Samsung Group is a household name in the global business environment. The company was established in the year 1938 to carry out trading activities. The next two decades after the companyâ€™s establishment was characterized by massive growth and diversification. The company diversified to food processing, textile, and insurance services and started exploiting international business opportunities. The company joined the electronics industry in the 1960 and has since then enhanced its presence in this market to be among the worldâ€™s largest vendors of consumer electronics and manufacturer of semiconductors. Samsung later diversified to construction and shipbuilding being a substantial player in these sectors. Companies affiliated with Samsung Group include Samsung Electronics, Samsung Engineering a construction company, Samsung Heavy Industries a shipbuilding company, and Samsung C&T a construction company. These affiliates are recognized globally in their respective sectors. Most of the companyâ€™s revenue comes from Samsung Electronics that is the worldâ€™s second largest ICT Company based on revenue. The companyâ€™s revenue for the year 2017 was 174 billion, and the company employs around 500000 people in its global operations. Samsung exploits both the global market and the international production environments. Although most of the companyâ€™s factories are in South Korea, it has strategic facilities across the globe, especially in Asia. Samsung faces a complex international business environment comprising of factors that determine the opportunities and threats facing multinational companies.
International Business Environment
International environment factors include political, economic, technological, and social-cultural factors. These factors to great extent influence strategies implemented by a multinational company.
The political environment impacts operations of multinational companies. Samsungâ€™s operations are spread worldwide implying that it interacts with many segments of the political environment. The legal environment is a segment of the political environment since laws are made through political processes. Factors of the political environment that affect multinational companies include political stability, business sentiments, legal factor, and relationships among countries. Political instability interferes with business operations which is damaging to profitability. South Korea is a relatively stable country and the government invests heavily in ensuring a supportive business environment. As a result, the companyâ€™s activities in the home country are not disrupted by political dynamics. However, the fact that the company operates in the global economy makes it vulnerable to political instability in other countries. The Arab world has been facing instability in the past one decade. This instability has affected sales in the affected countries adversely. Samsung commands a substantial market share in the Arab countries implying that political turmoil in these countries is reducing sales. Business sentiments in the global environment affect performance. These sentiments are classified into pro-business and anti-business sentiments. Probusiness sentiments are positive statements about a business made by influential political leaders. These statements enhance the companyâ€™s position in the market.
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