The Globalization Patterns of Multinational Enterprises: The Case of Samsung Electronics into Emerging Markets

The Globalization Patterns of Multinational Enterprises: The Case of Samsung Electronics into Emerging Markets

Multinational enterprises (MNEs) can be classified into 3 generations. The first generation includes MNEs from North America, Europe and Japan. The MNEs from North America and Europe advent after the second industrial revolution of the late 19th century, and MNEs from Japan joined the first generation after the early 1970s (Chandler, 1990; Kindleberger, 1969). The first generationMNEs expanded their businesses globally based on the exploitation of their intangible assets such as higher technologies, brand and management know-how. The second generation MNEs are from Asian Tiger economies based onthe industrialization during the 1960s and 1970s (Lall, 1983; Kumar & Mcleod, 1981). The major motive of globalization of the second generationMNEs was to reduce production costs, and their global expansions were stimulated by their governments (push factor) to overcome domestic market saturation. The third generation MNEs are newly introduced MNEs from emerging markets from the 1990s (Yeung, 1994). Even though these third generation MNEs did not have more technological advances, brand and management know-how than those of the first and second generation MNEs, their corporate governance based on government supportsand family orientations could be major impetus to become competitive global players. Based on the case study of Samsung Electronics Company’s globalization strategy, we conclude that some of the major reasons for the success of Samsung Electronics Company could be the development of a strong network between productionsin emerging economies, and sales in developed economies. Also, we can assume that the globalization strategies of the third generation MNEs seem to implement Samsung Electronics Company’s strategies of the 1990s and 2000s simultaneously. As a result, the key point to make a successful story just like SEC’s is how much and rapidly the MNEs internalize the acquired technologies and management know-how from the outside.