It proved to be tremendously difficult to change company’s DNA once given by its founders. To much focus on innovation and dual management were the first to blame for poor financials.
As several Philips executive confessed, turning the company around meant changing its religion, ingrained belief and value system, “one [CEO] can succeed only if he can break through the Philips culture. And the only way to do that is maybe to destroy it”. This battle cost the company 30 years of underperformance and it is not over yet.
Under the recent CEO, Gerard Kleisterlee, the senior management seems to get the message right: it is shifting to Asia, not only manufacturing but also R&D, sales. The target is to have 40% of revenues coming from that region. For them, it is like building new Philips. As the matter of fact, today, Philips employs more people in China than in the Netherlands. One day it may be known to people not as Royal Philips Electronics but as 飞利浦.