Strategic Analysis of Sony Corporation Sony Corporation, which is based in Japan, was founded in May 1946 and is one of the massive multinational companies in the world. It is a leading manufacturer of electronics, games and entertainment products and has over 900 subsidiaries worldwide (Sony Annual Report, 2012). It has achieved huge success in the past, especially in the early 80’s and into the 90’s because its high-quality, sophisticated products used to catch the attention of consumers (Vossoughi, 2012). In the present world, Sony found itself struggling to rise and reach that level again after facing intense competition from its competitors as well as pressure from other internal and external factors. Figure 1: Layers of Business Environment Framework Layers of the business environment framework in Figure 1 is used to conduct the strategic analysis of the company. PESTEL framework is used to analyse the most outer layer of the environment, which is the macro-environment, which identifies how future issues in the political, economic, social, technological, environmental and legal environment might affect organisations. These issues can act as key drivers for change, which are referred to as ‘the environmental factors that are likely to have a high impact on the success or failure of strategy’ (Johnson, Whittington and Scholes, 2011). Based on the information available from the case study, it is found that the changes in organisational culture might affect the company in terms of social. Meanwhile, new discoveries and developments of technology, which in the case study is the shift from analog to digital technology, might give an impact to the business in terms of technological aspect. Taking a look at economic perspective... ... middle of paper ... ...on of production’ (Navaretti, Castellani and Disdier, 2006). In conclusion, Sony should not just wait for bad situations to happen and only then start to think of the ways to solve them, but rather the company should make detailed, innovative plans that can lead to fruitful and profitable future outcomes. This is supported by Johnson (1992), who says that ‘the notion of strategy is to do with the long-term direction of the organisation and not just response to difficulties’. All of the challenges and threats that have arisen should be tackled quickly and in the most efficient manner possible by the company in order to be the fast-growing leader in the industry again. To summarise, by initially analysing the overall strategic analysis of the company, the company can form several strategic options based on the strengths, opportunities, threats and weaknesses present.
Every company has internal and external forces that effect how they operate within the community in which they are located and also within their own walls. These internal and external forces play a strong impact on the company’s profitability and success. These forces have an effect on what consumers they attract or ignore and how they are perceived by those who have the buying power. A mistake any analyzing and implementing measures to assist with these factors could greatly affects a company’s bottom line and success. This is why any company wanting to grow and be successful will need to take all of these forces; sociocultural, technological, economic, environmental and political-legal into consideration in creating their strategic plan.
The strategic recommendations provided will improve and enable the business to cope with the competitors, while the implementation of the strategy section will outline the way to go about achieving these alternatives in the business setting. Lastly, we put up a discussion on the evaluation procedures and necessary controls for the business. In the case study, it was discovered that there were sources of opportunities in which the company would invest.
Scenario: For this assignment, you have been examining two contrasting business organisations. The final part of the assessment asks you to examine how your chosen organisations are affected by changes in their political, legal and social environments.
Environmental – External environmental factors are forces or trends that can affect a business whether it is an opportunity, threat, or constraint. They can be divided into three interrelated subcategories of remote, industry, and operating environments. The remote environment includes factors beyond a company’s operating situation such as the economic, social, political, technological, and ecological factors. The industry environment includes factors that have more of a direct influence on a company’s business such as entry barriers, competitor rivalry, the availability of substitutes, and the bargaining power of buyers and suppliers.
N.V. Philips (Netherlands) and Matsushita Electric (Japan) are among the largest consumer electronics companies in the world. Their success was based on two contrasting strategies – diversification of worldwide portfolio and local responsiveness for Philips, and high centralization and mass production for Matsushita.
Mithas, S., Tafti, A., & Mitchell, W. (2013). How a Firm’s Competitive Environment and Digital
Best Buy, one of the biggest consumer electronics retailers in the world, provides products from smartphone, computers to large electronic appliances. It aims at offering a large variety of products with outstanding customer service at a comparably economical price. Yet, it has been facing internal and external challenges in the recent years. Bottom line and the share price are slightly catching up after a fall in 2013 but still barely satisfying the shareholders and customers are changing their purchasing habits which may threaten its future.
effectively is a huge driver for Sony. Invention and innovation? The need to create new technology and new productions within Sony can be a major drive for the research and development department within the company. The.. A business such as Sony who have achieved a breakthrough which is patented is a major sustainable competitive advantage over other.
