R&D
personnel which is equivalent to 26% of our total workforce. In recognition of R&D endeavors, Samsung Electronics was
included among the top 10 global companies in R&D investment announced by the U.K. Department for Business,
Innovation and Skills.

10. Conclusions
 Within smartphones, the South Korean manufacturer banked on its
AMOLED screen and custom UI for its Android-powered flagship
smartphone, and single-handedly created the phablet (phone/tablet)
market, with its Note smartphones sporting a large screen back in late
2011.
 Samsung demonstrated that it was not short on ideas and was
focused on catching up with both Apple and Nokia in the mobile
arena, as well as on strengthening its lead in digital televisions in
2012. Now that Samsung is the market leader, there must be a
significant shift in its strategic direction if it is to build on its position.
 Samsung has to show its competitors that it is confident and knows exactly
where it intends to steer the market. The market is expecting Samsung to
create category defining products, much as Apple has done with smartphones
and tablets