Samsung
A product feature launch that requires one meeting at a startup requires 20 weeks at Samsung - not bureaucracy, just physics.
Samsung is a $240 billion conglomerate spanning electronics, shipbuilding, life insurance, theme parks, and hotels - 270,000+ employees operating across fundamentally unrelated businesses. The company demonstrates the square-cube law in pure form: at 10,000 employees, simple structures work; at 100,000, those structures break; at 270,000, coordination costs overwhelm value creation. A product feature launch that requires one meeting at a startup requires 20 weeks at Samsung - not bureaucracy, just physics. Compare Apple: $380 billion revenue with 160,000 employees versus Samsung's $240 billion with 270,000. Apple generates 60% more revenue with 40% fewer people because focus dramatically reduces coordination costs.
In smartphones, Samsung exemplifies K-selection strategy: dozens of models across price points, billions in marketing and manufacturing, long development cycles, economies of scale. This works beautifully in stable, high-margin environments - Apple proves it with 50% of industry profits despite 15% unit share. But when markets fragment or accelerate, Samsung's long development cycles become anchors. Xiaomi's r-selection - cheap experiments, rapid iteration, disposable failures - adapts faster to unstable conditions. Neither strategy is superior; both are environment-dependent.
The lesson: scale and strategy must match environment. Samsung's conglomerate structure makes sense only when synergies exceed coordination costs. They demonstrably don't - Apple's 60% revenue advantage with fewer people proves that focus outperforms diversification at massive scale. K-selection works when markets stabilize; r-selection wins when they fragment. The attributes that make you dominant in one environment make you vulnerable in another. Samsung built for stability; technology markets don't provide it.
Cautionary Notes on Samsung
- Sprawl creates coordination costs exceeding value generation
- 20-week decision cycles for features that take one meeting at startups
Samsung Appears in 6 Chapters
Samsung mentioned as semiconductor competitor whose process knowledge TSMC protects through low employee outbound migration rates.
Competitive protection →Samsung ($240B revenue, 270K+ employees) demonstrates square-cube law: coordination costs scale faster than value creation, product feature launches take 20 weeks versus startup's single meeting.
Scaling limits →Samsung operates as ARM licensee for chip design and as TSMC competitor in semiconductor manufacturing, though with lower market share at advanced nodes.
Semiconductor ecosystem →Samsung as major ASML customer participates in co-development of technology roadmaps and invested in ASML to help fund EUV lithography development.
Technology partnerships →Samsung's K-selection strategy (dozens of models, billions in marketing/manufacturing, long development cycles) works in stable high-margin environments but struggles when markets fragment.
K-selection strategy →Samsung represents K-selection in smartphones: high investment, quality focus, economies of scale. Works when markets stabilize but becomes liability when markets fragment faster than development cycles.
Strategic adaptation →