Title: Philips Global (Netherlands)
I. Background (present, summarize highlights pertinent to the problem)
The Philips Company was founded in 1891 by Gerard Philips and his father Frederik as a family business. Frederik Philips, being a banker in Zaltbommel, financed the purchase and setup of an empty modest factory building in Eindhoven where Philips started the production of carbon-filament lamps and other electro-technical products in 1892. This first factory survives as a Museum devoted to light sculpture.
In 1895, after the first difficult years and going nearly bankrupt, Gerard's 16 years younger brother Anton entered the family business as a sales representative at the request of his father. Since then, due to Anton's brilliant business talent, the family business began to expand rapidly resulting in 1907 in the foundation of the N.V. Philips’ Metaalgloeilampfabriek (the Philips Lightwire-bulb Factory Inc) in Eindhoven, followed in 1912 by the foundation of the N.V. Philips' Gloeilampenfabrieken. (the Philips Light-bulbs Factories Inc). After Gerard and Anton Philips, who were first cousins of Karl Marx, changed their family business by founding the Philips Incorporation, they laid the base of the later electronics multinational.
In the 1920s, the company started to manufacture other products, such as vacuum tubes. In 1939 they introduced their electric razor, thePhilishave (marketed in the USA using the Norelco brand name).
Royal Philips Electronics of the Netherlands is a diversified Health and Well-being company, focused on improving people’s lives through timely innovations. As a world leader in healthcare, lifestyle and lighting, Philips integrates technologies and design into people-centric solutions, based on fundamental customer insights and the brand promise of “sense and simplicity”.
Headquartered in the Netherlands, Philips employs about 117,000 employees with sales and services in more than 100 countries worldwide. With sales of EUR 22.3 billion in 2010, the company is a market leader in cardiac care, acute care and home healthcare, energy efficient lighting solutions and new lighting applications, as well as lifestyle products for personal well-being and pleasure with strong leadership positions in male shaving and grooming, portable entertainment and oral healthcare.

II. Statement of the problem/Objectives
Philips is a people-focused, market-driven company that is organized around customers and markets. By understanding trends in society and obtaining deep insight into issues confronting people in their daily lives, we ensure that people’s needs remain at the heart of everything we do.
• (Mission) We improve the quality of people’s lives through the timely introduction of meaningful innovations
Innovation does not only mean “new technology”. It can also mean an exciting application, a new business model or a unique customer proposition brought about by an innovative partnership. In other words, an innovation is not the same as an invention. Technology remains very important, but insight into the needs and aspirations of consumers and customers is equally, if not more important and must always be our starting point.
• (Vision)In a world where complexity increasingly touches every aspect of our daily lives, we will lead in bringing “sense and simplicity” to people
Our corporate vision describes what we see as one of the biggest challenges facing people today – and how we can help them meet that challenge. We have identified the difficulty of coping with complexity as a major challenge for people in our time. One of the things that makes life today so complex is the fact that technological progress comes to us very often in a way that is too difficult to experience. We believe that this situation can be changed, and that we can help to make the benefits of our products and solutions easier to access and more relevant to people’s needs and aspirations.
• (domain)We operate in the health and well-being domain
We seek to improve the quality of people’s lives through focusing on their health and well-being. Quite simply, we want to help people live a healthy, fulfilled life.
By “health” we mean not only medical aspects of health, but also keeping fit, having a healthy diet, and generally living a healthy lifestyle. By “well-being” we mean a general sense of fulfillment, feeling good and at ease. “Well-being” also refers to the sense of comfort, safety and security people feel in their environment – at home, at work, when shopping or on the road. Our focus on health and well-being automatically implies that we contribute to building a sustainable society.
• (brand promise)We promise “sense and simplicity”
We differentiate ourselves through our brand promise “sense and simplicity”. Our brand promise is comprised of three pillars:
 We design our solutions around the needs of people.
 We apply advanced thinking and technology to deliver a better solution.
 We ensure our solutions are easy to experience.
• (values)Our values, the four Ds, are like a compass - guiding us in how we behave every day, and reminding us of the attitude we should have towards our work, our customers and our colleagues
 Delight customers
 We anticipate and exceed customer expectations
 Deliver great results
 We continually raise the bar
 Develop people
 We get the best from ourselves and each other
 Depend on each other
 We deliver more value by working as One Philips

III. Alternative Courses of Action (strategies taken by the firm to address the problem and or achieve objectives)
Sustainability
As a global health and well-being company, we firmly believe that the challenges around the health and well-being of our planet offer substantial business opportunities, creating value for our company as well as society at large. Through sustainable products and services, we contribute to a better and higher quality of life for everyone on the planet.
Commitment
Sustainability at Philips is all about improving the health and well-being of individuals and the communities they live in. At the same time we strive relentlessly to improve the environmental performance of our products and processes, and to drive sustainability throughout the supply chain.
Flexibility Production Process
Philips opened its factory for shavers in Drachten in 1950. The factory has seen many changes since those days. Manual labor has largely made way for mechanized production methods, which is essential to keep costs low and to stay competitive. High quality, continuous innovation and cost-efficient working methods are the organization’s hallmark

