Sonos Interim CEO Says Company Has Turned a Corner and He Wants the Top Job
(Bloomberg) -- Sonos Inc. interim Chief Executive Officer Tom Conrad said the audio company has 'turned the corner' following setbacks caused by software issues — and that he wants to be named to the top job permanently.
'I'm just feeling much more confident that we've turned the corner,' he said in an interview Friday. 'We've made some real breakthroughs in the last 90 days on some deeply esoteric technical challenges.' The longtime board member stepped in as temporary chief in January after his predecessor, Patrick Spence, left following a failed app revamp mired the company in controversy.
Last year, Sonos overhauled its iOS and Android apps — along with the underlying software that connects its hardware — and users immediately complained about interface issues, networking problems and equipment not being able to properly play music. The glitches upset many consumers who, in some cases, spent tens of thousands of dollars on Sonos systems placed throughout their homes.
Conrad said the latest software release, pushed out this week, helps fix issues that have continued to hit older players — such as the Play 1 and Play 3 — unveiled over a decade ago. He said that releases coming out the rest of the year will help make Sonos' software 'better than it has been in five years.'
By spending the past few months fixing the underlying software, the company is now focusing on improving the app's user experience, he said.
'Quantitatively today, the app performs better than the software it replaced,' he said, adding that upcoming releases across the summer and into early fall will 'restore convention' to the user experience and improve usability. 'I feel like we're on a really good path here.'
The issues, he said, were difficult to fix because they were so wide-ranging. 'It's not like we made a straightforward set of mistakes where we could just go in and plug some obvious holes.'
Conrad credits the turnaround to restructuring the way the company operates. Sonos previously was organized by business units, meaning there was one team for every product line. Now, the company is structured by functionality, meaning it's grouped into areas like hardware, software, design and operations. That mirrors Apple Inc.'s approach. (Besides sporting a Sonos tattoo, Conrad has one of a Mac on his arm.)
The old structure 'made it hard for the team to prioritize experience across the business units, which is so fundamental to what Sonos is,' Conrad said. The company, he said, is now staffed for success, has a clear set of goals and a more defined line of escalation to top managers. This 'has unlocked the progress we've made on software and how the team is feeling about what they show up to do here,' he said.
Conrad said Sonos hasn't fully determined how it will be impacted by tariffs the US has imposed on foreign imports, but that it stopped building products for the US market in China years ago, instead relying on Malaysia and Vietnam. Still, it's pulling forward manufacturing to bring hardware devices into the US while levies are stable ahead of anticipated changes, he said, because it's premature to try to figure out how this 'multidimensional problem' gets solved.
And while Conrad is interim CEO, he is very clear about wanting to drop the first part of that title. 'I hope the next chapter is I get named permanent CEO and I get to lead the company on a 5-year or 10-year plan, not on a 2-year plan,' he said. 'I have big ideas and I can't wait to get going.'
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