Signed 1. Samsung Note 7 collected from

Signed declaration

 

I
declare that this whole work is my own work and all data and information collected
from websites and other sources have been referenced.  

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Tutor:
Dr. Anna C. Bocar   

Model:
GHL4010

Date:31/12/2017

 Sign:

 

 

 

 

 

 

 

 

 

 

 

Acknowledgment

First of all, I would like to thanks all people who stand by my
side and helped me through the process of this assessment. Many thanks for my
colleges and my doctors for letting me understand the concept and the ways to
complete all my works on time.                                                            

Therefore, I am so grateful for every moment I has spent it with Dr.
Anna C. Bocar. Honestly she is a great person I
have ever met in whole my life. Special thanks for her for guide me to the
right way till the end.                                                                                                                          
                   

Narjis Saed Al Abd Al-Hajri                                                         

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Table of Contents
Signed declaration. 1
Acknowledgment 2
List of Figure and Table. 4
Introduction: 5
Discussion: 6
Recommendation: 13
Conclusion: 13
Appendix  14
Symbol 14
Meaning  14
mm   14
1000m   14
Inches  14
2.5 cm   14
Pixels  14
mAh  14
Milliampere hour, unit of
electrical charge used to describe the capacity of small batteries. 14
GB  14
Gigabyte, Unit of measuring
data storage capacity. 14
$(1USD) 14
0.3845OMR  14
Saudi Rial 14
9.75OMR  14
References: 15
 

 

 

List of Figure and
Table  

 

Figure 1. Samsung
Note 7 collected from the customer. 8

Figure 2. Arid
Gonzales Phone’s. 10

Table 1. list of
symbols with their meaning. 13

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Introduction:

 Samsung Electronics Company limited is a
multinational electronic firm. Samsung is one of the world’s largest
manufacturers of electronics. It combines the craftsmanship of traditional
manufacturing because of its high quality and low-cost products to suit all
living standards so, this are the reasons of expanding worldwide and increasing
its market share.

 Samsung started in 1938 by its founder Lee Byung-chull in Daegu,
Korea. Then it moved to Seoul for further expansion (Head quarter). In the early years the company dealt with noodles
and groceries in its business and from 1950 to 1960 it did other works such as
textiles and insurance. In the beginning of 1970s it entered the e-business and
produced a black and white television. Then it entered the petrochemical sector
such as refrigerators, small ovens and washing machines. In the 1980s, Samsung
began producing air conditioners and color televisions, video recorders and
personal computers. This means the company began to producing home equipment. In
the 1990s it began to produce phones. Samsung become the biggest company in the
world which it does many things not only electronic things.

 Samsung Products: Consumer
electronics, apparel, telecommunications equipment, medical equipment,
electronic components, ships, semi-conductors, precision instruments and
chemicals.  The subsidiaries of Samsung
are (Electronics, Life Insurance, Fire & Marine Insurance, Heavy Industries,
C&T, SDS and Motors (Renault-Samsung Motors cars division) etc.

 As considering that Samsung is a global
company, it has faced challenges and problems. From these challenges the
company learned more and make more research. In this research, we will review
the company’s problem in manufacturing defect in Galaxy Note 7.

The objectives
of this study are:

1.     
To Review the problem that Samsung has encountered.

2.     
To view the solutions and plan that Samsung has taken
to solve the problem.

3.     
To show the implications of the problem.

 

Discussion:

Globalization
is the important factors that allow the world to be like a small village. However,
because of the globalization the income of developing countries has increase
and it create new consumer market (Berger. S, 2007). Furthermore, because of the globalization
the income of developing countries has increase and it create new consumer
market. In addition, this in turn enhances production and increases research
and development, which leads to increased skills and value for enterprises.
Hence, multinational companies have begun
to move production from the mother country to other countries for expansion.

