Maintaining The "single Samsung" Spirit: New Challenges In A Changing Environment

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The case examines how Samsung has grown to become one of the world's leading global companies. It presents a detailed description of Samsung's "Top priority to the People' philosophy, and its strong cultural values; both of which have been instrumental in ensuring its continued success in the past few decades. Since 1982, Samsung Human Resource Development Center (SHRDC) has played a critical role in supporting Samsung's corporate strategy of achieving global competitiveness, through programs that focus upon maintaining Samsung values and developing a cadre of effective next generation leaders. New Employee Orientation (NEO), an intensive four-week in-house program for all Samsung employees, is one example of an SHRD program that helps provide a strong foundation of Samsung's unique culture among the new employees. Most importantly, NEO aligns employees across Samsung affiliates to its strategic direction, thereby fostering a stronger "Single Samsung" culture. In recent years, however, NEO has been faced with new challenges. First, Samsung's pool of new employees has become more diverse, with the recruitment of more experienced and foreign (non-Korean) employees who are being targeted in addition to the fresh college graduates whom Samsung has always relied upon. Second, Samsung has become aware of stark value differences between the older employees, who are obedient and easily follow rules, and the younger 'digital native' employees, who are more individualistic and prefer egalitarian and open policies. Managers at SHRD are concerned that the "Single Samsung" spirit, which forms the core of Samsung culture, is being threatened from within. Students must address issues related to the need for maintaining a unified organizational culture among diverse groups of employees whose values conflict with each others, and propose ways for Samsung to effectively employ and utilize all of its employees.

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S w W11236 MAINTAINING THE “SINGLE SAMSUNG” SPIRIT: NEW CHALLENGES IN A CHANGING ENVIRONMENT Shaista E. Khilji, Chang Hwan Oh and Nisha N. Manikoth wrote this case solely to provide material for class discussion. The authors do not intend to illustrate either effective or ineffective handling of a managerial situation. The authors may have disguised certain names and other identifying information to protect confidentiality. Richard Ivey School of Business Foundation prohibits any form of reproduction, storage or transmission without its written permission. Reproduction of this material is not covered under authorization by any reproduction rights organization. To order copies or request permission to reproduce materials, contact Ivey Publishing, Richard Ivey School of Business Foundation, The University of Western Ontario, London, Ontario, Canada, N6A 3K7; phone (519) 661-3208; fax (519) 661-3882; e-mail [email protected] Copyright © 2011, Richard Ivey School of Business Foundation Version: 2011-07-08 In 2009, the world economy was hit hard by the financial crisis that unfolded in the United States. A number of industries, including the financial, automotive and real-estate industries, were engulfed in this meltdown. The electronics industry was not an exception. Sony, the leading global electronics company, announced that it was likely to post net losses of ¥228 billion1 for the fiscal year 2008 and, in preparation, laid off 16,000 of its employees.2 However, Samsung astounded everyone with its impressive financial performance. Although Samsung predicted a ₩100 billion3 deficit in the first quarter of 2009, it emerged with a ₩40 billion surplus for that period.4 A critical factor that contributed to Samsung’s superior performance was its strong