Two key recommendations are: 1) funding a genealogical team which targets on the new system's research, invention and testing; 2) prioritize the product line based on the profits contribution and the market share of the product. Cutting the worst one, and then using the saving capital to support the new technology development. Opportunities to Create Value through Developing Samsung Operating System Strategic Area: Create Value: Sciences: Initial investment.
I Challenges to Create Value: I Opportunities to I I Decision IA good operating system can build up brand loyalty I Huge I I Why Need Samsung Own Operating I customers (like ISO for Apple). I Profits and costs are estimated, are not I System accurately calculated I Core technology relying on other companies not a I Technology development to maturity needs a long I I operating system can better fulfill upgrading I time. I needs. I Enjoy the all chain profits and APS regulation fees. I I long-term strategy.
I Own I Marketing: I Putting "Auto-assistants" machine In retail stores. I Machine cannot solve all problems. Provide 24-hour customers assistance. Immediately. I I Management: I Customer Satisfaction I Problems cannot be solved I Technical team takes charge in he design, research, I Need time to collect data, then measure final I Organization the work sure Results. Sure stock prices stay TTL stable level. I Short-Term: land developing Jobs. Accounting department makes I capital is being used.
I Finance department will make I Finance I It Is hard to know how long we should wait until I Short-Term and Long-Term I New operating system launching, problems, negative I the operating system Is fully mature. I news may lead to stock price decrease. I Long-Term I Accounting: I lead to stock price increase. Complement the technology by restructuring financial I Need time and resources to get final analysis. I I Tracking as Accounting Department I statements then check performance of the Samsung I I operating system.
Opportunity and Challenge Overview Developing Samsung operating systems can reduce the dependence of the Android system. Samsung may master initiative in upgrading smartness. In the case that Android stops the corporation with other cell phone companies, Samsung will not be passive. Samsung can get more profits from the APS companies. In China, Samsung biggest market, the cheap-cost cell phones are in fashion. Creating new mints of difference (PODS) will better avoid simulation in order to eliminate the particular threats.
Technology is a tough Job and needs huge initial investment. At the beginning, change is not always readily welcome. The new systems will face many problems when it is launching the first time, like the negative reflection from market and unstable stock price. Recommendations As the analysis I mention above, we make the following recommendations for how Samsung develops their own operating systems and cut some product lines which contribute the least profit to Samsung Electronics. And then better utilize the capital for developing Samsung own operating system.
Recommendation 1 : Samsung Operating System Research and develop Samsung operating system, reduce dependence on Android systems. Benefits and Anticipated Results The operating system is the core technology of smartness. A company having their own operating system can better service themselves. Samsung will enjoy the profits from hardware to software. In the case that Android stops cooperating with other cell phone companies, Samsung will be able to reap all the profit from its own operating system. Developing Samsung own operating system is also a security strategy.
In the initial phase, Samsung may lose a portion of market shares because of the brand loyalty of Android or Samsung immature system. For long term, after Samsung operating system gains maturity, the technological problems will not be a puzzle anymore, I believe the market share even may increase more than before. Recommendation 2: Product Line Cutting Prioritize Samsung electronics product line based on market share and profits profit and the smallest market share in a specific region. Cutting the product line which contributes the least profit will cause Samsung to lose that part of market share and revenue in the short term.
Samsung can save capital to target on the other successful product lines. Significantly, Samsung can utilize that capital to develop the Samsung operating system. For finance, during the in short-term, closing a product line may occur negative effect for stock price. Or in the long-term, after Samsung operating system matures, the trend of the stock price should increase.