Philips plans to split into two companies
Electronic giant, Philips says it will split itself into two companies where one will focus on health technology and the other on lighting solutions.
Chief Executive Officer of Philips, Mr Frans van Houten, told journalists at this year’s Philips Innovation Experience 2014 that the move was to position both companies for long-term market leadership, enabling them to innovate and address customer needs even better and faster.
The Innovation Experience attracted journalists from over 120 countries including Ghana to the Netherlands to witness the operations and innovations of Philips.
"Innovation has been and will always be at the heart of Philips and the Innovation Experience underlines how we are pushing the boundaries to improve people's lives with a host of great products and services
"Our recent announcement to establish two market-leading companies focused on the HealthTech and Lighting solutions opportunities will allow us to hone in our innovation strengths in two exciting and growing markets. Innovation and the Philips brand will be at the core of the two new companies," said Philips CEO Frans van Houten.
Mr Van Houten said Philips had taken the steps to meet urgent needs. “What we are seeing is the merging of the consumer and professional healthcare spaces. To lead a good life, consumers want to monitor and manage their health, be it in the air they breathe, the food they eat or their personal hygiene.”
He said governments were looking for ways to deliver better and more affordable health care beyond the hospital walls. To this end, they are encouraging healthy living, preventative health, and remote support of people with chronic diseases. They also want to empower healthcare professionals to co-operate more effectively and deliver better diagnoses and treatments.
Mr van Houten said to enable this revolution; health care has to be delivered as an integrated service across the entire continuum of care. This runs from healthy living and prevention, to diagnosis and treatment, and recovery and homecare.
“The portfolios of our Health care and Consumer Lifestyle businesses already span this continuum. By merging the two and working from a unified vision and strategy in a single company, we create a stronger foundation for future growth and innovation.”
He noted that the lighting industry was experiencing the largest transformation since the invention of the light bulb. He said LEDs and connected lighting technologies were catalysing the shift from lighting products to lighting solutions and systems.
“While still valuable for the illumination it provides, light will increasingly create social and economic value by making buildings and cities safer, more beautiful and energy efficient”
Innovation and Philips vision
He said the transformation of Philips would ultimately allow the company to remain true to the power of the brand and proud heritage of innovation. “Innovation is the lifeblood of Philips. In fact this year, it is a 100 years since Philips set up a laboratory dedicated to research. Under the leadership of the young Dr Gilles Holst, the lab’s initial focus on incandescent light bulbs quickly broadened to other areas, including HealthTech. “
Over the years, Philips’ researchers have generated more than 100,000 patents and delivered many meaningful innovations. To this end, they are encouraging healthy living, preventive health and remote support of people with chronic diseases.” he said
Philips was founded in 1891 by Frederik Philips and his son Gerard in the southern Dutch town of Eindhoven. Initially a producer of light bulbs, Philips grew to become one of Europe's largest industrial companies in the 20th century. It is credited with innovations such as the TV set, radio set, compact disc and the electric shaver. In the 1970s, it employed more than 400,000 people globally.
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