What Makes Samsung Such An Innovative Company?
There are critics of Samsung who argue that its success is mostly due to copying and then tweaking the innovations of others. There is a good deal of truth in this, especially around the early Galaxy designs.
But Samsung is a global leader in screen technology, TVs, batteries, and chip design. So in terms of innovation it is doing a lot right. But we know very little about how.
We know how its competitors innovate – we look at Google and see the 20% time, the big adjacencies, the search for disruption, the bold statements about the future of autos, for example.
We know that within Apple when a project gets to a critical stage, the company assigns three teams to its development, each of which competes against the other. We know the importance of design thinking, an attribute Google is learning about. And of customer experience.
What does Samsung do in comparison? How does it line up against these American masters or conversely are Google and Apple good enough to compete against Samsung?
There’s no doubt that patent circumvention is an aim when Samsung innovates. From its early forays into innovation, competing against Toshiba in washing and drying machines, Samsung has chased patents in areas where its competitors appear to have protection and has oriented its innovation efforts to find new patentable ideas in its competitors’ backyard.
Samsung has nurtured a close relationship with the Russian Academy of Science since then. There is a framework agreement between the two parties. And the Korean Government has its own agreement under which it funds Korean small businesses to develop projects on the back of Academy research. Samsung meanwhile appears to help the Academy to increase its patent count and to exploit its inventions.
The relationship with Russian science was the introduction of TRIZ, an innovation method that Samsung adopted from 2000 onwards but which only reached American companies from the mid-2000s onwards.
TRIZ is a methodology for systematic problem solving. Typical of its origins in Russia, it asks users to seek the contradictions in current technological conditions and customer needs and to imagine an ideal state that innovation should drive towards.
Samsung had early successes with TRIZ, saving over $100 million in its first few projects. It was also adopting Six Sigma at the time.
But it was TRIZ that became the bedrock of innovation at Samsung. And it was introduced at Samsung by Russian engineers whom Samsung had hired into its Seoul Labs in the early 2000s.
In 2003 TRIZ led to 50 new patents for Samsung and in 2004 one project alone, a DVD pick-up innovation, saved Samsung over $100 million. TRIZ is now an obligatory skill set if you want to advance within Samsung.
At the Samsung Advanced Institute for Technology, Hyo June Kim, who wrote The Theory of Inventive Problem Solving, a foundation text on TRIZ published in Korean, trained over 1,000 engineers across Samsung companies in 2004 alone.
At Samsung even the subsidiary CEO has to take TRIZ training. From looking at the various presentations I estimate that engineers get about 15 days of training plus 7 days specific project work. That’s quite an investment in method and people.
So the answer to why Samsung is so innovative – with at least two major product announcements this month – is that it is heavily invested in its people, it goes in search of special talent wherever it can find it, but specifically made astute moves into Russia early on; it targets its innovations towards specific competitors and patents that it wants to overhaul (as Apple did under Jobs); and it has an innovation culture based on extensive training, repeatable methodology and creative elite formation, backed by the highest levels of management.