Our strategic focus
A strategy of focused organic growth, founded on clear choices in business and innovation, and a relentless focus on execution
Our strategic focus
A strategy of focused organic growth, founded on clear choices in business and innovation, and a relentless focus on execution
Over the past 10 years, Philips has undergone a transformation to reshape its portfolio and become a focused health technology company. As a result, we are active in highly attractive segments that offer significant potential for growth and margin expansion. These markets are attractive due to the underlying growth of demand for access to healthcare from an aging and growing population. This in turn fuels the need for meaningful innovation to address the rising healthcare spending and staff shortages, and make healthcare more efficient and productive. At Philips, we view the data from patient monitors, imaging devices, and Electronic Medical Records as the foundation upon which AI propositions can be built to turn clinical data into actionable insights for patients, providers, and consumers. In addition to providing clinical insights, the same informatics solutions also provide operational forecasting – something our customers have been requesting since COVID-19 to help them improve productivity.
Driving value creation with sustainable impact
Scalable people- and patient-centric innovation Philips’ purpose – to improve people’s health and well-being through meaningful innovation – is at the center of everything we do. This core principle has never been more relevant than it is in these challenging times. As a leading health technology company, we believe that – viewed through the lens of customer needs – innovation can improve people’s health and healthcare outcomes, as well as making care more convenient and sustainable, both in the hospital and at home. Given our global presence, strong enterprise informatics platforms, ambulatory monitoring and imaging data, as well as our capabilities to support care across settings, Philips is uniquely positioned to do this, leveraging our strong clinical, consumer and ESG franchise, and our strong brand.
In the consumer domain, we develop innovative solutions that support healthier lifestyles, prevent disease, and help people to live well with chronic illness, also in the home and community settings. In clinics and hospitals, we are teaming up with healthcare providers to innovate and transform the way care is delivered. We listen closely to our customers’ needs and together we co-create solutions that help our customers improve outcomes, patient and staff experience and productivity. We are embedding AI and data science in our propositions – for instance, applying the power of predictive data analytics and artificial intelligence at the point of care – to leverage the value of data in the clinical and operational domains, aiding clinical decision making and improving the quality and efficiency of healthcare services. Increasingly, we are working together with our health systems customers in novel business models, including outcome-oriented payment models, that align their interests and ours in long-term partnerships.
Going forward, we will focus our innovation on where we see customer needs evolving. To improve outcomes, we will support clinical workflows in areas where we have domain leadership, especially cardiology and the ICU. To increase productivity in a system having to contend with high patient volumes, staff shortages and rising costs, we will enhance care pathways and operational workflows through integrated technology infrastructure, and we will leverage our (enterprise) informatics and hardware innovation to lower costs and reduce the burden on staff. To improve the delivery of care outside the hospital, we will utilize our consumer/home experience and our strength in data and informatics to connect and support care for patients across settings. In doing so, we will leverage leading technologies across our portfolio. To name just a handful, by way of example: our Ingenia Ambition MR system with BlueSeal magnet that offers helium-free-for-life operation; our Azurion suite of interventional cardiology solutions; our IntelliVue MX750 and MX850 patient monitors and MCOT ambulatory cardiac ePatch offering comprehensive monitoring capabilities across sites of care; and our multi-vendor, multi-modality, multi-site Radiology Operations Command Center virtualized imaging solution.
We will continue to invest significantly in innovation, but are making a number of important changes to increase the impact of our patient- and people-driven innovation and generate better returns. Moving forward, we will focus our resources on a smaller number of projects and products with greater potential for impact. We will scale and accelerate innovations, driven by the business and supported by rightsized Group research, with patient safety, quality and sustainability at the core of design. By bringing our central innovation activities into the heart of the businesses, we are bringing our system and software innovation closer to our customers. Focus on reliable execution The key driver for our turnaround is improved execution grounded in three decisive actions: 1) patient safety and quality: putting this at the heart of (business) innovation, elevating it to the highest level in the organization, and embedding it in our culture; 2) supply chain reliability, moving from a ‘one size fits all’ supply chain structure to a more agile, tailored value chain model per business; and 3) a simplified operating model: working in a leaner, more agile way, guided by patient- and people-centricity and accountable leadership.
Our ambition
With our global reach, market leadership positions, deep clinical and technological insights, and customer-centric, patient- and people-focused innovation capability, Philips is strongly placed to create further value in a changing healthcare world.
In concrete terms, we aim to improve the lives of 2 billion people a year by 2025, including 300 million in underserved communities, rising to 2.5 billion and 400 million respectively by 2030. This is one of the comprehensive set of commitments we have deployed across all the Environmental, Social and Governance (ESG) dimensions that help guide the execution of our strategy and support our contribution to UN Sustainable Development Goals 3 (Ensure healthy lives and promote well-being for all at all ages), 12 (Ensure sustainable consumption and production patterns) and 13 (Take urgent action to combat climate change and its impacts). We strive to deliver superior, long-term value to our customers and shareholders, while acting responsibly towards our planet and society, in partnership with our stakeholders. We believe that, executed with rigor, discipline and quality, the strategic imperatives outlined above will put us back on track for a future of sustained, progressive value creation.
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