Sony 2001 Annual Report Download - page 15

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Sony Corporation Annual Report 2001
13
Our objective is to differentiate our products by offering network services that are unique and entertain-
ing. We are rapidly putting together an integrated business model for this purpose, one that can add value to
our electronics business. For example, during the year, Sony started a network service that allows owners of
VAIO notebook PCs equipped with a CCD camera to transmit live images over the internet. By offering such
network services, Sony aims to add value to its hardware and expand its business.
Furthermore, we are aggressively investing resources to develop and improve key devices such as
semiconductors and displays, which, in addition to contributing to a product’s functions and quality, are
integral to the competitiveness of our business. We are particularly active in the semiconductor arena. While
also cooperating with other companies in leading-edge fields, we are investing on our own in production
facilities for CCDs and high-temperature polysilicon LCDs. Within the Group, the S&S Architecture Center
was formed to encourage joint design and development of system LSIs between it and group companies
making finished products.
To support the development of network businesses, we are now at work on a global network platform.
Until now, key technologies and systems for such critical functions as billing, settlement, and authentication
have been created individually for specific products and services. The new platform will enable us to formu-
late standardized technologies and systems that can be used throughout the Sony Group. To supervise these
tasks, we have formed the Broadband Network Center. Specifically, the center is responsible for reducing
redundant system development and operations costs and assisting in the launch of new businesses.
BUILDING A HIGHLY PROFITABLE STRUCTURE
Introduced in 1999, EVA® is now being used strategically as a tool to increase returns on invested capital.
We are using EVA® to speed up the process of selecting growing, profitable businesses worthy of receiving
new investments. In the fall of 2000, we decided to exit or downsize 28 of our 115 product categories in the
Electronics business. Approximately 850 engineers affected by this are being reassigned to strategic fields
and growth areas. In addition, we are currently examining those AV-related activities that serve maturing
markets and have relatively low returns. A decision on the desirability of continuing these businesses is
expected in the near future.
Furthermore, we are determined to become more competitive, by taking decisive actions to restructure
our businesses. This has taken the form of a realignment of our manufacturing sites. Now we are turning our
attention to building the world’s most powerful manufacturing platform, Sony’s EMCS (Engineering, Manu-
facturing and Customer Services) design and production platform, by pursuing greater efficiency in design,
production, inventory management, and logistics while also providing outsourcing services to third parties.
At the Electronics HQ we have established a global EMCS office. It will focus on several critical tasks:
ensuring that Sony only employs the most advanced production technology; procuring components under a