Sony Strategic Analysis, Executive Summary
Sony Corporation Strategic Analysis
Executive Summary
Sony Corporation is a Japanese multinational conglomerate consisting of a number of business units (consumer electronics, gaming, movie production, music and financial services) making it one of the most comprehensive entertainment companies in the world.
However, the start of the 21st Century has been a difficult period for Sony resulting in a decline in operating profits and share prices.
A SWOT and PEST analysis indicates that economic and social circumstances are favourable for Sony’s products and during this time Sony’s traditional strengths such as its diversity, global presence and spirit of innovation have ensured that the company remains a key force but there also exists a number of weaknesses such as it’s culture of ‘super-excellence’, resistance to (internal) change, missed opportunities such as the MP3 player market & new gaming demographics and an over-reliance on the success of too few new products. Fortunately threats such as a HD-DVD/Blue-Ray standardisation war and competitor competition in the next round of the cyclic console war have been partially handled through alliances with other companies to attempt to maximise the potential demand for Sony products in these important sectors. However it is critical for Sony to recognise its weaknesses, taking appropriate action and continue to not only consider it’s current competitors but it must also keep an awareness of new emerging Asian competitors that we have termed ‘Chony’.
With reference to Porter’s Four Alternatives it can be seen that the core elements of Sony’s business units lie in the area of ‘Differentiation’ (Games/Films/Music) or ‘Differentiation/Focused Differentiation’ (Consumer electronics dependent on actual product) placing it in a strong position.
Additionally, an Uncertainty/Impact analysis shows that the baseline
Executive Summary
Sony Corporation is a Japanese multinational conglomerate consisting of a number of business units (consumer electronics, gaming, movie production, music and financial services) making it one of the most comprehensive entertainment companies in the world.
However, the start of the 21st Century has been a difficult period for Sony resulting in a decline in operating profits and share prices.
A SWOT and PEST analysis indicates that economic and social circumstances are favourable for Sony’s products and during this time Sony’s traditional strengths such as its diversity, global presence and spirit of innovation have ensured that the company remains a key force but there also exists a number of weaknesses such as it’s culture of ‘super-excellence’, resistance to (internal) change, missed opportunities such as the MP3 player market & new gaming demographics and an over-reliance on the success of too few new products. Fortunately threats such as a HD-DVD/Blue-Ray standardisation war and competitor competition in the next round of the cyclic console war have been partially handled through alliances with other companies to attempt to maximise the potential demand for Sony products in these important sectors. However it is critical for Sony to recognise its weaknesses, taking appropriate action and continue to not only consider it’s current competitors but it must also keep an awareness of new emerging Asian competitors that we have termed ‘Chony’.
With reference to Porter’s Four Alternatives it can be seen that the core elements of Sony’s business units lie in the area of ‘Differentiation’ (Games/Films/Music) or ‘Differentiation/Focused Differentiation’ (Consumer electronics dependent on actual product) placing it in a strong position.
Additionally, an Uncertainty/Impact analysis shows that the baseline