Philips vs Matsushita Case

1340 Words6 Pages
How did Philips become the leading consumer electronics company in the world in the postwar area? Philips started as a Dutch light bulb producer in Eindhoven. The company focused on only producing light bulbs at the beginning, and could therefore specialize and create significant innovations. The rapid growth of being the leader in industrial research, helped to broaden its product line. However, the Dutch market was extremely small in size, and motivated Philips to expand into foreign markets like Japan, Canada and Russia. Philips also created joint ventures with local companies to gain market acceptance. The joint venture with General Electric made Philips transform from a highly centralized to a more decentralized company. The company started to expand its production line with products such as electric vacuum tubs and radios and started to capture a significant market share of 20 % in the world. During the post war era Philips gained success and the company was able to adapt to country-specific market conditions. This helped Philips expand to other countries and also generated in a broadened sales volume. Phillips also developed National Organizations (NO´s) in different countries, which helped to serve other markets more easily. NO´s were effective in distributing products to the customer while taking care of specific customer needs as well as country and market needs. This greatly increased self-sufficiency. The company´s change to a multi-national company in the 1930s was also a specific point why Phillips was the leading consumer electronics company. What distinctive competencies did they build? Philips success was mainly built on a worldwide portfolio of national organizations with a heavily decentralized company structure which gave these NO’s more autonomy and the advantage of technical and product development capabilities in local markets. They
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