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A man walks past an advertisement for Sony Walkmans at an electronic shop in Tokyo May 5, 2011. Sony, despite its iconic brand, remains out of step with the rest of the global technology world and its talent for crowd-pleasing innovation has largely evaporated. (KIM KYUNG-HOON/REUTERS)
A man walks past an advertisement for Sony Walkmans at an electronic shop in Tokyo May 5, 2011. Sony, despite its iconic brand, remains out of step with the rest of the global technology world and its talent for crowd-pleasing innovation has largely evaporated. (KIM KYUNG-HOON/REUTERS)

SPECIAL REPORT

Sony stumbles: Did Stringer's makeover fail? Add to ...

Ohga, who died in April aged 81, is best remembered for convincing the world to give up vinyl in favor of CDs and for green-lighting one young executive's ploy to beat Nintendo at its own game with the PlayStation.

The serial successes, though, bred complacency. "If you had the Sony name on the back of your shirt you were fine, so they stopped thinking," Maeda says.

In 1989, the Japanese economic juggernaut stalled and the benchmark Nikkei index topped out just shy of 39,000, marking the start of an asset value slump that continues to sap Japan's economic vitality 22 years later. That same year, amid a frenetic Japanese pursuit of landmark overseas assets, Sony made its first big mistake.

The company bought Hollywood studio Columbia Pictures for $3.9-billion from the Coca Cola Company. It was a business and culture that Sony didn't fully understand and became a big distraction for management.

Five years later as Ohga handed Sony over to Nobuyuki Idei it was forced to write off $2.7-billion from the purchase after a string of costly box-office flops.

Seven years later, Apple's Steve Jobs, inspired by Sony's Walkman, launched the iPod digital player. It was a seminal event for Apple and a huge warning for Sony.

In one move, Apple ended Sony's dominance of the music player market and left little doubt that Sony was heading for a full blown crisis.

Back in 2000, Sony's market value had been more than seven times Apple's. Today, Sony's market value is only one eleventh of Apple's, and its share price is little changed from 1995 - the year it launched the digital camcorder.

TOO ORDINARY

When Stringer was appointed Sony's Chairman and CEO in 2005 he was keen to show that he could revitalize the company's reputation for creativity. As a Welshman running a Japanese company, but who understood its corporate culture, he was seen as having a better chance of shaking it up than most.

After a bruising first year of heavy losses, he was anxious to kick off the annual management meeting at Tokyo's Grand Prince Hotel New Takanawa on an optimistic note. Stringer trotted out a group of what he claimed were the 50 brightest engineers that Sony had to show the 1,200-strong crowd of managers gathered in the ballroom.

"These are our future," Stringer boasted of the group of the cleanest, most well-composed assemblage of geeks, recalls one former Sony executive in attendance that morning.

They "were the equivalent of scrubbed, West Point recruits," he said in reference to a prestigious U.S. military academy. "No tattoos, no piercings, no 14-year-olds," the former Sony manager said. "I remember saying, 'We're so screwed.' No one in that group was going to say 'Why the fuck do we need a (computer) mouse.'"

Sony's problem, offers Hironobu Yokota, a procurement manager who left Sony in 1995 because "all the misfits had left", is that it has become ordinary, a condition he says is worsening.

"I have consulted for Sony several times since I left. Looking at it from the outside, it is basically getting worse and worse," explains Yokota.

Even the engineer Sony eventually picked to do battle with Apple is now among the Sony refugees, and has become one of its fiercest critics to boot.

Koichiro Tsujino, who spearheaded the development of Sony's Vaio laptop, left the company in 2006 and later headed up Google's Japanese unit before recently establishing his own cloud computing company. His last project at Sony had been to develop a rival to the iPod.

Tsujino blames much of his former employer's problems on failures of corporate governance and petty jealousies that he says crushed what had been a creative atmosphere much like that at Google now.

"The biggest difference between Google and Sony is that Google doesn't waver," says Tsujino.

"Japanese companies, including Sony, tend to waver. Sony is typical of this. That was how it was when I left. They start working on an Internet project, but when it doesn't work out they will drop it in a year," said Tsujino at his office in Tokyo.

Sony, he insists, needs someone like Ohga - unafraid to be "absurd, irrational and outrageous."

As more Sonyites from the golden era depart, the only traces left behind of famed innovator Morita is the air of elitism, says Osamu Katayama, a business writer who in 2010 published a book "The Stringer Revolution: What has he changed at Sony".

Morita he explains tried to become a pillar of the Japanese establishment, his ambition to head the prestigious Keidanren business lobby. As a result "Sony has a very strong sense of being elite," says the author, who also dismisses Sony under Stringer as an "ordinary company."

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