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A case study is written summary or syntheses of real-life cases based upon data and research. It suggests a story with a beginning, middle and end. It is a challenge with a result or a problem with a solution. Approach to design case study is Challenge
Solution
ResultCast studies identify appropriate strategies for the resolution of dilemma of the case. Case study is a part of effective knowledge management. It is specific and easily digestible story format, which comes up with a solution. Case study is the practical implication of business studies. It enriches your exposure to field work and your managerial and executive expertise to handle organizational issues.
Business case study – To summarize real-life business scenarios, a problem occurring in organizational setup or a dilemmatic situation, leading to operational misconduct and inefficiency in organizations is business case study. The issue may be from any field like finance, HRM, Management, Strategic Management, Production, Marketing and General Operations etc.CASE STUDY LAYOUT
Title page – The title page will contain the full title of the case study. A title must not be vague or non-specific because it may not attract readers’ attention. The two most common formats of titles are nominal and compound. A nominal title is a single phrase, for example “A case study of hypertension which responded to spinal manipulation.” A compound title consists of two phrases in succession, for example “Response of hypertension to spinal manipulation: case study” Keep in mind that title of articles average between 8 and 9 words in length.
Introduction – The introduction is where we convey case study to the reader. It is useful to begin by placing the study in a historical or social context. If there is something especially challenging about the diagnosis or management of the condition that we are describing, now is our chance to bring that out. Introduction doesn’t need to be more than a
few paragraphs long, and the objective is to have the reader understand clearly, but in a general sense, why it is useful for them to be reading about this case. Avoid using jargons specifically in introduction. Introduction should create a dramatic interest.
Company History – Reporting of background should be very selective. It is not the history of the whole organization but a history that relates to the problem or decision. Information about the organization should shed light on the problem.
Industry Profile – Industry profile gives the details of the context within which the organization operates with pressures, threats, laws, information on competitors and other external factors that impact the organization.
Case Problem – First, describe the complaint that brought the situation to you. Next, introduce the important information that is obtained from your research. Also, try to present dilemma information in a narrative
form – full sentences that efficiently summarize the results of questioning. The next step is to describe the results of our clinical examination. Again, we should write in an efficient narrative style, restricting ourselves to the relevant information. It is not necessary to include every detail in our clinical notes. Also, you should describe the actual results, since not all readers will have the same understanding of what constitutes a “positive” or “negative” result. Dilemma is the main problem or the main motive to write up a case so it should be logical, clearly narrated, well structured and very near to reality. It must not be self-created or assumption based. The case must realistically grapple with the problem and appreciate the complexity of decision making in the real world.
Management and Outcome – In this section, we should clearly describe the plan for settlement of the situation and the outcome. It is useful for the reader to know what types of remedial actions have been taken.
Additionally, you should be as specific as possible in describing the remedial action that was used. If some techniques have been used you are required to elaborate clearly those techniques. Remember that people who are not familiar with managerial techniques may read our case study.
Conclusion – Here the problem and options for consideration are restated but the decision point is open for students to resolve. The case should never end with a ‘yes’ or ‘no’ or ‘right’ or ‘wrong’ answer. The conclusion should create tension and suggest options for the readers. Successful cases have no definite conclusions.
References – Only use references that you have read and understood and actually used to support the case study. Use a minimum of six references. The sources should be academic journals located in the UIU library. Also, you may use select business news sources such as Wall Street Journal, Forbes, Fortune 500, Nightly Business Report (NBR) and Business Insider. Finally, you will need to use the corporation’s latest annual report to shareholders.
Introduction
As he stood by his office’s window reviewing the annual reports for the past three years, Dr. Siyoung Choi was drowned in thoughts about the direction that Samsung company would take. In his mind, Siyoung knew that Samsung had to be agile in finding a solution to its current problems. Failure to do so would inhibit the firm’s goal to become the number one smartphone-selling company globally. Besides, delayed action would threaten the firm’s sustainability, considering the significant global macroeconomic variations and consumer behavior changes.
Earlier that afternoon, Siyoung had made a statement to the press about the company’s profit plunge. Notably, Samsung witnessed a 56% profit decline a year earlier following a disruption in its chip business and a weakening in its smartphone sales after complaints of broken screens (“Samsung profits tumble,” 2019). Moreover, the firm’s revenues declined 5% year-after-year to about $53billion (Trefis team, 2019). This profit and revenue decline was one of the worst in three years after the entity faced a similar profit deterioration in 2015. While Samsung was not the only phone manufacturer hit by industrial disruptions, Siyoung knew that an escalation of the situation would significantly affect its future financial reports.
Company History
Samsung is not among the pioneers of mobile technology; however, the firm has worked its way up to become one of the global conglomerates and distributor of smartphones and other electronic devices such as appliances and semiconductors. The entity, which is best known for its smartphones, began as a small export company venturing in the sale of fish and fruits to China in 1938 before joining the electronic industry in 1988 (Park, Alvstam, Dolles & Strom, 2014). While the company’s first mobile phones did not sell as expected, Samsung continued to innovate and improve its products. In 2002, the corporation manufactured the pebble-like design, which sold about 10 million units (Madani, Abdulai, Koosawangsri & Ha, 2014). This sale was one of the most significant company’s breakthroughs in the mobile phone industry.
