Evaluate the effect of Technological change on the Business Environment of Sony - Case Study Example

The present study would focus on the technological change and their effects on the business strategy of organizations. The choice of the topic assumes significance in the present business environment as most of the firms operating in the modern day business environment have been severely affected as a result of the fluctuations in the business environment that has emerged as a result of the recent economic and financial crisis. The organization selected for the study is Sony Electronics. The choice of the organization assumes significance considering the fact that Sony is a market leader across many consumer electronic markets of the world as is known for its excellence in innovation in its product lines.

The firm is accredited with numerous innovations in the field of consumer electronics. Products like Sony Walkman have created a revolution in the world. About the Company Sony Corporation was established in the year 1946 at Tokyo, Japan with an initial start up capital of 190,000 Yen (Sony, 2011). The name of the company has been derived from the Latin word ‘Sonus’ which means sound. . roximately 7,214,000 million Yen as of 2009.The product portfolio of the company consists of Audio, Video, Televisions, Communication and information devices, Semiconductors and various electronic components like batteries, recording systems etc (Sony-b, 2011).

The business prospects of Sony Corporation are largely affected due to the fluctuations in the business environment of the firm. The aspect is more important considering the fact that the firm operates in different markets across the globe which have different consumer behaviour. In addition to varying tastes of consumers the firm also faces issues that are related to the macro environmental aspects like exchange rate fluctuations, economic and fiscal policies etc. Presence of competitors also affects the business prospects of the firm as it plays a major role in shaping the future framework of strategies for the organization.

The effect of fluctuating business environment can be easily ascertained by analysing the revised business and revenue forecasts (refer annexure 1) of the company for the year 2010. The global economic down turn has also played a major role in the revision of estimated forecasts. This aspect assumes significance since the sales of electronic products are largely linked to the disposable income of the consumers. The global recession has played a major role in the declination of disposable incomes of individuals which has played a major role in the declination of sales volume and profitability of business organizations like Sony Corporation.

Exchange rate fluctuations have also led to considerable pressure on the strategists of the organizations to lower their expected revenue margins. In addition the price competition which has started as a result of dip in sales figure corresponding to the