We're hearing yet another report of internal discord at Sony (SNE). Who's in control?
Amidst widespread fears the company will post its first annual loss in 14 years, CEO Sir Howard Stringer is still struggling against an "old guard" that's resisting his efforts to steward the company, the FT reports this morning. The crux of the dispute surrounds whether Sony should cut underperforming products and introduce Western-style layoffs to the historically Japanese company.
The dispute centres on whether products such as televisions have become commodities, in which case, Sir Howard believes, Sony should cut its production costs and rely more on sales of software built into its gadgets. He emphasised the importance of this business in a speech at the US Consumer Electronics Show this month.
There is acute sensitivity, too, about sacking Japanese staff, who believe they have a "job for life". A decision to spare them from the planned cuts would risk angering Sony's foreign employees. A manager at Sony in the US said his colleagues saw "a lot of fat" in the Japanese operations.
We're onboard with Sir Howard: The problem with many Sony products from HDTVs to stereo equipment (except the troubled PS3, a special case) is they don't offer consumers a unique or compelling experince, leaving the company to compete mainly on price.
But first things first: Just in the past month, we've seen Sony Entertainment squabble with joint venture Sony Ericsson, and Japanese spokesmen contradict their own CEO. The first step in Sony's revival is for there to be a strong leader at the top with the confidence and authority to rule. What remains to be seen is if Sir Howard can be that leader.
See Also:
Sony To 'Slay Sacred Cows'...So Are PS3 Price Cuts Coming?
Sony: We Don't Care What "CEO" Howard Stringer Thinks
Sony To Sony Ericsson: No, You Can't Make A 'PSP Phone'
Delusional Sony Exec: PS3 Makes Us The "Official" Leader In Gaming
