Sony Corporation which is commonly known as Sony is a multinational company popularly known for its cell phones, electronics, gaming, and entertainment services. The company has been doing business for a long time and its growth has also been commendable. The future of the company is bright and the correct growth strategy would ensure its profitability and survival in the long run. At present, the company is not limited to a single type of product and in the future also they would welcome the entrance of new products.
a) The key options that Sony could consider for its future growth strategy
Market Entry: The Sony company can opt for a market entry strategy for its future perspective. It can be done through direct exporting, licensing, franchising, Joint ventures or partnership and buying other companies. The advantages of entering into new markets are economies of scale, reduction of risk, better market coverage, innovative technologies and if one market reduces, it is offset by the rise in the other area. This type of strategy has its own problems as well such as loss of control, controlling the overall organization and lack of performance in the new market can lead to huge losses.
Substantive Growth: Gaining a dominant position in the market is what every company strives for. Sony can look for substantive growth by gaining larger markets in the industry. It helps in planning for the goal to achieve. Sony can reduce competition by this strategy. Furthermore, growth opens up many opportunities. The problems with this strategy is it requires huge funds, more hiring of staff and effective decision making. If the goal for the future is not properly planned then the competitors would gain benefits and it would be harmful for Sony in future.
Limited Growth: Sony can decide and set forth the growth that it is likely to expect in its long-run. Growing too fast can create financial problems and also problems in keeping the same level of growth. Limited growth is a smarter and a low-risk strategy. The profits of the company would rise but Sony would not be too aggressive in its growth strategy. Limited growth have its own restrictions. There could be a situation where aggressive competitors could capture the market. Sony would feel complexity in the working and decision making or delegating the tasks. Furthermore performing below the industry's standard would create questions.
Retrenchment: Retrenchment strategy involves cutting down the expenses and dis-investing in those products and services which are not doing well. Sony if adopts this strategy it would mean that it will have reduced costs, reduced competitiveness, less reliable on market and improved efficiency. The company could also survive in down turn economy. But the problem of such a strategy is that it causes reduced growth, productivity and inability to meet customer's demand. Sony would also experience drop in overall profits and reduced workforce.
b) The most appropriate strategy for Sony
The best approach for Sony is to choose the market entry approach. They can enter into ventures and partnership with other companies to achieve the desired goal. They have various products and segments, they can use these products to expand their market. Sony can use this strategy to concentrate on the main revenue-generating segments and also open up for new prospects of growth in the market. In the present scenario the Sony company is not limited to only cell phone business. It has other segments like gaming, entertainment, computers, cameras and other electronic items. In the future as well these all segments are expected to grow so this strategy would align with present condition of Sony. The Substantive growth would create lots of problem for Sony as it is not limited to a single product. It has a variety of products and an aggressive approach in any segment would mean other segments gets overlooked. Limited growth would not properly align with the present goals of Sony. The competition is high and it is expected from Sony to enter into new markets and bring out innovative and better products which would be not at all possible with limited growth strategy for the future. Retrenchment strategy is also not suitable for Sony as they need more investments in research and development and it requires more funds. Sony is trying to enter into new markets and products and reducing cost would limit them to grow. It is better for Sony to try and capture more markets and other product segments for a bright future.
c) The roles and responsibilities of Sony staff in strategy implementation
The implementation of strategy requires lots of planning and resources to accomplish it. Sony would need to define the roles and positions of their main staff. The management initially needs to define the responsibility and delegate the work to their subordinates. Sony would needs different employees for all the segments it has. The specialised people would have the required experience and skills to take the decision regarding their area. If Sony is planning to grow its market in other countries it would need competent people in that area to carry out the company's activities. Proper research and development departments and employees in each field specialised and experienced to work in that area are required to be employed. Sony should have the top management would would take the overall decisions of the company. They need to consider all the segments and products, even the new market needs to be accessed by them. They should be responsible for all decision making like inclusion on new products, segments, market, etc. On the basis of that the middle level management should be assigned the work of managing and implementation of the objectives set up by the top managers. The middle level managers should delegate and monitor the lower level employees to ensure that the objectives are achieved at proper time. The lower level staff needs to fulfil the tasks and duties assigned to them. The market entry strategy would require hiring and training of new people. This should also be kept in mind by Sony before implementing the strategy.
d) The resources requirement and allocation in strategy implementation by Sony
The market entry strategy would requires more resources to attain the goal. Initially Sony needs to study the resources that it would require and also the quantitative amount of the same. Market entry strategy would mean more requirement of natural resources, infrastructure, technology, human resource and knowledge. Sony would need to evaluate the resources availability in the region where they are planning to expand and how they will allocate and use it for their advantage. If Sony is preparing to enter into new segment or product line or planning to have a joint venture with the other company, it becomes very essential to study the resources they would require and already have with them. Sony should allocate its resources as per the priority set by the company. The products which are likely to grow more and generate more revenues should be assigned and allocated with more resources.
e) Contribution of SMART objective of Sony in strategic implementation using balanced card approach
SMART objective means clearly defining the goals and essential details related to it. Sony can employ a SMART objective which means that the goals are:
- Specific: The goal should clearly define the path in which it is heading. The goal could be increased in market share or profitably. In the case of Sony, it is to Increase the market share and expand to different areas as well as new segments in the industry.
- Measurable: Measurable objective makes it easier to review whether the objective has been achieved or not. Sony can state the percentage of the market to capture or increase to achieve the objectives.
- Achievable: Before setting the objective it should be evaluated whether it could be achieved with the available capacity.
- Realistic: the objectives should be realistic and could be achieved.
- Time Scaled: A proper time should be mentioned as it makes easier to know when it is to be done. Sony can break its long-run objectives into short term achievable targets which would help Sony to grow.
Sony can further use a balanced scorecard approach for the overall and balanced development of its business. They need to align their financial resources, internal business performance, research and development and customer satisfaction with the future objectives of the company. Sony needs to make sure that the various activities are not deviating from the vision that has been set-up by the company. If any such deviation is found then corrective measures should be taken. Sony can set specific and short term goals for different periods in order to properly focus on all the segments of the business.
Sony has been growing at a good pace and it is also including various segments and products in its business. It can use a market entry strategy to keep being a competitive company which it has always been. The possibilities and future of different products and industries needs to be accessed before including them in the company. The core items, non-core and high revenue generating products need to be priorities. Sony has maintained quality and innovation in its products which has been a remarkable attribute of the company and for the long run this would give them the upper hand that they need. They need more partnerships and alliances with the prospective companies to ensure constant growth in the long run.
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