Did you know: Samsung once burned 150,000 phones just to make a point

Actions speak louder than words. That was the mindset of Samsung’s late Chairman, Lee Kun-hee. Back in the 90s, he was fed up with the company’s direction. He was a man obsessed with quality, which was something Samsung wasn’t exactly known for in those days.

In 1995, when defect rates for Samsung’s phones hit an all-time high, Lee figured out that all those speeches about quality he was making weren’t having the effect he was hoping for. So, he decided to make his point with a move so bold it became company legend: he gathered a few thousand employees in a factory courtyard and burned 150,000 Samsung phones right in front of them.

The day that changed everything

Samsung phones had serious quality issues back in 1994. The defect rate had climbed to a staggering 11.8% — meaning more than one in ten phones didn’t work and had to be returned. At the time, the company was focused on rushing products out the door to turn a quick profit rather than building something that lasted.

That strategy backfired. Chairman Lee knew he had to make serious changes. He wanted to shift the company’s entire DNA from quantity to quality, but that is easier said than done. When he realized his speeches on the topic weren’t sinking in, he decided to take things up a notch.

In March 1995, Lee piled up 150,000 defective devices at Samsung’s Gumi factory in front of 2,000 workers. He selected ten employees — some of them wearing headbands that read “Quality first” — to smash the phones with sledgehammers. Then, they set the remains on fire.

It was a bold statement that ignited a new era at Samsung: an era that refused to tolerate subpar products and became obsessively focused on quality.

So, did it work?

It did. By the end of that very same year, Samsung’s market share in South Korea had skyrocketed, taking the company from fourth place to the number one spot.

Over the years, the name Samsung became synonymous with the very thing Lee Kun-hee demanded: quality. The company’s rise continued globally, and in 2012, it officially overtook Nokia to become the biggest phone maker in the world — a title it has held for nearly 14 years, though it occasionally trades the top spot with Apple.

You could argue that today, consumers trust the brand implicitly. That trust is why Samsung can charge a premium for its products, from smartphones to refrigerators.

However, the company hasn’t been immune to controversy. The biggest blemish was undoubtedly the Galaxy Note 7 crisis, which cost the company billions and forced a global recall. While its reputation took a hit, the damage wasn’t permanent; sales of its other products remained strong, proving just how much brand equity Samsung had built up since that bonfire in 1995.

We still hear about quality control issues occasionally — no manufacturer is perfect — but Samsung generally holds a reputation superior to many of its rivals. A key reason for this is control. Unlike companies like Google, which rely on external EMS partners to assemble their devices, Samsung is vertically integrated. It doesn’t just assemble phones; it manufactures the critical components inside them, from the OLED displays to the camera sensors and memory chips.

So my question to you is this: Was Chairman Lee right to burn millions worth of technology, or should he have stuck to memos and PowerPoint presentations? Cast your vote in the poll above and share your reasoning in the comments.