Sony StoreSir Howard Stringer, who Sony Corp.'s (NYSE: SNE) board turned to as chief executive in 2005, said he will retire as chairman. He departs as the company he oversaw sits in the rubble, compared to the enterprise he took over, its stock having fallen more than 75% during his tenure as CEO.

Kazuo Hirai replaced Stringer as CEO last year, but the Japanese manager has inherited a company so troubled that it cannot be salvaged. Hirai's early days as chief executive have been marred by huge losses, most of which were due to Stringer's strategies.

Sony's board believed that Stringer could cut through an insular culture, one in which engineers made many decisions without regard to outside market considerations. That culture created the PlayStation and PS2, the best-selling game consoles of all time. Before that, the same company launched the wildly successful Walkman. It is also the same culture that drove the company to buy Columbia, which eventually became the seed of Sony Pictures in 1989.

Stringer had some success as the head of Sony's U.S. operations before he was called to the firm's Tokyo headquarters. Sony's board must have thought that the U.S. success could be transferred to the entire company worldwide. It was a huge misstep for which the board will be remembered unfavorably.

Stringer failed to see that consumer electronics would become commodities, many of them produced inexpensively in Korea and China. Sony's brand was not powerful enough to offset new, quality products sold by competitors at lower prices.

Stinger also failed to push Sony into the smartphone business as it burgeoned in 2007 with the release of the Apple Inc. (NASDAQ: AAPL) iPhone. Instead he created a joint venture with Ericsson as a means to grab market share. The new company bungled product launches. Sony bought out Ericsson just over a year ago, but that was too late. Apple and Samsung already had shoved other smartphone operations out of the sector. Stringer also failed to aggressively enter the PC business when there were still large profits to be had. Sony's PC operations are now a minor factor in an industry with its best years behind it.

As Stringer leaves, the best question to ask is whether he did anything right.


Filed under: 24/7 Wall St. Wire, Management Change Tagged: AAPL, featured, SNE

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