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What's the mission and vision statement of Sony Ericsson?

Mission Statement of Sony Ericsson: To provide quality end to end communication services to small and medium sized corporate business. Vision Statement: To experience the joy of advancing and applying technology for the benefit of the public.

Therefore, it can be said that Sony Ericsson's mission and vision is to become the communication entertainment brand. They achieve this by inspiring more people to not only communicate by use mobile applications such as entertainment, games & imaging. Sony Ericsson is successful as a mobile communications company as it integrates communication and entertainment in one. Sony Ericsson Mobile Communications is a joint venture by the Japanese consumer electronics company Sony Corporation and the Swedish telecommunications company Ericsson to manufacture mobile phones. The stated reason for this venture is to combine Sony's consumer electronics expertise with Ericsson's technological knowledge in the communications sector. Both companies have stopped making their own mobile phones separately and started making phones combined as Sony Ericsson Mobile Communications. The mission and vision statement of Sony Ericsson is clearly reflected in the way they do business. By launching new technology-based products as 3G, 3GSM and Cyber shot Mobile Phones, Walkman, Android, Smart phones etc. they spread new informationbased mobile technology, mobile communications and mobile entertainment.

4 steps of strategy formulation: 1. Primary task: The main and primary task of Sony Ericsson Mobile Communication is to make new technology-based mobile phones, smart phones, walkman, android etc. along with mobile applications and mobile games and delivering them to the people.

2. Core Competencies: Human Resources: One of the core competencies of Sony Ericsson is it's human resource. By employing creative and innovative employees and retaining them in the company assures Sony Ericsson a continuous culture of innovation with it's motivated employees. It is said that a workplace that allows workers to be creative is a positive environment desired by ingenuous and talented employees who are the cream of the crop of the company. Leadership in technological innovation: Sony Ericsson has established its leadership in mobile communications and mobile entertainment technology. The company launched Java 3D-enabled handsets, best 3G handsets voted by GSM association, Sony Ericsson's cyber shot phone was awarded best 3GSM mobile handset. Innovation in partnership: It forges partnerships with content providers and developers such as Sony BMG for its entertainment capabilities. Sony Ericsson also engages itself with relevant sponsorships. In 2004 it sponsored the Women's Tennis Association tour, thus named as the Sony Ericsson WTA tour in 2005.

3. Determining Order qualifiers and Order winner: Order Qualifiers: These are the characteristics of Sony Ericsson's products that qualify these products to be purchased by the customers. Such as: i. High Tech Products: Products of this company are much developed in technological efficiency. Sony Ericsson always tries to cope up with the ever constantly changing technologies. The objective of this company is to reach the latest technology to the customers through it's products before any other company does. ii. Good Customer Service: Sony Ericsson Mobile Corporation provides faster and satisfying services to it's customers. There is no hazard in case of any occurrence of problem in the products. iii. Different Outlets for Different customers: Sony Ericsson offers different outlets for different types of customers according to their need, desire and purchasing ability.

Order Winner: These are the characteristics that help win the order of products to be sold to the customers in the marketplace. Such as:

i. Reasonable Range: The products of Sony Ericsson are available at very reasonable and affordable price for everyone. In Bangladesh, the price of Sony Ericsson Mobile Phones starts from BDT. 6,250 up to BDT. 36,000, Sony Ericsson Walkman starts from ii. Most Features: The products of Sony Ericsson have much more features as compared to the other subsequent competitors products. And all are at a lower price that people can afford it.

4. Positioning Strategy: It determines how the company will compete in the marketplace. Such as: 1. Sony Ericsson

Corporate Strategy of Sony Ericsson : Corporate Strategy refers to the overall strategy of a diversified company. Corporate Strategy is what makes the corporate whole add up to more than the sum of its business parts. The Corporate Strategies of Sony Ericsson are as follows: SWOT Analysis: SWOT stands for Strength, Weakness, Opportunities & Threats. SWOT Analysis is a simple framework for generating strategic alternatives from a situation analysis. It is applicable to either the corporate level or the business unit level and frequently appears in marketing plans. Strengths:

i. Increased Market Share: Market Shares of Sony Ericsson company has been increased in a great extent in recent years. Its one of the strongest points of this company. ii. Reduced Losses: Sony Ericsson has been successful in reducing its company losses in the past year. The company cut its total losses by more than half in the second half of 2002. Sony Ericsson should look to continue to cut costs in order to narrow company losses even further. The success of the joint venture will be viewed by its ability to break even and generate profits. iii. Brand name: Having a strong brand name means that it will be more likely that

Sony Ericsson will sell more handsets, as consumers normally choose to buy branded products with which they are familiar rather than those that are unfamiliar. Sony Ericsson should look to leverage both the Sony and Ericsson brand names, as they are both respected brand names in the fields of electronics and telecommunications. The joining of these two brand names will again help the company to increase awareness of its products resulting in increased sales of handsets. iv. New products: Sony Ericsson has released a line of new products that it is forecasted will help the company to increase its share of the market, as well as generate extra sales and profits.