For many years, IBM succeeded in holding a very good market position. In fact, the company achieved a very high market share and huge profits. However, this situation did not last forever. In 1990, IBM experienced its first quarterly loss of $2billion due to some unexpected accounting charges. However, revenues increased from $62.7 billion in the previous year to $96 billion. In 1991, the c...
This case study analysis is on Samsung Electronics Company (SEC) and how it has climbed up the ranks in the past decade via calculated marketing strategies, extensive market research and analysis, and a risky bet on how the market will evolve. Samsung’s principle outlook took time and education from within and thereafter the general market.
In a world of free trade, growing competition and accessibility to foreign markets, the need for methodical market analysis and assumptions is steadily rising in today’s business environment. It is just a normal way of thinking to primarily intent to eliminate the financial before entering a new and foreign market. This suggests that enterprises have to develop an overall strategy for their business in order to gain competitive advantage and consequently market share. With the words of Michael E. Porter, professor at Harvard University and leading authority on competitive strategy, this desirable market success is indirectly linked to the individual structure of a market. The unique structure of a single market influences the strategic behaviour and the development of a competitive strategy within a firm. The competitive strategy finally decides whether a company performs successfully on the market or not. Referring to this interpretation of business success, M. E. Porter established his five forces framework that enables directives to gather useful information about the business environment and the competitive forces in industries.
Apple, Inc is a well known name in the computer technology world; Apple, Inc leads the computer industry in innovation thanks to the award winning desktop and notebook computer known as OS X operating system (Yoffie & Slind, 2008). This paper will focus on Apple Inc., strategic management and why is it critical to the success of the organization in meeting its goals and mission. It is therefore important to define strategic management, according to Certo, Peter & Ottensmeyer, (2005), strategic management is a continuous process that directs an organization to be appropriately suited to its internal and external environment. Strategic management benefits organizations by providing personnel, capital, helps to set standards and most importantly activates people. For an organization to have a successful strategic management plan, the mangers must learn to think strategically and have the ability to evaluate their environment and develop new ideas. Steve Jobs one of the founding fathers of Apple Inc used strategic planning to his advantage by making Apple’s mission a simple one- bringing easy to use computers to the general market, revolutionizing the computer market.
Firstly, Philips’ main capability is the decentralised structure with strong local subsdiaries, which is the National Organisations (NOs). Philips established NO after the war to replace the destroyed industrial plant in Netherlands. During this period, electronics was seen as luxury good and trade barrier between nations was high. The decentralised structure supports Philips in competing effectively with local competitors and enables them to adapt with the diverse local market. Each NO had the their strength and resources to sense and perform adaptive marketing as well as develop their product to respond the local differences. It is reflected in its television product. The first color TV is created in Canada, while the first stereo TV is created in Australia and the teletext TV is created in UK (Bartlett, C. A., 2001). The strong independence of these local subsidiaries also reinforced by the communication barriers during that period (Bartlett, C. A., Ghoshal, S., & Birkinshaw, J. M., 1995). The decentralised structure gives high degree of independence in each international unit, including decision-making autonomy (Daft, R. L., 2009). In the case of Philips, NOs as local subsidiaries had more power over the Product Departements (PD), as Philips gave NOs financial autonomy as well as liberty to set their own target. Thus, the NOs ability of autonomous marketing and product development function had become Philips m...
In analyzing the macro-environment, it is important to identify the factors that might in turn affect a number of vital variables that are likely to influence the organization's supply and demand levels and its costs (Kotter and Schlesinger, 1991; Johnson and Scholes, 1993). The "radical and ongoing changes occurring in society create an uncertain environment and have an impact on the function of the whole organization" (Tsiakkiros, 2002). A number of checklists have been developed as ways of cataloguing the vast number of possible issues that might affect an industry. A PEST analysis is one of them that is merely a framework that categorizes environmental influences as political, economic, social and technological forces. Sometimes two additional factors, environmental and legal, will be added to make a PESTEL analysis, but these themes can easily be subsumed in the others. The analysis examines the impact of each of these factors (and their interplay with each other) on the business. The results can then be used to take advantage of opportunities and to make contingency plans for threats when preparing business and strategic plans (Byars, 1991; Cooper, 2000).
Technological change, change in economic climate, natural occurrences and such-like are matters that concern the macro-environment of a business. These external, uncontrollable, influences can and will impact hugely on the success or failure of a business. One of the tools that are applicable in considering these factors is PESTLE. Political; Environmental; Social; Technological; Legal and Economic considerations will need to be engaged in order to prepare the business for macro-environmental influences. For this reason, PESTLE will be the most appropriate tool to use to identify and outline the main macro-environmental factors that may affect my business.