Samsung needs 'innovation around the clock,' chairman says

Samsung chairman Lee Kun-hee is calling for the firm to ditch old business plans and pump up research and development to remain competitive against modern-day competitors and the fast-paced nature of the electronics market.

Within the executive's annual speech, Lee highlighted how the last year has been tough thanks to rising competition from rivals, and as a result, Samsung must turn its back on old ideas and methodologies to remain one of the key players within the electronics and mobile markets.

According to the Wall Street Journal, Lee said:

"Research & development center(s) should work around the clock, non-stop."

In addition, Lee said Samsung must "get rid of business models and strategies from five, ten years ago and hardware-focused ways."

Although perhaps not as expressive as previous speeches, the statement does bring to mind the 71-year-old's continual desire to improve and reinvigorate the firm. Decades ago, the chairman urged executives to "change everything except for your wife and children." However, contrary to this, the firm has often been criticised for jumping on the back of other companies and their products -- producing alternatives in the market and add-ons for software rather than producing useful, original features for consumers itself.

The Galaxy S4 smartphone, for example, has a useful array of gesture-based controls and bolt-ons for its Android operating system, but in comparison to rival products such as Apple's fingerprint recognition system -- despite the fact Apple's offering is far from perfect -- other firms are presenting innovative software with the potential to go further far more often than Samsung.

Samsung is the world's largest mobile device, television and semiconductor producer, but boosting its reputation in the software department is a must if the company is going to hold its own against firms such as Apple and Google -- both of which have made a number of acquisitions to improve the software they offer.

During Apple's fourth quarter earnings call, CEO Tim Cook confirmed the recent "strategic acquisition" of a total of 15 firms, not only in the chip department, but also companies that can improve the iOS mapping system.

Google spent over a billion on acquisitions last year, mainly due to the purchase of Waze, another mapping software development firm.

In comparison, Samsung has spent roughly one billion dollars in acquisitions since 2010. However, Samsung Chief Financial Officer Lee Sang Hoon said last November that the South Korean firm will become more aggressive in the search to secure valuable startups and SMBs that could improve its own products.

If this promise holds merit, this may improve the confidence of investors, who have seen Samsung's market cap drop by over $6 billion this week. Some analysts believe that profit will drop this year due to a lack of innovation and stiff competition provided by rival firms.

This post originally appeared on ZDNet.

This post was originally published on Smartplanet.com