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Case Study: Business Strategy of Sony Corporation

Founded on May 7, 1946 in Tokyo, Japan, one of the most successful technological corporations in the world: Sony was created under the two legendary men: the physicist Masaru Ibuka and the physicist Akio Morita (Sony, 2013). They made the decision to set up a company repairing and producing electrical equipment and established Sony under the name under the name Tokyo Tsushin Kogyo K.K. which is Tokyo Telecommunications Engineering Corporation, known as Totsuko. At that time, Totsuko was just a small company with capital of 190,000¥ (~ 2000 $) and around 20 employees compare to giant corporations in Japan such as Toshiba, Hitachi, Sharp, Matsushita with tremendous capital, facilities and labour capacity. Although in 1946 Japan was just recovered from the wartime, while the other giants still possessed enough resource and experience to control the Japan market, Totsuko had no machinery and little scientific equipment and using only their own intelligent and engineering expertise, the young talented group with great ambitious set their first step to the new markets. From 1955, the company continued producing product with the logo ‘SONY’. In 1957, the company decided to change the name of the company from Totsuko to Sony Corporation.

There was a little story behind the name ‘Sony’. it was originally by integrating “SONUS” the original Latin for “SONIC” meaning sound, with “SONNY” meaning a youthful boy. The idea came to Akio Morita when he was visiting the U.S in 1950s, he noticed that many U.S companies’ names are relatively simple with only alphabetic letters, at that moment he realized the name Totsuko was difficult to remember for customer around the world and decided to change to ‘Sony’.

Over a half century, Sony Corporation has always been a pioneer in technological development and acquired reputation for being innovative. Its aim is always to be the Japan’s first or even the world’s first. This is also the reason Sony had many failures in the past due to the fact of being first but it never stop moving forward. Grow from a small company of 20 employees, today, it has become a global corporation consists over 160,000 employees over the world and ranked #38 in the World’s Most Powerful Brands list according to Forbes (2012). Sony takes part in a wide range of businesses including electronics, game, entertainment and financial services sectors with major products such as television, computer, camera, game console, mobile audio, mobile phone and entertainment sectors with Sony Pictures Entertainment, Sony Music Entertainment making it one of the most comprehensive entertainment companies in the world. Famous for being always innovative, Sony may not be the biggest company but definitely, the most innovative, they have brought to humanity a vast number of creations that change the world that we already familiar with such as Walkman, Playstation, Blu-ray. Despite the fact that in recently years, Sony has lost their market’s stand due to economic losses and fierce competitions from Apple and Samsung, however, people still believe in the spirit of an innovative legend such as Sony will never fall down.

Unique Selling Points

One of the major unique selling points of Sony is its innovativeness. In the past where the company is not even a competitor to those giants such as Toshiba, Hitachi or Matsushita, the one strength Sony possessed is intelligence and gradually they proved to the world that they deserve a top position in world most innovative brands. The innovativeness of Sony comes from the strategy of creating their own in-house technology for their product development rather than adopting and relying on market technology. Long before the IPod from Apple becomes the world iconic music device, there was the Walkman from Sony. Introduced on 1st, July, 1971, the first Walkman with metal-cased blue-and-silver TPS-L2 was born as the world first’s low cost portable stereo and achieved great success until now with the sale record of 200 million unit by the time the IPod was introduced.

Product quality and quality management are also major unique selling points making the formidable reputation of Sony. From the original electronics products lines, entertainment and communication devices to robots, Sony always presents to the market premium products with the brand exclusive features in order to deliver to the customer their best cutting edge technology. Furthermore, the brand is also famous for its management system in term of quality enhancement and customer services in an effort to further achieve customer’s satisfaction, trust and reliability.

One more thing that makes Sony a well-known brand in the world as well as a major unique selling point is its strong brand equity . By extending the businesses of the company to a variety sectors including PCs and network products, TVs and Digital imaging, Electronic components and semiconductors, Entertainment and Financial services, Sony has achieved huge brand awareness , and it is likewise enhance its brand equity. Some feature products from Sony such as Bravia TVs, DSLRs Cameras, Playstation gaming consoles, portable music players Walkman and VAIO computers for example. In addition, they even take part in entertainment sector with the Sony Music Entertainment and Sony Pictures Entertainment which are very popular in the world.

Major Problems and Challenges Faced by Sony Corporation

Sony is a multinational organization and has to deal with the dynamic industry in which it is operating. It has developed itself by formulating a steady work environment where engineers had thoughtful appreciation of technology and have worked without restraint as they pleased to focus on development of dynamic technologies and creation of products that people have always desired.

Sony Corporation, which has been a leading corporation once, has reported losses for almost four consecutive years. It declared a record annual net loss of 520 billion yen ($6.4 billion) for the year ends in March 2012. The main strategic problem of Sony Corporation is embedded in its several product lines that provide too many parts of the entertainment value chain. The company’s innovation and operations slowed down due to the introduction of the “empire-building” strategy. It has lead to the weakening of its competitiveness in all of the market segments of its business. In addition to the internal problems faced by the wide product lines by Sony, it is facing other external challenges as well. In late 2000s, global economic crisis caused a significant decline in consumer spending as of recession and resultantly caused a decrease in the profitability of Sony. The overall demand of the products of Sony has declined due to the appreciation of the Japanese Yen as it has lead to negatively affect the purchasing power of non-Japanese consumers of Sony Products. Further, the Great East Japan Earthquake disaster and its consequences also effected Sony’s operations badly and resulted in extensive re-establishment costs. In the presence of these external and uncontrollable challenges, Sony was unable to cope with the increasing competition and it became difficult for Sony to retain its market share within the electronics and game industry. In accordance with such problems the top management team of Sony was comparatively conservative. As a result, Sony lost its competitive edge in the industry due to decrease in its technological innovation. In a nutshell, the primary emphasis of Sony Corporation on restructuring strategies in such alarming and challenging situation leads to enormous and continual losses.

Overview of Sony Corporation Strategies and its Implications

Sony Corporation is a giant in its industry having well-built core competencies . It has economies of scale and wide scope both in production and research and development because of its huge network in Japan, the United States and other countries all around the world. Moreover, its unique quality, technology and differentiated products are other top strategic benefits that can help it to attain competitive advantage in market.

Sony’s business operations have been restructured many times in last two decades. Sony’s first signs of loss began in early 1990s when it experienced a loss of ¥ 293.36b in 1995. The reason behind this loss was primarily the unrelated diversification and the dearth of innovation. New products are imitated very soon by the competitors in the digital era because these products can be produced by assembling widely-available parts. So there always remain the dangers of being entangled in price wars. This can only be avoided by readily adapting changes in a way that competitors cannot keep up. In reaction to this, Sony put all its efforts into restructuring the corporation considering it as a way towards success as there was general trend of diversification in leading companies. It faced heavy restructuring costs in this course but these efforts failed to attain the expected results and outcomes. In 1994, Sony formulated an eight company structure with an aim to create a market-responsive company but the losses prevailed. In 1996, it designed a ten-company structure with a same goal to get the company back to profits. Again, due to unrelated diversifications, heavy decentralization and minimal involvement of board room in major decisions, the losses cannot be reduced. After 1999, the company focused on Internet based products due to dot com burst. This major shift in business focus further worsened the situation. The major reasons for further losses were the lack of consolidation and hence substantial fall in sales. In addition to this, the economic slowdown in the US was also a key reason. Consequently, the focus on core competency was re-established which resulted in regaining profits slightly.

Sony must focus on increasing sales immediately so as to meet their short-term goals and attain success in long run. In addition to restructurings among Sony’s product lines, it should ensure stable profitable trend to avoid more severe decline. In the past few years, it has been able to reduce it cost. It should maintain this reduction so as to increase gross margin in the long run. Moreover, it should utilize the increased leverage and other assets in the ways that can lead to optimum and efficient boosting of sales. Most importantly, it should try to reduce or mitigate the macroeconomic risk which has been a major cause of unexpected losses in previous years.

