According to an Associated Press report, Ryoji Chubachi is stepping down as president of Sony, allowing Howard Stringer, Sony’s chairman and chief executive, to assume the role and give him a more active part in restructuring the electronics giant.
In a statement quoted in the AP report, Stringer says, “This reorganization is designed to transform Sony into a more innovative, integrated and agile global company with its next generation of leadership firmly in place.”
According to The New York Times, Stringer will retain his role of chairman and chief executive. Chubachi will become vice chairman responsible for product quality and safety, a position that effectively removes him from the frontlines of decision-making as it pertains to the future direction of the company.
Nobuo Kurahashi, an analyst at Mizuho Investors Securities in Tokyo, says in the AP report that since Stringer is not Japanese, he operates under different business principles than his predecessors did, which may enable him to deliver quicker changes. Typical Japanese managers, according to Kurahashi, tend to be more bureaucratic and seek group consensus, which can slow the process for change.
The Times says that as a result of the global economic recession and a strong yen, which shrinks the value of foreign earnings in Sony’s home currency, the company will post an annual operating loss of $2.7 billion for the year ending March 31—its first annual net loss in 14 years. The AP report notes that at the end of 2008, Sony announced that over the next year or two it plans to cut 8,000 full-time employees (as well as an additional 8,000 temporary workers) and shut five or six plants.
According to the Times report, Stringer said at a press conference, “We have two distinct challenges facing us. The first is the global slowdown, which forces us to make significant adjustments. The second challenge is the evolution of our competitive environment. New competitors [are] springing out everywhere.”
The Times adds that Kazuo Hirai, chief of Sony’s video game unit, will become the head of an Internet-linking products and services group, bringing together multiple divisions that, in the past, Stringer complained did not work together closely enough.
The AP quotes Stringer as saying, “The changes we’re announcing today will accelerate the transformation of the company that began four years ago [when Stringer assumed the position of chairman and chief executive]. They will now make it possible for all of Sony’s parts to work together to assume a position of worldwide leadership.”