What recommendation would you make to Chairman Lee regarding Samsung`s response to the threat of large-scale Chinese entry as of 2014?

                   Samsung Electronics have dominated the DRAM market since in the 1980s. Their advantage and core competencies derive from its work conditions where their weekly schedule consisted of Monday-Tuesday-Wednesday-Thursday-Friday-Friday-Friday[1]. Also, unlike Japanese, German & US companies, they can achieve their goals through intensive capital supply and incisive R&D. But their core competencies have one weakness, ‘inimitable’. Core competencies with the value & rareness can give companies a strength but just temporarily without inimitability. Chinese entry with more larger capital supply may harm Samsung Electronics`s profit and finally will catch up Samsung`s technology. Also they have abundant demand for DRAM made by Chinese company and it`ll make Chinese company to easily compete with Samsung Electronics`s chicken game. So, how will it be possible to response to the threat of Chinese entry? It should make the entry barrier in DRAM market.

                  Apple`s innovation is not derived from its intensive capital supply or incessant working labor. They just re-created the market structure and shouted to the consumer to follow. When nobody thought of the personal computer, Apple made it. When every company thought of analogue cell phone market, they pioneered the smart phone market. The memory business including DRAM market was originally designed by the Intel which now don`t participate in the DRAM market. Intel didn`t created the DRAM in optimal way but their own way. And also Samsung Electronics can also do in another way. Applicable but more efficient or market-breaking innovation can be attainable with the new DRAM market pioneering.

                  Creating the entry barrier through developing the new market have weaknesses. First, developing also possible in another companies including Chinese. So, Samsung Electronics`s should use its whole competencies to pioneering. Second, if they failed to make the new market it`ll severely damage the Samsung Electronics`s profit. Sony failed to make VCR market monopolistic to their way. And it also harmed their profit with their reputation as a leading electronics company.

[1] Samsung, Semiconductor Stories Series #43: July 20, 2004, http://www.sec.co.kr/index.jsp.