Critical Evaluation of the ‘One Sony’ Strategy

The most important challenges for Sony are the high competition in industry and the macroeconomic risks. In this regard Sony should re-develop its competitive advantage, regain focus, ensure quality and reduce external factors effect on company’s performance and profitability.

The chief executive of Sony Corporation has emphasized on the fact that it’s the time for Sony to change now. He has given a revival plan that elucidates a major shift from the company’s unprofitable television business. It also planned to cut 10,000 jobs as well. In the new strategy, it is emphasized that the Sony would concentrate on three businesses namely the mobile devices, including smartphones and tablets; cameras and camcorders; and games.

Sony has fruitfully expanded into various business segments (Electronics, Game, Pictures, Music, and Financial Services) since the beginning of the company as a telecommunication company in 1946. It has diversified its product lines and has attained remarkable reorganization in a wide range of sectors. It has enhanced many other resources like research and development, marketing, customer services and even unrelated areas. All this has lead to both positive and negative effects simultaneously. As diversification has lead to the expansion of the company, it has also resulted in decreasing its specialized capabilities. Hence, Sony was unable to keep hold of its competitive advantage in any sector or segment of its business and lost the competitive edge against the highly specialized competitors within each segment.

So it’s the need of the hour that Sony locates a specific segment or sector to focus and specialize in it and then it should restructure the company around that focused segment. This type of restructuring can help the company to utilize maximum of its resources in the most productive and optimal way. The current move of Sony’s strategy is exactly in this line. Sony is about to terminate or integrate its least profitable segments. Such restructuring will lead to the development of a proprietary product collection and special set of Sony hardware and software products that can be used against the highly specialized competitors like the products of Apple. In this way, Sony can have an edge over the competitors in long run as no other company is operating in such wide range of sectors currently as Sony is. Sony, no doubt, will have an incomparable experience in this regard. This type of restructuring can reverse the recent unprofitable trend of the company as it will be a strong positive signal to the market and its competitors enhancing the confidence of consumers and investors.

The segments or sectors of business that should be focused should have the specific features. Sony should focus on such sectors which are already its main segments, namely the consumer, professional & devices segment or the networked products & services segment. Moreover, such segments should also have the prospect or potential to get integrated with various remaining segments. In this way, Sony will be able to leverage most of its current resources. Most importantly, this market segment should be moderate in competition as well. Sony would be able to implement the strategies in such segments where it has bigger market share recently.

Keeping these benefits in view, the mobile devices of Sony are extremely desirable sector to be focused by it. The series of Sony Ericsson smartphones launched with the Xperia brand in 2011 which operated on Android gained an extensive market share and have much more potential. Similarly, the Xperia smartphones can also be integrated with Sony tablets, personal computers and game consoles in this concern. In this way, Sony can be able to lower the cost and increase the demand for such Sony products in the long run keeping the main focus on the abundant competition in the smartphones and tablets markets.

Another sector to be focused by Sony can be of the games. The main reason behind it is that it’s the major segments for Sony in which it has competitive market share. The sector of games can induce synergies among Sony’s product lines. Moreover, the competition in the segment of games business is not as extreme as it is in the other market segments. Sony intends to replace the operations of disjointed lineup of content delivery platforms to expand its PlayStation game network which will offer music and video as well. This is no doubt a good strategic step.

However, one Sony strategy is intending to focus on Sony’s digital imaging business that involves digital cameras and camcorders. This policy is again not very appropriate as Sony will have to face intense competition from Canon, Nikon, and Olympus. Moreover, Sony will also face threats from substitutes such as tablet computers which are highly equipped with advanced digital imaging functions. Keeping all these factors in view, it can be deduced that Sony will encounter great problems in the integration of digital imaging sectors with its other businesses.

Another appropriate feature of the new strategy is the decision of shrinking the TV business as the severe competition from Samsung and LG, the deficiency of synergy potentials and the comparatively low share of market is making it impossible for Sony to attain or retain its competitive advantage.

The focus on certain sectors will provide various benefits to Sony. Sony can start acquisitions within related segments once it has established strong focus. The acquisition strategy will lead to increase market share, to get the economies of scale, decrease manufacturing costs, and provide access to new technologies and patents. An increase in the market share will provide Sony with higher pricing power. The economies of scale will raise its productivity. The reduction in the manufacturing cost will lead to give benefit in a price competition. The technologies and patents will allow Sony to speed up their innovation progress which is slow right now. Sony must start by acquiring smaller companies in its focused market segment and should overpay premiums for the expected synergies as well.

Another main focus of this new strategy is to improve the quality of its products by managing such features at the top level of management in integrated way. The major strength of Sony is its brand name because consumers deem Sony’s products as trustworthy and having high quality generally. Whereas the quality of products of Sony has decreased in last few years. For instance, Sony declared that almost around 535,000 of their VAIO laptops might be in danger of overheating because of the temperature gauge error in 2010. Similarly, Sony had also recalled eight models of Sony digital cameras because of the problems with the image pick-up shortly after its multiple delays in launching PlayStation3. Such quality problems have lead to cost lawsuit expenses and have damaged the corporate image as well. Now, Sony is seriously emphasizing on attaining specialization in its products to avoid any such circumstances in future which is a positive action of this strategy.

Moreover, Sony is expecting to enhance its business in emerging markets with greater focus on the innovation . It is a vital strategy for any business so as to keep itself in the market successfully. This will provide it with more markets’ availability in the long run increasing the sales and hence profits.

However, this strategy is lacking in one very important aspect which is handling the macroeconomic factors. The presence of Sony in the international market has lead to its sensitivity to exchange rates and local economies. No doubt, Sony cannot get direct control over such factors but it can utilize its Financial Services segment to mitigate the risk exposure. Sony can apply this strategy by making derivatives contracts (currency swaps and interest rate swaps) or by taking short positions in particular securities as long as these practices comply with laws and regulation. The most problematic task is goal congruence. It means alignment of the manager’s incentives with the overall firm because such hedging measures can impact the profitability of the financial services segment. If these factors are ignored, they will again lead to unexpected losses to Sony in the long run making all other measures unrewarding.

Sony took the direct action in introducing the company system in the first place. It then performed an organizational improvement synchronized with the changes in the surrounding environment. Its strategy shifted in accordance with Chandler’s proposition that “organization follows strategy”. Sony’s organizational reforms and responding to environmental changes after the bubble collapse were significant. The one Sony and one management system will lead to solve many problems and have the capability of improving the performance of the company as all the major decisions are now to be taken and implemented by the top management. The new approach emphasizes on the strengths of the entire Sony Group as “One Sony” by implementing a rapid decision-making process. With the help of this, Sony’s primary goal is to revive and cultivate the electronics business to create new value in addition to further escalation of the stable business foundations of the Entertainment and Financial Service businesses.

This management structure has reduced the previous complexity of the system and efficiency is expected to be increased. The more top-down leadership is expected to start to attain Sony’s goals for the next years as it is said it’s the key to spot the requirement to ‘create visions’, ‘motivate’, ‘establish direction’ and ‘align people’. The focus is on development of six components for successful strategic leadership that involves determining a firm’s vision, retaining core competencies and mounting human capital . All these aspects are introduced to develop new technology and benefit from a centralized decision making system in the long run.

Sony has faced many difficulties for several years and has now been able to properly identify many of its real problems. The latest strategy will lead to address them to some extent. Although some improvements have been shown in the recent times but still many areas are to be focused on in this strategic change. The basic reason behind it is that Sony is not a market leader now. Resultantly it does not have that old power to influence the direction of the market and follow its own plan. Moreover, the policy of defending its own interests has proved to be exigent. The strategies need not be deliberate always, they can emerge as well. This strategy is good in many aspects and can lead to revive Sony Corporation but still Sony needs to work hard if it wants to survive and regain its market-leading position again.

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Sony Corporation’s Strategy in Context Case Study

Introduction, factors that affected yoshida’s decision, internal environment factors.

