Sony’s loss of $3,2 billion from last year suddenly became $6,4 billion after taxes, which makes 2011 to the company’s biggest loss in one year so far. The company’s new CEO have now presented his plans which is supposed to flip Sony’s negative results to positive.
After the latest record loss there’s no one that has any doubt that Hirai has a huge task ahead of him. The road to recovery will be long, and according to the newly appointed CEO it builds on the three core pillars at Sony: digital imaging, gaming and mobility. The goal will be restructuring, streamlining and to faster be able to respond to the market’s needs.
The company’s structuring will put everything in mobility: cellphones, tablets and the computer series called Vaio under the same department. R&D (Research and Development) and also design will be run by the same group from now on. The ability to respond to the market in good time is really important, that’s why the development period of all products is going to be cut by half, thanks to this measure.
The ability to quickly respond to new market trends is everything in the industry
Looking at the game side the company will focus more on downloadable and easily available content. Kazuo Hirai plans to expand the range of downloadable titles to the company’s consoles (PlayStation 3 and PlayStation Vita), this also applies to smartphones and tablets that’s PlayStation Suite compatible.
Recovery of the TV department for Sony is vital
The most important thing to Sony is the recovery of their TV department, where the company has had negative results for 8 years in a row. This is where we will get to see the biggest changes, in an attempt to streamline and restructure operations 10 000 people will loose their jobs. Sony still believes that LCD is the future and will remain there for some time, but they will also continue to do research within technologies like OLED and Crystal LED. The range of different models will also be cut by 40 percent, to reduce the costs of development. The goal is to drive down the cost of operations for the TV department by a massive 60 percent, and to cut flexible/unpredicted costs by 30 percent.
The short term focus will not be Crystal LED or OLED
The question if it’s really worth to keep the department alive has been given to Sony, when the only thing it has done during the last 8 years is to cost the company money. Hirai answeared this with that they are engaged in making the department profitable again, and at the same time he said that it’s just natural to take a closer look at all departments – which also leaves them with the oppurtunity to withdraw from this market. Hirai made no comment regarding if Japan’s government will lend a helping hand to revive the department.
Hirai believes that he can make the department profitable as soon as next year, 2013. If he fails in doing this it will mean that the department has been loosing money for 10 whole years. That’s when the company really has to take a closer look at the department and if it’s worth to continue to manufacture and sell TV’s, or if it’s time to stop the business, which is something that many thinks they should’ve done a long time ago. Hirai does believe that he will be able to succeed with his One Sony initiative, where the former CEO Howard Stringer failed with Sony United.
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This guy is clearly just another clueless penny-pinching accountant instead of a leader.Focussing on LCD will be the death of Sony TV division and possibly Sony as a whole.Sony’s success as a brand name has always been from its perceived differentiation through innovation and quality. Sony need to move forward through bringing real innovation to market and building on quality, like they were doing 30 years ago when they got big in the first place. This guy is going in exactly the opposite and wrong direction.Going cheap and doing more of the same is never a recipe for sudden success.… Läs hela »