Why Sony Failed?
Why Sony fail? When I read “Leading Change Why Transformation Efforts Fail”, I directly linked Sony with the transformation fail.Sony, the previous electrical giant, announced a record annual net loss of $6.4 billion for fiscal year 2011 in May 22 2012.
This marks the fourth consecutive year that Sony reported substantial losses. Transformation efforts couldn’t turnaround the bad situation of Sony due to the mistakes that made by Sony in those transformation.
First, Sony did not establishing a great enough sense of urgency. Sony began its diversification strategy in 1980s. By 1990’s, Sony shaped game, electric, picture, and finance four main businesses. By that time, some potential crisis began to emerge. However, all of these risks were hidden by excellent annual reports. Even when Sony confronted “Sony Shock” in 2003, leaders of Sony couldn’t realize its development dilemma and prepare to transform.
Until 2005, continued losses pushed Sony to review its strategy and re-appointed Sir Howard Stringer as CEO. Sony had lost a lot of opportunities, such as LCD TV. Post core business of Sony, electrical manufacture, Second, Sony lacked a clear version. As a high technological company, innovation decided the fate of Sony. However, Sony made a fetish of its brand recognition and marketing power, and ignored the importance of innovation. The last great innovation of Sony is CD, which was launched in 1982.
Even when Sony reintroduced innovation as its basic strategy, there was no direct process to commit the strategy, and the strategy just became an empty slogan. Even today, Sony cannot have a leading technology in its areas. Now, Sony appointed a new CEO, who emphasized the importance of innovation for Sony. There isn’t enough time left to the new CEO, and maybe Sony will die in future several years. Hiroko Tabuchi First Published: Mon, Apr 16 2012. 06 26 PM IST How Sony failed to keep up with the tech revolution