Sony is a Japan-based international corporation that produces electronics and provides entertainment and financial services. Established in 1946 by Akio Morita and Masaru Ibuka, it succeeded as a part of Sony Groups that also includes Sony Pictures, Sony Music, Sony Interactive Entertainment, et cetera (Green, 2017). While the performance of Sony began in Tokyo, it covers a lot of countries worldwide today due to the opportunities provided by globalization processes. In order to remain competitive, the company forms joint ventures, sells its activities, and restructures the branches and divisions. The chairman, Kaz Hirai, and President and CEO, Kenichiro Yoshida, are the two main people who identify the company’s course of development. The ownership structure consists of institutional holdings allocated to holders, who cannot lead the company, yet Yoshida and Hirai should respond to them about their actions.

This paper will focus on how Yoshida took a new perspective on leading the company and making it successful based on the range of the previous solutions regarding the company’s strategy. This CEO freed Sony from the production of Vaio laptops and returned the corporation to profitability (Inagaki & Barber, 2018). It should be stressed that Yoshida is not a traditional Japanese leader since contrary to all widely accepted strategies, he criticizes the previous management of the company for not adapting Sony to the changing electronics market. In particular, the paper will discuss why such strategies as focus on innovations and content prioritization were declared by Yoshida as the key components of the integral decision. Currently, one may observe the first positive results of the mentioned solution, which are evident through reduced costs and increased interest of customers and partners. More to the point, the stakeholders tend to support this decision due to its consistency with the contemporary market development trends.

The structure of the essay is organized chronologically to follow the factors that contributed to the target solution. First of all, the way Sony was introduced will be examined to understand its initial mission. Second, it seems also essential to determine the external environment factors that promoted the decision of Yoshida, which will be conducted in the context of the stakeholder theory, focusing on the connection with the interested parties and taking their needs and expectations into account. Third, the internal environment will be analyzed based on the constructs of the institutional theory. The social and cultural aspects that played a decisive role in the historical success of the company are to be identified and interpreted. Ultimately, the concluding part will summarise the key points and answer the question of how Sony adopted the identified solution.

Early Steps and the Raise of Sony

Sony created the transistor radio after World War II, which soon was spread across the globe due to its popularity. The leadership of Akio Morita allowed the company to remain ahead of technological progress, and its leaders devoted most of their work to come up with ways to utilize the achievements for the benefit of all people. Inspired by the idea of creating new markets, Sony played the role of a pioneer and occupied the leading position in the sector of consumer electronics (Frynas & Mellahi, 2015). There are few technology companies that have a comparable success story. At this period, the company’s management used about 85 percent of the time to the issues associated with research and development, 10 percent to staff, and only the remaining 5 percent to finance (Frynas & Mellahi, 2015). For Akio Morita, the financial results were the results of hard work on the creation of new products and the formation of new markets. It was believed that in case Sony handled well with its main task, the results will be consistent. Thus, it is clear that the initial developmental course taken by Morita and Ibuka was closely associated with innovations, which were given much less attention in the future years.

External Environment Factors

One of the key persons who affected the target decision was Edward Deming. The prominent Japanese quality control system was introduced by this expert who was not known in his own country until his ideas of quality control had such a huge impact on Sony. The Americans realized the significance of the statements of this scholar but did not treat them with the same seriousness as the Japanese. In fact, the Deming Prize for quality is one of the highest awards that a Japanese company can receive. In the 1950s, Deming persuaded the leaders of the company to concentrate on producing goods faster, better, and cheaper – he promoted the ideas of industrialization (Kar, 2017). In other words, the initiative of the rapid and massive increase in production was declared pivotal. The higher the quality of the product, the fewer maintenance problems will occur. It should be stated that all of the discussed events and actions occurred in the headquarters of Sony – Tokyo, Japan.

The review of the relevant sources shows that such obsession improved quality yet left the leaders of Japanese business with fewer skills to develop and apply innovation in any other field. Over time, Sony tended to pay less attention to the development of industrial products, forgetting the idea to create new markets (Moskowitz, 2016). For example, even though Vaio computers were of exceptional quality, they almost did not use new technologies. When the company had to get involved in severe competition with, HP, Dell, and Lenovo, its success began to depend on the game to reduce the cost/price of the production of computers, but not on the development of new designs. One should point out the fact that Sony has deliberately developed a clearly industrialized strategy focused on the processes and production volumes, instead of trying to create something unique.

In 2012, led by Stringer, Sony has entered into a partnership with Ericsson, subsequently buying it entirely (Noam, 2018). Again, customers did not observe any new technologies or attempts to create a device that stands out from the rivals. Instead, Sony has focused on increasing the volume of production along with the circumvention of the products of Nokia, Motorola, and Samsung with regard to price and functionality (Merrin, 2017). With no consumer or technological advantage, Samsung left Sony with its industrial strategy far behind due to lower costs. This shows that the preference was given to volumes intentionally as a way to maximize profit and saturate the market.

According to the stakeholder theory, a company is not only economic integrity and a tool for making a profit but also an element of the environment in which it operates. Namely, it is a system that influences and is influenced by its environment, including local communities, consumers, suppliers, public organizations, staff, investors, and shareholders (Freeman & Moutchnik, 2013). The first method of the identified theory that is used by Sony is to establish partnerships with stakeholders (Fernando & Lawrence, 2014). An important goal of this method is to build such relationships so that it is more profitable for the stakeholder to act in the interests of the company since in this case it also reaches its own interests. Yoshida considers that Sony should make better use of its user data in order to create content that best suits their preferences (Kodama & Shibata, 2015). This proximity to users is regarded as the way to survive. Therefore, Sony will not close PlayStation Vou, the Internet streaming television service.

In the context of the stakeholder theory, the concept of shared values ​​can be defined as policies and operational practices that enhance the competitiveness of a particular company (Hörisch, Freeman, & Schaltegger, 2014). At the same time, it strives to improve the economic and social conditions of related communities. Creating shared values ​​focuses specifically on situational identification as well as expanding and strengthening the links between social and economic progress (Kodama & Shibata, 2015). Since previously the volume and price reduction were the main goals, innovations lacked necessary attention purposefully as they were not assigned a top priority.

Today, Yoshida attempts to preserve its quality and introduce innovations to build a business around communities of interest arising among gamers, film fans, and music lovers (Figure 1 shows that quality remains essential for Sony). For instance, the largest community is the Sony PlayStation Network. The CEO believes that the data on 80 million players need to be better analyzed in order to create content that best matches the interests of the audience (Thilk, 2018). A recent example of such a hit is the success of the new Spider-Man for the PlayStation 4, which was released on September 7 and for three days sold a record circulation of 3.3 million copies. By approximate calculations, Spider-Verse film collected $30-35 million (Thilk, 2018). Thus, it is evident that the decision to target customers was dictated by the need to better understand what they need and adjust innovations accordingly.

The institutional theory of organizations implies that they are social structures with a certain degree of resilience. There are social, cultural, cognitive, and regulative components of the theory that specify how one or another decision was taken. It should be emphasized that the main insight of the institutional theory refers to imitation as organizations tend to look at their competitors to make solutions instead of practicing a rational approach. Overall, cultural and cognitive explanations are most appropriate to understand Sony’s decision. In consistent with this theory, Yoshida observed other companies and found that such giants as Apple or Google always target innovations and adjustment of their products. Partially, the CEO focused on his decision since the company was lacking for many years.

In 2016, headed by Kazuo Hirai, an ex-CEO, Sony entered the new frontier of competitiveness by launching Blu-Ray technology to the market, its strategy remained the same. First of all, it aimed at finding a way to sell as many devices as possible working in a new format (Pope, 2012). Therefore, the company did not sell Blu-Ray technology to anyone. Similarly, it behaved in the market of audio files by developing its own audio encoding format that was applicable only to devices manufactured by Sony. In the conditions of the information economy, this approach could not suit consumers, and Blu-Ray turned out to be an unprofitable undertaking, uninteresting to the market, and the same fate awaited the now closed series of digital Sony players (Pope, 2012). One may observe such a situation in almost all areas of the company’s business. For example, in the production of televisions, Sony has lost its technological advantage that was achieved due to the launch of Trinitron CRT. In the segment of flat-panel devices, Sony applied its industrial strategy, trying to beat the competition by increasing volumes and reducing costs with predictably dismal results.

