Outsourcing is a key part of our Supply Management strategy. The majority of our top twenty suppliers were Electronic Manufacturing Services (EMS), Original Design Manufacturing (ODM) or Original Equipment Manufacturing (OEM) suppliers.
Outsourcing allows us to add value for Philips through reduced operating and capital costs. At the same time, it increases our flexibility and decreases time-to-market and time-to-volume. It also enables Philips to leverage its core competencies to best effect, and provides access to the technologies and skills of our suppliers.
Consequently, we focus on EMS, ODM and OEM suppliers who can work closely with us and help us capture value through early involvement in the innovation process. Our goal is to build long-term business relationships, where we share both the risks and rewards of innovation with key strategic suppliers.
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