Made In Japan: Akio Morita and Sony
Listening to songs on my iPod, I always wonder how advanced the technology has grown over the years since the days The Early “Portable” Radio
of Gramophone, to Valve tubed Radios, to transistorized Radios and Cassette players. But, if there is one thing that has truly brought music into your pockets and made it portable for the first time – it’s the Walkman. Today’s Gyan is about one such personality and the company he founded that stands tall as an example of innovation, continuous improvement and the virtue I admire the most – the entrepreneurship. Yes, it’s the “Sony”
Born on 26th January, 1921 Akio Morita belonged to a family who were into the business of brewing “Sake” – an alcoholic drink made using rice – for about 400 years. Sake enjoys the popularity of the national drink of Japan and the families brewing Sake were revered for their profession and the legacy continued through generations. Kyuzaemon – Akio’s father was grooming him well to inherit the family business of Sake brewing and to become the next Kyuzaemon. Although, Akio belonged to this traditional Japanese family, his father had a modern vision. His uncle, especially, played a vital role in making Akio’s perspectives broader towards the western culture.
Akio was interested in Physics and Mathematics. He also enjoyed taking apart electronic gadgets and put them back together. Considering his likings, Akio got admitted in the Physics Department of Osaka Imperial University.
Those were the days of World War II. Japan was fighting a losing battle against the allies on several fronts. After graduation in 1944, Akio joined Navy's Wartime Research Committee. This is where he found Masaru Ibuka.
The nuclear attack on Hiroshima and Nagasaki left a paralyzed and humiliated Japan. The country had no choice but to surrender. Every plant, factory and industry was now either destroyed or was under US control.
Akio returned to his family in Nagoya once the war was over. He was now ready to take up the job of a professor in Tokyo Institute of Technology. This was when he read about the research laboratory founded by Ibuka in Tokyo. Reading the article, Akio met Ibuka and together they founded “Tokyo Tsushin Kogyo Kabushiki Kaisha” (Tokyo Telecommunications Engineering Corporation) on May 7, 1946, with approximately 20 employees and initial capital of 190,000 yen. At that time, Ibuka was 38 years old and Morita was 25.
The “headquarters” of Tokyo Tsushin Kogyo K.K. was in a war struck, dilapidated Departmental store. The main gate was kept closed at night. So the employees would go in and out through the fire escape. Many a times, the police had mistakenly arrested the employees thinking they are burglars!
Morita and Ibuka started selling converters for Radios so that people can listen to Short Wave Bands banned earlier by the Japanese Government. Then they tried their hands at making electrically heated mattresses. But the mattresses used to get so hot that nobody could get a good night’s sleep! After this failed attempt, they tried selling electric cooker which was fairly successful.
The company was soon to see success when in 1949 it developed magnetic recording tape and in 1950 sold the first tape recorder in Japan.
Music had always been passion for Akio. In his childhood, his uncle would bring him records of Beethoven, Bach and young Akio would wonder how to improve their sound quality. Years later, his company started manufacturing Tape Recorders. In 1957, it produced a pocket-sized radio. The company tried making Tape Recorders and Radios as small as possible so that they can fit in the shirt’s pocket. The pocket radio was a little bigger in size than the usual shirt pockets. So they even sold shirts having pockets befitting the radio!
This was when Akio decided to change the name of the company from “Tokyo Tsushin Kogyo Kabushiki Kaisha” (hush!) to “Sony”! Akio wanted to make his company a global organization and he knew that US was their primary market. The current name would not go well in that country. So, deriving from Latin “Sonus” – Sound and “Sonny” – American Slang for “Whiz Kids”, Akio renamed the company to “Sony”, in spite of the opposition from his own employees!
While technical part was Ibuka’s forte, Morita would worry about how to sell the products to the customers and would handle the marketing of the company.
Sony was and still is very keen about the quality of their products. But back then, anything that is made in Japan was considered inferior. So the “Made in Japan” tag would always be in small fonts somewhere at the corner. A custom officer once scolded about this fact and since then, the “Made in Japan” and “Sony” would appear prominently.
Akio Morita always thought big. Once, a US company named Bolova placed a huge order of 100,000 transistors to Sony. But there was a condition that Bolova would sell them with their brand name. It was a major breakthrough for Sony but Akio politely turned down the offer saying he wants to make a World Class company! In another incident, another company asked Akio to quote the prices for 5000, 10000 and 50000 transistors. Morita quoted a discounted price as the quantity went up. But when the customer asked for a 100,000 transistors order, Akio quoted it much higher. On being asked why the price was quoted higher when in fact it should have been less, Akio replied that to provide that much amount of transistors, he would need to set up another factory, hire more people. In Japan, there was no tradition of firing people once the job is done. So, even when the order was completed, Akio couldn’t have fired the extra employees. Hence, to take care of all these factors, Akio had quoted a higher price. The incident truly depicted Akio’s caring nature towards his employees and his respect to the Japanese Management.
