Software Monetization Featured Article

Philips Tells Its Transformation Tale

December 13, 2017

Philips (News - Alert) has changed significantly in recent years. It starts out as a lighting company, expanded into other consumer products, and now also delivers health-related solutions. At the same time, it’s expanded via acquisition, and it has moved from selling boxed solutions to an array of services and software-driven offerings.

All this change prompted the company to embark upon two transformation programs.

One involves harmonizing its various processes. This was important because the company’s acquisitions over the years resulted in a variety of approaches to doing things.

The other effort is a software and services program. And this transformation effort focuses on delivering outcomes for Philips customers such as hospitals.

Jeroen Peeters, business process owner for software operations at Philips International, is involved in the second effort. Speaking at the recent Gemalto

LicensingLive! Event, he described the drivers and requirement of this effort.

 “Our new propositions are happening faster than we can cope with,” he explained, so Philips wanted to create a funnel into which it could feed such propositions.

Philips had been down the road before where it implemented siloed solutions to move on new propositions. But that’s less than ideal, he said, and it can adversely impact customer experience.

A better approach is to harmonize the customer experience across your portfolio of offerings, he indicated. That allows for commercial and delivery model simplification, he said. It enables process, technology, and organization driven capability improvements along the entire customer journey. And it accelerates return on investment.

Getting there is hard work. And it requires support all the way to the top of the organization. But businesses can start small and continue to build value over time.

During the session at LicensingLive! With Peeters, Gemalto (News - Alert) released the results of a global survey of software-enabled hardware manufacturers. The results indicate that 84 percent of survey participants either have either implemented or are considering implementing software-based revenue models.

Gemalto reports that 37 percent have already made a full shift to a software-centric business model, one that places software at the core of how a company delivers value and generates revenue. And it reported that 94 percent of respondents have increased their investment in software development in the last five years.

Edited by Mandi Nowitz