The situation started to change before Yoshida – under the leadership of Morita in the 1990s, the development of new products was at the forefront, and the tactics of the industrial age were used to reduce costs. However, Sony executive, Stringer who came to the company in 2009 was trained differently: to implement an industrial strategy. In his perspective, new products and markets occupied a subordinate place. They were convinced that if Sony would have sufficiently high gross figures and would be able to sufficiently reduce costs, sooner or later the victory in the competition would be ensured to it. By 2010, Sony had reached the climax of this strategy, putting the company at the head of a non-Japanese leader (Dhillon & Gupta, 2015). Stringer earned his reputation as the head of Sony’s American subsidiary, who, in perfect agreement with the letter of the industrial strategy, reduced the 30,000-strong staff of the company to 9,000 (Hartung, 2012). For Stringer, Sony’s mainstream development course was neither innovation, nor technology, nor new products and markets.

In Stringer’s version, an industrial strategy meant obsession with cost reduction. While Morita’s management meetings were 85 percent dedicated to innovation and market-based technology, Stringer brought a modern approach to Sony (Velez-Castrillon & Angert, 2015). It should be stressed that Sony’s leadership was driven in strict accordance with MBA success recipes of the 1960s. By focusing on a specific limited range of products to increase production volumes and trying to avoid the costly development of technological innovations in favor of mass production, he strived to achieve the reduction of costs. The increase in the service life of the product and equipment was also dictated by MBA value systems of that time (Velez-Castrillon & Angert, 2015). That is why during Stringer’s short stay at the head of Sony, the company did not create a single new product.

In 2012, when Kazuo Hirai replaced Stringer as the CEO of Sony, the corporation suffered losses for four years in a row. However, competing in costs with countries where labor is cheaper than Japanese, Sony turned out to be daunting, and Forbs called people to sell stocks of Sony, yet it proved to be wrong (Hartung, 2012). Hirai returned Yoshida to Sony and made him a finance director. In 2012–2018, Sony’s shares have risen in price three times, and the corporation has returned to the top ten most expensive companies in Japan. The operating profit for the 2017/18 fiscal year increased 2.5 times to a record 734.9 billion yen ($ 6.72 billion) (Inagaki, 2017). This shows that the decision to employ innovations as the driving force of future actions is effective. In terms of the institutional theory, the previous leaders of the company tried to use traditional and industrial strategies that now seem to be outdated.

As it can be viewed from the provided above analysis, all the actions initiated by Sony leaders were deliberate and planned. The key factors were associated with the social and cultural constructs that specified their actions and beliefs. It is noteworthy that Yoshida’s approach to innovations is caused by his commitment to the Japanese approach to exceptional quality and also by his creative application of the global production culture inspired by new technology (Graph 1 and Graph 2).

A vivid example of the need for internal cooperation is the project of a self-driving car, which is engaged by a group of Sony engineers who previously developed smartphones. Yoshida assures that this project was not started up for the sake of creating a car but to evoke passion in employees and keep talents (Nakamura, 2019). In addition, Sony would like to occupy a niche manufacturer of entertainment systems for cars and supplier of image sensors (Iwato, 2018). The production of the latter sharply increased after the appearance of the trend for smartphones with two cameras.

To conclude, this paper explored the factors that led the current CEO and President of Sony to take the decision that focuses on innovations, content prioritization, and the stop in the production of Vaio computers. Based on the chronologic presentation of the events, it was revealed that the Japanese brand became interested in reducing costs and increasing production volumes while the development of new technologies was not considered important. Even though such an approach was effective for the 20th century, it seems to be outdated today. The mentioned statement identifies the key reason for the target decision that allowed Sony to survive the crisis and become successful again.

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Velez-Castrillon, S., & Angert, C. (2015). How Sony got its groove back: A case study in turnaround management. Business Education Innovation Journal , 7 (2), 144-154.

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IvyPanda. (2024, February 22). Sony Corporation's Strategy in Context. https://ivypanda.com/essays/sony-corporations-strategy-in-context/

"Sony Corporation's Strategy in Context." IvyPanda , 22 Feb. 2024, ivypanda.com/essays/sony-corporations-strategy-in-context/.

IvyPanda . (2024) 'Sony Corporation's Strategy in Context'. 22 February.

IvyPanda . 2024. "Sony Corporation's Strategy in Context." February 22, 2024. https://ivypanda.com/essays/sony-corporations-strategy-in-context/.

1. IvyPanda . "Sony Corporation's Strategy in Context." February 22, 2024. https://ivypanda.com/essays/sony-corporations-strategy-in-context/.

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IvyPanda . "Sony Corporation's Strategy in Context." February 22, 2024. https://ivypanda.com/essays/sony-corporations-strategy-in-context/.

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Total quality management: three case studies from around the world

With organisations to run and big orders to fill, it’s easy to see how some ceos inadvertently sacrifice quality for quantity. by integrating a system of total quality management it’s possible to have both.

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There are few boardrooms in the world whose inhabitants don’t salivate at the thought of engaging in a little aggressive expansion. After all, there’s little room in a contemporary, fast-paced business environment for any firm whose leaders don’t subscribe to ambitions of bigger factories, healthier accounts and stronger turnarounds. Yet too often such tales of excess go hand-in-hand with complaints of a severe drop in quality.

Food and entertainment markets are riddled with cautionary tales, but service sectors such as health and education aren’t immune to the disappointing by-products of unsustainable growth either. As always, the first steps in avoiding a catastrophic forsaking of quality begins with good management.

There are plenty of methods and models geared at managing the quality of a particular company’s goods or services. Yet very few of those models take into consideration the widely held belief that any company is only as strong as its weakest link. With that in mind, management consultant William Deming developed an entirely new set of methods with which to address quality.

Deming, whose managerial work revolutionised the titanic Japanese manufacturing industry, perceived quality management to be more of a philosophy than anything else. Top-to-bottom improvement, he reckoned, required uninterrupted participation of all key employees and stakeholders. Thus, the total quality management (TQM) approach was born.

All in Similar to the Six Sigma improvement process, TQM ensures long-term success by enforcing all-encompassing internal guidelines and process standards to reduce errors. By way of serious, in-depth auditing – as well as some well-orchestrated soul-searching – TQM ensures firms meet stakeholder needs and expectations efficiently and effectively, without forsaking ethical values.

By opting to reframe the way employees think about the company’s goals and processes, TQM allows CEOs to make sure certain things are done right from day one. According to Teresa Whitacre, of international consulting firm ASQ , proper quality management also boosts a company’s profitability.

“Total quality management allows the company to look at their management system as a whole entity — not just an output of the quality department,” she says. “Total quality means the organisation looks at all inputs, human resources, engineering, production, service, distribution, sales, finance, all functions, and their impact on the quality of all products or services of the organisation. TQM can improve a company’s processes and bottom line.”

Embracing the entire process sees companies strive to improve in several core areas, including: customer focus, total employee involvement, process-centred thinking, systematic approaches, good communication and leadership and integrated systems. Yet Whitacre is quick to point out that companies stand to gain very little from TQM unless they’re willing to go all-in.

“Companies need to consider the inputs of each department and determine which inputs relate to its governance system. Then, the company needs to look at the same inputs and determine if those inputs are yielding the desired results,” she says. “For example, ISO 9001 requires management reviews occur at least annually. Aside from minimum standard requirements, the company is free to review what they feel is best for them. While implementing TQM, they can add to their management review the most critical metrics for their business, such as customer complaints, returns, cost of products, and more.”

The customer knows best: AtlantiCare TQM isn’t an easy management strategy to introduce into a business; in fact, many attempts tend to fall flat. More often than not, it’s because firms maintain natural barriers to full involvement. Middle managers, for example, tend to complain their authority is being challenged when boots on the ground are encouraged to speak up in the early stages of TQM. Yet in a culture of constant quality enhancement, the views of any given workforce are invaluable.

