“At this point, Sony just needs some strategy, any strategy, because that is better than no strategy at all,” said Sea-Jin Chang, chairman for business policy at the National University of Singapore and author of “Sony vs. Samsung: The Inside Story of the Electronics Giants’ Battle for Global Supremacy.”
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Sony marketed its PlayStation 3 console as an integrated entertainment system that serves as a hub in the living room, connecting the Internet and television.
But Sony’s obsession with hardware has marred that strategy. A delay in developing the console’s Blu-ray DVD player forced Sony to push back its release. Sales suffered because the PlayStation 3 cost much more than rival models from Nintendo and Microsoft. Sony was also slow to move into the world of online games, giving Microsoft a head start.
Sony’s woes mirror a wider decline in Japanese electronics. Though executives here are quick to blame a strong yen, which hurts exports, a deeper issue is that once-innovative companies seem to have run out of ideas. And when a nation can no longer compete on abundant labor or cheap capital, ideas and innovation are paramount.
Japanese consumer electronics manufacturers “have lost their technology leadership in many areas,” Steve Durose, head of Asia Pacific telecommunications, media and technology ratings at Fitch Ratings, said in a recent industry commentary.
“Ten years ago, these companies were major technology innovators, the creators or leading developers of many electronic products and trendsetting devices such as televisions, digital cameras, portable music players and games consoles,” Mr. Durose said. “Today, however, the number of products remaining where they can boast undisputed global leadership has narrowed significantly, having being usurped or equaled by the likes of Apple and Samsung Electronics.”
Both publicly and privately, Sony’s top management shows a deep understanding of many of these fundamental challenges: the need for different sections of the company to work better together, for a more unified user experience, for innovation.
But Sony’s recent leaders have had trouble wielding authority over the sprawling company. Sony remains dominated by proud, territorial engineers who often shun cooperation. For many of them, cost-cutting is the enemy of creativity — a legacy of Sony’s co-founders, Mr. Morita and Masaru Ibuka, who tried to foster a culture of independence. But the founders had more success than recent executives in exerting control over division managers.
Executives complain privately of recalcitrant managers who refuse to share information or work with other divisions. One executive said he was startled to discover that a manager whose position had been eliminated had been rehired under a different title. (“Or maybe he never really left,” said this executive, who spoke on condition of anonymity out of fear of angering his bosses.)
In 2005, such challenges prompted Sony to select Howard Stringer, a British-born American businessman, as C.E.O., rather than Ken Kutaragi, the brains behind PlayStation. Mr. Stringer had a record as an agent of change: as head of Sony in the United States, he oversaw music, movies and electronics there and eliminated 9,000 of 30,000 jobs.
At his first news conference as C.E.O., Mr. Stringer declared that he would “accelerate cross-company collaboration, thereby revitalizing the company and promoting creativity.”
But not even Mr. Stringer, who has stepped aside for Mr. Hirai but will remain as chairman, could break down all the silos at Sony.
The company still makes a confusing catalog of gadgets that overlap or even cannibalize one another. It has also continued to let its product lines mushroom: 10 different consumer-level camcorders and almost 30 different TVs, for instance, crowd and confuse consumers.
Related
Sony marketed its PlayStation 3 console as an integrated entertainment system that serves as a hub in the living room, connecting the Internet and television.
But Sony’s obsession with hardware has marred that strategy. A delay in developing the console’s Blu-ray DVD player forced Sony to push back its release. Sales suffered because the PlayStation 3 cost much more than rival models from Nintendo and Microsoft. Sony was also slow to move into the world of online games, giving Microsoft a head start.
Sony’s woes mirror a wider decline in Japanese electronics. Though executives here are quick to blame a strong yen, which hurts exports, a deeper issue is that once-innovative companies seem to have run out of ideas. And when a nation can no longer compete on abundant labor or cheap capital, ideas and innovation are paramount.
Japanese consumer electronics manufacturers “have lost their technology leadership in many areas,” Steve Durose, head of Asia Pacific telecommunications, media and technology ratings at Fitch Ratings, said in a recent industry commentary.
“Ten years ago, these companies were major technology innovators, the creators or leading developers of many electronic products and trendsetting devices such as televisions, digital cameras, portable music players and games consoles,” Mr. Durose said. “Today, however, the number of products remaining where they can boast undisputed global leadership has narrowed significantly, having being usurped or equaled by the likes of Apple and Samsung Electronics.”
Both publicly and privately, Sony’s top management shows a deep understanding of many of these fundamental challenges: the need for different sections of the company to work better together, for a more unified user experience, for innovation.
But Sony’s recent leaders have had trouble wielding authority over the sprawling company. Sony remains dominated by proud, territorial engineers who often shun cooperation. For many of them, cost-cutting is the enemy of creativity — a legacy of Sony’s co-founders, Mr. Morita and Masaru Ibuka, who tried to foster a culture of independence. But the founders had more success than recent executives in exerting control over division managers.
Executives complain privately of recalcitrant managers who refuse to share information or work with other divisions. One executive said he was startled to discover that a manager whose position had been eliminated had been rehired under a different title. (“Or maybe he never really left,” said this executive, who spoke on condition of anonymity out of fear of angering his bosses.)
In 2005, such challenges prompted Sony to select Howard Stringer, a British-born American businessman, as C.E.O., rather than Ken Kutaragi, the brains behind PlayStation. Mr. Stringer had a record as an agent of change: as head of Sony in the United States, he oversaw music, movies and electronics there and eliminated 9,000 of 30,000 jobs.
At his first news conference as C.E.O., Mr. Stringer declared that he would “accelerate cross-company collaboration, thereby revitalizing the company and promoting creativity.”
But not even Mr. Stringer, who has stepped aside for Mr. Hirai but will remain as chairman, could break down all the silos at Sony.
The company still makes a confusing catalog of gadgets that overlap or even cannibalize one another. It has also continued to let its product lines mushroom: 10 different consumer-level camcorders and almost 30 different TVs, for instance, crowd and confuse consumers.
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