Power concentrates on Chairman Stringer in Sony’s new “top-down” personnel structure
3, 27. 2009
Sony Corp., suffering from bad business performance, will move into a new system in which Howard Stringer, Chairman and CEO, will serve concurrently as President, effective on April 1, 2009. Ryoji Chubachi, current President, will become Vice-Chairman with the right of representation. The new appointment of Stringer is understood to be aimed at reorganizing the company faced by bad business performance of the electronics, its core division, under his direct overall control.
Vice-President, promising candidate for next presidency, is removed
Stringer assumed the chairmanship of the company in June 2005, while Chubachi became president in the same month. Stringer, who had made a successful achievement in the software division of music and movies, and Chubachi, who had been working in the technological division, formed a "duo leadership system" to run the company. As a result, the electronics business should have been restructured, which was the major issue of the company, and grown to occupy at least 70% of the total sales of the company by March 2008. The electronics business should have recovered after then earning an operating profit amounting to 356 billion yen.
However, Sony was directly hit by the worldwide consumption downturn after the fall of 2008, and its sales of liquid crystal television sets and digital cameras sharply went down. Sony's consolidated operating profit-and-loss account for the term ending in March 2009 is expected to register a loss of worst ever 260 billion yen. Sony is now driven to dismiss 16,000 employees at home and abroad.
Under the new personnel system, it could be said that the company puts an end to the "duo leadership system " made up of Stringer and Chubachi, which has continued since June 2005, and the management authority of the company will be totally vested in Stringer's position in a "top-down" form. Stringer avoided promoting Katsumi Ihara, Vice-President in charge of digital appliances who was believed to be a promising candidate for the next president, and he appointed a younger person. Explaining about the purpose of the new system, Stringer said at a press conference that it was necessary for him to act concurrently as president so that he could get in direct contact with the executives in charge of variety of affairs by reducing the number of other ranking officials in the middle in this time of crisis.
Voice is heard that "Mr. Stringer should be held responsible together with others."
The latest personnel reshuffle, however, can not avoid giving an impression that Chubachi alone was held responsible for the bad business performance. In fact, voices were heard immediately after the company' large-scale restructuring announced in December 2008, pointing out the possibility of both Stringer and Chubachi stepping down together to pave the way for establishing a fresh management leadership. Not a small number of people in the industry expressed their opinion that Stringer should also be accountable for the business failure because he was together with Chubachi in the "duo management system. " It is strange that only Chubachi is held responsible, they say.
Some other people in the industry expressed their concerns that the "Sony's traditional spirit of craftsmanship to make things" might disappear if Chubachi steps down and Stringer, who hails from Britain and who has served as the president for broadcasting of the U.S. major television company CBS, holds the full management power over Sony.
Attention is focused on how the new personnel structure of Sony with Stringer on the top might push the company's effort for reformation and earliest possible improvement of the management.