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Multiple Challenges Faced by Philips and Matsushita in Managing Global Operations

Satisfactory Essays

Both Phillips and Matsushita have faced enormous challenges and multiple reorganizations in trying to manage global operations. Both have tried multiple organization structures, but have encountered some very distinct barriers caused by the external environmental factors which were critical in forming and executing each firm’s business strategy. The two companies are almost complete opposites when it comes to comparing their individual value chains. Philips and Matsushita also have firm structures that make their advantages and disadvantages uniquely interesting. Historically competition has been fierce between the two rivals, but perhaps their time would be better used working on their weaknesses than spending time trying to keep up with each other. Despite the two firms very different business strategies and operating differences, in my opinion there can only be one leader. Read on to find out which one! Phillips was started in 1892 with a small light-bulb factory in Eindhoven, Holland. Geographically, it is a small country located in central Europe. Going International was essential for Phillip’s survival. One of the more important barriers it had to overcome was a historical barrier. An important event happened in 1919 when Phillips entered into an agreement with G.E. in which they shared permission to use each other’s patents, which split up the world into, “three spheres of influence.” This venture caused this firm to change from a primarily

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