I'd say "the current state of Heavenly Sword".
WSJ on in-fighting at Sony
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You think it was appropriate for him to air the internal dirty laundry in public that way? Really? When the chief person he's complaining about for publication in one of the leading business journals on the planet is still there at a senior position within the company of which he's head? That's appropriate behavior in your book?
Ironically, one of the points made in the article (correctly) was how inappropriate it was for KK to hang the electronics division guys out to dry in public like he did. So KK was wrong there but Stringer is right here? No, I don't see that.
Yeah, I will weigh in with my opinion.
First of all, it is absolutely critical that whoever is ready to start commenting on this article, find and read the whole thing; Kotaku and Next-Gen - that's all I have to say. There is a lot of context missing here. The thing's posted on forums all over the place, so it shouldn't be hard to track down. I could link to it myself, but... rules and such.
Anyway I *am* coming into this discussion as pro-Kutaragi, but not as anti-Stringer. When you look back three years ago, there was a decision to be made at Sony: make Kutaragi CEO, or go with someone else. They chose to go with someone else, and that someone else was Stringer out of the film division. I think Kutaragi does have a problem in terms of seeing himself under Stringer - he simply does not recognize his authority to an extent. And that's certainly an issue from a chain of command standpoint. But that doesn't mean the decisions Kutaragi has made have been the wrong ones, and therein lies a crucial difference. The problem is that Sony is being viewed here through the lens of a Western investor, and frankly the typical investor is fickle and greedy - they see only the short-term.
Before the Stringer announcement, Kutaragi was in charge of electronics and semiconductors as well - that led to the investment in LCD against the prevailing desires of his contemporaries in that division and today has resulted in a massive comeback in TVs for Sony. The Cell was his call, his invention essentially, and the idea was company-wide utilization. I get nervous in the post-Stringer world that indeed from an engineering standpoint, projects that require a long commitment and vision are at risk of getting chopped to meet short-term profit goals. There is a strong synergy achieved by CE, gaming, and semiconductors being under singular command, and I just hope that the emphasis on cost-cutting doesn't sort of breakdown some of the ways these divisions are able to help each other out. Obviously Kutaragi had a super-contentious relationship with his immediate underlings back then, as that has been long-since known well before any of this news here; his relationships with fellow officers has been pointed to as the reason why Idei was hesitant to appoint him CEO in spite of heavy endorsement by group chairman Oda. Anyway I think Stringer's been doing an overall good job; I think there's been strong growth lately and the core CE segment has come back a good bit (though again I'll highlight on the back of intitiatives Kutaragi got underway). I don't think Stringer is a bad pick for CEO, but if you read that WSJ article you can tell he's got to get a little more serious about bridging the divide right now, becuase he's seen as 'ivory tower' in the way he conducts business in Japan.
Ehrenberg's just a plain idiot - he's the business equivelent of the AEI pre-Iraq invasion and frankly I think he could use a year in Japan to come to terms with cultural differences. He's too harsh on both Kutaragi and Stringer in his assessment.
Well, I would have liked for Kutaragi to become CEO personally, but that didn't happen so whatever. I've been a fan of Stringer so far so it doesn't matter much. Kutaragi and Stringer strife... well, I think it's touchy. I think creating a COO position and giving it to Kaz was a good compromise for them both. Kutaragi can absolutely *not* be fired though, or the reverberations throughout Sony would be massive. As much as higher management dislikes him, he's a hero among the rank-and-file and still viewed as the sort of "rightful" heir by many. Read the original WSJ article and see what went down when Stringer canceled the Aibo project, and imagine that on a scale several orders of magnitude greater.
Again, it's crucial that the original article be read though for accurate context into this situation.
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I read the entire article last week and it's really not a surprise at all. It (the internal struggles) is alomst exactly as I would have projected it was based on circumstantial evidence.
KK was over the top, Stringer tries to reel him in before losing more money and peoples feelings get hurt. Airing the dirty laundry is a bit surprising on both ends (especially KK's comments about the electronics division).
But I think Stringer's comments were more those of damage control and "everything is under control now, the ship has been righted". :smile:
KK was over the top, Stringer tries to reel him in before losing more money and peoples feelings get hurt. Airing the dirty laundry is a bit surprising on both ends (especially KK's comments about the electronics division).
But I think Stringer's comments were more those of damage control and "everything is under control now, the ship has been righted". :smile:
It's possible that the scenario can play out like inefficient's post. Happened exactly like that in one of my previous employers. I think at least 2 factors are still not aired though.