Morita explains this basic difference between Japanese companies and their American counterparts. In other countries, they hire people who are already good at one or two things and then depending upon the work, they are used. But in Japan, good people are selected, trained and used to carry out the task. It’s like building wall using stones of different shapes. If you wish to create a wall of different shape, you don’t need to throw away the stones; just rearrange them and they would fit together!
In 1960, Sony produced the first transistor television in the world. 1960 was also the year when Sony Corporation of America was established in the United States. It was soon followed by Sony applying for American Depository Receipts (ADRs) in 1961. Sony was the first Japanese company to be listed in NASDAQ. Morita’s vision not only helped Sony build up the much needed capital but also paved way for other Japanese companies to go global.
In 1968, the company entered the music software business in Japan by establishing CBS/Sony Group Inc. jointly with CBS, Inc. of the U.S. Then in 1979, Sony entered the financial business in Japan with the founding of Sony Prudential Life Insurance Co. Ltd., a 50-50 joint venture with The Prudential Life Insurance Co. of America. Furthermore, Sony acquired CBS Records Inc., the records group of CBS in 1988. The following year, Sony acquired Columbia Pictures Entertainment, Inc., enabling the company to become a comprehensive entertainment company that owns both quality software content and a wealth of hardware.
At Sony, much stress was given on inventing products that couldn’t be imagined by the common man. Walkman* was one such example. Even the people from Sony itself questioned Morita and Ibuka why anyone would like to buy an electronic gadget just to listen to music while doing his work, walking, working out. But, both Morita and Ibuka – well in their sixties by now – were firm on their decision. Sony brought in the Walkman and rest all is history.
Today, Sony is a leading manufacturer of audio, video, communications, and information technology products for the consumer and professional markets. Its music, motion picture, television, computer entertainment, and online businesses make Sony one of the most comprehensive entertainment companies in the world. With the annual sales of approximately $67 Billion in the year ending 2005, Sony employs 151,400 people.
Akio Morita resigned from Sony’s chairmanship in 1994 following a cerebral hemorrhage while playing tennis. In 1999, he – a man who always remained young at heart - died at the age of 78, leaving behind a great legacy of “Thinking Big”, Self Confidence and Patriotism.
Regards,
Abhishek
P.S.
There is an autobiography of Akio Morita titled “Made in Japan: Akio Morita and Sony”
*: Launched on July 1st, 1979, Walkman was the brainchild of both Morita and Ibuka. The Walkman was initially launched as 'Soundabout' in the U.S., 'Stowaway' in England, and 'Freestyle' in Australia but it soon got recognized as “Walkman” throughout the world making its way in the Oxford Dictionary in 1986. The court battle for the patent of Walkman is won by one Andreas Pavel who invented the concept and the first walkman a year or so before Sony. The article appeared in 18th December’s Times of India.
of Gramophone, to Valve tubed Radios, to transistorized Radios and Cassette players. But, if there is one thing that has truly brought music into your pockets and made it portable for the first time – it’s the Walkman. Today’s Gyan is about one such personality and the company he founded that stands tall as an example of innovation, continuous improvement and the virtue I admire the most – the entrepreneurship. Yes, it’s the “Sony”
Born on 26th January, 1921 Akio Morita belonged to a family who were into the business of brewing “Sake” – an alcoholic drink made using rice – for about 400 years. Sake enjoys the popularity of the national drink of Japan and the families brewing Sake were revered for their profession and the legacy continued through generations. Kyuzaemon – Akio’s father was grooming him well to inherit the family business of Sake brewing and to become the next Kyuzaemon. Although, Akio belonged to this traditional Japanese family, his father had a modern vision. His uncle, especially, played a vital role in making Akio’s perspectives broader towards the western culture.
Akio was interested in Physics and Mathematics. He also enjoyed taking apart electronic gadgets and put them back together. Considering his likings, Akio got admitted in the Physics Department of Osaka Imperial University.
Those were the days of World War II. Japan was fighting a losing battle against the allies on several fronts. After graduation in 1944, Akio joined Navy's Wartime Research Committee. This is where he found Masaru Ibuka.
The nuclear attack on Hiroshima and Nagasaki left a paralyzed and humiliated Japan. The country had no choice but to surrender. Every plant, factory and industry was now either destroyed or was under US control.
Akio returned to his family in Nagoya once the war was over. He was now ready to take up the job of a professor in Tokyo Institute of Technology. This was when he read about the research laboratory founded by Ibuka in Tokyo. Reading the article, Akio met Ibuka and together they founded “Tokyo Tsushin Kogyo Kabushiki Kaisha” (Tokyo Telecommunications Engineering Corporation) on May 7, 1946, with approximately 20 employees and initial capital of 190,000 yen. At that time, Ibuka was 38 years old and Morita was 25.
The “headquarters” of Tokyo Tsushin Kogyo K.K. was in a war struck, dilapidated Departmental store. The main gate was kept closed at night. So the employees would go in and out through the fire escape. Many a times, the police had mistakenly arrested the employees thinking they are burglars!
Morita and Ibuka started selling converters for Radios so that people can listen to Short Wave Bands banned earlier by the Japanese Government. Then they tried their hands at making electrically heated mattresses. But the mattresses used to get so hot that nobody could get a good night’s sleep! After this failed attempt, they tried selling electric cooker which was fairly successful.