AtlantiCare in numbers

5,000 Employees

$280m Profits before quality improvement strategy was implemented

$650m Profits after quality improvement strategy

One firm that’s proven the merit of TQM is New Jersey-based healthcare provider AtlantiCare . Managing 5,000 employees at 25 locations, AtlantiCare is a serious business that’s boasted a respectable turnaround for nearly two decades. Yet in order to increase that margin further still, managers wanted to implement improvements across the board. Because patient satisfaction is the single-most important aspect of the healthcare industry, engaging in a renewed campaign of TQM proved a natural fit. The firm chose to adopt a ‘plan-do-check-act’ cycle, revealing gaps in staff communication – which subsequently meant longer patient waiting times and more complaints. To tackle this, managers explored a sideways method of internal communications. Instead of information trickling down from top-to-bottom, all of the company’s employees were given freedom to provide vital feedback at each and every level.

AtlantiCare decided to ensure all new employees understood this quality culture from the onset. At orientation, staff now receive a crash course in the company’s performance excellence framework – a management system that organises the firm’s processes into five key areas: quality, customer service, people and workplace, growth and financial performance. As employees rise through the ranks, this emphasis on improvement follows, so managers can operate within the company’s tight-loose-tight process management style.

After creating benchmark goals for employees to achieve at all levels – including better engagement at the point of delivery, increasing clinical communication and identifying and prioritising service opportunities – AtlantiCare was able to thrive. The number of repeat customers at the firm tripled, and its market share hit a six-year high. Profits unsurprisingly followed. The firm’s revenues shot up from $280m to $650m after implementing the quality improvement strategies, and the number of patients being serviced dwarfed state numbers.

Hitting the right notes: Santa Cruz Guitar Co For companies further removed from the long-term satisfaction of customers, it’s easier to let quality control slide. Yet there are plenty of ways in which growing manufacturers can pursue both quality and sales volumes simultaneously. Artisan instrument makers the Santa Cruz Guitar Co (SCGC) prove a salient example. Although the California-based company is still a small-scale manufacturing operation, SCGC has grown in recent years from a basement operation to a serious business.

SCGC in numbers

14 Craftsmen employed by SCGC

800 Custom guitars produced each year

Owner Dan Roberts now employs 14 expert craftsmen, who create over 800 custom guitars each year. In order to ensure the continued quality of his instruments, Roberts has created an environment that improves with each sale. To keep things efficient (as TQM must), the shop floor is divided into six workstations in which guitars are partially assembled and then moved to the next station. Each bench is manned by a senior craftsman, and no guitar leaves that builder’s station until he is 100 percent happy with its quality. This product quality is akin to a traditional assembly line; however, unlike a traditional, top-to-bottom factory, Roberts is intimately involved in all phases of instrument construction.

Utilising this doting method of quality management, it’s difficult to see how customers wouldn’t be satisfied with the artists’ work. Yet even if there were issues, Roberts and other senior management also spend much of their days personally answering web queries about the instruments. According to the managers, customers tend to be pleasantly surprised to find the company’s senior leaders are the ones answering their technical questions and concerns. While Roberts has no intentions of taking his manufacturing company to industrial heights, the quality of his instruments and high levels of customer satisfaction speak for themselves; the company currently boasts one lengthy backlog of orders.

A quality education: Ramaiah Institute of Management Studies Although it may appear easier to find success with TQM at a boutique-sized endeavour, the philosophy’s principles hold true in virtually every sector. Educational institutions, for example, have utilised quality management in much the same way – albeit to tackle decidedly different problems.

The global financial crisis hit higher education harder than many might have expected, and nowhere have the odds stacked higher than in India. The nation plays home to one of the world’s fastest-growing markets for business education. Yet over recent years, the relevance of business education in India has come into question. A report by one recruiter recently asserted just one in four Indian MBAs were adequately prepared for the business world.

RIMS in numbers

9% Increase in test scores post total quality management strategy

22% Increase in number of recruiters hiring from the school

20,000 Increase in the salary offered to graduates

50,000 Rise in placement revenue

At the Ramaiah Institute of Management Studies (RIMS) in Bangalore, recruiters and accreditation bodies specifically called into question the quality of students’ educations. Although the relatively small school has always struggled to compete with India’s renowned Xavier Labour Research Institute, the faculty finally began to notice clear hindrances in the success of graduates. The RIMS board decided it was time for a serious reassessment of quality management.

The school nominated Chief Academic Advisor Dr Krishnamurthy to head a volunteer team that would audit, analyse and implement process changes that would improve quality throughout (all in a particularly academic fashion). The team was tasked with looking at three key dimensions: assurance of learning, research and productivity, and quality of placements. Each member underwent extensive training to learn about action plans, quality auditing skills and continuous improvement tools – such as the ‘plan-do-study-act’ cycle.

Once faculty members were trained, the team’s first task was to identify the school’s key stakeholders, processes and their importance at the institute. Unsurprisingly, the most vital processes were identified as student intake, research, knowledge dissemination, outcomes evaluation and recruiter acceptance. From there, Krishnamurthy’s team used a fishbone diagram to help identify potential root causes of the issues plaguing these vital processes. To illustrate just how bad things were at the school, the team selected control groups and administered domain-based knowledge tests.

The deficits were disappointing. A RIMS students’ knowledge base was rated at just 36 percent, while students at Harvard rated 95 percent. Likewise, students’ critical thinking abilities rated nine percent, versus 93 percent at MIT. Worse yet, the mean salaries of graduating students averaged $36,000, versus $150,000 for students from Kellogg. Krishnamurthy’s team had their work cut out.

To tackle these issues, Krishnamurthy created an employability team, developed strategic architecture and designed pilot studies to improve the school’s curriculum and make it more competitive. In order to do so, he needed absolutely every employee and student on board – and there was some resistance at the onset. Yet the educator asserted it didn’t actually take long to convince the school’s stakeholders the changes were extremely beneficial.

“Once students started seeing the results, buy-in became complete and unconditional,” he says. Acceptance was also achieved by maintaining clearer levels of communication with stakeholders. The school actually started to provide shareholders with detailed plans and projections. Then, it proceeded with a variety of new methods, such as incorporating case studies into the curriculum, which increased general test scores by almost 10 percent. Administrators also introduced a mandate saying students must be certified in English by the British Council – increasing scores from 42 percent to 51 percent.

By improving those test scores, the perceived quality of RIMS skyrocketed. The number of top 100 businesses recruiting from the school shot up by 22 percent, while the average salary offers graduates were receiving increased by $20,000. Placement revenue rose by an impressive $50,000, and RIMS has since skyrocketed up domestic and international education tables.

No matter the business, total quality management can and will work. Yet this philosophical take on quality control will only impact firms that are in it for the long haul. Every employee must be in tune with the company’s ideologies and desires to improve, and customer satisfaction must reign supreme.

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Case Study - Sony

Sony Corporation is a leading manufacturer of audio, video, imaging, game, communications, key device and information technology products for the consumer and professional markets. Keiko Shiga from Sony’s Quality & Environmental Department tells us more about Sony's science-based targets here.

With Sony's music, pictures, computer entertainment and online businesses, it is uniquely positioned to be the leading electronics and entertainment company in the world. Sony recorded consolidated annual sales of approximately $72 billion for the fiscal year ended March 31, 2016. We spoke to Keiko Shiga from Sony’s Quality & Environmental Department about the company’s science based targets.

Why did you decide to set a science-based target?

We didn’t actually set out to set a science-based target in response to a call from the Initiative. We already had “Road to Zero”, our global environmental plan for achieving a zero environmental footprint by 2050, which we announced in 2010, and we were working towards this. We knew our “Green Management” mid-term targets had to be ambitious in order to put us on track to achieve the radical reduction in emissions necessary by the middle of the century.

We are part of WWF’s Climate Savers Program and we were speaking to them about our targets for 2020 and they said: ‘these look science-based.’ We didn’t realize this but agreed to submit the targets for a quality check and they were approved! We successfully hit our 2015 targets for climate change, and are now on track to delivering more reductions.

