PUBLIC VERSION APPENDIX A:

(1)

PUBLIC VERSION

APPENDIX A:

Figures & tables chapter 1

FIGURE A1: The four Product Divisions (PD) of Royal Philips NV

(* = per 01-2008 merged into ‘Consumer Lifestyle’).

Philips Electronics N.V. – CEO Gerard Kleisterlee PD Consumer Electronics (CE)* PD Domestic Appliances & Personal care (DAP)* PD Lighting (HQ Eindhoven) – CEO

Theo van Deursen

PD Medical Systems PD Lighting – CEO Theo van Deursen BG Luminaires – CEO Rene van Schooten BG Lamps BG Lighting Electronics BU SSL Modules BG Automotive BG Special Lighting Applications BG Lumileds

FIGURE A2: The 7 business groups (BG) of the product division lighting.

BG Luminaires – CEO Rene van Schooten

Chief Marketing Officer –Jaap Schlejen

Sales Manager Supply Chain Manager

CFO Human Resource

Manager

Strategy & Business Excellence Manager

Chief Purchasing Officer

(2)

FIGURE A4: The 5 groups in the BU luminaries Europe – marketing

(* = includes IC Ketrzyn).

Chief Marketing Officer – Jaap

Schlejen

Product Marketing Segment Marketing LiDAC R&D Global Technology

Officer BU Luminaires Europe PM Indoor – Jeroen Rijswijk BU Luminaires Europe PM Outdoor BU Luminaires Europe PM SSL BU Luminaires Europe SM Indoor BU Luminaires Europe SM Outdoor Innovation Center Winterswijk Innovation Center Miribel Factory Development (in 10 factories)* Marketing Communications

FIGURE A5: BU Luminaires Europe Product Marketing Indoor at 01-10-2007 (until 01-2008).

SPMM Luminaires Indoor Europe - Jeroen Rijswijk

European Product Marketing Managers

Factory Product Managers

EPMM Architectural Indoor (3x)

EPMM Functional Indoor (2x)

EPMM Industrial Indoor (1x)

(3)

FIGURE A6: BU Luminaires Europe Product Marketing Indoor per 01-2008.

SPMM Luminaires Indoor Europe – Jeroen Rijswijk

EPMM Architectural Indoor EPMM Functional Indoor EPMM Industrial Indoor

EPM Architectural Indoor (2x)

EPM Functional Indoor (2x)

EPM Industrial Indoor (2x)

(4)

TABLE A1: Function profile European product marketing manager (Rijswijk, 2007B).

FUNCTION PROFILE European Product Marketing Manager (Indoor Luminaires) 0. General

1. Key areas of responsibility

1.a Key activities

The European Product Market Manager Indoor Luminaires (EPM) is an employee of the Marketing Department of the BU Luminaires Europe. He/She reports to the senior Product Market Manager Indoor

A. She/ he is category manager for a specified range of MAG’s/ Product families, drives the MAG AOP, defines & deploys the European portfolio strategy (Portfolio management: innovations, extensions, key cost reductions, upgrades, deletions, topline sales/int. margin) for these categories which is written down in the product strategic plan as defined during the yearly strategic round and actively drives the resulting product creation, deletion & introduction process within his / her category towards pre-set targets; B. Responsible for the price performance positioning of his/her individual product categories

and the products within a category based on competitor benchmarks, customer/ application research. (Product Market/ Region combinations). Identifies cost-reduction targets needed to meet these price positionings.

C. Provides input to the segment and product roadmaps and makes product roadmap proposals based on identified key innovations for new products which are the result from an extensive scan of technical innovation opportunities versus real market/ segment/ key account requirements.

D. Provides direction and guidance and acts as coach for the Country Product Market managers and if relevant to the Factory Product Managers working on his/her product categories

E. Has commercially the leading role in the MIP/PRIP Process and is responsible for the functional/technical specifications as he/she translates (together with the Factory Product Manager) the functional product requirements into technical product specifications whilst assuring based on customer feedback that it is the right specification for the key

introduction countries.

