GROUP - 2 





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 Core Incompetencies Overseas subs not innovative Poor global strategy 24/12/07 PGDBM-1 PICT-SITM 3/22 .

market. etc. develop new products 24/12/07 Decentralized (NOs) Adapt.Philips Value Management Research Development Manufacturing Marketing Service. and service products within national markets PGDBM-1 PICT-SITM 4/22 . Centralized Basic scientific innovation. manufacture.

Centralized Applied product and process innovation Centralized (PDs) Develop and manufacture products Decentralized (NOs) Market and service products within national markets 24/12/07 PGDBM-1 PICT-SITM 5/22 .Matsushita Value Management Research Development Manufacturing Marketing Service. etc.

       PHILIPS Gerard Philips and Anton Van Riemsdijk and Rodenburg Wisse Dekker Van der Klugt Timmer Boonstra Kleisterlee      MATSUSHITA Konosuke Matsushita Yamashita·s Tanii·s Yoichi Morishita·s Kunio Nakamura·s 24/12/07 PGDBM-1 PICT-SITM 6/22 .

Gerard Philips and Anton     Development of tungsten metal filament bulb Transfer of Assets Research Laboratories shifted to England Top Management moved to USA 24/12/07 PGDBM-1 PICT-SITM 7/22 .

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 24/12/07 PGDBM-1 PICT-SITM 8/22 .

Wisse Dekker (1982)    Focused on core operation Cost reduction in operation Overseas Technology Sharing Agreement 24/12/07 PGDBM-1 PICT-SITM 9/22 .

Van der Klugt (1987)  Matsushita overtook Philips 6000 5000 4000 illi 3000 2000 1000 0 Net i -1000 -2000 -3000 1970 1975 1980 e i $ Net I e Philips Matsushita 1985 1990 1995 2000 Year 24/12/07 PGDBM-1 PICT-SITM 10/22 .

Van der Klugt (1987)    Matsushita overtook Philips Divided business in core and non-core nonDivesting Business 24/12/07 PGDBM-1 PICT-SITM 11/22 .

Timmer (1990)    Stick approach Sold the non profitable business Ignored consumer demand 24/12/07 PGDBM-1 PICT-SITM 12/22 .

Boonstra (1996)   Shifted production to low-wage countries lowAchieved 24% returns on net assets 24/12/07 PGDBM-1 PICT-SITM 13/22 .

Kleisterlee (2001)   Outsourced production Made a loss after 1996 24/12/07 PGDBM-1 PICT-SITM 14/22 .

Conclusion  Philips had a complex manufacturing and marketing origanization which was not cost effective. 24/12/07 PGDBM-1 PICT-SITM 15/22 .


Konosuke Matsushita     Started company with Yen 100 and start production of double-ended stock doubleBattery Power lamps. electronic irons and radios 250 year Plan divided into 25 year section plan PostPost-war boom with new products 24/12/07 PGDBM-1 PICT-SITM 17/22 .

     Divisional Structure Business Expansion Global Leadership Monitoring and Operation Controls Headquarter and subsidiaries relationship 24/12/07 PGDBM-1 PICT-SITM 18/22 .CONT.

Yamashita·s   Local Market Operation More product alternatives were made available in overseas 24/12/07 PGDBM-1 PICT-SITM 19/22 .

Tanii·s     Brought all subsidiaries under METC Acquisition of MCA Economy burst Less profit as compare to 1991 24/12/07 PGDBM-1 PICT-SITM 20/22 .

Yoichi Morishita·s    Decentralization of authority Shifted production to Asian Country Began investing in R&D Partnership 24/12/07 PGDBM-1 PICT-SITM 21/22 .

24/12/07 PGDBM-1 PICT-SITM 22/22 .Kunio Nakamura·s   Change the company·s vision. Focus on customer need.

uk HBS Case Study 24/12/07 PGDBM-1 PICT-SITM 23/22 .Bibliography