The boss called the team two months later with further instructions
from Samsung.
“Put the LCD on the computer.”
The battle lines were hardening, and the hostilities were beginning to
flare.
As AST’s finances continued to slide further into the red, senior
executives were summoned to the conference room and asked to retire.
“Who’s next?” they joked with one another.
By December 1997, after six years of losses, three chief executives in
four years, and wide-ranging layoffs, Samsung had whittled down AST
from 6,500 people to 1,900. Even Korean Samsung employees, seeing the
writing on the wall, defected to companies like HP.
“The very good ones in there saw the opportunity and they jumped
ship,” Sheppard said.
By the end, Samsung had sunk $1 billion into the $2.1 billion
manufacturer, before deciding to shut down AST in 1999 and sell the name
and patents to Packard Bell.
The chairman’s lofty ambitions for Samsung were faltering thanks to its
colossal, high-risk expenditures. Samsung’s management practices,
international standing, and unimpressive credit rating (Moody’s gave it
Baa2) were still too backward and archaic for the kind of global expansion
the company envisioned.
Focusing on improving the quality of Samsung’s products with its own
in-house designers seemed like the only viable way forward. Already the
chairman and Miky Lee had yet another idea.