ROYAL PHILIPS CASE STUDY – PRESENTATION (GROUP 5)

 Why did Philips identify four priority sectors for its business?

1. To focus efforts and investment in new innovations related to their core strength areas.
Philips prepared four priority “health spaces”: cardiology, oncology, respiratory, and
fertility/pregnancy/parenting.
2. Philips was already having a strong position and expected the greatest potential for
growth in these health spaces.
3. All the above were major reasons for fatalities across the globe.

 Why did Philips use APIs and did not go with building their interface?

1. Both the component businesses and the solutions businesses faced challenges adapting
to a platform strategy. API-enabled components usable across the enterprise and hence
were warranted. (Philips had learned this from Amazon).
2. For creating reusable components, API-enabled components were a novel approach to
building functionality.
3. APIs were important to give access to their HSD Platform.

 Why did Philips want HSDP to be an industry wide platform?

1. It was not possible for Philips alone to move from traditional product-based business
model to solution-based business model.
2.To develop a health care ecosystem, they wanted to develop HSDP as the operating
system. This was evident as they offered HSDP as a PaaS to external parties.

 Why did Philips come up health continuum concept?

To offer end to end solutions in health sector. E.g., Stroke Treatment and post-operative
care. They wanted to reduce the door to needle time for all patients. They wanted to focus
on healthy living, prevention, diagnosis, treatment, and home care.

 Why did Philips focus on internal and external factors for its digital Transformation
objective?

Cultural change was the corner stone for change in healthcare ecosystem. They wanted to
bring disruption which was only possible with attitude change in healthcare workers and
through organizational change (internally).

Breaking the silos and offering HSDP as PaaS were key highlights of transformation.
 Why did Philips opt for reusable components?

Philips took inspiration from Lego bricks, where each Lego brick needs to be excellent. But
when demand comes from Customer, they could simply put the bricks together to provide
the solution, making them fully interoperable. This gave superior customer value. This also
gave them longer-lasting relationship and recurring revenues – something that cannot easily
be displaced by a competitor.
E.g., The sensor [a biosensor attached to the body to provide continuous monitoring of a
certain condition] is a Lego brick for a general hospital ward solution. But it can also be a
Lego brick for a discharge solution—I discharge a patient; I want to keep monitoring this
patient at home.

 Some of the integrated solutions took longer time and created a bottleneck, What steps
were taken by Philips to overcome this?
1. Component and solution separation as well as component reusability
2. API enabled components

 Why did Philips focus on preventive health rather than solving real disease problems?
1. One of the biggest challenges of Philips was the healthcare industry itself where most of
the resources were allocated for diagnosis and treatment rather than prevention.
2. Integrated solutions focused on prevention could be beneficial for patient and society by
bringing down overall healthcare cost spending.

 Philips had a decline in overall revenue due to its traditional product and business then
why did they continue with same along with integrated solutions?

1. Revenue now and in years to come was depended on traditional products.

2. Philips had a strong market presence in medical device and imaging industry.
3. Sale of these products helped in lead creation for integrated solutions.

 One of the biggest hindrances in growth of Philips was the healthcare industry itself and
the ways how specialists functioned. What steps were taken by Philips for this?
1. Healthsuite Lab engagements which was not designed for direct sales rather providing
fee-based service for potential customers.
2. Establishment of separate vision lab and solution lab.
3. Change in sales and marketing approach by identifying potential customers and
educating existing customers.

 Why did Philips go for 2 digital platforms HSDP and CDP2?

1. For quick generation of new solutions and providing enterprise-wide functionality.

2. The services available from CDP² shielded application developers in the business
groups from having to use the more basic services offered by HSDP. In fact, business
unit developers were expected to refrain from using HSDP directly.