Sony PESTLE Analysis
This course work is to evaluate the different factors affecting the international business. Such as political, social, economical, and technological. You will see all these factors to be discussed in a chosen company and it also contains supply chain with logistic process of the chosen company.
International business is the process of integration and interaction among the people. it is the process of boosting the interdependence and connectivity of the world markets and businesses.
In the recent two decades, this process speeded up and it helped allot of companies to be known by people all over the world, Sony is one of those companies, which speeded up its growth and become one of the best companies in the world. Sony was founded in capital of japan Tokyo in 1946; it was the idea of two men engineer masaru ibuka and akio morita a physicist. They decided to make the company of the repairing the electronic equipment’s at very beginning the company had no machinery and had little scientific equipment’s“ In 1955, the company decided to use the SONY logo on Totsuko products and three years later changed its name to Sony Corporation”. 12/03/11
Sony was the combination of two concepts one was (Sony boy) popular expression in japan to describe the younger person, the other was Latin word sonus’ which is the root of words such as ‘sound’ and ‘sonic. The new name attracted the market of its younger age people with energy and passion for unlimited creation. In 1959 Sony launched its first magnetite –coated paper based recording tape. that was the first tape which has been launched in japan, before people were not familiar with tape. In 1954 sony won the licence for making the transistors which has newly been invented on that time in America but till now it remained un applied to the radios.
“ground-breaking developments include the first Trinitron Colour Television in 1968, the colour video cassette player in 1971, the Betamax VCR in 1975, the Walkman in 1979, the world’s first CD player in 1982, the 8mm camcorder based on a universal standard in 1985, the first consumer-use digital video camcorder in 1995, the next generation high capacity optical disc “Blu-ray Disc” recorder in 2003 and the world’s first consumer use digital HD video camera recorder conforming to HDV standards in 2004, just to mention a few historic Sony milestones.” http://www.sony.co.uk/hub/european-graduate-programme/3/1 accessed on 18/03/2011.
Sony is well-known globalized country with big range of its product in all over the world.
It includes of BRAVIA TV, reader ebook, compact cameras system(NEX), camera, VAIO laptop s/DIGITAL HOME, DSLR, camcorder, Walkman mp3/mp4 player, home cinema, projectors, DVD
recorder, blue-ray Disc player, hi fi, accessories, car stereo, headphones, photo frame, bloggie, play station and sony professional, http://www.sony.co.uk/section/home accessed on 17/03/11
on march 17 Thursday 2011 Sony brook the record in fifty one east the leading retail in Qatar.
By claiming 40% of the shares in Qatar, Sony turned into its top market in the world. http://www.ameinfo.com/259496-large.html accessed on 21/03/11
Different factors affecting sony company:
“Analyse of the external environment could be assist by acronym PEST, which is standing for political, economical, sociocultural, and technological factors. It is also known as environmental scanning. PEST is useful tool to monitor and evaluate forces and factors affecting the company in long term” J Morrison (2002).
It is roles and regulation, which has been imposed by a stable government on the business.
On the other hand, these changes may expected from the government in the future by business.
Political factors of Sony can be changed at any time, which could affect business of the Sony at time of change. As well as instability in political situation of country will affect the business
Reduction in recession and credit crunch could cause Sony to speed up its trade; meanwhile same situation could happen for the competitors of Sony, which may affect Sony negatively. Therefore, Sony needs to be very careful to its innovation and idea generation.
Sony is globalized company so that changing in international law or trade restriction could affect the way in which Sony works, and Sony needs to follow the rules and regulations, that are imposed by the government. The terms legal always cannot come with term political because most of the time, by change in the politics of a country the legal terms and condition for business environment may remain the same. So that it could be named exceptionally, separate from political environments.
The essencial factor by which growth of the economy could be assessed is economical factor.
It could cover around the major aspects such as unemployment, wages, rising in spending of consumers and which sectors of economy is growing which sectors are not. J Morrison(2002).
However the economic situation of Sony was reported not in good condition , cause of the economic shrunk.
Due to this, economic shrunk and credit crunch the exchange rate was affected which could be related to Sony because it is international business and it is the key point which need to be taken into consideration being an international business. certainly the price selection will effect also. Recently the economic situation of Sony got worst in japan cause of the earthquake, which hated japan. Sony reported that it has 110 employees at two offices in Tokyo without injuries during the tremor.