Since 2002, Samsung diversified its product portfolio to include other electronic devices. For example, in 2005, the entity ventured into the production of TV sets, which was seen as a high-risk business by the board of directors because of the high technological barriers and rivalry from industry leaders such as Sony (Park, Alvstam, Dolles & Strom, 2014). Nevertheless, after the chairman’s intervention, the board agreed, and Samsung invested in manufacturing the private households. By 2012, Samsung had generated $248 billion worth of revenue and was ranked 20th in the Fortune Global 500 list (Park, Alvstam, Dolles & Strom, 2014). Samsung’s high revenue generation mainly stemmed from its product diversification and sale of innovative and efficient electronic devices.
Unfortunately, two years after enjoying steady growth in sales, Samsung experienced a sharp decline in its quarterly profit. In 2014, the corporation witnessed a 6% profit decline (“Samsung electronics,” 2014). Industrial experts partly attributed this decline to a lag in smartphone sales and growing competition from Apple. Notably, consumers became more inclined to buy the new iPhones, leading to Samsung’s cash cow’s slow movement.
Four years later, Samsung was hit by another profit decline that threatened its operations. The company’s annual report showed a sharp decrease in profits from approximately $38billion to $18 billion (“Consolidated financial statement,” 2019). The corporation also attributed the profit decline to reduced sales of its smartphones and the unprecedented industrial slowdown that disrupted the chip business, and subsequent price falls. Notably, Samsung sourced the key materials required in the manufacturing of memory chips from Japanese suppliers. However, with the ongoing trade dispute between Seoul and Tokyo, Samsung’s chip business was disrupted as it could not import the required raw materials.
As Samsung’s expected launch of its foldable smartphone neared, Siyuong was still unsure whether its situation would improve. A lot was at stake, including a further decline in the shareholder’s equity, company profits, and revenues. Besides, without a proper recovery strategy, Samsung risked experiencing fierce rivalry from competitors such as Huawei.
Industry Profile
Smartphone industry
The smartphone industry has benefitted significantly from the growth of the market for internet-enabled devices. Studies show that by the second quarter of 2013, the global mobile phone sales grew by 3.6% to 435 million (Cecere, Corrocher & Battaglia, 2014). This figure was relatively high than any other essential handset that has been in the industry for a while.
Besides the market growth, the smartphone industry has also witnessed competition growth between incumbents and new market players. For example, Cecere, Corrocher, and Battaglia (2014) posit that since Samsung released the Samsung Instinct and Apple developed the first iPhone, competition and legal battles over patents and designs have grown significantly. Samsung has also been in stiff competition with Huawei, a China-based smartphone manufacturer, and distributor. In essence, the smartphone market’s considerable growth has triggered fierce competition as industrial participants strive to secure a significant market share in the industry.
Furthermore, the smartphone industry has witnessed repeat declines in sales in some years. For example, this market experienced a drastic decrease in sales following the 2001 and 2008 financial crisis. Moreover, the shipment of new devices fell by 38% year on year, according to research by strategy analytics (Nair, 2020). Nevertheless, most of these sales decline results from seasonal changes, explaining why smartphone sales recover with almost double-digit growth after a decline.
Memory Chip Industry
Memory chips are also among Samsung’s primary source of earnings. Over the years, the market for memory chips has grown considerably due to the tremendous growth of the electronics industry. Notably, memory chips are used in a wide range of electronic devices such as smartphones and laptops. Therefore, the growth in the electronic industry accounts for the rise in the demand for memory chips. According to a PRNewswire report, the market for memory chips is forecasted to grow between 2019 and 2024 (Research and Markets, 2020). Furthermore, these chips’ prices are expected to rise in the coming years after remaining relatively low for about one year (Choudhury, 2019). Memory chip manufacturers such as Samsung are likely to benefit from the tremendous growth in the market and memory chip prices.
Threats
Despite the growth in the market for memory chips, there have been substantial threats to manufacturing these devices in firms such as Samsung due to regulatory changes. Choudhury (2019) notes that the ongoing trade dispute is likely to disrupt Samsung’s memory chip supply as its core suppliers are located in Japan. Arguably, with the ongoing trade disputes between the two countries, Samsung may lack the raw materials required to manufacture memory chips and smartphone displays.
Case Problem
The primary problem that brought Samsung’s case to the spotlight is the high expectations of launching its new Samsung phone, which was brought to a halt by complaints about broken screens. According to news reports, the defects in the device were an embarrassment to a firm that was already experiencing a sales decline and increased competition from its rivals (“Samsung profits tumble,” 2019). The decrease in the company’s second-quarter profits also brought Samsung’s internal and external issues to the limelight.
