In December 2008, Japan’s Sony Corp. – the world’s second-largest consumer electronics maker – announced a few restructuring measures primarily aimed at changes in management and manufacturing. These include:
- A $1.1 billion savings plan in its electronics division
- Cutting 16,000 jobs
- Pulling out of businesses and limiting investment for savings of almost 100 billion a year
Analysts believe the company needs more and bigger restructuring measures to improve its slowing sales and inventory pile-ups. Another challenge Sony has been facing are cultural clashes between its Japanese, US, and European operations. Restructuring moves would imply changing many of its long-established business practices (the Japanese business culture which is so deeply connected to its social culture). The restructuring plans include shutting down of some of its major divisions in its Japanese domestic operations. How Sony would go about facing these challenges and are more restructuring moves imminent amidst the financial crisis and lower consumer demand? Sony’s first non-Japanese CEO, Sir Howard Stringer sure has his task cut out.