Open letter to Sony's Howard Stringer ...

... and a fitting closure to this blog! Two things I've been wanting to do for some time is to make a final post to this blog now that I am no longer posting here. I also wanted to finally publish a few letters (e-mails) that I sent while working at Sony a few years back, now that I can do so with relative impunity. They encapsulate the beliefs and values behind the entire endeavour that was this blog and they make for a fitting subject matter with which to close this little exercise of mine! The e-mails were sent while I was still working at Sony around three years ago. I left soon afterwards. They capture the essential thinking that I had recorded in this blog from its inception in 2002 but had in fact already started when I first joined Sony in 2000. The first e-mail was sent to Sir Howard Stringer just as he had been made CEO and Sony was going through a very rocky patch that had started some time prior to that and was the very reason he was brought in. It was purely speculative and proactive - read on below: NOTE: The slide deck referred to in both mails can be found here on SlideShare (they are slightly more refined than the original but essentially the same).

-----Original Message----From: Danelutti, Stephen Sent: 01 June 2005 09:46 To: Stringer, Howard Subject: 70% of new Innovation and Change efforts fail! Dear Sir Howard, Considering the imperative of the subject at Sony right now, I'd like to propose a solution. The problem: Company transformation efforts are largely failing because innovation and change efforts are too often a top-down approach that do not sufficiently consider and involve the constituent most responsible for effective change efforts

and within which great ideas most often reside - the workforce! The solution: Technological tools, cultural alignment and process engineering that facilitate bottom-up involvement so employees can drive change efforts in the most suitable way and bring marketable ideas to the attention of top management with a high rate of buy-in followed by a high success rate in the marketplace. Attached is a summary slide with a slightly more detailed overview of my proposed solution (with relevant online links). I would really appreciate your feedback! From someone passionate about Sony, innovation and change but exceedingly frustrated by an inability to be more effective due to organisational constraints! Yours sincerely, Stephen Danelutti

Needless to say, I received no reply but then this was sent very soon after Sir Howard was appointed CEO so obviously he was a little busy. I remained undeterred and my second opportunity came up soon afterwards. In response to an idea gathering initiative that was started soon after I sent my first mail I fired off my second attempt. The initiative was communicated via e-mail by the way and responses were to be given by e-mail and supposedly Sir Howard Stringer and Dr Chubachi (COO at the time if I recall correctly) were going to personally review every idea, or some such nonsense. E-mail, can you "Adam and Eve" it... -----Original Message----From: Danelutti, Stephen Sent: 13 June 2005 12:05 To: Sony Ideas Subject: An idea about successful idea creation and management! Dear Sir Howard and Dr. Chubachi I would like to commence with my e-mail/idea by saying that the Sony Ideas initiative is a very good one and a great start. However, in my humble and frank opinion, it is not enough! This e-mail (an introduction of my thinking) and the

attached presentation (a more detailed, generic overview of a programme surrounding the idea) are all about my alternatives! One additional point of clarification I'd like to make is that I use the term innovation synonymously with ideas throughout. Finally, about the idea itself! Hopefully it addresses at least two of the issues that your initiative raises: a uniform, efficient and continuous way of evaluating all ideas; a way of ensuring that you get much more than just 5 ideas, that are successful. But I hope it goes much further! Thank you for your consideration! Why is managing ideas properly so important? Because so many new ideas fail! Fail to reach the market or fail to be profitable! Improving the odds is critical! Because ideas are the lifeblood of Sony and the engine of growth, managing them should be given higher priority. I believe in providing for and involving employees in a programme for continuously creating and managing new ideas efficiently that exceed the one-off, electronic suggestion box - with all due respect. This is critical for Sony's future success and effectively makes innovation management a core competence. Ideas cannot be copied so easily in this world of commoditisation, or at least can be protected, sufficient to wring large profits from them!

What else is important? Change is closely linked to ideas. Microsoft turned their whole company around when they discovered how big an idea the Internet was going to be and realised that they had not yet properly capitalised on it! So too Apple when they saw the potential in MP3 players. The most successful way of innovating (as you will see from my presentation) is to capitalise on opportunities as they arise - this requires being as flexible to change as Microsoft and Apple were. Also, considering that change is the only constant today, that managing it is imperative and that many programmes fail, making change management a core competence becomes critical too! If you accept the link, you could conclude as I have, that innovation + change = transformation and that this needs to be done continuously and effectively in order for it to become a competitive advantage ad infinitum. More about this in my presentation.