 According to the Shyam Soni (2011) define the
multinational companies as characterized by sophisticated technology that has
helped them spend a lot of money on development and research”. He adds “The
fact that these companies have accumulated capital has led to spending on
ongoing developments so that companies consider this spending a type of
investment”. According to the United Nations, the multinational company was
defined as “an enterprise that controls or owns the service or production
facilities outside the country in which it operates”.

 Samsung is also the multinational company or
corporation and it as other companies seeking to provide the best and quality
products for customers. However, it is looking for what is new and innovative
in the world of electronics. Furthermore, as many companies Samsung tries to
satisfy its customers. Samsung has many features which are make it universal
and inter the market. These features are:

·        
The brand is universally recognized.

·        
It has a good reputation in the market.

·        
Distinguish its production by low cost products with
high quality and better output.

·        
Samsung devices can be integrated with various
software.  

·        
Production of spare parts for high quality equipment.
This is excellent engineering in the company.

·        
It has innovative designs in electronics.

·        
The company focuses on environmental protection in its
products.

·        
It has the largest share in the phone market and is in
second place in the smart phone market.

·        
It has a high promotion strategy in product marketing.

For these
reasons Samsung has consumer confidence and it earned customer satisfaction in
the market. In addition, it is accelerating its products in the market ahead of
its competitors. The most competitors for Samsung are Apple, LG Electronics and
LG Display, Lenovo Group Limited, Intel Corporation, Sony Corporation and
Toshiba Corporation.  Huawei companies is new in term of phone.
Samsung want to be the head for introduce it products. So, on 19th August 2016 Samsung
launched new phone in the market which is the Galaxy Note 7. This phone has
unique specifications and features that were not present in any device. Samsung
wanted to be the first to introduce new features for mobile phones and display
them in the market at high quality and at a price that suits everyone. We will
display the features in the device Galaxy Note 7.

Galaxy Note
7:

This device,
as mentioned above, is one of the devices that Samsung has succeeded in
introducing unique features and characteristics that did not exist in any
device. Galaxy Note 7 is a revolution in the world of technology since its
first appearance because it is characterized by high specifications and
advantages required and desirable, especially those who are interested in the
world of technology and have a passion for the acquisition of the latest version
of phones.

The features
of Galaxy Note 7 are:

The Galaxy
Note 7 is the smart phone and the best phone that Samsung produced in terms of
specifications, especially with new features such as fingerprint, screen
protection against breakage and water and the best camera in pictures and video
compared to other devices. As it is considered a new innovation in the world of
phones and never of its competitors have the same idea.

Size: Samsung has maintained the same size of
the large screen, but the dimensions and distance between the screen and the
edge of the device is currently the dimensions of (153.5 × 73.9 × 7.9) mm. In
addition, the weighs about 169 grams, while the measure and protection of the
screen of Samsung Galaxy Note 7 is measuring 5.7 inches 1440 × 2560 pixels. Supported
with the Gorilla Glass (5) resistor against scratches, intermediate shocks and
breakage, the first phone from a major product line, comes with a curved
screen, flexible sides, giving the phone a unique design.

Battery
capacity: The
capacity of the Galaxy Note 7 battery is 3500mAh with a fast charging feature,
this battery cannot be removed. Samsung supplied its smart phone Galaxy Note 7
with a USB-C express charging port, which enables faster data transfer and
charging. The battery life up to 14 hours.

The capacity
of camera: The Galaxy
Note 7 features a 12-megapixel camera and a 5-megapixel camera with an Exynos 8
Octa processor. Also, it contains of 4 GB random access memory and 64 GB
internal memory with 256 GB memory card.

Exceptional
features: The other
thing that Samsung distinguish is an iris scanning sensor. On the left side of
the earpiece in the Galaxy Note 7 is an iris scanning sensor, and an infrared
beam is used to scan the iris of the user’s owner and thus open the phone, and
is considered the highest level of protection. In addition, this is a feature
invented by Samsung to protect the device from the abusers or when someone
stole a device, the security system in the device requires the scanning of the
cornea and this prevents the thief from opening the device and the use of data
and tampering with it.