Weaknesses:

i. Loss making: The Sony Ericsson joint venture is currently loss making. Sony Ericsson must try to generate profits as soon as possible or the venture may be deemed unsuccessful. Company losses may still be tolerated over the next couple of years, as the Sony Ericsson venture has only been trading for a relatively short period of time. However, sustained losses over a period of time may lead to either Sony or Ericsson deciding to cease their funding of the joint venture. ii. Marketing Costs: The launch of the companys line of new cellular handsets will mean that marketing costs will increase for the months when the products are launched and for the initial period of the products life cycle. High marketing costs are a necessity in this situation in order to spread the market. iii. Lack in understanding Customer Preferences: Sometimes its difficult to find out the requirements of the customers properly. Sony Ericsson Mobile Communication Company should increase their observation and monitoring of the customers desire to lessen the weakness of the company.

i.

Opportunities: Mobile phones market in developing: Now-a-day, mobile communication sector is expanding its arena constantly in high speed. A vast amount of opportunity has been created for the companies that want to conduct business in this sector. And these opportunities are increasing day by day as the technology is advancing gradually.

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iv. v.

High % of young market: Most of the users of electronic gadgets, such as mobile phones, walkman etc are the young generation. As the percentage of the youth among the total population is increasing day by day, the targeted customer market is also expanding simultaneously. Strong Customer demand for innovative product: Customers always have attraction and intention of buy the new & innovative products which have come along with new technologies & features that have not come before. In that case, Sony Ericsson Mobile Communication Ltd is one step ahead. High Disposable income in emerging markets: Its also an opportunity to expand the mobile communication & mobile entertainment services. Network capabilities and low tariff of service providers.

i. i. ii.

Threats: Landline penetration and introduction of Sky phones for rural areas. Intense competition. Bargaining power of consumers.

Evaluation of Financial Performance of Sony Ericsson According to its balance scorecard: Quarterly financial announcements Sony Ericsson reports third quarter 2011 results (14 October 2011):

Income before taxes was Euro 31 million 33 percent increase in sales quarter-on-quarter Smartphones account for more than 80 percent of total sales

The consolidated financial summary for Sony Ericsson Mobile Communications AB (Sony Ericsson) for the third quarter ended September 30, 2011 is as follows: Number of units shipped (million) Average selling price (Euro) Sales Euro m.) Gross margin(%) Operating income (Euro m.) Operating margin(%) Restructuring charges (Euro m.) Operating income excl. restructuring charges (Euro m.) Operating margin excl. restructuring charges (%) Income before taxes (IBT)(Euro m.) IBT excl. restructuring charges (Euro m.) Net income (Euro m.) Q3 2010 10.4 154 1,603 30% 63 4% 4 67 4% 62 66 49 Q2 2011 Q3 2011 7.6 9.5 156 166 1,193 1,586 31% 27% -37 38 -3% 2% -37 38 -3% -42 -42 -50 2% 31 31 0

Bert Nordberg, President and CEO of Sony Ericsson commented, We delivered a solid 73 million Euro improvement in income before taxes as we rebounded from the previous quarter with a 33 percent increase in sales. Android-based Xperia smartphone sales now account for more than 80 percent of sales and we have shipped 22 million Xperia smartphones to date. We will continue to invest in the smartphone market, shifting the entire portfolio to smartphones during 2012. Units shipped during the quarter were 9.5 million, a 9% decrease year-on-year due to a decline in feature phone shipments, partially offset by an increase in smartphone shipments. The 25% quarter-on-quarter increase was due to the higher volume of smartphones shipped. Average selling price (ASP) for the quarter was Euro 166, up 8% year-on-year and 6% sequentially. The year-on-year increase was due to the shift to smartphones and

