From mass production to complex production: case of the Korean telecom equipment sector

Abstract

This study addresses the following question: why did Samsung and LG fail to transition from the mass-produced goods sector production to complex product system sector production? In general, there are four necessary factors to facilitate successful operation in complex product systems: research and development capability, organic networking among various actors, the capability to leverage suitable support from government and the establishment of a large demand base. Samsung and LG has strong R&D capabilities and engaged in useful networking and their failure to succeed in the complex product system sector can be attributed to inappropriate support from government and their failure to establish a large demand base. We conclude that technological factors are necessary but insufficient to facilitate the successful transition from a mass-produced goods sector to a complex product system.