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Aug 13, 2020

Frans van Houten: Philips is still a truly Dutch company, but also American, Chinese and French

Estimated reading time: 2-4 minutes

In an interview with Dutch Elsevier Magazine, Philips CEO Frans van Houten discusses the impact of COVID-19, the transformation of Philips into a focused health technology company, and international competition. “We have to innovate faster by integrating different disciplines – hardware, software, data, clinical knowledge. Philips is never finished.”

 

According to Frans, the COVID-19 crisis has made one thing clear: “The crisis is a catalyst for change in the healthcare system. Remote care, in which monitoring the health of patients can take place outside the hospital, is getting closer. Until recently, telehealth was a theoretical concept. It did not fit in with the business model of hospitals or insurers. Now, because of corona, we see the limitations of the traditional system.”

A healthy dose of Dutch culture

With 30 factories worldwide, does Philips still consider itself a Dutch company? “I think we are still a truly Dutch company, despite the fact that we only achieve 2.5 percent of our global sales in the Netherlands. We do almost 40 percent of our R&D in the Netherlands. The export value of our factories is more than 2 billion euros, which is four times as much as we sell in the Netherlands. I also think Philips has a healthy dose of Dutch culture in how we run the company.”

 

However, it is also important that Philips is sufficiently seen as an American company in America, and as a Chinese company in China. “You can never say: yes, we are a Dutch company, so we do everything in the Netherlands. After all, you have to make a local contribution in all the countries in which you operate.”

 

Frans also discussed competition with traditional peers, such as Germany’s Siemens and the American company General Electric “We are the only ones who still have a clear consumer portfolio,” he observes. “Because, to keep healthcare affordable, we also believe in prevention. We all know that healthcare weighs heavily on budgets. We are convinced that capacity can be better used, that productivity can be increased, that we can support patients in a different way through technology.”

 

With the collecting and processing of patient data becoming increasingly important, competition will also come from new players. “We have to take all these Silicon Valley companies very seriously, because they have very deep pockets and a lot of talent. If you're talking about remote care, I think you need integration between the data, devices and care systems. We at Philips have put a lot of effort into that.”

Innovate faster

Is an independent Philips a goal in itself for the Philips CEO? “Personally, I think that is important. The best way to guarantee it is to perform well, to lead the way as a company. That means we have to innovate faster by integrating different disciplines – hardware, software, data, clinical knowledge. Philips is never finished. Companies that cling too frenetically to the past lose relevance and ultimately no longer have a right to exist.”

 

Read the English translation of the Dutch interview here. The original article, which was published on August 4, 2020, can be found here and via this link (copyright Elsevier Weekblad)

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Ben Zwirs

Ben Zwirs

Philips Global Press Office

Tel: +31 6 1521 3446