1. Case Study - Samsung SDS -
Rev 2: Apr., 2015
Prof. Euiho Suh
POSTECH Strategic Management of Information and Technology Laboratory
(POSMIT:
Dept. of Industrial & Management Engineering POSTECH

2. Contents 1 Introduction 2 Vision & Mission in 2005 - Overview 3
Vision in 2005 4
Mission in 2005 5
Goals in 2005 6
SWOT Analysis 7
BCG Matrix 8
GE/Mckinsey Matrix 9
International and Domestic Strategies

3. Introduction Overview Established in 1985
The biggest System Integration (SI) company in Korea
Business areas
Intelligent manufacturing
Intelligent logistics
Intelligent office
Intelligent surveillance
Smart education
Smart healthcare
Smart converged space

4. Vision & Mission in 2005 - Overview
To become the information service integrator who creates the best value for customers
Vision
Impression Management
Lead Networking Society
 To become proactive to lead customer needs
 To foster talented people of the knowledge society
 To provide information culture in everyday life
Mission
Corporate Values
Impressing Employees
Impressing Customers
Impressing Everybody

5. Vision in 2005
DREAM 21
Samsung SDS, leading the network society of 21st century
Sales: 10 trillion won
Average annual growth: 38%
Operating profit: 500 billion won
Number of employee: 20,000
More than 5 world class products
Global top 10 IT service corporate
To establish Cambridge Samsung Partnership (CSP) with Cambridge Technology Enterprise (CTE)

6. Mission in 2005 (1/2) Customer Market
To become proactive to lead customer needs
To foster talented people of the knowledge society
To provide information culture in everyday life
Product Service
Solution service - network, hardware, software
Information service - Consulting, Education
Communication service - Communication network, Internet, PC communication
Geographic domain
Proactive overseas investment
IT centers - India, Russia
international Offices - San Jose, Tokyo, China
Technology
Global cyber education
Glocalized cooperation
Work process optimization
Video conference system
Strategic alliance

7. Concern for Public Image
Mission in 2005 (2/2)
Concern for survival
Proactive action to lead customer needs
Philosophy
To become the information service integrator who creates the best value for customers
Self-concept
Establishing Cambridge Samsung Partnership (CSP) with Cambridge Technology Enterprise (CTE) in order to improve international businesses
Concern for Public Image
To provide information culture in everyday life

8. Goals in 2005 Goals of Samsung SDS Goals Sales 1.7 billion won
S/W development
H/W sales
Sales 740 billion won
SI 44%
SM 38%
N/W 16%
Education 2%
Sales 2 trillion won
SI 58%
Consulting 6%
Education 2%
N/W 16%
Information Distribution 18%
Sales 10 trillion won
SI 50%
Consulting 10%
Education 5%
N/W 20%
Information Distribution 18%
Year
1985
1996
2000
2005
Status
Foundation
The best IT corporate in Korea
Top 25 global IT service corporate
Top 10 global IT service corporate
Sales/Average Annual Growth
1.7 billion won
740 billion won
2 trillion won / 28%
10 trillion won / 38%
Internal/External Investment Ratio
87% / 13%
70% / 30%
50% / 50%
Operating Profit
-400 million won
10 billion won
60 billion won
500 billion won
Number of Employees 63
5,700
9,000
20,000
World class products 2
More than 5
Overseas
2 offices 1 IT center
5 offices 15 IT centers
10 offices 20 IT centers

9. SWOT Analysis (1/3) Internal Assessment of the Organization
Strengths (S)
Weaknesses (W)
Good brand image
Excellent human resources
The largest IT corporate and longest history in Korean IT industry
Excellent education programs
As known as SI academy
Active support from Samsung group
The largest ICT education center
Low flexibility of management
Low ability to deal with changes
Short history compared with foreign competitors
Lack of experts
Lack of consultants
Lack of professional skills
Poor information infrastructure

10. SWOT Analysis (2/3) External Assessment of the Environment
Opportunity (O)
Threat (T)
Globalized market
A lot of demands from the financial industry
Increasing needs for the public sector
The growth of the global economy
Development of information technology (e.g., Internet)
Economic downturn of SI (System Integration) industry
Low chance to get investment
Rivalry among existing firms
Threat of international corporates
The opening of the telecommunications market
Dumping

11. SWOT Analysis (3/3) TOWS Analysis Strengths Weaknesses Opportunities
Threats
S-O strategies
Strategic alliances with Microsoft
To make vision focusing on “Globalization”
To improve the cyber university and online services
To strengthen education of foreign language
To enter the financial industry aggressively
Intensive investment on Intranet
To establish corporation in U.S.
To land large-scale-SOC (Social Overhead Capital) orders aggressively
W-O strategies
Strategic alliances with foreign consulting firms
To develop HR (Human Resource)
To start AT&T WORLDNET Service
To make CAD (Computer-aided-design) department
To focus on the medical industry
To make Post-doc courses
To construct the global network
S-T strategies
Joint research with universities
To hire experts
Strategic alliances with foreign firms
To improve customer services
Partnerships with CEOs who have worked in SDS
Strategic alliances of advertisement and brand
W-T strategies
To design the flexible organization
TQM (Total Quality Management)
To develop and utilize system development methodologies
Headhunting
Group IT infrastructure and network
System management efficiently
Outsourcing

12. Information Distribution
BCG Matrix
System Integration
Consulting
High
ICT
Market Growth Rate
Education
Cash Flow
Information Distribution
System
Management
Low
High
Low
Relative Market Share

13. GE/Mckinsey Matrix Competitive Strength High Medium Low High
Market Attractiveness
Medium
Low

14. International and Domestic Strategies
Cost Leadership
Concentrated Growth
Domestic
Concentrated Growth
Vertical Integration - Vertical integration with ICT SMEs
Concentric Diversification - Investment on all of the fields related with ICT