Samsung To Introspect Post Galaxy Note 7 Debacle: CEO
It is now well documented, that Samsung landed in plenty of soup with the rather inflammable Galaxy Note 7 phablet, which it expected to perform well with its features. But with the explosions taking place ever so frequently on a worldwide scale, it spelt doom for the company, and it currently has gone into an introspection mood. Samsung CEO Kwon Oh-Hyun conveyed in a speech delivered at an event held to celebrate Samsung Electronics’ 47th anniversary that the company will now focus on more internal monitoring in order to improve its crisis management operations. [Read the full story here]
The CEO‘s speech was meant to urge executives to make systematic changes on Samsung’s traditional way of doing business, and managing the organization.
He said, “We have a long history of overcoming crises. Let us use this crisis as a chance to make another leap by re-examining and thoroughly improving how we work, how we think about innovation and our perspective of our customers.” While subjective, his words could well point towards serious corporate correction measures in order to ensure, that all those linked to the Note 7 debacle, will indeed be pushed out of the Samsung eco-system.
Samsung loss in terms of brand value and consumer trust is practically immense. Branding Brand surveys indicated that out of 1,000 surveyed consumers, post the Note 7 fiasco, nearly one-third or around 34% said that they would not buy any other product from the brand. This is outlined by the fact that a World Economic Forum and survey showed at 3/5th of CEOs believed that brand reputation represented as much as 40% of their entire market capitalization, which implies how sensitive a zone Samsung has been hit with the Note 7 disaster.
An S&P Global report pointed to the fact that the company would need to cut its 3rd quarter 2016 revenue estimates by as much as $2.3 billion, and a loss of another $3 billion in operating profits is also foreseen over the next few quarters due to the Note 7 issue. So, the brand and consumer trust loss is showing up in the accounting books too.
There are reports that the company has rightfully launched an internal investigation as to what and how things went wrong with the explosive, and it does point to the fact that they are indeed sincere in their approach to the problem. What it will result in finally, would be tough to forecast, but the expected can be news worthy changes in the corporate setup of the organizations, which has typically ridden on consumer trust and reputation.
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