The northern part of japan hated by earthquake was huge responsible for supplying the electronics industries with components. At the same time, it affected the relationship of Sony with their suppliers. Now Sony focuses on replacement of the destroyed offices and keeping the relationship with their suppliers.http://news.softpedia.com/news/ accessed on 24/03/11.
Even though Sony has gained reputation, cause of it is quality services and products they provided. Still needs to be well aware of the customer demand, good communication with the people, Changes in lifestyle of people, the increase on woman leaving work. Generally educational level of population, the extent of educational facilities for women, and taking part in business life. These all are the key factors which Sony needs to consider and must have social involvement in most needed things for the people such as infrastructure system. In the case of ignorance of these factors socially Sony will damage its image. J Mmorrison(2002) babette E and criag S. Fleisher analysis without paralysis FT Press (2008)
One of the four important factors, which is essential for the company to assess its external environment is technological factor. And Sony works around the technology every day. sony should use new and upgraded technology in productivity which could may give sony competitive advantages and leading market. By using the new technology sony can do research by which Sony can respond to the demand of its customers. http://www.scribd.com/doc/26203913/Sony-Corporation-PEST-SWOT-Analysis accessed on 24/03/11
Logistic and supply chain of Sony:
Sony’s global logistics company, continuous innovation according to the global market and tries to tighten the inventories as much as possible.
Sony has 75 factories around the world and 200 global sales networks, according the estimate of international logistics experts, Sony group’s 160,000 TEUs annual global cargo, which is one of the large skill productions of manufacturers and shippers. One of Logistics parts of Sony, which is located in west coast of U.S. it focuses on logistics centre in Carson, near to los Angeles, facing with some problems but Sony’s view that the in current technical conditions the management for these risks the following points could be the solution, its benefit is to reduce the number of employees, and decrease the logistics operation centre into a single centre. It is not only because of decreasing the unnecessary financial resources or decreasing in total investment in logistics infrastructure but also to improve the effectiveness and efficiency in logistics sector. Sony has counted the world’s cheapest logistics operator in the U.S. currently, due to implementing of some exports of priority planning, the departure procedures of Singapore air shipment of 7 days turned into 4 days of shipping and air to 1 day. Sony logistics management tries to increase the sales in logistics services, part from that tries to reduce the waste of Sony logistics resources. http://www.laowee.com . accessed on 06/04/11
Supply chain management of Sony:
Sony is committed with fair business practice in all its activities. Sony has the same expectations from its suppliers in spite of their location. Sony makes it easy for the supplier whom they are working with to be accessed by them in order to build relationship based on mutual trust.
In complying with regulations, law and social standards and being a good corporate citizen, Sony works to response the demand of the customers. And Sony expects same from its suppliers. For maintaining the sound financial and operating bases, Sony believes that all activities of procurement shall be conducted on regular basis.
For uninterrupted supply of parts and materials suppliers need to provide their financial base, also information on management policies and operations.
Beside these all Sony consideration to environmental conservation and its one of central element of Sony’s management policy, Sony and its suppliers need to work together for decreasing there operation impact on environment. Sony has it own” ….green partner environmental quality approval program….” Suppliers are required to qualify it while signing deal with Sony. In this innovative world Sony has not left back and tried hard to keep their customers with new an updated products which could give them excitement, satisfaction and good quality and suppliers who want to make partnership with Sony they should have skills and technology which is required by Sony and they should be able to generate new values by creating new unique technonology capability.
the Relationship of Sony with his suppliers involve E-commerce, which allow both sides to share the information for enabling the transactions to be performed effectively and efficiently, the employees who ever working with Sony are well aware of E-commerce there for suppliers are required to have the skills of E-commerce as well.
Sony has its own quality assurance program through which the quality of new entrance supplier to Sony Company could assured and accepted.
One of the most important and essential point which could give the company the leading age in market is price therefore Sony tries to have competitive price from their suppliers in order to have competitiveness of Sony products by which Sony could gain competitive advantages and play its major rule in market via low price selection.
Sony has connection to each supplier through their products supplied to sony. Each supplier is required to be capable of delivering the products on time, therefore Sony can fulfil the demand of customer by its appropriate way as it’s required . http://www.sony.net accessed on 06/04/11. this is the basic structure of supply chain of sony.