(1) A lot will depend on whether Stringer or his teams has any concrete and executable plans to recover the company (Not just cost cutting). If not, he will have to go someday anyway. So might as well get rid of him asap to savage the situation.
(2) Has the board found someone (decidedly) more suitable ? If not, it's going to make a bigger mess.
Struggles like this are not uncommon. A recent CEO who caused lot's of grief but was able to turn the ship around was Steve Jobs. He killed projects that were believed to represent the company's very future (e.g., the third party Mac manufacturers, the Newton) and had to let go of employees, even brilliant ones, if they refused to follow his plans (or defied him in open meetings). Stringer is no Jobs (given that he listens to the wrong PR guy ), so his clock is always ticking.
On the other hand...
I don't really see this interview as something negative. A lot of the bad things have already happened. Some more executives may have to go (reshuffled).
If Sony survives Stringer's transition (His "Sony as 1 Orchestra" plan for the lack of a better word), it will make them undeniably stronger. While I love Kutaragi('s passion, creativity, persistence, aggressiveness, ... etc.), that strategy is something he cannot execute (His is more like "Sony as 1 Kutaragi"). What Kutaragi can do very well though is to formulate long term, bold strategy for the Sony core divisions to compete better in the future. Stringer's involvement actually free Kutaragi's time to do that (If powerful people still listen to him), and under his endorsement, SCE was agile/"free" enough to put a new structure to execute those strategies.
We will learn more in their annual report. There's been a flurry of Sony exec interviews recently though (Jack Tretton's and Phil's).
(1) A lot will depend on whether Stringer or his teams has any concrete and executable plans to recover the company (Not just cost cutting). If not, he will have to go someday anyway. So might as well get rid of him asap to savage the situation.
(2) Has the board found someone (decidedly) more suitable ? If not, it's going to make a bigger mess.
Struggles like this are not uncommon. A recent CEO who caused lot's of grief but was able to turn the ship around was Steve Jobs. He killed projects that were believed to represent the company's very future (e.g., the third party Mac manufacturers, the Newton) and had to let go of employees, even brilliant ones, if they refused to follow his plans (or defied him in open meetings). Stringer is no Jobs (given that he listens to the wrong PR guy
), so his clock is always ticking.On the other hand...
I don't really see this interview as something negative. A lot of the bad things have already happened. Some more executives may have to go (reshuffled).
If Sony survives Stringer's transition (His "Sony as 1 Orchestra" plan for the lack of a better word), it will make them undeniably stronger. While I love Kutaragi('s passion, creativity, persistence, aggressiveness, ... etc.), that strategy is something he cannot execute (His is more like "Sony as 1 Kutaragi"). What Kutaragi can do very well though is to formulate long term, bold strategy for the Sony core divisions to compete better in the future. Stringer's involvement actually free Kutaragi's time to do that (If powerful people still listen to him), and under his endorsement, SCE was agile/"free" enough to put a new structure to execute those strategies.
We will learn more in their annual report. There's been a flurry of Sony exec interviews recently though (Jack Tretton's and Phil's).
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The above is why many are unable or unwilling to judge Sir Stringer at this point. His tenure has been too young and the only trend we can see is the cost-cutting. The global Sony Platform's goals are to trim it's main sectors and improve software as to connect these main sectors and Stringer has begun eliminating waste by enforcing the former. Kutaragi is the dreamer and Stringer the enforcer. I see no conflict of interest for the company.
I've worked at a company that had it happen both ways. First, after a retirement a new weak CEO tried to control a long-term strong and successful division head. . . and it ended up with the CEO going down after about two years. Then a new stronger CEO came in and after some skillful maneuvering the division head and other senior old timers were moved out. The higher position will win out in the long run, that's why it's the higher position. . . who will be in those places at the time and how long it takes to happen is a different question.
Well here's the thing - I think to a fair extent Stringer has already recovered the company. He basically has one year left to meet his 5% margins target, and I expect that he'll meet it. They're already at ~4% anyway, and that's some good distance covered. Sony's profits are way up when you take out considerations like battery recalls and $2 billion console launches; even with those considerations, they're still strong in the short term historically. So assuming there's not some sort of meltdown this year as well, the year beginning April 1st should honestly be a record year for Sony.
You're right that the year end conference call will shed more light on the happenings, but for the most part I consider Stringer as successfully having done the job he was chosen to do. The board knew his management style when they brought him onboard, and I don't imagine that they are going to 'dispose' of him.
