Sony's CEO Hosts Corporate Strategy Meeting (Transcript)

Sony Corporation (SNE)

Corporate Strategy Meeting

April 12, 2012 04:00 AM ET


Kazuo Hirai – President and CEO


Unidentified Company Representative

Good afternoon ladies and gentlemen. Thank you very much for coming to this meeting. We will start the corporate strategy meeting. And the first will Kazuo Hirai appointed as President and CEO of Sony Corporation as of the 1st of April will talk about the corporate strategy under the new management structure for about 40 minutes and then answer your questions.

For Q&A session, Hirai will be a main person to respond to your questions but others will be joining in. the Executive Deputy President, Yoshioka and EVP, CFO, Masaru Kato, EVP is Chief Strategy Officer, Tadashi Saito, the EVP Nemoto as well as Executive, the EVP Kunimasa Suzuki they are all Corporate Executive Officers. And we plan to conclude this meeting at quarter past six. So, Hirai-san please.

Kazuo Hirai

Good afternoon ladies and gentlemen. Thank you very much for attending today's conference. Taking time out of your busy schedule. Before talking about the corporate strategy, let me say that two days ago we announced the downward revision to our earnings forecast and we are now forecasting a net loss of 520 billion yen for fiscal 2011. The news hit me hard and as CEO I take it very seriously. But at the same time, it strengthened my resolve to transform Sony. Now it’s the time for Sony to change. Since I was nominated President and CEO in February, I have received laurels of encouragement from investors, analysts, the press and other stake holders. They want Sony to change and to support Sony's process of change in transformation. So do the employees. They want to restore Sony to its former glory and go further beyond. Sony will change. I have fully dedicated myself to changing Sony. Everyone at Sony is standing together to make this happen and as a result, Sony will change. Today's corporate strategy meeting is organized too share with you how we will change and what we will do to achieve this.

The Sony Group is comprised primarily of three businesses, electronics, entertainment and financial services. Our entertainment and financial services businesses have stable business foundations and are both poised for future growth. However, the most present issue the Sony Group faces right now is the rebuilding and future growth of the electronics business.

The restoration of the electronics business will not come up out through easy fixes or tricks. Simply put we must attack our problems head on without delay and make plans to resolve our problems and execute those plans definitely and speedily. This is the only way to change Sony.

There are three points I would like to discuss about how to bring about change. The first is acknowledging the issues at hand. The second is the key initiatives to transform the electronics business and the third is the management's structure to execute these key initiatives.

First I'd like to discuss the issues facing the electronics business. There are four key issues that must be dealt with for electronics business to recovery. They are one; speaking of management decision making, two, making full cost and selective investment based on our long-term strategies, three, developing innovative products, services and technology. Four, taking the TV business from eight consecutive years of losses to profitability. These four actions are essential for Sony's revitalization and future growth.

How we'll go about making this happen, we will determine if Sony will be back. And whether or not we can do that lies entirely with Sony strength. They are, one, a business reach and brand reorganization that spanned a globe. Two, technological strength induced our imaging, gain and other fields. Three, content and business know-how in film, music and game. Four, and lastly, something I believe in very strongly, what I call the Sony DNA, the will and drive to generate new value that is in so many of our talented employees.

Sony has always been a company that used its entrepreneurial spirit to create never before seen products that stirred curiosity and assuring new eras of entertainment for so many people all around the world. This spate has not changed. It is my responsibility to create management foundations that allow each employee to make the most of the Sony DNA within them to address each and every one of these use that must be resolved and to continuously deliver results to prove this. This is key to the rebuilding of Sony which I like to talk about key initiatives for transformation.

Together with my management team, we have refined the key managerial transformation areas, I mentioned on February 2nd the day after I was nominated as CEO in to five key initiatives. It is through these five key initiatives that we ask out Sony core businesses and what it takes to succeed within them. This is the most important element in Sony's transformation.

Strengthening core businesses and turning around the TV business are particularly present and we have already started to take these issues and tackle these issues. Above all the world expects Sony to surprise them with attractive and innovative products and services things that represent Sony's return to glory are indeed that creates customer satisfaction is incremental in making this happen. Sony has great engineers breaking on reach portfolio of innovative technologies. We have taken great care to revamp our R&D to allow small and timely transformation of technology to new attractive products.

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