Samsung: The Internet of Things (Simplified Chinese version)
(8 pages of text)
Case (Pub Mat)
In 2014, the Internet of things (IoT) was still considered in its infancy stage. Over the next two years, the IoT matured and represented a considerable amount of uncertainty for the entire electronics industry. In 2016, the industry was at an inflection point regarding the technology, and its largest competitors had to make a choice: risk investing in research and development for a potential return (or failure), or stay the course and let competitors assume the risk. The chief executive officer of Samsung Electronics Co. Ltd. (Samsung), Boo-Keun Yoon, was in a position to take a stand in regard to the IoT and invest US$1.2 billion, which could have a major impact on the company’s future. It was up to Yoon to decide.
This case is suitable for business technology courses at the undergraduate- and graduate-level. The case can be used in a variety of topics related to the market entry of new or emerging technologies and the disruption in an industry caused by a new technology. Specifically, the case is suitable for discussions on a major global business deciding whether to adopt IoT technology as well as the dilemma of whether to increase or lower research and development investment in a new technology. After working through the case and assignment questions, students will be able to do the following:
- Analyze the reasoning required when making new research and development investments as a technology company.
- Recognize the complexities that exist for a giant industry incumbent trying to innovate and compete with smaller, nimbler start-ups.
- Understand the IoT and what large-scale implications it represents for consumers and businesses.
- Analyze how and why technology firms try to employ platform strategies.
- Understand and apply the concepts behind “escalation of commitment” and the “sunk cost fallacy”—two major issues in the technology industry.
- Analyze the technology industry and its inherent fast-paced competitive dynamics.
- Identify and recognize the issues that arise when trying to develop a new technology as a business in an increasingly technologically dependent world.
Information, Media & Telecommunications
South Korea, Large, 2016
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