Sony in Reinvention

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Sony Overhaul

Introduction:
This paper will analyze how Sony is struggling to reinvent itself in the market by transforming its corporate culture, cutting costs and introducing new product lines in its ailing electronics division. Recommendation.

Corporate culture needs to be cohesive and organic: The corporate culture at Sony is bureaucratic and the job for life mentality has created Empire building in departments. Each department or unit looks to gain control over key projects and ignores the company well being as a whole, Sony eventually suffered leading to a loss of $1 billion for the year ending in March. 2009. This culture needs to be changed to be more constructive and the communication within the departments needs to be improved. Cross functional teams across departments and units need to be created to overcome this silo effect in the organization. A corporate culture that values innovation needs to be developed for employees to come up with new product ideas that can give back its competitive edge in the consumer electronics division. The vertical chain of command should not be adhered to and it should be organic promoting horizontal communication to foster ideas within employees. New Leadership to create buy in from the employees: Sir Howard Stringer who took over as the CEO of sony in 2005 is the only American CEO sony has ever had since its inception, even though he has a team of 4 musketeers in their late 40’s and 50’s helping him in his transformation in addition to a Chief Transformation officer that Sir Howard Stringer hired, the 4 musketeers that Sir Howard Stringer hired were originally overseeing some departments and Stringer broadened their responsibilities. While that is not totally a wrong approach, Stringer might have hired 2 of his transformation people like that and 2 withint he organization who were young superstars, this would create more diversified thinking. Groups of employees with a head should be created to listen to employee opinions about changes, so they feel empowered they are a part of the change and this will lead to more buy in from employees. PROBLEMS AT SONY

Sony’s problems have been increasing with the current recession taking a further toll on the already weak electronic giant which was once the market leader in consumer electronics. Lewins Change model of unfreezing-changing/movement-refreezing is a framework that can be applied to Sony’s transformation. Let’s take a look at each of the steps below * Unfreezing: Howard Stringer was faced with a mentality which was job for life at Sony’s headquarters. When he had to do the first step of unfreezing, he did this talking to his employees to let them know status quo is not going to change Sony from ailing. He made effective speeches to his management and employees and said ‘I am asking you to get mad when Samsung’s market share increases, I am asking you to get mad when Apple’s Ipod sales increases’. He motivated employees to change to transform Sony into a profitable company. Stringer also laid off around 5% of the 158,000 employees at Sony including closing some of its factories. * Changing/Moving: This step shifts the behavior of the organization to a new level. Howard Stringer did this by hiring a chief transformational officer who worked at IBM to bring in new behaviors and patterns at Sony. He also restructured to form new core groups and also appointed 4 English speaking Japanese to run the core groups. * Refreezing: This step stabilizes the organization at a new state of equilibrium. This is the step that Howard Stringer is in the process of establishing and struggling with right now. The new culture that Stringer wants to cultivate has not been easy, there has been a lot of resistance to the change. Stringer wants to create a culture of shared values and more a cohesive culture but there is not a lot of employee buy in to change the culture. The changes at Sony took place...
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