We believe it is essential to act on climate change and to do so quickly. It is central to our identity as a company that seeks to make a connection with people. Our customers don’t just look for functional value but deeper and more elusive emotional value. In Japanese culture, we call this ‘kando’. Being environmentally aware and responsible is one of the most important ways to achieve this.

What was the process for setting and implementing the ambitious targets?

The basic foundation of the Green Management mid-term targets was developed by the Quality & Environmental Department, involving business groups and relevant divisions in the discussions as needed. We also talked with some stakeholders about their expectations for Sony and benchmarked what other advanced companies are doing for environmental initiatives. Then we took it to the Group Executive Committee at one of their monthly meetings.

The CEO was instrumental in getting other executives on board. For him, it was central to what Sony is and does.

Without his backing it would have been harder to get other leaders on board.

Across the company, people are behind the targets and agree with the idea that we have to radically reduce our emissions. We provide e-Learning on Green Management mid-term targets to keep awareness and momentum high. Of course, in the shorter-term the specific targets and reductions require negotiation and explanation.

What changed as a result of having an official quality checked science-based target?

In some ways not much changed. We were already working towards the Road to Zero, and so the internal processes were in place to deliver this. However, having targets approved by a global initiative, as being science-based and in line with the level of ambition necessary to prevent dangerous climate change gave us more confidence and greater authority. This was particularly important in the context of COP 21 and the Paris Agreement, which saw an increase in awareness around the need to act.

What benefits do you anticipate or have you already reaped from having a science-based target?

This is something our customers want. It is important for our brand value. We need to fulfill our mission to provide the products customers want. And because these products are more energy efficient we are also helping to reduce global emissions, so it’s a win-win.

It puts us in a good position vis-à-vis our competitors, and also regulators. It means we meet and try to surpass what stakeholders expect of us, keep offering the best to our customers, and in doing so, get ahead of what other companies are doing. We also save money, because of energy efficiency.

Having a science-based target helps keep us on track. It means we know what we need to do in the short and medium term to meet the longer-term vision. And it also helps convince people internally that we are doing this in a logical manner. By being part of the global initiative we know we are part of a bigger movement, and that if we all work together we can deliver the reductions necessary.

Did you encounter any challenges?

Sony’s long-term vision implies a radically new way of doing business. Achieving this vision will demand changes beyond the company’s control and require collaboration with key stakeholders, including shareholders, employees, consumers, suppliers, governments and civil society.For example, we have targets for our supplying partners to meet, which is a challenge. We will have to work with them to convey the importance of reducing emissions in the supply chain. We cannot do this alone and building partnership will be key to get others to act.

Another challenge is that customers want bigger products in categories like TVs, with more vibrant displays, but they also want energy efficiency and lower emissions.

We have to try hard to deliver both. We also have to work out ways to ensure that our emissions keep going down even as the number of products our factories produce goes up.

We have absolute rather than intensity targets, so we have to cut emissions even when we grow. We will have to continue to innovate and work very hard to hit targets but I am confident we will do it – as we always have in the past.

Can you give some examples of innovations that have occurred as a result of the targets?

We have developed new LED displays for our TVs, which are more energy efficient, without compromising on picture quality. For example, the smart screens in the 4K BRAVIA™ TV X85B series adjust LED backlight brightness frame by frame to avoid wasting energy, and use 20% less energy than previous models (compared to X85A series in standard viewing mode).

We have also developed our own recycled plastic, SORPLAS, which is made from up to 99% recycled material and saves up to 80% CO2 emissions during manufacturing. This is used in many of our products and we are now also selling this outside the Sony Group.

Our environmental targets apply to all Sony companies – not just electronics, but also entertainment companies such as music and motion picture businesses. These divisions have the same emission reduction targets for operation, but they also have their own specific target – to “raise awareness and inspire action on sustainability from over 500 million people through entertainment”. For example, the main character from our film Angry Birds has become a UN Ambassador for the International Day of Happiness and is part of a campaign for greater sustainability. The idea is if the earth is happy then Angry Bird is happy. These sorts of creative innovations might not directly drive down emissions but they are really important to drive engagement, which is essential for action at the scale required.

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Sony Quality Management System Analysis

1.2.2 STRATEGY 1.2.2.1 Managing quality Sony configured its quality management system by defining quality management mechanisms across all processes, from product development, planning, design and manufacturing through sales and customer service. This has included defining the roles, responsibilities and authority of those responsible for product and customer service quality and establishing guidelines. The framework of Sony’s quality management system is showed below in a figure. Based on this quality management system, Sony is implementing measures on an ongoing basis to improve the quality of its products and services. Examples of such measures are Sony has appointed Corporate Executive in charge of Product Quality and Safety, Quality …show more content…

Moreover, it has held Quality and Customer Service Strategy Meetings and held Quality CS Officer Meetings and many more. Sony is responding well to the customers where it makes active use of customer feedback to improve its products and customer services. Figure is provided the flow of responding to the customer. Besides, Sony has established dedicated quality management organizations in each of its business areas that are responsible for improving quality for pertinent products in each market. Other than that, Sony pursues design-, manufacturing- and parts-related initiatives aimed at improving product quality. The highest priority for the Sony Group is to ensure the safety of the customers who use Sony products. Sony has assigned specialists to work full time on improving technologies essential to product reliability and continues working to ensure the long-term reliability of its products by developing elemental technologies for preventing the deterioration, wear and corrosion of materials and parts, as well as technologies necessary to ensure the reliability of new technologies and products and to evaluate such technologies and …show more content…

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Quality Management - Sony PlayStation 2 - Case Study Example

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Guidance for organizing around value, DevSecOps, and agility for business teams

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SAFe Case Study: PlayStation Network

Playstation network stays top of its game with safe.

The following summary is based on a public presentation by Tripp Meister of PlayStation Network. To watch in full, visit https://www.youtube.com/watch?v=0K97pzff3as&feature=youtu.be

“I personally believe we have delivered more in the two years we’ve been using SAFe than we did in the four years prior-not in raw code, but in value. Our downtime went down and that saved the company about 30 million over the course of the year. That’s real money and a really positive outcome.”

— Tripp Meister , Director of Technology, PlayStation Network

Since 1994, millions around the world have chosen to game with PlayStation. Today, the gaming console made by Sony Interactive Entertainment (SIE) continues to lead with more than 150 million users globally. And most recently, it took the top spot among competing consoles in holiday sales.

PlayStation customers eagerly await new releases. Delivering a quality product on time requires tight collaboration across more than 1,000 SIE engineering team members. Co-located teams reside in eight different cities.

In meeting its targets, the SIE engineering organization found Waterfall and Agile Scrum fell short in bringing together hundreds of team members cohesively. These approaches failed to address the many dependencies across the organization and resulted in less than desirable business results. What’s more, disparate teams were able to plan only one or two iterations in advance.

“It can take 700 people to make one screen available,” explains Tripp Meister, Director Technology, PlayStation Network. “Coordinating this work and having it well organized so the company can release new features and updates is critical to success. If we just follow processes like Scrum and Agile, things can fall through the cracks, especially with the highly connected systems we build at PlayStation.”

SAFe: Enabling Value Delivery

In early 2014, SIE leadership chose to deploy the Scaled Agile Framework® (SAFe®) to bring greater organization and collaboration to development.

“SAFe gives us top-down prioritization based on senior management direction, pulls disparate groups together into common timeframes, and enables us to manage dependencies much better,” Meister says.

SIE engaged a SAFe coach and began with the 2-day Leading SAFe® training for managers. By February of 2014, the company launched its first Agile Release Train (ART), and then followed that with ART launches every 12 weeks.

For every launch, team members come together in person. “Every 12 weeks, about 500 people coalesce in San Diego,” Meister says. “While it’s not cheap to bring everyone together, it’s what allows us to deliver value because you walk out of there and know you can get your work done. For 12 weeks, you are unimpeded.”

