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Samsung's Flaw

A

Arthur Hanson

Well-known member
Samsung's Win Is South Korea's Loss - Bloomberg View

Corporate structure and culture are core to innovation. A comparison of the culture of Apple and TSM to Samsung may be the determining factor in who wins the innovation game. Something to think about. I have always maintained whether it's a country or company, culture is key. Good finances and good culture are linked as is bad culture and bad finances. Like anything else. cultures can change and adapt if innovation is at their heart. In tech, acceptance of failure is key, for that is what makes an inquisitive mind that will try new paths.
 
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Is this a Samsung culture issue or the culture of South Korea business in general? In traveling the world I have experienced many different business cultural norms. For example, I have worked with a dozen or more different foundries around the world for the past 20+ years and have found them to be very different even though they are in the same business. Who is to say one is good or bad, right or wrong? I do agree that cultures change and adapt and doing business on an international scale is a main driver, absolutely.
 
When looking at statistics, the top poker players loose more hands than they win, and the losers win more hands than they loose. It's all about risk management and going after the large wins. I maintain, just like poker, the one who can manage risk and when they see failure they fold early and when they feel they are winning, up the ante. In short the more one experiments and uses failure as a learning tool, the faster and farther one advances. Since failure is counter intuitive, it takes a special talent to work with, embrace and fully understand. I have notices some cultures think in steps and others in leaps. I know of very good engineers on both ends of this, but have found the very best have an intuition that allows them to think in leaps. Another trait I have noticed is rigidity in procedure and strategy being the first steps to decline. Just my personal observation.
 
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Arthur Hanson said:
Samsung's Win Is South Korea's Loss - Bloomberg View

Corporate structure and culture are core to innovation. A comparison of the culture of Apple and TSM to Samsung may be the determining factor in who wins the innovation game. Something to think about. I have always maintained whether it's a country or company, culture is key. Good finances and good culture are linked as is bad culture and bad finances. Like anything else. cultures can change and adapt if innovation is at their heart. In tech, acceptance of failure is key, for that is what makes an inquisitive mind that will try new paths.
Click to expand...

Arthur, one might argue that based on your rule Samsung's culture is superior. They obviously created way more technical innovation than Apple. Apple does make more money but seemingly it has rather little to do with the technical merits.
 
lillo777, First, thank you for adding to the discussion, an open forum is key to making the SemiWiki community the valuable resource it is.
I disagree with you on innovation. Both Apple and Samsung are great companies. Samsung makes great products, but they did set up an engineering team that copied much from Apple, both tangible and intangible. They are an excellent, top rated manufacturer, otherwise Apple would not have used them in the first place to make a flagship product. Apple has created something Samsung could not create, a long lasting and durable ecosystem that really started to dominate with the Ipod which was built on the intuitive operating system that Apple started with their computers. Many, many companies can build great products, but very few can create a world wide successful ecosystem and continue to build on it over years. That is the hardest form of innovation that only a handful of companies have created (Microsoft, Facebook, Google among others). This is something Samsung has failed at. I consider Samsung one of the best producers of products, but not a leading edge innovator in consumer products. They have yet to build a world wide, long lasting ecosystem and that is what has become the most important part of a world wide business. An ecosystem is the ultimate success of creating a culture, the rest are just things. SemiWiki is an ideal example of creating a culture and I expect we will see it develop, evolve and grow, making the world a better place in the process.
 
Would not it be incorrect to limit the definition of innovation to only consumer products? How about the Samsung's ecosystem for other companies? With their manufacturing, technological and design prowess (top of the line process, component design etc.) they make it possible for Apple to build those consumer products. Besides there is nothing inherently superior about creating a vertically integrated ecosystem. Ecosystem created as a result of cooperation between many companies (Google, Microsoft, Samsung, LG etc.) might be a much better thing. Admittedly I am not a fan of Apple and I do not share the admiration for their ecosystem. Ecosystem which until recently had just one phone model (it's two now but those differ only by size - no models with SD card, no rigid models, no models with replaceable batteries or a not pay-limited NFC etc.) and which does not have a real desktop computer does not impress me. The limitations are too severe in this ecosystem.

Also, it's really difficult to quantify the innovation. Perhaps the only available metric is the number of patents and we all know that Samsung is far ahead of Apple in this department.
 
I just want to add that as an engineer in semiconductor/computer industry I do not appreciate the fact that Apple generally refuses to cooperate with other companies in the field. If other companies had the same attitude the technological progress would not be as fast as we have it now.
 
lillo777, I agree and stated that Samsung is a top level manufacturer with an ecosystem. But that ecosystem is far smaller economically and socially than Apple's. As far as semiconductors, I feel TSM is much more of an ecosystem company than Samsung. They as far as I know never made an attempt to steal technology as Samsung did when they set up a parallel engineering team. For reference I have an LG phone and Asus computer (also 2 Toshibas and 2 Lenovos that are now old). Setting up a world wide network/ecosystem is far more difficult and chancy than building a semi or consumer product. When multiple cultures, countries and political systems can be joined by a single companies ecosystem, it's a rare accomplishment and to maintain it over years is even rarer. I have never had an Apple product or stock (unfortunately) so I have no bias there. I feel TSM is a superior foundry and ecosystem to Samsung, even though the lead will go back and forth. Even so, TSM has a wider customer base and produces a greater array of semis. To try and compare Samsung, Apple, TSM and others is like trying to compare Apples (joke) to bananas to oranges to vegetables, all different in fundamentals and applications. PS I should have mentioned I have a long term holding in TSM.
 
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