As James Surowiecki so brilliantly researches and shows in his book: The Wisdom of Crowds; good ideas and actions are not the preserve of a few experts and more often than not, large groups of people have better and more successful ideas/solutions - so involve the whole workforce! Also, with regard to both innovation and change programmes, if they are handed down from management without sufficient engagement of employees, they are not as effective! A mechanism for involvement, buy-in and measurement is critical, beyond broadcast communication and a feedback channel like a suggestion box. Ideally though, it is more than just involvement, it is engagement of passion! Finally, successful ideas and change agents can come from anywhere, not just the engineering or R&D department and innovation can go beyond just products to cover business processes (like DELL) and business concepts as well (like eBay).

With engagement in mind but beyond "morale boosting" comes accountability, which I know ranks high on your agenda. For example, linking critical activities with success and performance goals like GE's CEO Jeffrey R. Immelt is doing. One of the ways in which he is trying to shift the current mindset at GE is with pay - linking bonuses to new ideas. Out of interest, he is also doing it with customer satisfaction and sales growth, with less emphasis on bottom-line results. Further focus areas are with risk Spending billions to fund "Imagination Breakthrough" projects that extend the boundaries of GE and with experts - Rotating executives less often, and bringing in more outsiders to create industry experts instead of professional managers.

What are the bases for my observations? Other than my past experience, interests and areas of study I would like specifically to speak of my experience at Sony, to raise some issues by way of example and to provide a sample voice so to speak, if nothing else! Past communication/efforts. This is not my first attempt to bring my idea forward as you can see from the mails preceding this one. My last e-mail to you Sir Howard is very recent and you no doubt have been too busy to consider it but what is important is that I am using a very rudimentary channel - email - because there is no alternative. Why didn't I go to my current manager you might ask? Fairly clear evidence that this would fail

based on past experience and a focus on current operations that made it impossible and irrelevant - a common problem with generic corporate ideas! Isolating change management and innovation - generally accepted as a failure point. For example, one of the reasons my idea was rejected in the first round (in Europe) was because a Change Management department had just been created in Brussels and my ideas/effort (although supposedly valued) were seen to be in potential conflict with those. The other classic example at Sony concerning innovation, that has become legend, is that of Ken Kutaragi succeeding with PlayStation despite the system not because of it and with its support! I was involved in the Eurostar project to move European Business Units to the UK from The Netherlands. A good example of a badly managed change programme - sorry to say and I'm sure I need not say more! The fact remains though that Sony is not the best company in managing change. I was deeply involved in a due diligence exercise to evaluate a business that had been longer than a year in preparation. It had resided in this time at the B2B division of Sony Europe, PSE. It was for a business that, in partnership with Publicis the Communications group, was to provide and earn revenue for management of a digital content management and distribution system for flat display signage in major malls across Europe. Network Services Europe, of which I am a part, was asked to conduct the exercise with a view to taking the business over. Notwithstanding the confusing and long drawn out decision to hand it back to PSE as a final conclusion (with no end in sight for this business opportunity), I observed a complete lack of a unified process of submission and evaluation of the idea itself - with all due respect. Generally, I have seen first hand many other examples of people who have had ideas about innovation or change but have been frustrated in their efforts. Brilliant, passionate people without a clear way of progressing or with very little support/encouragement by management. So they leave for other companies or like me they become independent, in order to carry the flame onwards. On this last point I would like to clearly state that just because I am independent (last year in my 5 years at Sony), does not mean I am not committed.

Why should you consider my idea? Although I really do want to keep the focus of this mail on my "idea about idea management", I feel I would not do it credit or myself without pointing out my value

to Sony beyond the idea itself and competence to propose/manage/support it, but also in terms of my other relevant skill sets. Without wanting to send a CV or make a large issue of it I have summarised salient points below: Succesfully set-up a CRM programme for Digital Imaging Europe across Europe - key future focus for Sony is customer focus. Past experience and study has focused on this area too! Successfully set-up and managed a professional services group steering European software development activities - key future focus for Sony! Bridged the gap from device to content by working on a mobile entertainment project (full track download and streaming to mobile phone StreamMan) as part of a largely content driven group, DADC in Salzburg key future focus for Sony!

What am I asking for? My idea requires refinement and validation! The validation could be either theoretical with the support of a reputable research body or practical by implementing at a relevant department. Ideally both occur and this could be concurrent or linear with practice following theory. Sony is currently undergoing a massive transformation. I am deeply passionate about the company and its products, would really like to see a success story but better still, be a part of it and I have in-depth knowledge about the company and its future focus areas. Finally, considering that change and innovation are critical factors in the success of the transformation effort at Sony, then I would make a very able agent, if I may say! Bottom line: Let me implement or support the implementation of my idea (or a modification of it where necessary) at Sony or at the very least let me take a part in Sony's transformation efforts where I will in any event carry out my research independently and can contribute learning accordingly.

Many thanks once again for your time, attention and consideration! Yours sincerely

Stephen Danelutti