Business environments are dynamic; they keep changing, new systems and methods of doing businesses are being implemented and shaped by external environment. Five major forces that affect business environment are political, technological, environmental, economic, cultural and social changes; a single business has no influence on the above external factors; the best it can do is devise strategies to take advantage offered by the situation as it mitigates against any threat brought about by the external environment.
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Sony Corporation is the fifth largest media conglomerate with its headquarters at Minato, Japan; the company produces a range of electronic commodities like phones, radio, and television. It concentrates in consumer and professional markets oriented commodities, to remain competitive in the fast developing electronic industry; the company has embarked on massive innovation and invention of products and processes (Hopper, 2007).
One major external factor affecting Sony is the fast growth in technology. It is offering the company some competitive advantage and at the same time keeping, the company alert to tap any opportunity offered however, it has increased competition in the industry a notch higher (Sony Corporation Inc, 2011). This paper looks into the effects that technological changes have on Sony; it will focus on the effect it has on its innovativeness.
Brief history of Sony
The initial idea to have an international electronic company has its roots in 1945, when started a radio repair shop; Akio Morita later joined him. In the efforts to seek knowledge for their young electronic company, Masaru Ibuka visited the United of America where he convince Bell Labs‘ to sell their invention of transistor to his company.
This was the start of innovation in the company when the company decided they could use the transistor in the communication industry. In 1955, the company made Japanese first transistor radio, Sony TR-55, which was sold commercially. The company adopted the name Sony in 1958.
Since the adoption the company’s name, it has continued to grow in size and sales: it form one of the World Top 20 Semiconductor Sales Leaders. To remain competitive, the company has embarked on massive innovation, invention and development of customer-oriented products.
Currently the company’s chairperson, the president/chief executive officer (C.E.O) is Howard Stringer, Vice president is Ryoji Chubachi and the chief finance officer is Masaru Kato. The current number of employees are above 167,900; in 2010 financial year, the company made an after tax profit of 7.214 trillion / $88.205 billion (Sony Corporation Inc, 2011).
Technology effects on the company
The use of technology in the business arena is in different dimensions, companies embrace technology to conduct processes in different areas. Automation of processes is a crucial factor in businesses since they create an efficient way of doing business: the following are the areas that Sony has been affected by technological development:
Technology as a platform of innovation
In modern competitive business world, small, medium and large-scale businesses need to develop new processes, products, strategies and paradigms so as they can remain afloat and have a competitive advantage. Innovation is defined as a continuous process of selecting, developing and commercialisation new commodities, processes, approaches and business models.
In Sony, the company being in the electronic industry, it develops in-house developments, inventions and innovations; these are facilitated by computer systems and software is used to simulate certain results for decision making; for example when producing Television , the company uses different technologies to produce goods priced differently.
The innovation is increasingly required to include more features in the gadgets. Some of the major break through that the company has attained though the use of computer generated products is Universal Media Disc, developed in 2003, HDV with JVC, which was invented in 2004, and Blu-ray Disc with Panasonic in 2006. When coming up with these products the company ensures that it consults available resources and levels of technology existing in the world (Haberbeg and Rieple, 2001).
Internal process automation
The company has embarked on the use of technology to automate its internal process; some of the areas involved are the use of integrated supply chain management, this is a system where different sectors of the company are integrated to assist in the management of stocks and inventories.
In the process of supplies management, the company has innovated a system that is applicable and responsive to its needs; the system has been fine-tuned by internal and external sources that it ensures that the company has a constant supply of goods and materials when they need them (Mark and Ian, 2002).
The second internal area that the company has adopted technology is in the internal auditing team management; internal management consists of a team of experts that monitor and control internal processes to ensure they are compliant with the set standards.
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The department uses computers and software to monitor the level of compliance in the firm. When products have been developed, the company uses technology to test for level of quality and ensure that it meets the set standards before they find their way to the market (Hislop, 2005).
With technology, the company has been able to develop appropriate communication strategy is involved in ensuring that the right technology in terms of infrastructure and software has been adopted in the organization. The company’s information system benefits the company in the following ways.
1. Sharing of information in the company between different departments and employees
2. Facilitated communication both internal and external communication
3. Develop an online marketing and advertising mechanisms, which will work to the benefit of the company.
4. Improve efficiency in the businesses and ensure that customer’s needs are satisfied at any one point.
5. To ensure that areas of inefficiency in the business are detected and business re-engineering mechanisms adopted (Colllier ,2008)
Technology, decision making and Business intelligence
To develop effective decisions, a company needs to have sufficient information generated internally and externally. Technology has offered a number of ways to store, analyse, interpolate and report of an industries statistics/information; this has facilitated sound and responsive decision-making. In the recent past, technology has increasingly been adopted in organizations. It assists in developing efficiency and thus customer satisfaction.