So... my own "Kutaragi vs Stringer" questions have nothing to do with corproate recovery five years out from now, which I already consider solid - but rather ten years out. I just hope that the innovation element isn't crushed out of Sony in the process of margin growth, and that's something we just won't know for now.
Here's a good article from a couple of days ago that plays into another thread we had going on: http://www.businessweek.com/globalbiz/content/feb2007/gb20070227_116817.htm
It's about the changes (both current and potential) at Sony semiconductor and gives some insight into what Stringer's policy may mean from both a financial and technological standpoint. It shows how much 'grey' area there can be in these moves; there's rarely a black-and-white right or wrong. For their parts, Kutaragi and Stringer simply view the same world from inherently different lenses. Some of the 'overage' on SCEI's R&D will no doubt make itself known tomorrow as they announce this vision of theirs for PS3 at GDC. It will then be up to us to determine whether choices like the one Kutaragi made to go ahead with spending or Stringers to curtail risky investment should have won out.
By the way, it's not that rare for "visionaries" at Japanese companies to do their own thing under the radar when they feel that their superiors simply don't "get it." Here's a quote from within the WSJ article:
That sort of thinking goes also to the efforts by Inafune and others on projects such as Lost Planet, to work behind the scenes on something even after it has been shot down by their managerial superiors.
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Yeah ... (answering to all the posts above) given that Stringer was able to pull Kutaragi back in the end, but still open enough for different heads to do their jobs their ways. He may survive a little longer. I don't think he made any major mistakes yet (unless there are unreported saga in the boardroom).
I am slightly happier after Stringer called analysts out for (him) not knowing what the hell they want.
So far, I have more questions for Chubachi, not Stringer.... just because he's largely an unknown figure to me (e.g., Is he making good and important decisions in the technology divisions ? What is his vision for Sony for the next 5 years ?).
EDIT: Just saw xbd's post. In that sense I agree with him, but I put more burden on Chubachi for the technology side of business. Stringer will have to make his decisions based partly on Chubachi's feedback. And yes, one can argue Stringer picked Chubachi... so he should bare all the responsibility, but you know what I mean.
I am slightly happier after Stringer called analysts out for (him) not knowing what the hell they want.
So far, I have more questions for Chubachi, not Stringer.... just because he's largely an unknown figure to me (e.g., Is he making good and important decisions in the technology divisions ? What is his vision for Sony for the next 5 years ?).
EDIT: Just saw xbd's post. In that sense I agree with him, but I put more burden on Chubachi for the technology side of business. Stringer will have to make his decisions based partly on Chubachi's feedback. And yes, one can argue Stringer picked Chubachi... so he should bare all the responsibility, but you know what I mean.
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Whoops I meant Kutaragi. Anyway....
This is a different. Kutaragi accused the engineering division of messing up and that's why the PS3 was so expensive. The problem with that was he was not correct, it was his fault for going over budget, and also he was on shaky ground with that division already. This obviously pissed a number of people off internally.
Stringer talking won't have an impact on the company or any of it's divisions. The only person it harms is Kutaragi's reputation.
So one person talking hurts the company, while the other has no impact on the company, only an individual.
This is a different. Kutaragi accused the engineering division of messing up and that's why the PS3 was so expensive. The problem with that was he was not correct, it was his fault for going over budget, and also he was on shaky ground with that division already. This obviously pissed a number of people off internally.
Stringer talking won't have an impact on the company or any of it's divisions. The only person it harms is Kutaragi's reputation.
So one person talking hurts the company, while the other has no impact on the company, only an individual.
I thought Kutaragi accused the electronics division for messing up blue diodes rollout ?
He is engineering, or am I confused again ?
Does anyone know if Sony's stock fall after the article ? As for Kutaragi, what comes around goes around. Wouldn't be the first time he got treated roughly. I wouldn't write him off yet. He's a smart guy and has learned a lesson or two. I am a sucker for come backs.
standing ovation
Regular
I don't think the younger generation has a problem with a history major and a foreigner running a Japanese engineering company. But the older generation has a huge problem with this; and they wield the most clout.
In the end they will probably get rid of Mr. Stringer AND Mr. Kutaragi.
I think Stringer will leave because he cannot communicate on a social level (he doesn't speak Japanese), nor can he communicate on a technical one (he's not a mathematician, a physicists, or an offshoot thereof) -- oh, and I almost forgot the most important point: he's not Japanese. Kutaragi will get the boot because he is a renegade who has pissed too many people off.
In the end they will probably get rid of Mr. Stringer AND Mr. Kutaragi.
