Can Sony follow Apple to Born Again greatness?

Posted by Rob Enderle, principal analyst, Enderle Group

Watching Sony is almost like watching a classic Kung Fu movie where the young student grows up to be a champion who eclipses the master.   Apple modeled itself partially after Sony and is currently vastly more successful than its one time idol.  In fact the only thing that Sony currently seems to produce reliably is red ink

Because companies are expected to be immortal, Sony could emulate Apple and the firm still has manufacturing, content, and gaming resources that exceed Apple’s.  Back in 2002 some thought  the two firms could run head to head, but I think most people, and for good reason, think that Sony isn’t even in Apple’s league anymore and many of us worry Sony won’t be around much longer either.

Learning from Steve Jobs
One of the lessons from the book Inside Steve’s Brain is how it took Apple, which (though it is hard to believe at the moment), was in much worse shape than Sony and turned it into the market leader it is today.

The one lesson that Sony could learn is to get the company down to fighting weight.  Apple was, like Sony is, way too complex to manage successfully.  Too many products, too many divisions, too many separate things that are fighting with each other.   In short an infrastructure that is at war with itself.  

Steve Jobs cut Apple to the bone shutting down anything that wasn’t core to making the company successful and effectively cut Apple’s scope so that it fit within Steve Jobs’ reach. 

Step one to turning around Sony is to make this kind of a cut, Sony is in too many conflicting businesses, it too often gets in its own way, and it simply is too complex to manage successfully.   The first step has to be to reduce the complexity of the firm so that it can be managed.

Customer satisfaction and loyalty

Another example that Apple sets is customer loyalty.  Sony often has products that are more reliable than Apple’s, however if you have a problem with an Apple product, generally, you are taken care of.  Sometimes Apple goes a little crazy like voiding warranties for smokers  (I’m allergic to cigarette smoke myself so I don’t have a problem with this), but Sony could learn a lot about building customer loyalty from Apple.

Back in the 90s I did a number of surveys only to find out that during that decade Dell had both the worst PC product quality and the best customer loyalty.   This was because when the PC broke Dell made sure you were taken care of.  Fred Abbott, one of the guys I work with, had recent problem with a Dell computer and got such good service he has been praising Dell every chance he gets.   This is the kind of service experience Sony needs to drive because they currently have a reputation for the worst service and customer loyalty in the business even though they still build some of the most reliable products in the market.  

As I write this sales for one of Sony/Ericsson’s phones are being suspended  because of customer complaints across Europe.   This kind of thing destroys a band, customer confidence and loyalty. 

Sony needs to lead again
There was a time when Sony was known for being on the leading edge with technology.  They had the first real robotic pet (which they unfortunately killed off), the first large screen LED backlit TV, the most advanced gaming systems, and some of the most advanced video equipment of its time.   They were first to market with a good (in terms of hardware) eBook reader but Amazon schooled them on how it should have been done with the Kindle.  Currently, after a redesign, Sony wasn’t even able to build  to the slim needs of its customers effectively   - along with Barnes and Noble - handing the fourth quarter eBook sales to Amazon and the Kindle. 

For much of this decade Sony seems to be poor copies of Microsoft and Nintendo in gaming, a poor copy of Samsung in TVs, and they aren’t even on the same planet as Apple with cell phones.   Part of this is marketing, if you can’t market a cool new idea competitive there is little point in bringing it to market, but Sony as a lame follower is simply not working for the company. Sony needs to lead in its chosen markets.

Wrapping up
Sony has announced they are going to put capability in new Sony TVs that will uniquely allow them to watch Sony first run content and if you watched the Sony 2012 movie you saw a massive amount of Sony PCs placed in it.   This may showcase a change in the company where the parts are starting to support each other and that alone would lead to a more successful result. 

Still, given how long Sony has been struggling I think the more drastic changes that Steve Jobs demonstrated a decade ago are required for Sony to come back.   I think the firm has the potential to be great again, I doubt whether it will do what is necessary to again reach that greatness.  Like  Sun Micrososystems, I think we are watching Sony die a slow death.  This outcome is avoidable -  all they need to do is learn from an old student, Apple, how to do this.