Prior to adopting SAFe, cadence varied across groups. Some iterated daily, while others did so weekly or bi-monthly. Now, SIE consistently adheres to a cadence of two weeks with 12-week iterations or PSIs, potentially shippable increments (identified now as Program Increments (PIs) in SAFe 4.0). They run six or seven iterations at a time, which comprise a major release.

SIE program managers serve as Release Train Engineers (RTE), which Meister refers to as the “ringmasters.” They oversee designers, user experience developers, systems architects, systems engineers, and product managers in executing on work in manageable increments and in adhering to the vision.

With the move to SAFe, the company made demos optional for developers. And when they do attend, demos remain high-level and limited to just 5-10 minutes—compared to all-day demos presented previously. “If developers do attend demos, it’s an opportunity to read the face of the product manager they delivered to,” Meister says.

Clearer Vision, Predictability and Priorities

At SEI, SAFe has fundamentally changed the culture of the engineering organization:

• Greater visibility/transparency —Developers have more insight into broader company initiatives and activities. “Now, every planning session we do, every single employee practicing SAFe knows our financial results,” Meister says. “The work we do isn’t usually visible, so when you see that you impact the bottom line, it resonates better.”
• Better coordination —Prior to SAFe, collaboration wasn’t necessarily constructive. Now, from Tokyo to San Diego, everyone speaks a common language when it comes to Agile. Disparate groups work together more cohesively, and SEI has enhanced coordination between Portfolio and Program management activities.
• Dependency management —In an environment with many dependencies, SAFe serves as a dependency management system, improving predictability.
• Clearer priorities —With weighted shortest job first (WSJF), SAFe brought a new approach to prioritizing. “SAFe has really allowed us to work on the most valuable thing at the moment,” Meister says.

$30 Million in Savings

Today, approximately 700 team members across 60 Scrum teams actively use SAFe. Since 2014, the company has launched six trains globally, shipped more than 350 production releases, completed 22 PSIs, over 125 sprints and 250 features. With the Framework, SEI also cut initial planning time by 28 percent. Instead of 1550 man-days to plan, it now takes 1125.

“I personally believe we have delivered more in the two years we’ve been using SAFe than we did in the four years prior—not in raw code, but in value,” Meister says. “Our downtime went down and that saved the company about 30 million over the course of the year. Before, we had done similar things, but they were not nearly as effective as SAFe.”

Organization

PlayStation Network, part of Sony Interactive Entertainment

Software/Gaming Challenge

Co-located teams across eight different cities found Waterfall and Agile Scrum fell short in bringing together members cohesively.

• Delivered double the value compared to before practicing SAFe
• Cut initial planning time by 28 percent
• 700 team members across 60 Scrum teams actively using SAFe
• In two years, launched six trains globally, shipped more than 350 production releases, completed 22 PSIs, over 125 sprints and 250 features

• Work toward a common theme —”We base our milestones on an objective set that goes across all thousand people doing this, giving them a common theme to work toward,” Meister says.
• Decentralize decision-making —Empower individuals to negotiate decisions together, at all levels.
• Gain full buy-in —”SAFe worked because everyone bought into it, top to bottom,” Meister says.

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BUS602: Marketing Management

Case Study: Sony

This scholarly case study looks at Sony's participation in the video game industry. Sony provides an example of marketing strategy and strategic positioning of its products in a highly competitive global environment. It illustrates the need for industry competitive data analysis, demographic segmentation, product features, product positioning, and the magnitude of marketing decisions faced by multinational companies. 

Sony's Battle for Video Game Supremacy

As Sir Howard Stringer, CEO of Sony Corporation, settled in for his flight back to Japan from New York, a number of pressing issues occupied his mind about Sony's future. At the forefront, Sony's next generation video game console, the PlayStation 3 (PS3), was set to launch worldwide on November 17, 2006, a mere week away. Despite PlayStation 2's (PS2) dominance in the last generation of gaming consoles, Stringer understood that past successes were no guarantee of future success in the intensely competitive game industry.  

Microsoft had launched the first volley in the last console war by releasing the Xbox 360 in the fall of 2005. Within one year, almost 4 million Xbox 360s had been sold worldwide, giving Microsoft a significant head-start in the race for market dominance. Meanwhile, Nintendo, a competitor thought to be dead due to the lackluster sales of its previous console, the Nintendo Gamecube, had generated significant "buzz" around its new entry, the Nintendo Wii (pronounced "we"). Targeting more of a mainstream audience than Sony and Microsoft, the Wii, scheduled to launch just two days after the PS3, posed a serious threat to Sony's market share, particularly due to its $249.99 retail price, half the price of the PS3.  

Stringer also knew that there was much more at stake than winning the console war. The next generation of the DVD market was at stake as well. In addition to being a gaming console, the PS3 was a Blu-Ray disc player. Blu-Ray was a next-generation optical disc format that held more than five times as much information as DVDs and allowed high-definition television (HDTV) owners to watch movies with an unprecedented level of image quality. The PS3 was, in effect, the "Trojanhorse" for the Blu-Ray format. 

Sony found itself in an intense standards war with Toshiba, a well-established Japanese electronics manufacturer, that, in partnership with Microsoft, had developed its own digital video standard, the HD-DVD that retailed for $500. The battle lines were being drawn as companies including HBO, New Line, Intel, and Sanyo aligned themselves with HD-DVD and Fox, Disney, MGM, Lionsgate, Apple, Dell, Pioneer, Panasonic, Philips, HP, and Sharp sided with Blu-Ray. Warner Brothers and Paramount were supporting both formats. 

While winning the digital video format war could prove to be extremely profitable for Sony, the battle would be hard-fought. Sony, meanwhile, had had some disappointments in the past in establishing its own technology formats. In the mid 1970s, it launched the BetaMax, a home videocassette tape recording format which was quickly out-marketed by JVC's VHS format largely due to the fact that VHS tapes held more taping capacity (two hours) compared to Betamax's one hour. In 2003, Sony attempted to establish its own music and movie playing format by introducing the Universal Media Disc (UMD) for its portable gaming device the PlayStation Portable (PSP). Initial PSP units were sold with the UMD version of Spider-Man to highlight the flexibility of the device. But UMD never took hold, in large part due to the lack of UMD titles and the number of other devices that played UMDs.  

Stringer was well aware that replicating the PS2's success would not be easy. The price of the PS3 would be a significant barrier to widespread penetration. At $599, the PS3 could no longer be considered a toy and would not likely be an impulse purchase for the majority of consumers. Although compared to stand-alone Blu-Ray players, which sold for $900-$1,000, the PS3 could be considered a bargain since it could play games as well including some older generation PlayStation games. 

By all accounts, since entering the video game industry in 1994, Sony's ability to capture the attention spans of child and adult gamers had been impressive. However, as technology became more varied and versatile, so did consumer tastes. Stringer knew it was critical that Sony kept consumer appetites both satiated and begging for more.  

Sony's Pledge Of Quality And Quality Management

Show More 1.1 APPROACH TOWARD QUALITY ASSURANCE 1.1.1 Basic Policy Sony has defined its operating foundation to give top priority to customers by giving them high-quality products and services. This philosophy was given by Sony’s co-founder, Masaru Iuka. To reflect these changes operating environment, in April 2012 Sony update the Sony Pledge of Quality, which outlines its basic policy on product and customer service quality. This move was aimed further at to ensure that the quality of its products and customer services exceeds the expectations of its customers around the world. The Sony Group is not satisfied only to improve product and service quality, instead they are also deploying Company-wide activities to perceive the world’s top management …show more content… Even after that, if the disapprove results can be produced, investigation should be requested again 4. appropriate process Reverse analysis is done and appropriate action will taken for quality management systems after finding the reason of problems in evaluation and analysis in order to avoid repetition in the system. 1.3.1 SONY'S QUALITY MANAGEMENT SYSTEM Sony reconfigured its quality management system by inspecting different quality management mechanisms across all processes i.e. from development, planning, design and manufacturing through to sales and services including the roles, responsibilities and authority of those responsible for product and service quality and establishing guidelines. Based on this quality management system, Sony is putting in to practice these measures on an ongoing basis for improvement of the quality of its products and services. • Corporate Executive in charge of Product Quality and Safety having the skills with coordinating efforts to improve product and customer service quality and ensure timely responses to