I think Stringer will leave because he cannot communicate on a social level (he doesn't speak Japanese), nor can he communicate on a technical one (he's not a mathematician, a physicists, or an offshoot thereof) -- oh, and I almost forgot the most important point: he's not Japanese. Kutaragi will get the boot because he is a renegade who has pissed too many people off.
I thought Kutaragi accused the electronics division for messing up blue diodes rollout ?
He is engineering, or am I confused again ?
Yeah, I think a lot of the drama concerning Kutaragi lashing out at Sony's manufacturing abilities relates to Kutaragi's own position as COO of CE two years ago, and probably dissatisfaction on his part at how things have been managed since. But we can't know anything more about that in terms of whether he's justified or not in thinking he would have done better, so we can probably just attribute his comment to bitterness on some level or another.
Sony stock has been on a good move upwards for a while now, and last week everything was battered down in a global sell-off, so its hard to tell whether that article had any effect on Sony stock. But probably not, since to institutional investors it would have presented nothing they didn't already know anyway. Sony's stock is up like ~3.5% today for whatever that's worth, but again its likely bounceback from the last week's sell off.
I think Kutaragi's passover to be CEO of the company will be viewed by Sony historians as a key inflection point for the company, that's how expected his ascent was. And we'll never know how things would have gone if that track was taken. But Idei, and now Stringer, seem commited to hedging his influence. I just can't envision how events could transpire now at Sony to put Kutaragi back on track to the top job... I think he is basically untouchable to an extent in 'Fortress Playstation,' but Kaz has become Shogun within that empire at Stringer's hand.
After reaching a high at the end of February there was a slight decline last week. I don't know if it can be attributed to the infighting article but it's not a stretch.
If my boss talked about me that way in the press, my resignation letter to his boss(es) would be immediate, and talk about the impossiblity of continuing to do my job under such circumstances where my superior has made it clear to everyone I do not enjoy his confidence, etc.
would not surprise me.
This whole affair reminds me of Apple when Steve Jobs resigned. Jobs, brilliant, crazy, hotheaded, bent on adding features and taking corporate actions which bumped up against Sculley, the more traditional bean-counter style CEO. The outcome of the public battle at Apple was the resignation of Steve Jobs, really the loss of the person who was driving employees to be creative at Apple, sucking the soul out of the company, as well as possibly their greatest marketing device. Of course, Jobs went on to found NeXT, Pixar, rescue Apple, and is now Disney's largest shareholder. Jobs has taken seemingly a lot of risky actions at Apple, but there's no denying the results.
Crazy Ken may be more crazy than Steve, since atleast many of the ideas Jobs backs were technically feasible in the near term, but I think the loss of Ken to Sony would be tragic. You need crazy mad people at these large corporations in positions of power if you want to break outside the box every once in a while.
People who think the impossible is possible (even if it isn't)
Crazy Ken may be more crazy than Steve, since atleast many of the ideas Jobs backs were technically feasible in the near term, but I think the loss of Ken to Sony would be tragic. You need crazy mad people at these large corporations in positions of power if you want to break outside the box every once in a while.
People who think the impossible is possible (even if it isn't)
Am I reading the same quoted articles as everyone?
There were comments in this thread to the effect that Stringer supposedly criticised Kutaragi harshly. I think some people had mistaken Kotaku's paragraphs in quotes to be Stringer's own words, when they were really Ehrenberg's voice.
I would bring to your attention that at least one comment from the WSJ article originated from "a person familiar with the situation". Stringer doesn't need to say that, of course. And that was about Kutaragi's dining habits too.
The only substantiation that the WSJ article had for Kutaragi's "tense" relationship with the electronics division is that Kutaragi "blamed" the electronics division for diode shortages. I do not know who else Kutaragi could have "blamed" - it seems to be a necessary and natural description of the situation.
Please, read carefully.
There were comments in this thread to the effect that Stringer supposedly criticised Kutaragi harshly. I think some people had mistaken Kotaku's paragraphs in quotes to be Stringer's own words, when they were really Ehrenberg's voice.
I would bring to your attention that at least one comment from the WSJ article originated from "a person familiar with the situation". Stringer doesn't need to say that, of course. And that was about Kutaragi's dining habits too.
The only substantiation that the WSJ article had for Kutaragi's "tense" relationship with the electronics division is that Kutaragi "blamed" the electronics division for diode shortages. I do not know who else Kutaragi could have "blamed" - it seems to be a necessary and natural description of the situation.
Please, read carefully.
Those ppl do believe in their engineers and trust them to make the impossible possible.
Sometime it works, sometime it doesn't..