geographic mix despite a negative effect from foreign exchange rates. The sequential increase was due to product and geographic mix. Sales for the quarter were approximately Euro 1.6 billion and essentially flat year-onyear. The gross margin percentage for the quarter was 27%, a decrease of 3 percentage points year-on-year and 4 percentage points from the previous quarter. The year-on-year decrease in margin is attributed to product and geographic mix. The sequential decrease in margin was due to inventory-related adjustments and product and geographic mix. Income before taxes for the quarter was Euro 31 million, compared to income before taxes of Euro 62 million for the same quarter in the previous year. Loss before taxes for the previous quarter was Euro 42 million. The sequential improvement was reflective of higher sales and lower operating expenses, while the year-on-year decline was due to lower gross margin percentage offset by lower operating expenses. Net income during the quarter improved by Euro 50 million sequentially, while net income decreased by Euro 49 million year-on-year. Income taxes recorded during the quarter reflect the distribution of profits and losses between various jurisdictions and tax adjustments. Minority interest reflects higher net income at a majority-owned joint venture company. Cash flow from operating activities during the quarter was Euro 53 million. External borrowings of Euro 51 million were repaid during the quarter, resulting in total borrowings of Euro 718 million at the end of the quarter. Total cash balances at September 30, 2011 amounted to Euro 466 million. Sony Ericsson estimates that its share of the global Android-based smartphone market during the quarter was approximately 12% in volume and 11% in value. Sony Ericsson maintains its forecast for modest industry growth in total units in the global handset market for 2011.

Sony Ericsson reports second quarter 2011 results (15 July 2011)

Supply chain constraints from the Japan earthquake significantly impact Q2 results Smartphones account for more than 70 percent of total sales Android-based Xperia volume up 150 percent year-on-year

The consolidated financial summary for Sony Ericsson Mobile Communications AB (Sony Ericsson) for the second quarter ended June 30, 2011 is as follows: Number of units shipped (million) Average selling price (Euro) Sales (Euro m.) Gross margin (%) Operating income (Euro m.) Operating margin (%) Restructuring charges (Euro m.) Operating income excl. restructuring charges (Euro m.) Operating margin excl. restructuring charges (%) Income before taxes (IBT) (Euro m.) IBT excl. restructuring charges (Euro m.) Net income (Euro m.) Q2 2010 11.0 160 1,757 28% 36 2% -32 68 4% 31 63 12 Q1 2011 Q2 2011 8.1 7.6 141 156 1,145 1,193 33% 31% 19 -37 2% -3% 19 -37 2% 15 15 11 -3% -42 -42 -50

Bert Nordberg, President and CEO of Sony Ericsson commented, Sony Ericssons second quarter profitability was affected by the March 11 earthquake in Japan. We estimate that the impact of earthquake-related supply chain constraints on our portfolio was close to 1.5 million units, with most of the effect in the early part of the quarter. Our shift to Android-based smartphones continues with smartphone sales accounting for more than 70 percent of our total sales during the quarter. We have shipped more than 16 million Xperia smartphones to date. We have introduced eight new Xperia smartphones this year and we continue to see strong consumer and operator demand across the Xperia smartphone portfolio. Units shipped during the quarter were 7.6 million, a 31% decrease year-on-year and a 6% decrease sequentially, due to a decrease in volume caused by constrained supply of critical components and an anticipated decline in the number of feature phones shipped. Average selling price (ASP) for the quarter was Euro 156, a 3% decrease year-on-year but an 11% increase sequentially. The year-on-year decrease is due to product and geographic mix and price erosion. The sequential increase in ASP is attributed to favorable product and geographic mix, more than offsetting price erosion and unfavorable foreign exchange rates.

Sales for the quarter were Euro 1,193 million, a 32% decrease year-on-year and a 4% increase sequentially. The gross margin percentage for the quarter was 31% with an improvement of 3 percentage points year-on-year that included restructuring charges, and a decrease of 2 percentage points from the previous quarter, which included the benefit of some larger than normal items relating to royalty matters and warranty estimates. Loss before taxes for the quarter was Euro 42 million, compared to an income before taxes of Euro 31 million for the same quarter in the previous year, due to lower volume. Income before taxes for the previous quarter was Euro 15 million. The sequential change was reflective of lower gross margin and higher operating expenses. The quarter ended in a net loss of Euro 50 million, compared to a net income of Euro 12 million in the same quarter in the previous year, and Euro 11 million in the last quarter. Tax expenses in this quarter included the impact of tax adjustments and the distribution of profits and losses between various jurisdictions. Cash flow from operating activities during the quarter was negative Euro 224 million, mainly due to increases in accounts receivables and inventories, negative net income and timing of certain payments. New external borrowings of Euro 165 million were made during the quarter to enhance liquidity and growth, resulting in total borrowings of Euro 769 million at the end of the quarter. Total cash balances at June 30, 2011 amounted to Euro 516 million. Sony Ericsson estimates that its share in the global Android-based smartphone market during the quarter was approximately 11% in volume and 11% in value. Sony Ericsson maintains its forecast for modest industry growth in total units in the global handset market for 2011.

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