F. Responsible for generating the sales commitments/ targets for a new product introduction prior to the execution of the project. (Documented in the MS1 document in the MIP/PRIP project.) These targets are defined in co-operation with the Country (Product) Marketing Managers.

G. Defines product marcom input, materials and content for his/her the European product portfolio; supports guarding the consistency in look and feel; defines product, sales and customer training tools;

H. She/he is factory product manager for products allocated to the PSG & CSG supply organizations

I. May be appointed commercial project leader for MIP/PRIP projects

J. Has a multitude of working contacts with international colleagues (Product managers, Marketing manager, Sales/ Key Account managers and ITM colleagues) and has frequent working contacts with customers in the luminaire value chain (e.g. Investors, Architect, lighting designers, specifiers, wholesalers, installers).

• Identify & list Technology/Market/Segment opportunities

• Project management for knowledge generation projects from a market and or technology concept perspectives.

• Project management for PRIP projects.

• Competitor analysis (prices, products, performances). • Market test on product concepts (pre- and after test).

• Define and Track product Introduction plan in line with time and budget • Create Product Profile (together with Factory PM)

• Monitors sales & integral margin development against budget and compared to last yr. via Business Warehouse queries and when required initiates and facilitates corrective actions with Country Organisations

• Carries out regular portfolio analysis by means of Business Warehouse to assure proper analysis as basis for portfolio management.

(5)

2. Desired experience / know-how/skills

• Strong Analytical skills and capabilities • Strong Project management skills • Well developed presentation skills

• Fluent (Verbal & writing) in English and min. one other Key EU language (French, German or Spanish)

• A marketing educational background (min: NIMA B) with clear technical affinity or a Technical educational background with clear commercial affinity proven by conducted courses or working experience

• Min. 3-4 years Product management experience in a Commercial B to B National sales or factory environment.

• Preferably Sales experience in a B to B selling market environment.

• Fundamental understanding of the lighting market needs at Wholesaler, Installer and Specifier / end user level.

3. Required personal characteristics

• Entrapreneurial • Team player;

• Strong interpersonal skills; • Coach;

• Process, Result & Milestone driven; • High personal output and effectiveness;

• Proven ability to work in a network environment; • Strong and open Communicator;

• Convincing; • Decision taker;

• Market & customer focussed; • Enthusiastic.

4. Specific

characteristics of the function

(6)

TABLE A2: Function profile factory product manager (Rijswijk, 2007C).

FUNCTION PROFILE Factory Product Manager (Indoor Luminaires) 0. General

The Factory Product Manager located in the factory reports to the Senior Product Market Manager

A. The Factory Product manager (f/m) is responsible for the life cycle management of a product from MS2 onwards and is after MS2 the contact person for the Country Product Market Manager for technical/operational questions.

B. The Factory Product manager actively safeguards portfolio management based on a sound ETO insight, sales development analysis (yearly analysis)

- gives project support to the CSU's

- provides portfolio trainings and training support to CSU's

- makes proposals for pruning, range extensions or product improvements - After agreement of the proposals by EPMM and Countries responsible for

execution

C. The Factory Product manager (f/m) is project leader for product maintenance and cost reduction projects.

D. Factory Product manager (f/m) may be assigned project leader for MIP/PRIP projects allocated to the factory, but is always involved in executing and/or supporting such projects.

E. Factory Product manager represents the Marketing Team in the factory PRB concerning her/his projects at hand.

2. Desired experience / know-how/skills

• Strong Analytical skills and capabilities • Strong Project management skills (PCP/MIP) • Is quite fluent in English, next to Factory language

• A marketing educational background (min: NIMA B) with strong technical affinity • Or Technical background with strong commercial affinity proven by marketing

courses

• Min. 3 years Product management experience in a Commercial B to B National sales or factory environment.

