Can Samsung Think Like a Startup?

Recently, Samsung announced that, in an effort to foster greater innovation, it was planning to adopt a more flexible culture – and “execute as quickly as a startup.” It wants to become an organization that can respond quickly to market changes, continuously innovate, have more open lines of communication and less top-down decision-making.

To which I say, “Bravo.” Being able to assess your weaknesses and identify a way in which you can correct them is no easy task, but when the weakness is your corporate structure and culture, that task becomes daunting, especially for a traditional, set-in-its-ways company like Samsung. The question then becomes, “What does a 78-year-old startup with a headcount of over 300K look like?”

Samsung would do well to adopt the exponential organization model. I’ve written about it before, and contrary to popular belief, age and size of a corporation are not barriers to embracing the ExO model, so Samsung’s impulse to forego its long-held, regimented structure to allow for fast execution is correct, especially for a technology company. Still, a number of its initiatives – as least as much as Samsung has announced so far – seem focused on quality-of-life issues, like relaxing dress codes, reducing weekend hours and cutting down on required after-work drinking sessions. I think Samsung can go much further.

Acting Like a Startup

Executives may have pledged to sign an agreement to reduce company hierarchy, sure, but Vice Chairman Jay Y. Lee, the son of ailing Samsung Group Chairman Lee Kun-Hee, needs to establish his commitment to the change before he asks anyone else to follow through. Without his taking the lead and showing through his actions that he believes in this shift, change throughout the organization will be limited and fleeting at best. But through modeling the new behavior and showing his team how they will personally benefit from adopting this new and more flexible approach to management, buy-in will be greater and deeper.

Thinking, and acting, like a startup requires more than just buy-in, though. And while a modern workforce probably appreciates not having a strict dress code, the key to thinking like a startup is breaking down the silos that have inevitably been built up during the course of Samsung’s long history. Silos are a natural development for market leaders, but they are also where innovation goes to die. And the company’s major smartphones business has been losing market share due to its traditionally rigid corporate culture.

Startups are the interlopers, the disruptors, the actors questioning the status quo. To operate like one, Samsung needs to turn those silos into more of a public square and open it up to new, different and diverse voices. It’s that diversity of experience among the workforce, and customers, that will uncover the innovations and iterations to keep Samsung at the technological forefront rather than as an also-ran.

Of course, an idea is only as good as an organization’s ability to act on it. For Samsung to shift to an entrepreneurial culture, it will need to encourage collaboration, both across departments and throughout the leadership structure. Knowledge and experience is critical, but it can also lead to blind spots. Bringing together people with complementary expertise will not only broaden each person’s point of view but will also reinvigorate a workforce that may have become complacent.

Finally, and most importantly, Samsung would do well to loosen some of the reins even further than just creating a casual, comfortable environment andflatten its hierarchy as much as possible. An organization this large will still need a solid foundation, but within its more traditional structure it can create avenues through which ideas can flow back and forth rather than just up the chain of command.

Startups are not burdened with a traditional hierarchy. They’re usually lean operations where each person has multiple responsibilities and no voice ever gets so loud as to drown out others. They’re not weighed down by established processes and ways of thinking and can evaluate any idea on its merits rather than on the potential financial risks.

No company survives as long as Samsung has without hitting this critical juncture. It also has long appreciated the need to form strategic partnerships to innovate and collaborate on technology. These are practices Samsung is already familiar with. Its task will be implementing the same collaborative spirit within the organization rather than just using it for its partners. Maybe that’s the path through which an older, global organization learns to think like a startup.


This article first appeared on Keith’s Linkedin blog. To get the latest from Keith, follow him on Facebook, Twitter, and YouTube.

Image courtesy of Pixabay.

Keith Ferrazzi

Keith Ferrazzi


New York Times best-selling author, speaker

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