Philips versus Matsushita: A New Century, a New Round

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Philips versus Matsushita: A New Century, a New Round 2

1. Introduction 2

2. Philips historical development 2

3. Philips tries for Reorganization 4

4. The historical development of Matsushita 6

5. Matsushitas tries for Internationalization 7

6. The Future together? 9

1. Introduction

N.V. Philips and Matsushita Electric are two worldwide known electric giants. Although they have both a long history they followed in the recent years different strategies and emerged with different organizational capabilities which leads back to the different background and of course also to the traditions of their homelands.

2. Philips historical development

Philips was founded by Gerard Philips and his father in 1892 in Eindhoven, Holland and became soon after, having another family member in the company, the third largest light-bulb producer in Europe.

However from its beginning on it always took care for his workers. As an example in Eindhoven it built company houses, bolstered education, and paid its employees so well that other local employers complained.

When larger electrical product companies were trying to diversify Philips only focused on one product, light-bulbs which enabled the company to create significant innovations. They scraped old plants and after advances were made they used new machines or factories. Philips also became a leader in industrial research, creating physics and chemistry labs to address production problems as well as more abstract scientific ones. After developing a tungsten metal filament bulb, which was a great commercial success, Philips had the financial strength to compete against its giants rivals.

Because of Holland's small size Philips was soon forced to expand to other countries for having enough volume to mass produce. So it started building sales organizations in the United States, Canada, and France. All other functions remained highly centralized in Eindhoven. Philips created also local joint ventures to gain...