Strategic Management: Sony Change Of Ceo.

2777 words - 11 pages

FORTUNE APRIL 4, 2005 "Inside the Shakeup at Sony,": Sony replaces Nobuyuki Idei, its departing CEO with Sir Howard Stringer in 22 June 2005. The public previously had the impression that either Kunitake Ando (Idei's previous nomination) or Ken Kutaragi (Mr. Norio Ohga's favourite) would take over this position. Though Norio Ohga has given his title in 1999 to Nobuyuki Idei, he stills hold the title of Chairman and interferes with daily operation and influenced directors' board decision. Ohga was first jealous of Idei's success when Idei gloating launched the PlayStation severely wounding Nintendo and all but exterminating Sega. However, things took an unexpected turn when Sony business plunged facing fierce competitors such as Apple, Samsung. Idei announced his successor as Sir Howard Stringer. The board has consensus that six other insiders, including Ando (President and COO), Idei (CEO) and Kutaragi (PlayStation mastermind) resigned after Howard takes over the helm and Howard would be given authority to nominate his own people. In March 2005, Nobuyuki Idei named non-Japanese and non-engineer Sir Howard Stringer as the next chairman and CEO of the media giant. Previously responsible for U.S. operations, Stringer has demonstrated his leadership ability, having worked with other Sony executives to slash $700 million a year in U.S. overhead costs. Despite his success in the U.S. market, Stringer has a tough road ahead, as he tries to bring Sony into the era of convergence and open communication - without being able to speak the language himself. Nobuyuki Idei said that "Howard's job is to communicate better and to symbolize that convergence is for real at Sony". Howard will need to seek consultation from other prominent CEOs such as Carlos Ghosn and Lou Gerstner to fight the battle for the better.NEWSWEEK MARCH 21, 2005 "Sony is not Japan,": Sony new CEO is a non Japanese named Howard Stringer. It elaborated that Sony has business has fallen drastically in company growth measurement. Sony has fallen from first to near last in company measurement of growth in Japan's top 10 exporting multinationals. Sony suffered huge setback when Apple launched its hot digital music player market replacing Sony electronics consumer gadgets. Nobuyuki Idei announced his decision to pass his role to Howard Stringer implied that the company performance is in much deficit than it previously thought. The value of Sony's shares has dropped almost 75 per cent in the last five years. The value of Sony brand has slipped from $16.4 million in 2000 to $12.8 billion in 2004 while rivals like Panasonic and especially Samsung were raising fast. From Sony history, founder Akio Morita saw Sony as a global company and it is not regarded as a Japanese company. Yet, the management style still very much of the Japan culture. It described Sony as being too "complacent" and has resulted it own set back. Its lingering stagnation bred when there isn't much innovation or changes to counter...

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