Galaxy Note
7 has received the IP68 certificate for resistance from water and dust, which
makes it very distinctive, as it has never been available in any previous
device.

The problem
in Galaxy Note 7:

 According to a
report published by Al-Arabiya newspaper on (3/9/2016) the problem was appeared on September 2016 in
Korea, after a young man reported to the company about the burning of his phone
in the case of charging the battery.  But
the company did not care what the young man said because it’s a single case. In
any case and common sense cannot handle an individual case, which may be due to
bad use by the consumer.

 After that, the company received (35) cases
have been reported globally. Only a very few cases have been registered around
the world and no cases have been recorded in Gulf Arab countries.

 Many countries have a law that protects
consumers from manufacturing defects, and this law defines the product
liability law. The law on product liability
depends on the premise that companies have a duty to protect consumers from
risk. The manufacturers must take care of their knowledge and insight into
their products, so they fall under financial responsibility for the damages and
injuries they cause. The defects in manufacturing are that “the product
comes out of the intended design, although all possible care was exercised in
the preparation and marketing of the product.” That is, the defect is
unintentional and goes beyond the quality and accuracy required. This means
that the product was weak causing damage to the consumer and here the
manufacturer must pay no injuries and the company take full responsibility. Samsung
was forced to withdraw all devices from the market which are affected and
unaffected.  Figure (1) shows the
customers cooperation with the Samsung Company. They were returned their phone
Note 7 after the issue of

the exploding.

Figure 1. Samsung Note 7 collected from the
customer.

 

In the
United States, Samsung withdrew Galaxy Note 7 from the market. The plan was replaced
the phone within two weeks with a new Note 7 unit, or one of the Samsung
versions of the Galaxy S7 or Galaxy S7 Edge with the payment of the price
difference to the user. The user also recovers the cost of accessories for the
Note 7 phone, as well as $ 25 gifts from Samsung.

The company
in Saudi Arabia in cooperation with the Ministry of Commerce and Investment in
Saudi Arabia announced this call to reach the largest number of customers in
the shortest possible time. Saudi Arabia withdrew 6186 devices worth
nearly 18 million Saudi riyals.

In New
Zealand the people decide to use the phone and do not return it back as the
company decided. But the company tack action on it by told them to disconnect
the service in all Galaxy Note7. Which means that cannot send or receive
messages or calls. But they can connect to the Wi-Fi services.

 Samsung in Oman also withdrew the phone from
the market. According to the Consumer Protection Law of the Sultanate of Oman,
which was issued in accordance with Royal Decree No. (66/2014) Article (25) “The
supplier is obliged to retrieve, refund, replace or repair the item with free without
any charge, in the event that the consumer finds fault in it”. Pursuant to
Article (27) “the supplier immediately when they discover any defect in the
products or services that harm the consumer or his funds, they immediately
stopping the circulation of the goods or providing the service, and informing
consumers who bought, and the parties concerned shall promptly report such
defect and withdraw the item goods from the market immediately, as set forth in
the Regulations”.

The real
problem was the defect in the phone battery (Explosion in the phone). Which means the phone heat
starts to rise at the start of charging, or reaches the battery explosion in
some cases. This is sometimes due to high battery temperature due to the fast
charging feature, which results in faster and higher heat in the batteries. However,
overcharging during charging also increases heat in the batteries.

The cause of
problem is irregularly sized batteries which lead to overheating. And because
of manufacturing problems when they replace the batteries that were rush out.
The Samsung made the battery with thin layer by removing the thickness margin.
The separator between positive and negative layer is too thin, usually around
10 percent extra space is required. This thin layer lead to increase the chance
of element touching and produce heat. Figure (1) shows Arid Gonzales phone’s,
he has shared this burned phone to the YouTubers to advise them and to tack
care of them self and returned there phone immediately to the company.