• Understands the lighting market needs

• Has good factory product, processes and culture knowledge 3. Required personal

characteristics

• Team player

• Strong interpersonal skills both internal and external • Result & Milestone driven e.g. get's things done in time. • Strong and open Communicator

• Convincing • Decision taker

• Proven ability to work in a network environment • Market and customer focussed

• Enthusiastic 4. Specific characteristics of

the function

The Factory Product Manager has a unique role and acts as ambassador for the countries in the factory and for the factory towards the countries. She/He for instance supports the CSU’s in building trainings on products for the sales force, visits the countries to see what support is needed on product level etc.

The Factory Product Manager is potentially a candidate for a European Product Market Management Role.

(7)

APPENDIX B:

Figures & tables chapter 2

TABLE B1: Maturity assessment for innovation portfolio management (source: BEST in finance

team, 2005).

(8)

TABLE B2: Maturity assessment for innovation portfolio management (Pennypacker, 2005).

Pennypacker: Project Portfolio Management Maturity Grid

MATURITY COMPONENTS Maturity Level 1 Initial Process Maturity Level 2 Structured Process and Standards Maturity Level 3 Organisational standards and Institutionalised Process Maturity Level 4 Managed Process Maturity Level 5 Optimising Process Project Initiation

*Just happens, new project initiation process is undocumented and inconsistent

*Basic process exists to identify & initiate project opportunities – could be an e-mail *Business needs identified *Organization wide complete process followed to identify, track & communicate new projects *Formalized approvals & evaluations against standards *Post-implementation review process introduced to compare estimate vs. actuals *Lessons learned lead to improvement recommendations *PM engaged in proactive identification of projects *Baseline data collected, benchmarked & leads to process improvements Project Prioritisation and Selection *Just happens, project selection process is undocumented and inconsistent *Project evaluated on business value at local level *Simple prioritization scheme based on high level subjective factors *Boards follow flexible prioritization scheme *Organization aware of process *Cost vs. benefit outcomes validated against historical information *Criteria routinely reviewed & updated to reflect business drivers *Baseline data collected, benchmarked & leads to process improvements. Portfolio Information Management *Project information exists independently & inconsistently *No consolidated list of projects in the portfolio *Project

communication not uniform

*Project lists are created and communicated *Project are categorized *Process exists to aggregate & communicate project data

*Aggregated & used to identify imbalance *More project information captured and kept current

*Information audited & validated *Baseline data collected, benchmarked & leads to process improvements Portfolio Performance Management

*Projects are not categorized in portfolios *No portfolio performance measurement *Periodic reviews with sponsoring organizations *Analysis & reporting processes include cost & schedule variances as reported by Project Managers *Go/No go decisions & corrective actions implemented *Project metrics regularly analyzed according to defined process *Consider root causes for poorly performing projects *Use of portfolio analysis tools *Use of portfolio analysis tools *Trends reported at multiple levels *Controlled proactive investment actions taken *Baseline data collected, benchmarked & leads to process improvements *Portfolio analysis process integrated into management decision process Portfolio Resource Management

*Ad hoc resource management occurs at the project level

*Defined process to identify resource needs for projects *Not performed on portfolio level *Resource balance decisions made on highest priority projects *Project time reporting occurs *Resource

repository with skills inventory exists *Resource

projections based on capacity & estimate vs. actuals for project

(9)

FIGURE B1: Top-10 factors leading to project failure; the bolded factors are tackled by

innovation portfolio management (source: J. Pennypacker, 2007).

The top-10 factors leading to project failure (source: email Jim Pennypacker, director CBP)

1. Expectations: Too high, unrealistic, not managed, poor communication

2. Requirements: Unclear, lack of agreement, lack of priority, contradictory, ambiguous, imprecise 3. Resources: Lack of resources, resource conflicts, turnover of key resources, poor planning 4. Planning: based on insufficient data, missing items, insufficient details, poor estimates

5. Risks: Unidentified or assumed, not managed 6. Schedules: Too tight, unrealistic, overly optimistic

7. Project governance: Lacking, ineffective, different priorities, no clear involvement 8. Project Charter: Incomplete, insufficient level of detail, unclear objectives, poor assumptions 9. Project Manager: Not appropriately experienced/skilled for project; incompetent

10. Project Team: Lack of training, skills, or experience, poor morale, too many responsibilities

(10)

APPENDIX C:

Figures & tables chapter 3

FIGURE C1: Two approaches for decision-making (Cooper, Edgett & Kleinschmidt, 2006A).

