Post-split, larger role for Philips' Bangalore campus

As the 123-year old Royal Philips of the Netherlands prepares to split into two companies globally, its Innovation Campus in Bangalore will be bolstered to take on a much larger role across all business segments, top officials said.

The company will also explore organic and inorganic growth in India, having already made two buyouts, Chennai-based Preeti brand of home appliances and Alpha X-Ray Technologies of Mumbai, besides opening a greenfield healthcare centre in Pune, the officials added.

These remarks came a week after Royal Philips made a grand surprise announcement that it was going to transform itself into two separate companies, one focussed on the healthtech and the other on lighting solutions, both of which have a strong presence in India.

While the Bangalore Innovation Campus, which has 2,000-strong staff, caters to the products and processes involved in both the segments, the Pune facility is in the development and production of innovation in the healthtech segment.

"The Bangalore campus, along with the other two in Shanghai and here, plays an important role in our overall strategy of improving lives. As we shift from products to solutions, Bangalore's role will only get larger," said Bert van Meurs, head of Philips healthcare.

Giving an example, van Meurs told IANS here that even if a future solution in healthcare space was being developed elsewhere in the world, the Bangalore Innovation Campus could be developing in its software since the focus was on integration, not on mere products.

Philips chief executive Frans van Houten explained further: People now want to monitor and care for their health better, be it the air they breathe, the food they eat or hygiene. So Philips wants to extend integrated services than stand-alone products.

"This runs from healthy living and prevention, to diagnosis and treatment, and finally recovery and homecare," Houten said, adding these were currently a part of two divisions -- healthcare and consumer lifestyle, which were being merged into one company.

"By merging the two and working from a unified vision and strategy in a single company, we create a stronger foundation for future growth and innovation," Houten told a select group of visiting journalists from across the world.

"The current model of healthcare is unsustainable: It is delivered in silos, which leads to ineffective treatments and waste. To make healthcare more effective -- economically and medically -- we need integration and personalisation."

On the overall reason for splitting Royal Philips into two companies, the group CEO said it was for three reasons: Better focus and innovation, creating better opportunities to raise funds and giving consumers complete solutions.

Be it in India, China or elsewhere, consumers, he said, will continue to be served by one brand and that would be Philips. As far as the 113,000 staff in over 100 countries were concerned, they will just have to step into their offices like any other day.

Speaking about the India operations, officials said the group had posted an impressive 71 percent growth in net profits in 2013-14, thanks to a robust growth across lighting, consumer lifestyle and healthcare segments, each accounting for around a third of sales.

Speaking specifically about Philips Innovation Campus in Bangalore, they said more than 10 products were delivered by it in the last fiscal year, not just for India but also growth geographies like Africa and Indonesia.

Some innovations from the India campus included a consultative critical care solution to enable a specialist doctor to monitor patients in distant, multiple intensive care units, almost in real time, to address the shortage of trained physicians.

These apart, the campus also developed a compact and low-cost ECG device, a unique USB-based tablet ultrasound system and a solar DC grid as an alternate source of energy to answer the energy crisis.

Looking ahead, the campus has forayed into internet-based solutions like sensors, cloud computing and mobile tech. It is also working on solutions that provide connectivity to consumers for a range of home appliances they have,from air purifiers to coffee makers.

(Arvind Padmanabhan can be reached at arvind.p@ians.in)