Can SAMSUNG Change with the Tech Times? (Reuters Special Report)

(Reuters) - Only a handful of reporters were at Samsung's booth at the Consumer Electronics Show in Las Vegas earlier this month when Jay Y. Lee dropped by.

They had been tipped that the sheltered heir to the Samsung business empire was about to make his first public appearance since his father named him one of the new presidents of the conglomerate's flagship, Samsung Electronics, in December.

Most of the Korean media contingent eagerly awaiting his appearance at the show had been diverted to another news conference. They didn't miss much. Jay Lee's remarks were brief and bland. He mainly wanted to make it clear his ambition was to be a chip off the old (and equally aloof) block.

"I'm trying very hard to learn his challenging attitude and personalize it," said Jay Lee, 42, the only son of Samsung Group Chairman Lee Kun-hee. "The chairman has this DNA that just won't let him be seen being beaten," said the boyish-looking Lee, wearing rimless spectacles and a business suit with an open collar.

His father's formula has helped turn Samsung into a top global brand over the past decade or so, boasting a market value of $143 billion, bigger than Intel and Hewlett Packard and equal to the combined value of Sony Corp, Nokia, Toshiba and Panasonic Corp.

Yet that's still less than half of Apple's $320 billion market value.

Samsung, which has had better net earnings than any other global tech firm except Microsoft and IBM over the past decade, is set to report its lowest profit in six quarters when it issues December quarter corporate results on Friday, although 2010 will be another record profit year.

The outlook for this year and beyond is unclear as global technology firms grapple with weak demand and falling prices for memory chips and flat screens, and new players enter the market for smartphones and tablets.

Successful business leaders are very good storytellers, it is often said, and the industry is looking for a new narrative from Samsung, as it passes the generational torch while trying to evolve into a more innovative and content-driven company.

Jay Lee, who graduated from the Seoul National University with a degree in East Asian history, has an MBA from Japan's Keio University and studied for a doctorate at Harvard, is deferring to his elders for now. But eventually Samsung will be his story to tell.

He is taking over at a pivotal point for Samsung Electronics, the world's biggest maker of flat screens and memory chips, the second-biggest mobile phone maker behind Nokia and a core holding in any emerging market portfolio.

His company faces the challenge of moving beyond being a hardware company, clever at copying ideas, to becoming more creative, better adept at software, at a time when consumer gadgets are getting smarter all the time. In short, it faces a management challenge.

In a statement to Reuters, Samsung Group said its strong performance during the aftermath of the global financial crisis has proved the value of its management model.

"Samsung's management is based on a complementary relationship between the founding family and professional managers. On the one hand, Chairman Lee Kun-hee provides long-term business visions and the basis for sustainability. On the other, professional managers bring to bear their day-to-day management skills without being unduly pressured by short-term and quarterly results."

Samsung had the biggest booth, the thinnest products, and by some accounts, the best buzz at the annual Las Vegas show. But the stars of this Las Vegas extravaganza, which drew a record 140,000 technology enthusiasts, were the tablet computers. More than 30 tablets were announced over the two-day show, and while Samsung's Galaxy Tab was one of the precious few actually in stores, all the new players pointed to Apple's iPad as the one to chase.

Click here for the rest of a very interesting article about a tech powerhouse.