Samsung Pushed for Early Note 7-Launch, But Ended in Crisis

Samsung would utilize an iPhone 7-launch without the big news and therefore pressed suppliers to an early launch of Note 7, but it backfired.

How could Samsung go from a garden the perfect competitor right up to the launch of Apple’s iPhone 7 for a short time after to end up in a huge crisis because of faulty batteries? It provides a new report from Bloomberg now insight into media.

According to several sources familiar with Samsung’s time in South Korea, Samsung for attempted to accelerate the launch of Galaxy Note 7, since the management of the South Korean giant last year heard allegations that Apple’s launch of the iPhone 7 would not bring the big news with it.

The Samsung would exploit to steal the headlines with a completely new design and new features such as an iris scanner. Samsung’s desire to speed up the launch should be seen in the light of a close contest between Apple, after iPhone 6 Plus was launched in 2014. Already since reacted Samsung on Apple’s foray in the larger smartphones and accelerated the launch of the next Note 5 from september to august, with success.

Shortly after switched off in the leadership, so Samsung DJ Koh, who previously was responsible for the Galaxy S series, now should stand for the Note series. After having assessed the iPhone 7 not to be groundbreaking, certain Koh, along with several Board Chairmen, to accelerate the launch of Note 7 to 10 days. Thus would the phone be launched the 3. August instead of the 13. August.

Samsung put enormous pressure on its suppliers

This meant that Samsung had to put a huge pressure on all suppliers of components for the top model. From the sources it seems that Samsung’s suppliers were under more pressure than usual, and it meant that the work hours were extended significantly and that there was time to significantly less sleep.

Employees therefore also began sleeping in the workplace to save long journey times, and easier, it was not of that Samsung repeatedly changed their minds about which specifications Note 7 should come with. Also during the three Chuseok-holidays in South Korea, there were no days off.

The enormous pressure from Samsung paid off. Samsung was already ready with prototypes in the period may to august, as telecommunications companies around the world were allowed to test in order to ensure that the signal quality was as desired. Thus was not focused on whether there was a problem with the battery, it sounds.

 

The panic hit Samsung’s leadership

The problems appeared quickly, since Samsung Galaxy Note 7 smoke out in the first shops. When the first user on YouTube showed his burned down Galaxy Note 7, traveled a shock wave throughout the Samsung’s leadership in South Korea. The battery manufacturer Samsung SDI, which owns 20% of Samsung, turned out to be the source of the problem, because it could not cope with the pressure, Samsung had laid.

While Samsung SDI according to management was the culprit, thought Samsung SDI, the error may have arisen elsewhere, either in a design flaw in the phone or with insulation. Samsung, however, nevertheless, took full responsibility for the battery error, which consists in the fact that the 3,500 mAh large battery is a tad too big to fit in your phone, so it has been squeezed together and have thus caused a short circuit inside the battery cells.

“They’ve clearly hit next. They hurried to beat Apple, and they made a mistake, ” said one of the analysts, Anthea Bloombergs Lai.

The error put the alert in the entire Samsung Group, where the 1. September in an internal online bulletin board supposedly is written the following from an engineer: “callback please everyone Note 7 and swap them with new ones. I do not want to have to get my profit-sharing. It’s humiliating, “ he writes, and alludes to terminate his position, if nothing is done about the problem.

It did, as we know, although there are also internally at Samsung was proposed to carry out a free battery replacement instead of a full replacement of the phone. The day after, the 2. September, Koh D.J. went out in public and withdrawn Note 7.

Usually involves you the necessary authorities in the event of withdrawal of products within 24 hours, so there can be followed some usual guidelines, which makes withdrawal easier for consumers. Samsung, however, was so fast out of the recall, the Consumer Product Safety Commission in the United States was not involved until two weeks later.

It has resulted in the recall has been something messy and unclear. Many telecommunications companies and retailers have not managed to deal with the case properly, and there have been widely different approaches depending on the country and place of purchase.

The Bill might amount to nothing less than $ 2 billion. or 13.3 billion. Crowns, but in the long term, it is not such a huge financial loss. This is what in turn on Samsung’s image and brand, which in the coming years may suffer major damage.

“This is a crisis and a blow for Samsung’s image. There have obviously been procedural missteps, and the company (Samsung, ed.) have to restore consumer and investor confidence, ” says professor of Economics at Hansung University in Seoul, Kim Sang Jo.