"Almost a year after Howard Stringer became CEO, the giant shows signs of a turnaround. But it'll take a lot more to keep it humming
Certain jobs seem suited only for the foolhardy: raising the Titanic, being shot out of a cannon, saving Sony. So when Sir Howard Stringer took over as CEO of the struggling Japanese consumer-electronics giant in March, few outsiders felt he had much chance of quickly reversing Sony's fortunes.
No more. Suddenly, Sony seems to be on a roll. Just four months after the introduction of the new Bravia liquid-crystal-display TV, Sony has become the third-best selling LCD brand in the world, researcher iSuppli said on Jan. 5.HOLIDAY CHEER.
Sony even appears to have emerged with no major business fallout from a public-relations nightmare caused by an aggressive copy-protection scheme attached to several CDs at its Sony BMG Music Entertainment unit (see BW Online, 12/2/05, "For Sony, a Pain in the Image
Meantime, both Sony's PlayStation 2 and its PlayStation Portable (PSP) game machines outsold Microsoft's new Xbox 360 game console over the important holiday shopping season. The feat is even more amazing considering that the PS2, at more than five years old, is considered long in the tooth, while the newly minted Xbox 360 was released on Nov. 22 -- and it flew off shelves.
Investors applaud the improvement. Sony's stock price on the Nikkei soared 30% over the past three months, outpacing Japanese rivals such as Pioneer, Sharp, and Matsushita Electric Industrial, owner of the Panasonic brand. In U.S. depositary receipts, Sony stands at $42 a share, up 27% from $33 three months ago. "There's a very good feeling in the company now," Stringer said during a Jan. 5 interview at the Consumer Electronics Show (CES) in Las Vegas. "You certainly couldn't declare a victory by any means, but I think so far, so good."BATTLING COMPLACENCY.
Analysts are inclined to agree. While it's early in the game, Stringer's impact is being felt inside Sony -- and investors are taking note, says Pacific Crest Securities analyst Evan Wilson. "This is going to take two years to play out with the restructuring that's planned, but I think you've got to give the guy an early nod and say he has done a good job," Wilson says.
What's behind the revival? Stringer is undertaking an aggressive reorganization of the venerable company, bringing in loyal executives from U.S. operations to lead the change. He's trying to reinvent Sony's brand to make it more relevant to digital-age consumers. And he's seeking to focus advertising, aiming to offer great campaigns akin to rival Apple Computer's eye-catching, toe-tapping ads for the best-selling iPod lineup.
"The worst thing that can happen to you," Stringer says, "is for things to go too well too soon. I'm slightly nervous because I don't want Sony to fall back into any form of complacency."" [more
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