The Samsung Group CurrentlyThe Samsung Group Currently• Operates within 57 countriesOperates within 57 countries• Generates 117 Billion $ in revenuesGenerates 117 Billion $ in revenues• Operates three core business sectors:Operates three core business sectors:

– ElectronicsElectronics– FinanceFinance– Trade and ServicesTrade and Services

• Accounts for 25% of Korean exportsAccounts for 25% of Korean exports• Represents approximately 10% of the value of Represents approximately 10% of the value of

Kospi (the Korean stock exchange)Kospi (the Korean stock exchange)

Samsung GroupSamsung Group

Business OverviewBusiness Overview

Samsung ElectronicsSamsung Electronics• Subsidiaries include Electronics, SDI, Corning, othersSubsidiaries include Electronics, SDI, Corning, others• Focuses on high-end consumer technologyFocuses on high-end consumer technology

• Strategic decision taken to move from value brand to Strategic decision taken to move from value brand to compete with Sonycompete with Sony

– Telecommunications world #3 after Nokia and MotorolaTelecommunications world #3 after Nokia and Motorola– TV manufacturer – world #1TV manufacturer – world #1– Monitor Manufacturer – world #1Monitor Manufacturer – world #1

• Brand Equity moved from a position outside the top 100 in Brand Equity moved from a position outside the top 100 in 1999 to #34 in 2002 and #25 in 20031999 to #34 in 2002 and #25 in 2003

Samsung FranceSamsung France

Within France, SamsungWithin France, Samsung• Exists wholly as a sales and marketing entity (plus one Exists wholly as a sales and marketing entity (plus one

service center)service center)

• Employs 130 personnelEmploys 130 personnel• Earns 800 million € (3.9 billion FF) in revenues and annualEarns 800 million € (3.9 billion FF) in revenues and annual

sales of 300M Euros (comparable to size of Germany and UK sales of 300M Euros (comparable to size of Germany and UK markets, taken separately)markets, taken separately)

• Enjoys an important market in terms of home appliances Enjoys an important market in terms of home appliances

Products & ServicesProducts & Services

Products sold to the French MarketProducts sold to the French Market• Electronics, including home theatre, digital Electronics, including home theatre, digital

cameras and video equipment, as well as stereo cameras and video equipment, as well as stereo componentscomponents

• Home Appliances: microwaves, refrigerators, Home Appliances: microwaves, refrigerators, washing machines, air conditioners, etc.washing machines, air conditioners, etc.

• Mobile TelephonesMobile Telephones• Computers, including LCD screens and monitors, Computers, including LCD screens and monitors,

laptops, printers, drive components, etc. laptops, printers, drive components, etc.

Services include after sales services, with Services include after sales services, with repairs handled externally repairs handled externally

Company's clientsCompany's clients

CustomersCustomers• Within France, Samsung markets to a large extent to the Within France, Samsung markets to a large extent to the

general public, with less emphasis on component sales.general public, with less emphasis on component sales.• Taken as part of the European market, France represents a Taken as part of the European market, France represents a

sizeable portion of Samsung’s sales of high quality consumer sizeable portion of Samsung’s sales of high quality consumer goods, the company’s strategic market.goods, the company’s strategic market.

• Samsung approaches marketing with a relatively one-size Samsung approaches marketing with a relatively one-size approach, including commercials which are translated and approach, including commercials which are translated and similar marketing approach in many markets. similar marketing approach in many markets.

Adaptation to FranceAdaptation to France

Samsung’s method: Interface positionSamsung’s method: Interface position• Five interface positions, filled by Korean ex-pats.Five interface positions, filled by Korean ex-pats.• One interface position for each manager.One interface position for each manager.• Liaison, with no direct authority.Liaison, with no direct authority.• Communicates directly, exclusively, with HQ in Communicates directly, exclusively, with HQ in

Korea.Korea.• Budget channel: the position through which funding Budget channel: the position through which funding

will flow from Korea.will flow from Korea.

Key Constraints Key Constraints

Costs of Entering the French MarketCosts of Entering the French Market• The Samsung Electronics European Headquarter The Samsung Electronics European Headquarter

is located in UK due to:is located in UK due to:– Larger market size in the UKLarger market size in the UK– Samsung’s familiarity with the English languageSamsung’s familiarity with the English language– Great Britain being viewed as a more favorable Great Britain being viewed as a more favorable

investment environmentinvestment environment

• Manufacturing plants are in UK, Spain and Manufacturing plants are in UK, Spain and Hungary where labor-related factors are more Hungary where labor-related factors are more favorable, including weaker unions than European favorable, including weaker unions than European neighbors France and Germany.neighbors France and Germany.

French BenefitsFrench BenefitsWhy did Samsung choose to enter France?Why did Samsung choose to enter France?

