Family leadership challenges: Disrupting the momentum at Samsung
Samsung is a Korean conglomerate (or chaebol) founded in 1938. Once a sole trading company, it has grown into a myriad of companies generating over $380 billion globally in industries as varied as construction, semiconductors, shipbuilding, banking and entertainment. Like most Korean conglomerates, an unusual feature of Samsung is that it has no overarching holding company; it is a constellation of companies sharing a common name and tightly interwoven cross-ownership ties. This ownership structure allows the third-generation descendant of the family business, Jae-Yong Lee, to control the conglomerate with shares in only a few affiliates. The case focuses on three pivotal moments of the Lee family’s leadership of the Samsung Group: the leadership transmission from the founder Byung-Chul to the second generation; the hospitalization of the visionary leader Kun-Hee and the succession to the third generation; and Jae-Yong’s arrest and later conviction, causing a leadership vacuum within the group.
The case describes multiple events throughout the company’s 80-year history and illustrates diverse aspects of a family business.
It also presents an interesting account of the business, economic, political and social development of South Korea since 1930s.
The instructor can use the case to provide real examples of some or all of the following topics: the role of vision in business, family business succession, and ethical leadership.
Samsung Electronics, Electric and Electronic Equipment
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