PHILIPS Vs MATSHUSHITA

STRATEGIC COMPETENCE

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GROUP - 2
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RENU REKHA KARAN ADITYA ASHOK MANISH

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PHILIPS
Strategy
National responsiveness Technology-driven innovation Entrepreneurial NOs Central research and funding

MATSUSHITA
Strategy
Global scale efficiency Market-driven rapid innovation Innovative PDs Linkages in the value chain

Core Incompetencies
Slow technology to market

Poor global strategy

Core Incompetencies Overseas subs not innovative

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Philips

Value Management
Research Development Manufacturing Marketing Service, etc.

Centralized
Basic scientific innovation, develop new products
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Decentralized (NOs)
Adapt, manufacture, market, and service products within national markets

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Matsushita
Value Management
Research Development Manufacturing Marketing Service, etc.

Centralized
Applied product and process innovation

Centralized (PDs)
Develop and manufacture products

Decentralized (NOs)
Market and service products within national markets

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    

PHILIPS Gerard Philips and Anton Van Riemsdijk and Rodenburg Wisse Dekker Van der Klugt Timmer Boonstra Kleisterlee

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MATSUSHITA Konosuke Matsushita Yamashita’s Tanii’s Yoichi Morishita’s Kunio Nakamura’s

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Gerard Philips and Anton

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Development of tungsten metal filament bulb Transfer of Assets Research Laboratories shifted to England Top Management moved to USA

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Van Riemsdijk and Rodenburg (1970)

Decentralization of Authority between Product Division and National Organization Closed the inefficient Local Plants and convert best into International Production Center

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Wisse Dekker (1982)
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Focused on core operation Cost reduction in operation Overseas Technology Sharing Agreement

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Van der Klugt (1987)

Matsushita overtook Philips
6000 5000 Net income (in $ Millions) 4000 3000 2000 1000 0 -1000 -2000 -3000 1970 1975 1980

Net Income

Philips Matsushita 1985 1990 1995 2000

Year

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Van der Klugt (1987)
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Matsushita overtook Philips Divided business in core and noncore Divesting Business

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Timmer (1990)
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Stick approach Sold the non profitable business Ignored consumer demand

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Boonstra (1996)

Shifted production to low-wage countries Achieved 24% returns on net assets

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Kleisterlee (2001)
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Outsourced production Made a loss after 1996

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Conclusion

Philips had a complex manufacturing and marketing origanization which was not cost effective.

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MATSHUSHITA

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Konosuke Matsushita

Started company with Yen 100 and start production of double-ended stock Battery Power lamps, electronic irons and radios 250 year Plan divided into 25 year section plan Post-war boom with new products
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CONT.
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Divisional Structure Business Expansion Global Leadership Monitoring and Operation Controls Headquarter and subsidiaries relationship

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Yamashita’s
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Local Market Operation More product alternatives were made available in overseas

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Tanii’s
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Brought all subsidiaries under METC Acquisition of MCA Economy burst Less profit as compare to 1991

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Yoichi Morishita’s
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Decentralization of authority Shifted production to Asian Country Began investing in R&D Partnership

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Kunio Nakamura’s
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Change the company’s vision. Focus on customer need.

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Bibliography
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online.glos.ac.uk HBS Case Study

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