Approach 2: The

portfolio review

dominates

(11)

(12)

APPENDIX D:

Figures & tables chapter 4

TABLE D1: Input requirements PCS5.

Tab Name Possibilities (=> = more options possible)

Tab 'Classification'

Review Round AOP2007 / SR2008 / AOP2009=>

BG/BU Luminaires / SSL / Lighting components=>

PG/BL Indoor /Outdoor / SSL

Product family/area Architectural ind / industrial ind / industrial ind=>

Project type Innovation / PLC maintenance

Application area (3 max) Shops / industry / school / healthcare=>

Locations Winterswijk / Miribel / Ketrzyn=>

Planned regions EMEA / Asia / North America=>

Current status PRIP / PB=>

Tab 'Marketing'

Value Proposition House

Time to market 0-6 months / 6-12 months / 1-2 years=> Strategic marketing thrust Efficiency / wellness / lifestyle=> Market perception (how advanced) Me too / mid improvement / disruption=>

Tab 'Strategy'

Strategic ambition class Set the pace / anticipate / niche / protect pos=> Competitive advantage (in years) minus1 / 0 / 1 / 2 / 3 / 4

Strategic ambition

Plan to achieve strategic ambition

5 forces analysis

Key competitive differentiation

Key value drivers (3 max) TCOO / ease of use / productivity => Interdependencies (Shared resources/technology/cannibalisation/cross-selling)

Tab 'technology'

Growth/innovation matrix %Cost %Market %Feature %Breakthrough

Maturity %Emerging %Growth %Mature

Competitive impact Base / key / pacing / emerging

Competitive position Lagging / at par / ahead

Tab 'scorecards'

Strategic fit 7 questions (1-5 scale)

Market attractiveness 3 questions (1-5 scale)

Commercial chance of success 10 questions (1-5 scale) Technical chance of success 10 questions (1-5 scale)

Tab 'financials'

(13)

TABLE D2: Outputs generated by PCS5.

Tab Name Content X-axis Y-axis Bubble size

Tab 'Data'

Scores

Scorecards

Tab 'Initial View 1' 5 bubble charts Chance of success (previous Attractiveness Value

final/initial view calculated/

initial view manual)

Strategic fit

Market attractiveness

Value

Technical chance of success Comm chance of success Value

Tab 'Initial View 2' 5 bubble charts Chance of success (previous Attractiveness Investment

final/initial view calculated/

initial view manual)

Strategic fit

Market attractiveness

Investment

Technical chance of success Comm chance of success Investment

Tab 'Final View 1' 2 bubble charts Chance of success (initl/final) Attractiveness Value

Tab 'Final View 2' 2 bubble charts Chance of success (initl/final) Attractiveness Investment

Tab 'Notes' Additional notes

Tab 'Balancing business' 6 bubble charts Investment Value

Market share Market size

Market position Market growth

Market growth Forecasted sales

FTE Value

Initial chance of success FTE

Tab 'Classification 1' 6 bar charts BG / PG / Product family FTE / Investment

Tab 'Classification 2' 2 bar charts Product type FTE / Investment

Tab 'Marketing' 6 bar charts TTM / mrkt thrust / advanced FTE / Investment

Tab 'Strategy' 4 bar charts Str ambition / Comp adv FTE / Investment

Tab 'Technology 1' 6 bar charts Maturity / PD Mat* / Inn Mtrx FTE / Investment

Tab 'Technology 2' 4 bar charts Impact / competitive position FTE / Investment

Tab 'Balancing over time' 6 bar charts Years (1st - 4th) Sales / investment / market size / IFO / FTE / market share

Tab 'PD Specific' 4 bubble charts** Competitive position Impact NPV

Chance of success NPV

BY costs

Competitive advantage Advanced NPV

Chance of success NPV BY FTE

‘Export Selected

Scorecards’ function

Radar graph containing all 20 variables of the 4 scorecards visualized per individual project

*PD Maturity not used at Lighting

(14)

TABLE D3: PCS inputs found for projects already on the product roadmap.