• Samsung Electronics France has acted as a sales Samsung Electronics France has acted as a sales and marketing entity, being established to achieve and marketing entity, being established to achieve market proximity, thereby positioning Samsung market proximity, thereby positioning Samsung more effectively with respect to international and more effectively with respect to international and domestic rivals. domestic rivals.

• In the late 1970’s, the US, Samsung’s largest In the late 1970’s, the US, Samsung’s largest export market, imposed voluntary export restraints. export market, imposed voluntary export restraints. At this time, Samsung became interested in the At this time, Samsung became interested in the European market as a means of market European market as a means of market diversification.diversification.

• Based on the market diversification and the Based on the market diversification and the globalization strategy of Samsung Electronics in globalization strategy of Samsung Electronics in the early 80s, sales subsidiaries have been the early 80s, sales subsidiaries have been established in 12 countries in Europe.established in 12 countries in Europe.

European PresenceEuropean Presence• Sales and service locations in 12 countries throughout Sales and service locations in 12 countries throughout

EuropeEurope• European HQ located in UKEuropean HQ located in UK• Production plant of micro oven and monitor in UK and of Production plant of micro oven and monitor in UK and of

VCR, TVCR in Spain and TV in HungaryVCR, TVCR in Spain and TV in Hungary• Sales volume in France (Annual Sales 800M Euros) almost Sales volume in France (Annual Sales 800M Euros) almost

same size to that of UK and Germanysame size to that of UK and Germany• Samsung Electronics started business in 1986 but Samsung Samsung Electronics started business in 1986 but Samsung

Electronics France established in 1994Electronics France established in 1994

Global HR ManagementGlobal HR Management

””Focus on HR for continued success...”Focus on HR for continued success...”• Samsung’s first world HR seminar was held this year Samsung’s first world HR seminar was held this year

in Korea.in Korea.• HR focus based on Korean rules – local towards HR focus based on Korean rules – local towards

common goals.common goals.• Out of 70.000 employees within electronics division, Out of 70.000 employees within electronics division,

11 – 12.000 foreign personnel.11 – 12.000 foreign personnel.• 300 top executives in Samsung – only 3 non-300 top executives in Samsung – only 3 non-

Koreans.Koreans.• With expasion, more non-Koreans to be eligible for With expasion, more non-Koreans to be eligible for

executive positions. executive positions.

Local HR ManagementLocal HR Management

HR Management within the FranceHR Management within the France• Korean presidentKorean president• 5 Korean Expats in France (interface positions)5 Korean Expats in France (interface positions)• 5 – 6 cultures in France5 – 6 cultures in France• Performance review twice a yearPerformance review twice a year• Sept. – competance appraisalSept. – competance appraisal• Manager recommend employees to a committeeManager recommend employees to a committee• Working on managerial programWorking on managerial program

Culture of SamsungCulture of Samsung

Asian versus Western CulturesAsian versus Western Cultures• Asian: emphasis on the groupAsian: emphasis on the group• Western: emphasis on the individualWestern: emphasis on the individual

Company cultureCompany culture• Private owner – no short-term Private owner – no short-term

decisions taken to please the stock-decisions taken to please the stock-marketmarket

• Immediate action – if you are 80% Immediate action – if you are 80% sure you go for itsure you go for it

Community Community

Korean philosophyKorean philosophy• Community oriented.Community oriented.• Training and educating people.Training and educating people.• Sponsors Health Care Research, other Sponsors Health Care Research, other

philanthropy.philanthropy.• Sponsors sporting events, including Olympics.Sponsors sporting events, including Olympics.

Mission StatementMission Statement

Management Philosophy Management Philosophy “ “We will devote our human resources and We will devote our human resources and

technology to create superior products and technology to create superior products and services, thereby contributing to a better services, thereby contributing to a better global society."global society."

Evolution of Samsung’s Mission StatementEvolution of Samsung’s Mission Statement• Economic contribution to the nationEconomic contribution to the nation• Priority to human resources Priority to human resources • Pursuit of rationalismPursuit of rationalism

Corporate valuesCorporate values

Soon to be announced by Samsung are new Soon to be announced by Samsung are new Corporate Values:Corporate Values:

• BehaviorBehavior– Creativity, Challenge and Strategic ThinkingCreativity, Challenge and Strategic Thinking

• OrganizationalOrganizational– Simplicity, Self-Control, SpeedSimplicity, Self-Control, Speed

• IndividualIndividual– Customer Focus, Crisis Awareness, Continued InnovationCustomer Focus, Crisis Awareness, Continued Innovation

Thanks ToThanks To

Yang Kyu Kim, President, Directeur GeneralYang Kyu Kim, President, Directeur General• kimyangkyu@samsung.co.krkimyangkyu@samsung.co.kr• 01 55 68 40 3001 55 68 40 30

Amaury Destailleur, Directeur, Ressources Amaury Destailleur, Directeur, Ressources HumainsHumains

• a.destailleur@samsung.coma.destailleur@samsung.com• 01 55 68 40 0801 55 68 40 08