Sony’s chief asks 10,000 to walk, man
Posted on September 24, 2005
Filed Under Uncategorized
Sony’s Howard Stringer has done the American thing. When you can’t fix it, slash and burn. It was just a matter of time, as we suggested in March.
From IHT/NYT:
The new head of Sony, maker of Walkman portable music players and PlayStation game consoles, introduced a plan on Thursday for turning around the struggling Japanese electronics giant that will cut 10,000 jobs – about 6.5 percent of its work force – as well as shed unprofitable products and centralize decision-making in the sprawling group.
But in a possible sign of rough waters still ahead, Sony said it expected to post its first annual loss in more than a decade this year. The company said it now foresaw a loss of ¥10 billion, or $90 million, for the fiscal year ending March 31, 2006, down from a previously forecast $90 million profit.
The chief executive, Howard Stringer, released his widely awaited turnaround plan in his first news conference since June, right after taking the helm at Sony. He promised to return Sony to profitability next year, saying the job cuts, product eliminations and other steps like factory closings would save almost $2 billion over the next two and a half years.
But he said that cost-cutting alone was not enough to ensure Sony’s future. The plan also included organizational changes aimed at improving communication between Sony’s notoriously autonomous divisions. Stringer said he hoped this cross-fertilization would lead to new products, allowing Sony to stay ahead of low-cost rivals in China and South Korea, which are quickly climbing up the technology ladder.
“We must be like the Russians defending Moscow from Napoleon, scorching the earth ahead of our competitors,” he told reporters.
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