Project Name Roadmap

A B C D E F

Project Name PCS

A B C D E F

Project Name PMRS

A B C D E F Launch window w2 2007 w2 2007 w1 2008 w2 2008 w2 2008 w1 2009 Tab 'Classification' (9) Review Round BG/BU PG/BL Product family/area Project type

Application area (3 max) Locations

Planned regions Current status

Tab 'Marketing' (4)

Value Proposition House Time to market

Strategic marketing theme (thrust) Market perception (how advanced)

Tab 'Strategy' (9)

Mrkt size / share / relative share / mrkt profitability / CAGR Strategic ambition class Competitive advantage (in years) Strategic ambition

Plan to achieve strategic ambition 5 forces analysis

Key competitive differentiation Key value drivers (3 max) Interdependencies Tab 'technology' (4) Growth/innovation matrix Maturity Competitive impact Competitive position Tab 'scorecards' (4) Strategic fit Market attractiveness

Commercial chance of success Technical chance of success

Tab 'financials' (3)

Complete NPV/Payback calculator

Forecasted sales

FTE investment

CONFIDENTIAL

Investment

(15)

(16)

Table D5: Classification system PRIP projects; >25 points = big bang, 16-25 = major, <16 = minor.

(Source: de Roode, 2005).

10 points

5 points

1 point

Score

Investment

>500000€

100000€-500000€

<100000€

New Extension

Improvement

Level of innovation

Leading Equal

Position towards competition

Follower

Nr countries / importance market

High Medium

Low

(17)

Table D7: Maturity assessment for current product portfolio management (source: Process

Survey Tool Marketing & Sales).

PHILIPS & LIGHTING SPECIFIC EVIDENCE PROCESS SURVEY TOOL SALES & MARKETING

Element 6: Portfolio Management

Required

Evidence Philips Lighting

(18)

Figure D1: Root-cause diagram for output-issues PRIP (late to market / not meeting commitments / incomplete launches).

(19)

Figure D2: Root-cause diagram of PCS5 not meeting objectives.

(20)

APPENDIX E:

Figures & tables chapter 5

FIGURE E1: Roles and responsibilities as defined in update SHAPE Marketing Re-design 2007.

Marketing Re-design: Who does what (avoiding duplication)

Foresight

&

Strategy

WHAT WHO • PD Market Intelligence • PD Strategic Segment Marketing

and:

• Regional Marketing • Global Product Marketing • Marketing Competency areas

• Market sizing • Market segmentation • Trend studies • Scenarios analyses • Segment strategies • Define focus growth areas

MARKET

EMEANorth America APR LATAM

- Develop 1-3 yr market strategy for region (segments & channels) - Develop and execute marketing mix thru value chain - Develop sales in target segments - Support insight, VPH and solution development - Write and execute campaigns and launch plans

Regional Marketing (by Segment- and Trade-)

PRODUCT Lam ps Lu m ina ires LE SS L Aut om otive SLA

- Develop and drive product category strategy - Define and manage portfolio of products in product category - Agree competitive cost prices, NNSP and volumes - Manage product quality issues and cost improvements - Drive product launches

Product Marketing (by BG) SEGMENT Of fices Indus try Sh ops Hospita lity He a lthca re Ou tdoor Automotiv e D ig . P roject ion Ho me s

- Develop longer term segment strategy - Validate insights, VPH, new solutions in segment - Develop business opportunity calculations for new solutions - Write marketing plan for new propositions - Define key themes and propositions within segment

Strategic Segment Marketing (by Segment)

Other

COMPETENCY

- Develop strategy for expertise area - Capability improvement - