Sony Corporation - Report Example

Table of Contents Decision Making Process 2 Steps of decision making and influencing factor 2 Changes in management 2 Approach to Decision making process as a CEO 3 Consumer Electronics Industry 4 Sales Forecast 5 References 6 Sony Corporation Decision Making Process Fiscal year 2012 that ended on March 2013 marked some great changes in the structure of the organization. Initiative of reforms in the management has been taken by new CEO of the organization in order to make the decision making process swift and efficient. Company has always been compelled by the objective to enhance the experience of its users and its decisions reflect the innovation that it has used to create the market out of thin air. They have continuously pursued quest of consumer excellence and regular innovation rather than focusing on profits this approach of Sony that has influenced its decision contributed much to the crisis that it saw past some years. Steps of decision making and influencing factor Sony Corporation has always believed in enhancement of its corporate governance structure and believe it to be important management objective. Sony adopted the “Company with Committees” corporate governance under the Companies Act of Japan and forms one of the major factors of decision making at Sony. Board of directors (BOD) mainly make decisions regarding the policies of the company, they also appoint, dismiss and oversea the performance of the directors, corporate executive officers and statutory committee members (Sony Corporation, 2012). Three committees of nomination, audit and compensation provide assistance to the board of directors, analysis and information in their respective field and duties. However management or corporate executive officers make decisions regarding the management of Sony Group business activities within the scope of the authority delegated to them by the BOD. However one thing has been common regarding the policies and decisions of the Sony since its beginning that is its volatility and emphasis on new products rather than emphasis on profit or loss statement. Due to this ever-ending quest of new products and higher technology research and development costs have gone so high that they have pushed the firm to the verge of bankruptcy. Changes in management Several radical alterations were made in the overall management structure by the newly appointed CEO of the company. These changes were aimed at driving growth as well as revitalization throughout Sony’s core electronic businesses. Furthermore, the transformations were also made in order to deliver persuasive user experiences through junction of the distinctive assets in place via the Sony group. The CEO of the company has placed himself in the center of the matter and the management team. Similarly, all the decisions that are being made in the company have provided a great deal of motivation for the entire team so as to work alongside the heads of each business platform as well as group. The overall aim of the new and vitalized business structure is solely to generate optimized and rapid decision making process (Jeff, 2012). CEO was justified in his new transformed approach for the decision making as it was after five years that Sony Corporation was able to generate profit. Approach to Decision making process as a CEO Mr. Hirai as CEO of the company brought some great changes and the financial results justified every step that he took. He brought in the concept of “One Sony” the idea being to increase the collaboration, cooperation and sharing amongst different departments and business units of the organization. He finally took a little different approach than usually has been done in Sony and focused his concerns a bit towards the profits along with the innovation and enhancement in technology. The concept of One Sony significantly influenced and accelerated the decision making process at the Sony. Besides making the structural changes he has also made changes in key position of Chief executive officers. All new executives supported the CEO and also collaborated alongside the heads of not only each and every business group but also with the headquarters and platform functions. The CEO made it possible for the company to engage rapidly in the transformation of the Sony’s electronic operation. According to my view, the most vital and important decision being made by the CEO of the company was regarding the positioning of digital imaging, mobile phones and game. These issues can be considered as the core and central pillars of the electronic business along with the growth plan. These also reflect the fact that the concentrations of the resources are majorly present in these respective regions (Sony corportaion, 2012). The home entertainment business sector of the industry has been taken directly by the CEO under his supervision however sector of semiconductor business area in which the Sony leads the market will be pushed by the R&D. Personally keeping myself in the position of Mr. Hirai I acknowledge the decision and structural changes made by him. However his decisions reflect the pressure of gaining profits and somewhat influenced by the market trends. It can be said that consumer electronics industry today is being dominated by the mobile phones and shift of Sony towards this sector is just to increase the profits and gain market share in the growing market. The quality and high-tech features that Sony offers are incomparable however it is some other sector of the industry that has been the company’s strength over the years. That has been the semi-conductors and home entertainment appliances; focus being shifted towards mobiles, digital imaging and games the R&D budget for other sectors might reduce. I as a CEO would not have headed the semi-conductor sector of the business by myself as the focus is towards the policy making and with the new concept of One Sony the role of the leader that could encourage high collaboration and cooperation amongst the departments and business units. Sony before new CEO faced loss in past five years thus pressure and frustration must have been high therefore the transformation and change in key positions would definitely create conflicts thus I would have played a role of solicitor and remained out of the management affairs as that would increase the burden and decrease the productivity. The policy and strategy of the company should be straight and as the CEO current aim would be to enhance the market share of the industry. It would be very much feasible to identify the weak loss making sectors of company and analyze whether they have prospects of growth if not then should be closed and if any prospects are seen then should be supported by money making sectors of the company. It would be very much feasible to run semi-conductor and home entertainment business as they are and increase the R&D for mobile phones and games as enhancement in technology and innovation are the critical success factors of this industry. Consumer Electronics Industry Sony operates in the consumer electronics industry that offers wide range of products and hugely depends upon the technological advancements and features that the products offer therefore is the critical success factor of the industry. Mobile or smart phones are the product that currently is considered to be the hottest product however recently market trends reveal that Pc Tablets are getting slightly ahead of smart phones in demand. It is basically the Apple and Samsung that are the dominant companies in the smart phones industry. It is a perception in the market that it is basically the Android that has taken up the role of market leader and curtailed the share of Apple however other than Samsung almost all the Android using mobile manufacturing companies are facing loses even is amongst that list. Samsung is the global leader in the smart phone industry however American market is led by Apple. Samsung leads the market in the sense of quantity that it supplies or ships is way more than that of the Apple however in terms of revenue Apple has almost 57% of the total associated profits of the market and Samsung holds 53% of the profits together they make more than 100% showing that other companies are facing loses (Tony, 2013). It is the continuous innovation in the products that they offer, exquisite features and utility of the products that makes them so much attractive for the consumers that they prefer the brand’s products over others present in the market. Besides the Samsung and Apple in the smart phone sector, Sony also faces competition in the other sectors of the business and its direct competition is from Panasonic, Koninklijke Philips N.v., Sanyo Electric company Ltd… (Yahoo, 2013). Therefore the smart phone industry has been offering huge returns however they have been associated to just two of the companies thus it would not be easy to curtail their market share and gain profits from the market unless the product that the Sony is offering provides some unique utility not just features that would convince the consumers to switch the brand. The other sector of gaming and digital imaging in which Sony faces competition from Microsoft’s Xbox and Canon in cameras therefore it still seems that semiconductor and digital imaging are the start products of the company and could be used to support the other sectors however in mobile sector progress can be made only through technological breakthrough. Sales Forecast First time in the past five years company has earned profits however revenues were almost stable it was the high operating expenses that caused loss. Even the revenues decreased in 2012 comparing to that in 2011 and did not show growth in 2013 however it is the recent trends of the market that show sakes growth of almost 4.7% while the growth level of the net income cannot be predicted (Msn, 2013). It can be forecasted that the revenue in the coming year would be $7,120,491. With the new policies of the CEO profits can be expected in the coming period. The graph below shows the movement. References Jeff, B., 2012. News. [Online] Available at: http://www.theverge.com/2012/3/27/2905412/sony-management-structure-change-announcement Msn, 2013. Sony. [Online] Available at: http://investing.money.msn.com/investments/stock-price/?symbol=US%3aSNEJF Sony Corporation, 2012. Annual Report , Tokyo: Sony. Sony corportaion, 2012. New Release. [Online] Available at: http://www.sony.net/SonyInfo/News/Press/201203/12-043E/ Tony, B., 2013. Tech. [Online] Available at: http://www.forbes.com/sites/tonybradley/2013/11/15/android-dominates-market-share-but-apple-makes-all-the-money/ [Accessed 8 March 2014]. Yahoo, 2013. Sony COmpetitors. [Online] Available at: http://finance.yahoo.com/q?s=SNE&ql=1 Read More