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Philips Semiconductors: Breaking with the Past

Publication Year



In July 1990, when Philips had shocked the financial world with the announcement of a 2 billion guilder loss, the semiconductor division was the primary contributor to the company's misfortunes. But, within the next three years, under the leadership of the very uncharismatic Heinz Hagmeister, the division achieved a remarkable turnaround from a loss of nearly 600 million guilders to a profit of 210 million guilders. Underlying this radical change in performance were not only a variety of strategic actions - from a financial restructuring to a drastic pruning of the product portfolio - but also a fundamental change of culture and of the behaviour of people. This case describes this transformation of Philips semiconductors, and the role of leadership in managing such a radical change process.

Topic List

Managing Turnarounds, Corporate Transformation, Strategic Leadership



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Holland; Worldwide

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Available on ECCH


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