As the world's largest lighting equipment manufacturer with more than 100 years of history, Philips has just split the lighting business in May and listed it independently on the Amsterdam Stock Exchange in the Netherlands, which will help Philips focus on the healthcare industry.
What is the future direction of Philips Lighting after the spin-off? On June 26, Wang Wei, president of Philips Lighting Greater China, said in an interview with reporters during the 2016 Davos Forum that smart lighting will become a trend in the Internet of Things era. Whether in the energy-saving wave of LED lighting or the digitalization of lighting, Philips Lighting hopes to be a leader.
"Beyond Lighting" Strategy
Wang Wei said that City Touch, a smart street lighting scheme launched by Philips Lighting, has been applied in Los Angeles, USA.
This “beyond lighting†strategy allows urban street lights to be detected and maintained in real time. The specific method is to collect the corresponding data on the terminal node, determine whether the maintenance is needed by installing the corresponding sensor, or even add the sensor, and more functions can be realized in the future. In this system, both hardware and sensors are produced by Philips Lighting itself.
Therefore, the current Philips lighting business has been divided into four parts: one is the light source, that is, the traditional lighting and LED lighting; the second is the lighting; the third is the sensor and software system, with the development of digital technology, Philips has formed a "light source + luminaire + sensor + software" system; fourth is the extension of services, including information and life cycle planning.
According to the goal of Philips Lighting, by 2020, the company hopes to replace the traditional light bulb with 2 billion LED bulbs, which is expected to grow rapidly in systems and services. However, for the moment, the proportion of traditional business in Philips Lighting's operating income is still relatively heavy, but the growth of emerging businesses is faster.
Product and model innovation
In the process of promoting the digitization of lighting, Wang Wei believes that product innovation and business model innovation are very important.
For example, Philips Lighting has introduced a smart light bulb Hue that can be controlled by Wifi connection, APP control, adjustable 16 million colors, and expandable functions. It can also set specific contexts, reflecting the pursuit of innovation by Philips Lighting.
“We believe that there are three major trends in the future lighting industry that are irreversible: first, the increased demand for lighting, accompanied by population growth and urbanization; second, the transformation of traditional lighting; third, intelligent lighting.†Wang He said.
Under such a trend, Philips Lighting has always encouraged innovation, advocated the realization of product iterations, and provided corresponding institutional guarantees when conducting internal innovation incentives.
First, set up a research center in the company to make certain forward-looking technical reserves before commercialization. Next, it is an attempt to invest and commercialize. Finally, through R&D (R&D) and the business team's cooperation, bring the results to the market and get orders in the market to maintain their innovative vitality.
So how do you measure the innovation of a company? Wang Wei proposed four key points: First, see how much the proportion of innovative products account for sales revenue each year; second, see how much patent technology is, whether there is breakthrough research and development, whether there is patent in new technology; the third is to see Whether it is possible to achieve breakthrough endogenous growth; the fourth is to see if a sustainable business model can form an open ecosystem.
“The foundation of the fourth industrial revolution is digital technology and Internet technology,†Wang said. “It’s not that a company can succeed in its own field. It must create an ecological environment, like Philips lighting is currently Cisco and SAP collaborate horizontally."
“In the field of lighting, Philips Lighting can play many roles in the future, from the perspective of the Internet of Things, circular economy and sharing economy, to see how to use renewable resources and energy-saving products to help the world save resources and reduce energy consumption. There is also an innovative business model that plays an important role in the fourth industrial revolution.†Wang Wei said with confidence.
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