The Product Engineering department at Sony shifts an average of 4 ideas for new products per day. Sony is a huge diversified organization employing 15,000 employees worldwide. The company continues to lead the mode of innovation in the consumer electronics industry. Why?
Because of the way the company uses its structure to motivate and coordinate its employees.
A “self-promotion” policy allows your engineers, without notifying their supervisors, to search for projects anywhere in the company where they think they can make a contribution. If they find a new project, their boss allows them to form their new team.
Sony has 23 business groups made up of hundreds of development teams, and its movement of people on other teams fertilizes ideas throughout the organization.
Sony promotes the lateral movement of people and ideas among engineering and design groups.
The “Sony Way” highlights communication between groups to foster innovation and change. Sony has a research department full of people with integration roles who coordinate the efforts of business groups and product development teams. It is your responsibility to ensure that each team knows what the other teams are doing, not only to share knowledge, but to avoid overlap or duplication of effort.
Once a year, the research department organizes a 3-day internal “special event” for Sony employees only, where each DP team can show their work to the others.
Sony's work structure is the cause of its success in the market and the number of innovative products that Sony manufactures. Like many large Japanese companies, Sony has a lifetime employment policy, which makes it easy for its engineers to take risks with ideas that support innovation efforts. Furthermore, Sony rewards its engineers with promotions and more resource control if they are successful.
Sony is realistic, however, when it makes the best use of its resources. Top management makes efforts to distance itself from the decision-making of a team or business group, such that the magic of decentralized decision-making can work, but it intervenes when it sees different groups duplicating efforts.
For example, when Sony makes a breakthrough in computers, it reorganizes the relationship between the audio, video, and computer groups, to take advantage of the way they coordinated the development of the new product.
Once again, Sony takes a side view of the way the organization works, and its vertical chain of command is geared toward finding ways to decentralize authority and make the best use of resources. This lateral decision-making methodology contrasts with IBM's old, centralized, vertical Product Design system.
Reference:
Organizational Theory, Design and change.
Gareth R. Jones.