Figure 2. Arid Gonzales Phone’s.

Samsung
explained that not all devices have a defect in manufacturing. That is the
proportion of phones facing the problem is small compared to the percentage of
units sold.   However, Samsung has confirmed the withdrawal of all devices
from the markets.    

The actions
Samsung has taken to resolve the problem:

Because its
global, Samsung does not want to gain a bad reputation in the market and also does
not want to lose its customers. Because Samsung want to retain its reputation
in the market, it did the following things to solve its problem:

1.     
Samsung stopped sales Galaxy Note 7.

2.     
Samsung has withdrawn all devices out of the market
from all 10 countries where phones are sold.

3.     
Samsung replace all phones sold to customers and
retailers of this model.

4.     
Samsung provide alternative equipment to those that
are sold.

The
implications of that problem:

The company provided
the product in ten countries including China. The company was forced to
withdraw its phones which led to several implications to the company:

1.     
The cost of replacing phones is large so it sold 2.5
million devices of this kind to customers.

2.     
The Company incurred significant financial losses the loss
is estimated at 7 million dollars.

3.     
Samsung’s market cap declined, causing the company to
postpone charging additional shipments from the phone, in order to conduct
quality inspection and control.

4.     
Samsung lost the trust of its customers.

5.     
Consumers bought iPhone.

6.     
Loss reputation.   

One of
Samsung’s most significant losses is the decision by several airlines around
the world, which is not allow its passengers to use Galaxy Note 7 on board
flights. Among the airlines that prevented carrying the device are American
Airlines and Tunisian Airlines. These airlines want to prevent its passengers
from carrying the Samsung device in order to keep them safe from the explosion.

On the other
hand, a week after the problem, Apple introduced its new iPhone 7 in the
market, which made Samsung in real trouble as expert’s fear customers are going
to buy iPhone. This reflected negatively on the company’s reputation.

Because the
problems caused from the battery, which must it observe it before, Samsung was
treated that by resizing the battery capacity from 3500 mAh to 3000 -3200 mAh
compared to the Galaxy S6 phone, which has 2600 mAh battery capacity. 

Samsung
wanted to be the first electronics company to introduce a new device in the
market before its competitors in order to win the market, but what happened is
the opposite, the speed of the offer sometimes loses its sweetness.

Recommendation:

1.     
Samsung was supposed to conduct a quality test for the
goods before it introduced the phone to the market. After designing the phone,
Samsung could be matching the products by applying quality control techniques.

2.     
All manufacturers should not rush to put their
products on the market before conducting an experimental test of the product. The
rush gives an opportunity to competitors especially when there is a defect in
the product and also can gain bad reputation.

 

Conclusion:

Multinational
companies aiming to expand and increase their investment in other countries and
the mother country in order to raise the level of income in the country. It
also contributes significantly to the production of goods and services suitable
for all countries after studying the culture of that country and studying its
economy. 

Samsung
still has strong reputation. it does not lose it reputation in the market
because its respects the consumers and protect them. It has not avoided itself
from the responsibility in its products, but has faced the problem with great
wisdom and strategy despite losing billions of dollars. Samsung still looking
forward to everything new in the world of technology and its vision 2020 is
“Inspire the World, Create the Future”, Samsung website.

Creating
laws that protect consumers is right. Because the laws aim to protect consumers
from the damage and risks that may occur to him by the manufacturers.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Appendix

Table 1. list of symbols with their meaning

Symbol

Meaning

mm

1000m

Inches

2.5 cm

Pixels

 

mAh

Milliampere hour, unit of
electrical charge used to describe the capacity of small batteries 

GB

Gigabyte, Unit of
measuring data storage capacity

$(1USD)

0.3845OMR

Saudi Rial

9.75OMR

 

·        
Number of Words: 2980.

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