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From total quality management to Quality 4.0: A systematic literature review and future research agenda

• Review Article
• Open access
• Published: 13 March 2023
• Volume 10 , pages 191–205, ( 2023 )

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• Hu-Chen Liu 1 ,
• Ran Liu 1 ,
• Xiuzhu Gu 2 &
• Miying Yang 3  

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Quality 4.0 is an emerging concept that has been increasingly appreciated because of the intensification of competition, continually changing customer requirements and technological evolution. It deals with aligning quality management practices with the emergent capabilities of Industry 4.0 to improve cost, time, and efficiency and increase product quality. This article aims to comprehensively review extant studies related to Quality 4.0 to uncover current research trends, distil key research topics, and identify areas for future research. Thus, 46 journal articles extracted from the Scopus database from 2017 to 2022 were collected and reviewed. A descriptive analysis was first performed according to the year-wise publication, sources of publication, and research methods. Then, the selected articles were analyzed and classified according to four research themes: Quality 4.0 concept, Quality 4.0 implementation, quality management in Quality 4.0, and Quality 4.0 model and application. By extracting the literature review findings, we identify the Quality 4.0 definitions and features, develop the quality curve theory, and highlight future research opportunities. This study supports practitioners, managers, and academicians in effectively recognizing and applying Quality 4.0 to enhance customer satisfaction, achieve innovation enterprise efficiency, and increase organizational competitiveness in the era of Industry 4.0.

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Liu, HC., Liu, R., Gu, X. et al. From total quality management to Quality 4.0: A systematic literature review and future research agenda. Front. Eng. Manag. 10 , 191–205 (2023). https://doi.org/10.1007/s42524-022-0243-z

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DOI : https://doi.org/10.1007/s42524-022-0243-z

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Total quality management : text, cases, and readings

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Case Study: The Implementation of Total Quality Management at the Charleston VA Medical Center's Dental Service

The views expressed in this article are those of the author and do not reflect the official policy or position of the U.S. Air Force, Department of Defense, or the Department of Veterans Affairs.

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Barry L. Matthews, Case Study: The Implementation of Total Quality Management at the Charleston VA Medical Center's Dental Service, Military Medicine , Volume 157, Issue 1, January 1992, Pages 21–24, https://doi.org/10.1093/milmed/157.1.21

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Total Quality Management (TQM) is an evolving management philosophy which has recently been introduced to the health care industry. TQM requires the use of a continuous process improvement methodology for delivered services. It was implemented at Charleston VAMC's Dental Service as a study to determine its effectiveness at the grassroots level. A modified Quality Circle was established within the clinical service under the guidance of Dr. Edward Deming's 14 principles. Top management support was not present. Many lessons were learned as process improvements were made. The overall success was limited due to the inability to address interdepartment process problems.

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Total Quality Management Case Study

Total quality management deals with management move towards centered on quality ‚ based on the participation of an organization’s members and aiming at long period success. This study is a comparative study between the libraries of Banasthali University‚ Rajasthan and Avinashilingam University‚ Tamil Nadu. The study focused on the comparison of infrastructure of libraries at present. It also about the library staff views on this job satisfaction and job quality ‚ views of library users on the quality

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Case Study on Total Quality Management

Introduction As an independent consultant in Quality Improvement‚ I will conduct an analysis of the operations of the company `Handles and Hinges`. I will answer how the company competes in its market place‚ what role does ‘ quality ’ play in its competitive strategy‚ whether or not I believe the company’s use of statistical quality control is sensible‚ how a TQM approach could benefit the company’s operations‚ and I will also apply the Gap model of quality diagnostics to the company and comment upon

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Total Quality Management

There are eight such dimensions of quality . These are: 1. Performance: It involves the various operating characteristics of the product. For a television set‚ for example‚ these characteristics will be the quality of the picture‚ sound and longevity of the picture tube. 2. Features: These are characteristics that are supplemental to the basic operating characteristics. In an automobile‚ for example‚ a stereo CD player would be an additional feature. 3. Reliability: Reliability of a product is

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Total Quality Management Case Study Ibm

Individual Assignment Total Quality Management (TQM) in Organizations Case Study : IBM Submitted by Meric Oztekin DEFINITION OF TOTAL QUALITY MANAGEMENT Firstly‚ I would like to give few definitions of total quality management (TQM) in order to get a better understanding in this topic. Different authors have given various definitions of TQM. As defined by ISO‚ TQM is a management approach of an organization‚ centered on quality ‚ based on the participation of all its members and aiming at long-term

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A Global Perspective on Critical Success Factors of Quality Management Practices Abstract This paper provides a literature review of the studies on quality management in the world. By reviewing the literature on quality management ‚ it is found that management commitment and international competition are critical for successful quality management implementation. However‚ there are differences on the level of quality management implementation among countries. It is suggested that the role of national

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Total Quality Management at IBM: A Case Study

Paper—ABST TOTAL QUALITY MANAGEMENT (A CASE STUDY OF IBM) *Vishal Gauttam Assistant Professor‚ A.B.S.T.‚ Shree Karni College‚ Jaipur. A B S T R A C T Every nation has its own independent historical and cultural background. The quality scenario‚ therefore‚ differs from one national setting to the other. The nations are orienting their quality management strategies and systems to meet the requirements of the operating environment though the primary focus remains the same‚ that is‚ Total Customer Satisfaction

INTRODUCTION TO TQM In real world‚ company actually compete in term of quality ‚ price and delivery to capture its customers which finally leads to the establishment of Total Quality Management Philoshopy to fulfill one of the element stated. In Malaysia‚ government had carries various effort to enhance and assist the quality standard by establishment of SIRIM. SIRIM had been responsible to promote ISO 9000 and TQM among Malaysian business industries. DEFINITION OF TQM As defined by OXFORD Dictionary

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ECONOMIC CASE FOR QUALITY What Do CEOs Think About Quality ? by Greg Weiler‚ ASQ project leader I n today’s highly competitive global marketplace‚ quality practitioners must justify the cost of quality . Making the economic case for quality by creating materials quality professionals can use to specifically demonstrate that quality pays rather than costs has accordingly become a priority for ASQ. In 50 Words Or Less • ASQ plans to help quality professionals make the economic

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CHAPTER 1 WHAT IS TOTAL QUALITY MANAGEMENT ? An organization planning the implementation of Total Quality Management (TQM) is about to embark on the challenge and opportunity of a lifetime. This adventure must surely change the organization. Total Quality Management can be the answer to both the customer’s plea for improved products and services and the organization’s quality and productivity problems. This chapter sets the stage for the conceptual understanding that is required before starting

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Introduction Security defines as the quality or state of being secure as freedom from danger (safety) or freedom from fear or anxiety; it is something given‚ deposited‚ or pledged to make certain the fulfillment of an obligation. ”Far Eastern University (FEU) is one of the best educational institution in the country  in the City of Manila‚ West Sampaloc‚ University Belt area is a nonsectarian‚ private university in the Philippines. It was founded as a domestic educational institution in 1928

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International Journal of Contemporary Hospitality Management

ISSN : 0959-6119

Article publication date: 1 November 1995

Total quality management in hotels is becoming more commonplace. But the meaning of total quality management (TQM) is often misunderstood. Presents an overview of TQM and a case study of quality processes in a US hotel company. Bergstrom Hotels of Wisconsin has been practising quality principles since 1989. What started out as a “quality commitment” has evolved into “continuous improvement”. Explains a variety of the tools used by Bergstrom, including the team process, data‐based decision making, and human resource support systems.

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Breiter, D. , Tyink, S.A. and Corey‐Tuckwell, S. (1995), "Bergstrom Hotels: a case study in quality", International Journal of Contemporary Hospitality Management , Vol. 7 No. 6, pp. 14-18. https://doi.org/10.1108/09596119510095343

Copyright © 1995, MCB UP Limited

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