A Revamp for Philips
People usually associate Royal Philips Electronics with consumer electronics, personal-care products or the kitchen appliance. Philips is also a high-tech manufacturer of medical equipment, semiconductors, and lighting according to the President and CEO, Gerard J. Kleisterlee.
Kleisterlee has been trying to remake the company since he took over as the President since 2001. He has outsourced operations, including Philips' entire components division. He has acquired hospital-products outfits and cut off almost all investment in household goods.
The financial position seems to be stuck as of now. According to Dresdner Kleinwort Wasserstein Securities, Philips should earn $3.5 billion on revenues of $36 billion in 2005. These numbers do not come close to the 2000 records, when Philips pocketed $11.3 billion on $44.4 billion in sales.
Kleisterlee still believes that Philips' transformation is accelerating. Philips had become rigidly compartmentalized and each division is focused on defending its own grounds.
There is also a world of opportunities from the company. A van was fitted with diagnostic and lab equipment and a high-speed satellite link to a top-tier hospital was designed by Philips. The vehicle is now delivering medical care to people from rural India and China.
Mr. Kleisterlee was recently interviewed by Michael Arndt, a Senior Correspondent of BusinessWeek.
