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Case
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Reference no. 410-029-1
Prize winner
Published by:
IBS Center for Management Research (2010)
Length:
20 pages
Data source:
Published sources

Abstract

Sony, the Japan-based multinational conglomerate, is one of the leading manufacturers of consumer electronics devices and information technology products. Sony was responsible for introducing path breaking products like the Walkman, the Discman, and the PlayStation gaming console, among others. But in the late 1990s, it lost its leadership position in many product lines in which it was operating. Analysts attributed this to the silo culture prevailing in the organisation. Each of the departments functioned like different fiefdoms, hardly co-operating with each other, even when it was necessary. Moreover, Sony's growing complacency led to its failing to recognise the growing popularity of new technologies and digital products and the company choosing to stick to its proprietary formats. Sony was caught off-guard and tried to revive itself under the guidance of its first non-Japanese head Howard Stringer, who took over as the CEO in 2005. For a couple of years, Sony appeared to be on the path to revival. However, for the fiscal year ending March 2009, the company reported a loss. Sony's failure to bring out innovative products in spite of having the required competencies was one of the main reasons for the company's problems, and analysts attributed it to the existing culture in the company. In February 2009, with the aim of addressing the issue of its silo culture, Stringer announced a reorganisation that involved changes in the organisation structure. Through this reorganisation, he sought to transform Sony into an innovative and agile company. However, it remains to be seen whether the reorganisation can bring Sony out of its problems. The case aims to achieve the following teaching objectives: (1) to examine the challenges faced by Sony in a competitive global business environment; (2) to understand the importance of organisational culture in effectively executing an organisation's strategy; (3) analyse how Sony can make its products competitive and foster innovation; (4) examine the efficacy of the reorganisation program initiated by Stringer in turning around Sony and solving its problem relating to the silo culture; and (5) analyse other measures that need to be taken by Stringer to restore the profitability of Sony. The case is intended for MBA/PGDBA students and can be used in human resource management as well as strategy and general management curriculum. The detailed teaching note includes the abstract, teaching objectives and methodology, assignment questions, feedback of case discussion, additional readings and references, and an analysis of the case. This case was the first prize winner in the 2009 John Molson MBA Case Writing Competition.

Teaching and learning

This item is suitable for postgraduate and executive education courses.

Topics

Sony Corporation; Organisational restructuring; Reorganisation; Silo culture; Organisation structure; Howard Stringer; Cross-functional teams; Organisation chart of Sony; Innovation; Leadership; Co-ordination among product divisions; Corporate communication; Corporate culture; Connect; Empowerment
Location:
Size:
Very large
Other setting(s):
2005-2009

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