High requirements
At the Drachten location, Philips manufactures, among other things, shaving guards, cutters and plastic parts. These parts are assembled into complete shavers and packed for shipment together with accessories at the same site. This is done with the greatest possible care. Our manufacturing processes have been set up in such a way that we deliver top quality. Shavers will only be shipped to our customers if they meet the highest quality standards
High speed
The entire production process is geared to high-speed delivery. When we receive an order from a sales organization or a large retail chain, we are able to manufacture, pack and ship the quantity of shavers ordered within a matter of days
Our employees
Philips Drachten wants to be a world-class organization. Employee engagement is crucial if we want to achieve this. Our employees show a strong teamspirit, a large sense of responsibility and an entrepreneurial mindset. Care for people and environment we keep an eye on the environmental impact of and on the working conditions throughout the production process. The location meets all environmental, health and safety standards. Safety, occupational health, reducing energy consumption, recycling and waste control are important issues. Water and air are cleaned with highly modern installations, to prevent nuisance and pollution.
Environmental Reacord
In the Greenpeace's Guide to Greener Electronics, Philips ranks on the 3rd place (after Nokia and Sony Ericsson). The company gains its points mainly for launching a LED TV that is free from PVC and BFRs, the first product in this category to be free from these hazardous substances. Philips have made some considerable progress since 2007 (when it was first ranked in this guide), in particular by supporting the Individual Producer Responsibility principle, which means that the company is accepting the responsibility for the toxic impacts of its products on e-waste dumps around the world.
For its "green products", Philips is using Philips Green Logo, which identifies products that have a significantly better environmental performance than their competitors or predecessors.[Also, the company is running the EcoVision4 initiative in which it committed to a number of environmentally positive improvements by 2012.

IV. Analysis/Evaluation (apply Envisafe principles or concepts) refer to related literature of matter

Worldwide logistics center
Three logistic departments are responsible for the supply, storage, transport and management of raw materials, semi-finished products and finished products: DAP Supply Chain Solutions, the Drachten Distribution Center and Shavers Logistics.
DAP Supply Chain Solutions
Supply Chain Solutions (SCS) manages the worldwide, integrated infrastructure essential for the optimal functioning of our distribution chain. This helps us achieve even better results and stay ahead of our competitors. SCS collaborates closely with all DAP sales organizations, distribution centers and supply centers in the world. SCS is the knowledge center in the field of logistics. The department is responsible for planning and integrating logistic processes in the entire chain. Their ultimate goal is to ensure the most efficient product delivery to every part of the world so that consumers will not be faced with empty spaces on the store shelves.
DDC
The Drachten Distribution Center (DDC) ships all DAP products to customers in the Benelux countries and Dubai. It is also the hub for the worldwide distribution of, among other things, the shavers made in Drachten and the tanning appliances made in Poland. The DDC handles and manages all matters related to transport, storage, Customs’ clearance and invoicing. Customers can also make use of its value-added services, which include packing products into special action packs
V. Conclusion/Recommendation
Philips has learnt a number of powerful lessons from its experience with co-creation.
Establish value alignment – Co-creation is about mutual value creation, where the value drivers of the company and the individual consumers should be aligned. Users want to see their contributions integrated in novel products, to acquire additional product knowledge and to enjoy themselves. To increase the applicability of user contributions, companies need to define a framework that sets the user’s degree of freedom in terms of the contributions they will be able to make. It is, however, important to allow enough freedom for users to express their needs and creativity.
Target the right consumers – Targeting users who are enthusiastic, involved with the product, possess adequate knowledge and skills, and are willing to contribute to product development or enhancement is vital to establishing a continuous flow of innovative and coherent contributions. In the phase of concept generation, companies can significantly benefit from so-called leadusers, whereas during testing, representatives of specific product segmentsare more valuable.
User incentives – Surveys completed by community members have shown that enjoyment and the acquisition of product knowledge, recognition and esteem are more important than monetary incentives in motivating users to become involved in the co-creation process.
Co-creation as a branding tool – Co-creation communities generate high levels of publicity. Over 2.4 million people visited Peugeot’s website during the two design competitions (see sidebar ‘Peugeot’s customer-led design contest’). Moreover, co-creation allows the building of relationships with users, resulting in increased customer loyalty. Enthusiastic and satisfied users have the potential to become invaluable product and brand ambassadors.
Legal aspects – Co-creation can create potential legal risks for bothconsumers and the company involved. Users may unknowingly violatecopyrights or other intellectual-property rights through the submission ofcontent in the co-creation process. User contributions should therefore becarefully evaluated.
Despite the risks, however, Philips’s experience suggests companies need torethink the role of the customer, and see them as potential knowledgepartners in the development of new products. Co-creation shows high potential for significant benefits: faster and more effective productdevelopment, increase brand recognition, and improved customer relationships. It is a challenging process, but one more than worth the effort involved.