Amsterdam, The Netherlands. Consumer electronics giant Philips Electronics entered a new era yesterday, as Cor Boonstra took over as Chairman and CEO, replacing Jan Timmer.
Boonstra has his work cut out for him, as he strives to build on the achievements of his predecessor. Timmer dragged Philips from the brink of financial disaster in the early 1990s, slashing the workforce by 60,000, to the current payroll of 250,000 worldwide, and turning the accountants’ red ink to black. Now Boonstra faces the challenge of continuing the Philips recovery as the firm enters the era of DVD and the Internet.
Alliances and cooperation will be vital to Philips in opening up new markets, and delivering new technologies such as DVD. Philips has suffered major losses in the 1980’s and early 1990’s by trying to strong-arm its own standards in the video recorder market, more recently with Digital Compact Cassette (DCC) and CD-Interactive (CD-I).
Boonstra worked for Unilever, and headed the U.S. Sara Lee Corp before joining Philips Electronics. He is the first Chairman of Philips to come in from outside, rather than moving up through the ranks. Insiders say that the 58-year old son of a grocery store owner is heavily committed to the bottom line, and creating profit for shareholders. He has a track record of energetic restructuring, which has led to speculation that he may walk in swinging a big cost-cutting axe.
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