Research on Development Strategies of Large Comprehensive
Multinational Corporations: A Case Study of Sony
Xinzheng Liu
1,a,*
1
SKEMA Business School, Service Admissions BBA, 60 rue Dostoïevski, CS30085, 06902 Sophia
Antipolis, France
a. louislaw020515@qq.com
*corresponding author
Abstract:
As a large comprehensive multinational corporation, Sony Group has faced
numerous crises since the early 21st century. Once a giant in the electronics industry, it
showed signs of decline in the millennium era. This paper analyzes Sony Group from four
aspects—strengths, weaknesses, opportunities, and threats—using the SWOT analysis
method. The research finds that Sony Group's strengths lie in its broad product market and
significant growth opportunities in the internet age. However, it also faces weaknesses in its
adaptability to technological changes and the demands of the times, as well as threats from a
highly competitive environment. Based on these conclusions, this paper suggests that Sony
Group should maintain relatively stable operations by leveraging its business advantages in
the global market. It should strive to provide more advanced products to a wide range of
consumers and industry users, utilize the rapidly growing internet technologies to transform
more online entertainment experiences, and offer differentiated products and services in a
competitive environment. This study provides a comprehensive analysis of large
multinational corporations, with a novel case study that offers new reference samples for the
application of the SWOT analysis method.
Keywords:
Large comprehensive multinational corporations, Sony, Development strategy,
SWOT analysis method.
1.
Introduction
Sony Corporation is a globally renowned, large-scale multinational enterprise group from Japan,
primarily engaged in the development of electronic products. Its business spans consumer electronics,
video games, finance, entertainment, semiconductors, smartphones, cameras, camcorders, and audio
equipment, with worldwide brand recognition.
However, since entering the 21st century, Sony has shown weaknesses in its electronics business.
According to the 2005 "Brand Value Ranking" published by Interbrand, the value of "Sony"
decreased from $43.15 billion in 2004 to $40.5 billion in 2005, a decline of 14%, causing it to fall
from 10th to 18th place. Additionally, in the "2005 Global 2000 Companies Ranking" published by
Forbes on February 28, 2005, Sony's ranking dropped from 2nd in 2004 to 23rd in 2005. In the "2013
Asia Brand 500 Ranking," Sony was placed 4th.
Despite the temporary decline in its consumer electronics business, Sony has not lost consumer
favor due to its historically remarkable achievements. On August 31, 2005, Asian Integrated Media
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DOI: 10.54254/2754-1169/111/2024.17765
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commissioned international research agency Synovate to conduct the "2005 Asia's Top 1000 Brands"
survey across multiple countries and regions in Asia, where Sony was named the top brand for the
second consecutive year. According to a survey released by Harris Interactive on July 12, 2006, Sony
was ranked as America's best-known brand for the 7th consecutive year and was considered the most
iconic brand in Mainland China, Taiwan, and Hong Kong. In the "Fortune Global 500" list published
by Fortune magazine in 2011, Sony ranked 73rd with a revenue of $83,844.8 million. In 2010, Sony
was ranked 69th. On September 21, 2015, in the "Asia's Top 500 Brands" list revealed in Hong Kong,
Sony was ranked 2nd. On July 19, 2018, Sony was ranked 97th in the "Fortune Global 500" list.
This paper will utilize the SWOT analysis method to study Sony's development strategies and
provide relevant suggestions to help Sony Group better respond to crises and develop itself, aiming
to offer references for the future development of large comprehensive multinational enterprises
represented by Sony.
2.
Literature Review
The most relevant literature to this paper focuses on the development research of Sony. Ting Li [1]
conducted an in-depth study on the development strategy of Sony Mobile Communications Inc. by
analyzing the current state of the mobile internet industry chain and the status quo of Sony Mobile.
Wenpeng Chang [2] attempted to comprehensively analyze Sony's recent innovative developments
using the theory of comprehensive innovation development, examining technological, institutional,
and managerial dimensions. He summarized the good experiences and existing problems in Sony's
innovation development process and provided constructive suggestions for the development of
Chinese technology-innovative enterprises. Zhujun Ling [3] investigated the impact of corporate
culture on corporate core competitiveness by collecting data and conducting case studies. Ling
analyzed the development and transformation history of Sony’s corporate culture, identifying cultural
factors that hinder core competitiveness and proposed four corresponding measures to help Sony
develop a suitable corporate culture to enhance its overall core competitiveness. Jianping Zhang [4]
applied theories of multinational corporations' foreign direct investment, combining data and actual
situations, to study Sony's operations in China. Zhang analyzed various aspects such as business
categories, management strategies, human resources under cultural differences, and technological
innovation. Meng Huang [5] used the example of Sony Mobile to analyze the application of the
AEFSSW model of social media marketing in the mobile phone industry, aiming to improve the
efficiency of social media marketing.
Additionally, literature related to the study of large comprehensive multinational enterprises is also
relevant. Toshihiko Haraguchi [6] explained the brand strategy and market marketing strategy of
internationally renowned Japanese companies and the relationship between brand strategy and
management strategy, using Sony and Honda as typical examples to analyze the development process
of Japanese corporate brand strategies. Mengni Tang [7] used the important turning points in the
economic development of China and Japan as the background and studied the cases of Sony and
Huawei, pointing out that the development process of private enterprises is influenced by the
macroeconomic development of the country and that the innovation capability of enterprises is crucial.