The competitiveness of a business is vested on the quality of its management decisions. A number of systems that aim at meeting a certain objective in the business arena have been developed. They are either homemade or all user systems (commercial systems). Business intelligence is the name used to refer to the total collection of such system; it was first coined in September 1996, in Gartner Group report.
Sony has an elaborate and effective business intelligence system that offers the company sound information necessary for making decisions when they are needed. With the system that is reinforced by a knowledgeable team, the company has used it to come up with new products, improve processes and increase efficiency (Bessant and Tidd, 2007)
The effects on Marketing and sales strategies
Although Sony is in the industry were its products are used in technology development, the company has adopted other companies products to sell its products, the company has an automated marketing and selling strategy where it uses computers and the internet to advertise its products. The company has developed a website where it posts different information meant for consumer consumption so as consumers can get to learn of new products in the market form the company.
The move to online advertising has been facilitated by the expansion of internet services in the world. Online marketing is a cheap and effective method of reaching customers spread in different parts of the globe. When a customer places an order, then the company undertakes the role of transporting the commodity to the most favourable place for the customer (Paley, 1999).
Online marketing gives an interactive environment that the target customer can be able to communicate to Sony management team via the website and offer their views on the company’s products. This facilitates development and products differentiation. This gives the user the advantage of airing his or her views; this was never possible in the old marketing and advertising models.
The population that is there in the world today, a majority is enlightened and knows its rights. In the exercise of these rights, the people need the environment that does not dictate on what they are supposed to do, the way the traditional marketing and advertisement seemed to do. The two-way system of communication is assisting in building a strong brand name and relationship marketing sees the (appendix for a summarised effect of technology).
When a company product has a good brand name, it is to the advantage of the company since the brand becomes self-advertising (Fred, 2008). Appropriate and up to date information technology tools should be used in the entire organization. Hardware and software tools should be developed which are appropriate for the attainment of set goals and objectives.
Technology and improved Customer service
Technology has assisted Sony to develop better customer service; mechanisms to get feedback and respond to customer issues are developed and facilitated by computer systems. This may take the form of call centre or other feedback mechanisms. This acts as another source of information to Sony for future improvements and current gauging in the electronic market.
Existing customers are a pool of assets to a company and they can give information relevant to the improvement of various processes. Marketing and selling strategies are addressed and skewed toward a customer-based approach (Fred, 2008).
When information is received, then the company embarks on aligning its processes to the needs of the customers. New developments have been triggered by the response of customers; they include Sony laptops, I phones and IPods which are the latest Sony products. To come up with products, there is need to simulate the situation and look for the best combinations, Sony has used computer system to create better combination.
Sony is in the electronic industry that is affected directly by the advancement of computers; it gets its market from the sector of the economy, thus the more technology develops the better for the company. In other words, it can be said that technology is the product for the company thus the more improved it is the better to the company. The more it develops products the higher it is likely to enjoy a large market.
How the company has reacted to the changes in technology
Sony has recognized that the changes in technology have come to the benefit of the industry: the company being in the electronic industry has no option other than embrace changes in technology. The management understands the danger of being technology backward; it will mean that the company will lose its competitiveness.
To avoid any chances of negative impact of technology, the company has developed a research and development team to pioneer on technology invention, development and innovation; the department, which works under the information and technology department, interacts with the outside world and gauges the position the company, is holding so as it can advise the company effectively.
To embrace and appreciate changes, the management has invested largely on developing a freelance culture were employees are encouraged to give their views on what they feel can benefit the company technology wise.
Strength and weakness of the response of Sony to technology changes
The company positive approach to technology has assisted it adopt and develop new systems and modern ways of conducting business. Technology has offered different opportunities that need to be grabbed as they come. The company has been able to take advantage of such opportunities thus increasing its gains. The strategy has made the company to be a technology developer other than being a consumer.
The approach has a weakness that it can divert attention of the company to developing of new products and forget their main core business. On the other hand, it is an expensive method; when a technology has been developed, the company is so fast that it does not wait to have exhausted the benefit of current technology before it adopts another.
Recommendation and conclusion
Scientific inventions and innovations have resulted to a business environment where technology influences decisions made in a company. The level of technology advancement in a certain country/industry determines the level of technology to be implemented in particular companies existing in the economy.
When the right technology has been adopted, a company gets a competitive advantage; however, there is no single level of technology that can be said to be optimal, a company need to keep developing and innovating other better technologies (Mitlez, 2004).
Sony is an international conglomerate company in the fast growing electronics industry, to remain competitive; the company has embarked on massive innovations and inventions of better processes and products in the efforts to become competitive. When developing processes and products, the company uses computer software to generate artificial situations that are afterwards interpolated to offer a background for strategic decisions on innovations.
Other than the benefits brought by technology, it has brought competition in the electronic industry a notch higher; companies in the industry are able to reach national and international markets at a lower cost, thus Sony has to compete with a variety of companies in the industry located in Japan and elsewhere in the globe for local and international market.
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Sony Corporation Inc., 2011. Sony. Available at www.sony.com .