As the world’s largest lighting equipment manufacturer with a history of more than a century, Philips in May this year, the lighting business has just been spun off, independently listed on the Amsterdam Stock Exchange in the Netherlands in Europe, which will help Philips focus on the health care industry.
After the spin-off and listing of Philips Lighting, what is the future direction?On June 26, Wang Yun, President of Philips Lighting Greater China, said in an exclusive interview during the 2016 Davos Forum that smart lighting will become a trend in the era of the Internet of Things. Whether in the energy-saving wave of LED lighting or the digitalization process of lighting, Philips Lighting wants to be the leader.
“Beyond Lighting” strategy
Wang Yun said, like Philips Lighting launched the city street lights intelligent lighting program City Touch, in the United States, Los Angeles has been applied.
This “beyond lighting” strategy, so that urban street lights can be real-time detection and maintenance. Specific approach is to collect the appropriate data on the terminal node, through the installation of the appropriate sensors to determine whether the need for supervision and maintenance, and even as long as the addition of sensors, the future can realize more functions. In this system, including hardware and sensors, are produced by Philips Lighting itself.
Therefore, the current Philips Lighting business has been divided into four pieces: one is the light source, which is usually referred to as traditional lighting and LED lighting; two is the lamps; three is the sensor and software systems, with the development of digital technology, Philips has formed a “light source + lamps + sensors + software” system; four is the extension of services, including information and Life cycle planning arrangements.
According to Philips Lighting’s target, by 2020, the company hopes to replace traditional light bulbs with 2 billion LED bulbs, which is counting on the rapid growth of systems and services. However, for the time being, the traditional business still accounts for a heavier share of Philips Lighting’s operating income, but the emerging business is growing at a faster rate.
Product and model innovation
In promoting the digitalization of lighting, Wang Yun believes that both product innovation and business model innovation are very important.
For example, Philips Lighting launched Hue, a smart bulb that can be connected by Wifi, controlled by APP, adjustable in 16 million colors, with expandable functions, and can also be set in specific contexts, reflecting Philips Lighting’s pursuit of innovation.
“We believe that there are three major trends in the future of the lighting industry is irreversible: one is the increase in the rigid demand for lighting, which comes along with the increase in population and the process of urbanization; the second is the transformation of traditional lighting; and the third is intelligent lighting.” Wang Yun said.
In such a trend, Philips Lighting has been encouraging innovation, advocating the realization of product iteration, and at the same time, providing appropriate institutional safeguards when it comes to internal innovation incentives.
First, a research center is set up in the company to do some forward-looking technology preparation before commercialization. Next, comes the investment and commercialization attempts. Finally, through the full cooperation of R&D (research and development) and commercial teams, we bring the results to the market and get orders in the market, so as to maintain our innovation vitality.
So, how to measure the innovative power of enterprises? Wang Yun puts forward four key points: first, to see how large a percentage of sales revenue is accounted for by innovative products each year; second, to see how many patented technologies there are, whether there are breakthroughs in research and development, and whether there are patents on new technologies; third, to see whether it is possible to achieve breakthrough endogenous growth; and fourth, to see whether the sustainable business model can form an open ecosystem.
“The basis of the fourth industrial revolution is digital technology and Internet technology,” Wang Yun believes, “it is not that a company can be successful just by doing well in its own field, it must create an ecological environment, like the current Philips Lighting is also in horizontal cooperation with Cisco, SAP. “
“In the lighting sector, Philips Lighting has many roles to play in the future, from the Internet of Things, the circular economy to the sharing economy, to see how we can help the world conserve resources and reduce energy consumption by utilizing renewable resources and energy-saving products. We also have an innovative business model in order to play an important role in the fourth industrial revolution.” Wang Yun said with confidence.
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