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Philips vs Matsushita

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harmonie rodriguez

on 25 June 2013

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Transcript of Philips vs Matsushita

Philips vs Matsushita
Company backgrounds
1889: Expanded abroad to foreign markets

1900: 3rd largest light-bulb producer in Europe

1919: From highly centralized to decentralization

1963: cassette tape

1972: launched their own VCR

1982: launched CDs

1997: launched DVD format with Sony
1933: divisional structure-central research laboratory & product divisions (3 divisions-Radio; Lamps and dry Batteries; and Wiring devices, synthetic resins and electro thermal products)

1935: Overseas markets

Post-war boom: Introduced a lot of new products (more than 200)

2000: Transformation & restructuring

2008: End of Matsushita
Philips' strategy
Matsushita's strategy
1. A shared but competitive leadership by the commercial and technical functions.

2. 1930s:Transfer of some activities (research laboratories) to other countries

3. War: building of the post-war organization on the strengths of the National Organizations (NOs).

4. Changes in the management with a cross-functional coordination: leadership by both a technical manager and a commercial manager.

5. 1960s: Reorganization because of competition

6. Over the next 4 decades, 7 chairmen experimented with reorganizing the company to solve the problem
1. Divisional structure: the « Hungry Spirit »

2. « Operation Localization »

3. Lower-cost production

4. R&D partnerships and technical exchanges: development of technology and innovation offshore

5. « Value Creation 21 »: digital networks, home appliance and components.
• Panasonic acquired Sanyo (2009-2010)
• Wanted to capitalize on the growing green market
◦ • rechargeable battery and solar panels
◦ • desire to make a big push for car battery market
▪ • goal: 40% of market share
• Panasonic gained control of dominant position in these markets:
◦ • Nickel-metal hydride (NiMH) batteries
◦ • Battery packs for hybrid- and all-electric vehicles
◦ • Li-ion (lithium ion) batteries
▪ • Panasonic was 6th largest; Sanyo 1st

(Reisinger, D. CNET. Panasonic finally buys up all of Sanyo. Dec 21 2010.)
Organizational Development
•A Dutch company founded 1892
•Traditional strength lies in research and development.
•Organizational Structure: Initially began as a centralized structure. In response to wartime disruptions, the company established many National Organizations (NOs).
Strategic Question: How did the use of different global strategies shape the outcome of both Philips and Matsushita?
Philips Position on the Global Stage
2008 to 2010 showed operational difficulties (2009 Annual Report)
Economic downturn – fluctuation of prices for raw materials and energy
Political factors – Middle East conflicts, pending US Healthcare reform with increased healthcare regulation
“Philips may be unable to adapt swiftly to changes in industry or market circumstances, which could have a material adverse impact on its financial condition and results.”
Changes in technology affecting one of three core businesses (lighting).
Firm’s Focus: emerging markets are increasingly important to the firm’s operation.

Vision 2010
Philips launched Vision 2010 in 2007.
Strategy: focus the business from its varied and numerous lines of business.
Currently a high-volume electronics group
Looking to be a market-driven global player in lighting, consumer lifestyle and healthcare.
Matsushita/Panasonic Corporate Strategy
Panasonic/Matsushita vs. Philips Comparison
Traxtal (Canadian innovator of medical instruments)
InnerCool Therapies (US company specialized in body temperature management)
Saeco (expanded their coffee portfolio)
Divest non-core activities, focus on expanding growth platforms

Overseas business growth
Engaging in more R&D
Multinational enterprise (Global standardization)
Strengthening local production in emerging markets (India, China, Brazil etc.)
Expanding in B2B businesses
Revamping production methods for A/C & refrigeration products
Growth in the healthcare market
Introductory products in ultrasound systems, etc.

Harmonie Rodriguez
Ji Cho
Carey Wakuta
Joe Benson
Kevin Lai

Founded in 1918, in Japan

Company culture: “Seven Spirits of Matsushita”

Knowledge of market trends

Organizational Structure: in the 1980s, plants producing one product reported directly to a product division and overseas companies producing a broad product line reported to METC
Full transcript