When Sir Howard Stringer took the reins of Sony worldwide in 2005 he outlined a strategy for an integrated company that leveraged the assets and operations of all Sony divisions to maximize the strength and profitability of the entire organization. 

IT plays an essential role in turning this strategy into an everyday reality and David Cortese, VP and Division CIO for Sony Pictures Home Entertainment, will be discussing the company's progress as part of the Day One (June 27, 2007) CIO panel at the Entertainment Supply Chain Academy (ESCA) at the Century Plaza Hotel in Los Angeles. 

In his worldwide capacity, David is tightly involved in the current Sony United initiatives, which are focused exclusively on improving overall performance across the studio's supply chain.  He oversees all aspects of information technology that support business operations, including manufacturing, distribution, finance, sales and marketing for the home entertainment division.   

At last year's ESCA, Michael Frey, Executive VP, Sony Entertainment Distribution, presented an outline of how Sony United was going to impact the supply chain activities of the home entertainment group.  At this year's event, Cortese, will be providing a detailed IT perspective on the process.  He provided a preview of his thoughts in the following interview: 

Q. Can you describe Sony United from a supply chain point of view? 

A. Within Sony today, there are 12 individual projects that are each focused on enhancing the supply chain in some way, shape or form; all of them are being designed to deliver our products better, cheaper and faster. What is great about the Sony United project is the very nature of our company; our manufacturing is done by a Sony company, we handle our own distribution, and we are also the content providers. We have all three segments working together toward the same objectives.  The reason Sony United is working is that we have the right leadership from the business truly owning and driving the projects  and we have representatives from all three organizations (Sony Pictures, Sony Distribution and Sony Manufacturing) working together on projects to reduce cycle times, transportation costs, inventory planning, you name it.  

Q. Any specific progress? 

A. We have identified a lot of redundant assets across all three companies; it doesn't make sense that we have three of everything. Three ERP systems, three reporting systems, etc.  One of our key objectives is also to leverage our own best practices, wherever they may lie, across the entire organization. For example, we are going to be moving all of our supply chain KPIs and metrics reporting for all three organizations to a single Teradata data warehouse.  Sony Entertainment Distribution has also built an inventory-planning tool that they have invested in that we are going to use it across all three companies.  Moving forward, we will be making sure that all our IT solutions are in line with the expectations and applications of all three groups. 

Q.  Besides savings, are these efforts resulting in increased revenues? 

A.  We have a lot of capabilities within these three companies, which we can offer as third-party services to other companies for incremental revenue opportunities.  We have recently gone live with one of the major studios as a partner on our scanned-based trading program, for example, and we are getting ready to provide other services to smaller or independent studios who don’t have the infrastructure they may want.  For some companies we will be able to leverage our manufacturing and distribution; others are looking for back office IT support functions; for smaller companies that haven't got the money to invest in ERP systems, we could provide that service as well.  

Q.  How would you describe the relationship between operations and IT at Sony Pictures Home Entertainment? 

A.  Our relationship with operations is tremendously tight; we probably spend more time with them everyday than any other division, working side-by-side making decisions and automating as many of the processes as we possibly can. Our work with WebConcepts, for example, is a result of operations and IT working together and the result has been our ability to take as many as 18 hours out of the supply chain when it comes to sending replenishment orders to retailers. At the end of a day, a store sends you their sales and we have to take those sales and compare them to the inventory in order to evaluate our replenishment needs.  This process used to take a full day. Today it is fully automated: we get Wal-Mart point-of-sale information at midnight and we have our replenishment orders done by three or four a.m.  As a result of a close working relationship between IT and supply chain operations, we have been able to apply basic business rules and business logic to many of our transportation and supply chain operations. 

Q.  What role is Sony IT playing in the emerging digital supply chain? 

A.  Right now most of our work is involved in organizing our digital assets. When I say "digital assets," I am referring to providing the company with the ability to control the traffic of our high res graphics and go direct to print and provide as much of a paperless workflow as possible, including digital storage, so that the artwork can be viewed from our asset repositories anywhere in the world and anytime they want.  This is one example of the amount of work that we are doing around digitizing the raw materials of our supply chain.