Week 17

Can you think of an organization that has implemented a ‘high risk strategy’?

Investing in a small private business/company is regarded as a high risk strategy.  If there is no proper strategy there is very high possibility of a complete failure.

A company is considered a high risk business based on two conditions. It operates within a high risk industry and risk of financial failure exists. So both of the condition might be applicable.

 If I have to  answer about any organization that has implemented ‘high risk strategy’ that has been successful would be SAMSUNG.

SAMSUNG a globally recognized name was founded by Mr. Lee Byung Chul,  in 1938 in Daegy, South Korea as a small export business has grown to  become one of the world’s leading electronics company. Today Samsung’s innovative and top quality products and processes are world recognized.  Through innovative, reliable products and services; talented people; a responsible approach to business and global citizenship; and collaboration with their partners and customers, Samsung is taking the world in imaginative new directions. (Samsung/US). Being a globally recognized brand it is dedicated in developing innovative technologies and efficient processes that creates new markets and continue to make Samsung a digital leader. (Samsung/US)

Samsung have a very simple philosophy that they follow that is to  devote their talent and also  use their technology to the fullest to create  superior products and services that can be contributed to make a society a globally better one. This is the era  of technology that also a very fast moving one so it has become a necessity for a constant change and new innovations no one can think of surviving in the market with one innovation and then full stop, everyone has to keep in consideration the fact that there should be a consideration for a long term goal for its  successful existence in the competitive market.

Samsungs Electronics vision for the new decade is to ‘’Inspire the world and create the Future’’. (Samsung/US)

In the market of smart phones the Apple Inc has been ruling so far with their I phone series and almost created monopoly with it,  it is not a easy nut crack to come in competition with the Apple itself  and here Samsung took a greater risk with coming with the Samsung galaxy series and boom Samsung galaxy was the biggest hit in Asian market as well as the European market as well, it came up with a user friendly smart phone in a cheaper price then the I phone and was mostly  successful in  diverting I phone’s loyal customers to Samsung  and it was a risk well taken. The strategy a successful one.

Now do the same for an organization who embarked on a high risk strategy that resulted in some sort of failure. Why was it a high risk? Why did it fail bad luck  or poor judgement?

Lloyds bank Plc is a British retail bank with branches across England and Wales. It has traditionally been considered one of the big four clearing banks.  It was originally founded in 1765. In 1995 it merged with the trustee savings bank and traded as Lloyds TSB bank plc from 1999. Lloyds bank has an extensive network of branches and ATM in England and Wales and offers 24 hour telephone and online banking services. As of 2012 is has 16 million personal customers and small business accounts.

As we all know how banks work the more customers they have the more money they generate with it. So in this way Lloyds bank opened accounts of almost everyone be that be students  or others  as for other banks they asked  for  funds verification and many other things but Lloyds made things easier for others, but in the future it definitely strike them with a drawback,  and another  issue is they also offered bank loans, house loans, car loans etc  in  cheaper rate. People were easily granted loans with less stricken checked credit history, so people applied for loans but as in the recession period people were not able to pay back the loans and the bank was in trouble that was the same issue with the credit cards as well. So this is a strategy fail for them, they tried to generate income with it but caught up in more trouble. It can  be regarded as the poor judgement of the organization and also  a poor startegic planning as well  which resulted in the downfall of the Lloyds Tsb.