3 year plan includes focus on PlayStation, Pictures, Music and Devices
Sony has outlined the next stage of its corporate plan: the strategy which will carry it into 2018. As part of business shifts which the corporation hopes will see it return to profit and a 10 per cent return on equity, Sony plans to redouble its efforts in four areas: devices, music, pictures and games. Hirai expects Sony to be on course for a minimum operating profit of ¥500 billion ($4.20bn) by the end of FY 2017 on March 31, 2018. Current Sony forecasts put operating margins for FY 2015 at just ¥20 billion.
Speaking to investors in Japan yesterday, CEO Kazuo Hirai said that Sony's business arms will be given more autonomy, allowing units to make more decisions and creating a more agile environment. However, integration into a wider corporate strategy remains key, with Hirai also expounding a "clearly defined positioning of each business within a broader business portfolio perspective."
"Sony will position Return on Equity (ROE) as its primary key performance indicator and has set a target for consolidated ROE of more than 10 per cent and a target for consolidated operating profit of more than 500 billion yen for the Sony Group in FY2017, the final year of its mid-range corporate plan," a corporate communication explains.
"Based on its specific characteristics and the competitive landscape, each of the Sony Group's businesses will be classified as a 'growth driver,' 'stable profit generator,' or 'area focusing on volatility management' in terms of its position within the Company's overall business portfolio. Each business will then be assigned a target figure for Return on Invested Capital (ROIC) linked with the ROE target for Sony Group as a whole, and managed with a clear emphasis on profitability.
"Sony is positioning Devices, Game & Network Services, Pictures, and Music as the segments that will drive its profit growth over the next three years. It will implement growth measures and engage in aggressive capital investment in these areas with the aim of achieving both sales growth and profit expansion...In Games & Network Services, the Company will strive to further expand the installed user base of the PlayStation platform and PlayStation Network (PSN)."
Sony is also planning to "spin out" some more areas into their own wholly owned subsidiaries, in the way it did previously for SCE. TV and mobile are the first expected targets of this, with some expecting at least one of these risky and embattled sectors to be sold off entirely in the way that the Vaio PC business was. Management structures are also expected to undergo some "realignment" in order to improve accountability and efficiency.
http://www.gamesindustry.biz/articles/2015-02-18-sony-aiming-at-USD4-20bn-profit-by-end-of-fy-2017
UPDATE:
The divisions Sony will spin off are its audio and video businesses. I'm not sure what that is exactly...hardware components like bluray players and such?