Samsung was in a dilemma about the next steps it should take. The ongoing trade disputes between South Korea and Japan were already a significant threat to its memory chip inventory. Samsung could seek alternative sources of raw materials from other countries. However, Japanese suppliers remained the most economical market because of their geographical proximity with South Korea. Alternatively, Samsung could offset its profits plunge by launching its foldable smartphones. Unfortunately, this new product’s initial launch had already begun on shaky ground following complaints about the broken screens; thus, there probably remained uncertainty about the reception and sale units from the smartphone. Besides tensions in the business areas, Samsung also faced challenges from the global macroeconomic environment (“Samsung profits tumble,” 2019). Notably, the prices of memory chips were expected to rise following the trade disruptions between Japan and Seoul. These economic changes posed a dilemma on whether Samsung was ready to shift to other suppliers, considering potential issues of price and quality.
Management and Outcome
Despite the glaring challenges facing Samsung, the company was swift in implementing key strategies to improve the situation. Among the visible tactics that Samsung employed were capitalizing on the mobile OLED screen to strengthen the sale of its flagship phone, the Galaxy Note 10 and Galaxy A series (Regan & Pham, 2019). The firm improved its foldable smartphone to make it more efficient and offset the broken screens’ initial complaints. Reports show that Samsung’s improved smartphone business enhanced its operating profit by 32% from the previous year (Regan & Pham, 2019). This figure was a significant indication that Samsung’s decision to leverage the mobile OLED screen yielded positive outcomes.
Besides improving its mobile devices, Samsung also capitalized on Huawei’s issues, one of its closest competitors, to increase smartphone sales. Reports show that Huawei was experiencing challenges in launching its flagship phone after the US imposed a ban that prohibited US companies from selling vital tech and components to Chinese tech giants (Regan & Pham, 2019). This ban led to the production of a less attractive phone that lacked critical features required by consumers, such as Google services and YouTube. Therefore, Samsung capitalized on Huawei’s-Us problems to position itself as a better alternative among retailers and other operators (Regan & Pham, 2019). This tactic enabled Samsung to improve its smartphone sales, which contributed significantly to its earnings.
Conclusion
Even as Samsung’s smartphone sales improved, the memory chip segment, a significant contributor to its earnings, was faced with several uncertainties. Would the smartphone sales sustain the company’s profits considering the seasonal changes in purchases? Still, would it be sustainable for Samsung to begin sourcing raw materials to manufacture memory chips from other suppliers? How long would it take to select suppliers that met Samsung’s quality standards? Would it be profitable to source raw materials from distant suppliers considering the forecasted rise in the chip’s prices? Siyoung had several thoughts as he prepared for the next brief on the company’s direction. He knew that although the smartphone industry was the firm’s primary cash cow, Samsung needed to boost its earnings by improving its inventory and sale in other product portfolios.
References
“Consolidated financial statements of Samsung electronics Co., LTD. and its subsidiaries index to financial statements” (2019). Samsung. Retrieved from https://images.samsung.com/is/content/samsung/assets/global/ir/docs/2019_con_quarter04_all.pdf
“Samsung profits tumble as it warns of ‘challenges’ ahead” (2019, July 31). BBC. Retrieved from https://www.bbc.com/news/business-49173984
Cecere, G., Corrocher, N., & Battaglia, R.D. (2014). Innovation and competition in the smartphone industry: Is there a dominant design? Telecommunication, 39(3-4), 1-14. doi: 10.1016/j.telpol.2014.07.002
Choudhury, S.R. (2019, July 31). Japan-South Korea dispute may be good news for memory chip prices. CNBC. Retrieved from https://www.cnbc.com/2019/08/01/japan-south-korea-dispute-memory-chip-prices-could-rise.html
Madani, F., Abdulai, M., Koosawangsri, R., & Ha, J. (2014). Samsung’s innovation strategy in smart phones market. SSRN Electronic Journal, 1(1), 1-23. doi: 10.2139/ssrn.3023595
Nair, B. (2020, May 19). How the decline in new smartphone sales is impacting the pre-owned device market. Forbes. Retrieved from https://www.forbes.com/sites/forbestechcouncil/2020/05/19/how-the-decline-in-new-smartphone-sales-is-impacting-the-pre-owned-device-market/?sh=2ec4dbed1b49
Park, S., Alvstam, C.G., Dolles, H., & Strom, P. (2014). Samsung electronics: From ‘national champion’ to ‘global leader’. In: Alvstam, C.G., Dolles, H., & Strom, P. (eds) Asian inward and outward FDI. Palgrave Macmillan Asian Business Series. London: Palgrave Macmillan. doi:10.1057/9781137312211_9
Regan, H., & Pham, S. (2019, October 30). Samsung profits plunge 56% but strong smartphone sales offer a boost. CNN. Retrieved from https://edition.cnn.com/2019/10/30/tech/samsung-earnings-q3-profit-intl-hnk/index.html
Research and Markets (2020, April 6). Global memory chip market trends and revenue projections, 2018-2024. PR Newswire. Retrieved from https://www.prnewswire.com/news-releases/global-memory-chip-market-trends–revenue-projections-2018-2024-301035763.html
Trefis Team (2019, November 5). Explaining the decline in Samsung’s Q3 profits. Forbes. Retrieved from https://www.forbes.com/sites/greatspeculations/2019/11/05/explaining-the-decline-in-samsungs-q3-profits/?sh=4191aaf567e1
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