The company was soon to see success when in 1949 it developed magnetic recording tape and in 1950 sold the first tape recorder in Japan.
Music had always been passion for Akio. In his childhood, his uncle would bring him records of Beethoven, Bach and young Akio would wonder how to improve their sound quality. Years later, his company started manufacturing Tape Recorders. In 1957, it produced a pocket-sized radio. The company tried making Tape Recorders and Radios as small as possible so that they can fit in the shirt’s pocket. The pocket radio was a little bigger in size than the usual shirt pockets. So they even sold shirts having pockets befitting the radio!
This was when Akio decided to change the name of the company from “Tokyo Tsushin Kogyo Kabushiki Kaisha” (hush!) to “Sony”! Akio wanted to make his company a global organization and he knew that US was their primary market. The current name would not go well in that country. So, deriving from Latin “Sonus” – Sound and “Sonny” – American Slang for “Whiz Kids”, Akio renamed the company to “Sony”, in spite of the opposition from his own employees!
While technical part was Ibuka’s forte, Morita would worry about how to sell the products to the customers and would handle the marketing of the company.
Sony was and still is very keen about the quality of their products. But back then, anything that is made in Japan was considered inferior. So the “Made in Japan” tag would always be in small fonts somewhere at the corner. A custom officer once scolded about this fact and since then, the “Made in Japan” and “Sony” would appear prominently.
Akio Morita always thought big. Once, a US company named Bolova placed a huge order of 100,000 transistors to Sony. But there was a condition that Bolova would sell them with their brand name. It was a major breakthrough for Sony but Akio politely turned down the offer saying he wants to make a World Class company! In another incident, another company asked Akio to quote the prices for 5000, 10000 and 50000 transistors. Morita quoted a discounted price as the quantity went up. But when the customer asked for a 100,000 transistors order, Akio quoted it much higher. On being asked why the price was quoted higher when in fact it should have been less, Akio replied that to provide that much amount of transistors, he would need to set up another factory, hire more people. In Japan, there was no tradition of firing people once the job is done. So, even when the order was completed, Akio couldn’t have fired the extra employees. Hence, to take care of all these factors, Akio had quoted a higher price. The incident truly depicted Akio’s caring nature towards his employees and his respect to the Japanese Management.
Morita explains this basic difference between Japanese companies and their American counterparts. In other countries, they hire people who are already good at one or two things and then depending upon the work, they are used. But in Japan, good people are selected, trained and used to carry out the task. It’s like building wall using stones of different shapes. If you wish to create a wall of different shape, you don’t need to throw away the stones; just rearrange them and they would fit together!
In 1960, Sony produced the first transistor television in the world. 1960 was also the year when Sony Corporation of America was established in the United States. It was soon followed by Sony applying for American Depository Receipts (ADRs) in 1961. Sony was the first Japanese company to be listed in NASDAQ. Morita’s vision not only helped Sony build up the much needed capital but also paved way for other Japanese companies to go global.
In 1968, the company entered the music software business in Japan by establishing CBS/Sony Group Inc. jointly with CBS, Inc. of the U.S. Then in 1979, Sony entered the financial business in Japan with the founding of Sony Prudential Life Insurance Co. Ltd., a 50-50 joint venture with The Prudential Life Insurance Co. of America. Furthermore, Sony acquired CBS Records Inc., the records group of CBS in 1988. The following year, Sony acquired Columbia Pictures Entertainment, Inc., enabling the company to become a comprehensive entertainment company that owns both quality software content and a wealth of hardware.
At Sony, much stress was given on inventing products that couldn’t be imagined by the common man. Walkman* was one such example. Even the people from Sony itself questioned Morita and Ibuka why anyone would like to buy an electronic gadget just to listen to music while doing his work, walking, working out. But, both Morita and Ibuka – well in their sixties by now – were firm on their decision. Sony brought in the Walkman and rest all is history.
Today, Sony is a leading manufacturer of audio, video, communications, and information technology products for the consumer and professional markets. Its music, motion picture, television, computer entertainment, and online businesses make Sony one of the most comprehensive entertainment companies in the world. With the annual sales of approximately $67 Billion in the year ending 2005, Sony employs 151,400 people.
Akio Morita resigned from Sony’s chairmanship in 1994 following a cerebral hemorrhage while playing tennis. In 1999, he – a man who always remained young at heart - died at the age of 78, leaving behind a great legacy of “Thinking Big”, Self Confidence and Patriotism.
Regards,
Abhishek
P.S.
There is an autobiography of Akio Morita titled “Made in Japan: Akio Morita and Sony”
*: Launched on July 1st, 1979, Walkman was the brainchild of both Morita and Ibuka. The Walkman was initially launched as 'Soundabout' in the U.S., 'Stowaway' in England, and 'Freestyle' in Australia but it soon got recognized as “Walkman” throughout the world making its way in the Oxford Dictionary in 1986. The court battle for the patent of Walkman is won by one Andreas Pavel who invented the concept and the first walkman a year or so before Sony. The article appeared in 18th December’s Times of India.
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