Ziwei Zhan [8] analyzed the performance management practices of fully-owned overseas subsidiaries
of Huawei and Sony, which have accumulated rich experience in long-term multinational overseas
operations, to provide specific strategies for the performance management of other multinational
overseas subsidiaries. Lifu Wang [9] reviewed and re-examined the concepts of brand communication
and social responsibility, conducting an in-depth analysis of their intersection and interrelationship.
Wang selected two representative companies from China and Japan, Sony and Haier, for comparative
analysis. Qi Zhang [10] took the mobile phone industry in China, Japan, and Korea as examples,
selecting Huawei, Sony, and Samsung as the main research subjects to study the impact of network
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word-of-mouth differentiation on cross-cultural national brand communication, integrating theories
of network word-of-mouth communication effect, national brand effect, and brand communication.
Based on the above literature, the potential contributions of this paper include: First, in terms of
research topics, although there has been considerable research on Sony Group, there is almost no
study that comprehensively analyzes its development strategy as a large multinational corporation in
the era of significant internet growth. Therefore, the subject of this paper is novel and comprehensive.
This study addresses the gaps in the existing literature by researching the development strategies of
large comprehensive multinational corporations using Sony Group as a case study. Second, in terms
of research methodology, this paper employs the SWOT analysis method to explore the strengths,
weaknesses, opportunities, and threats of Sony Group as a large multinational corporation. Third, this
paper provides targeted and personalized recommendations for the development of Sony Group, with
relevant insights that can also benefit other large comprehensive multinational corporations as a
reference.
3.
SWOT Analysis
SWOT Analysis, also known as SWOT Matrix or TOWS Matrix, is a method used to evaluate a
company's competitive position and to develop strategic planning. It involves assessing the internal
strengths (Strengths) and weaknesses (Weaknesses) of the company, along with the external
opportunities (Opportunities) and threats (Threats). This method, introduced by Albert Humphrey,
typically requires a dedicated team for optimal implementation. Ideally, a SWOT analysis team
should consist of an accountant, a salesperson, a senior manager, an engineer, and a project manager.
3.1.
Strengths:Extensive Product Market
Sony boasts a vast product market. For instance, in 2023, Sony's mobile image sensor products held
over 55% of the market share, maintaining its lead in the global mobile image sensor market for five
consecutive years. This dominance in the market grants Sony a monopolistic position, offering a
relatively stable development advantage.
3.2.
Weaknesses:Inadequate Adaptability to Technological Changes and Era Requirements
Entering the early 21st century, Sony exhibited weaknesses in its electronics business. After the
release of the PlayStation in 1994, Sony did not launch another groundbreaking product for a decade.
Existing products also lost competitiveness or failed to meet the demands of the time. For example,
Sony's Walkman, which revolutionized portable music, was eventually replaced by Apple's iPod
because the Walkman did not support MP3 audio files. This highlights Sony's inadequate adaptability
to technological changes and evolving market requirements. Moreover, Sony's conservative decision-
making in the early 21st century led to its product development lagging behind, unable to integrate
emerging superior technologies. Consequently, Sony's products lost their competitive edge,
threatening its dominance in the electronics market.
3.3.
Opportunities:Significant Growth of the Internet Era
The global internet has undergone several significant phases of development, with a continually
evolving landscape. The initial phase dates back to the 1960s, followed by the commercialization and
explosion phase from the early 1990s to the early 2000s. The third phase, the Web 2.0 era, spanned
from the early 21st century to the early 2010s. Currently, we are in the fourth phase, the mobile
internet era, which began in the 2010s, characterized by the widespread use of smartphones and
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mobile applications. This ongoing growth of the internet era provides a broader market for Sony and
its related industries.
3.4.
Threats:Highly Competitive Environment
The competition in the electronics market is primarily driven by technological innovation. Emerging
companies, led by Apple, continually introduce new products and improve product performance to
meet consumers' demands for high-quality, high-performance products, thereby enhancing brand
competitiveness and creating a positive brand image. Moreover, brand image is crucial for enhancing
competitiveness in the electronics market, significantly influencing consumers' purchasing decisions.
Consumers tend to prefer well-known and reputable brands. Companies like Apple, Huawei, and
Samsung possess more advanced technologies, and their brand images align better with modern
consumer preferences, giving them a stronger brand appeal than Sony. This unavoidable highly
competitive environment presents a significant challenge for Sony in its pursuit of continued
development in the electronics field.
4.
Conclusions
This paper outlines and analyzes Sony Corporation's strengths, weaknesses, opportunities, and threats.
Sony's strength lies in its extensive product market. However, it faces weaknesses due to inadequate
adaptability to technological changes and era requirements. The company is presented with
opportunities in the significant growth of the internet era but also encounters threats from a highly
competitive environment. The study provides the following policy insights: 1. Maintaining Stable
Operations: Sony should leverage its market position in electronics, gaming, music, and film
industries to maintain stable operations globally. 2. Market Penetration and Customization: Sony
should deepen its market presence in various countries, gaining a profound understanding of user
needs. The company should develop products and offer customized solutions tailored to different
national markets, providing advanced products to consumers and industry users. 3. Leveraging
Internet Technologies: Sony can utilize rapidly growing internet technologies to transform more
online entertainment experiences, laying the foundation for future entertainment experiences. This
includes offering new entertainment experiences such as online services in gaming, collaborative
projects with Manchester Football Club to create sports spaces, and live virtual performances in music
spaces. 4. Differentiated Products and Services: Sony needs to offer differentiated products and
services to meet diverse consumer needs and preferences in a highly competitive environment.
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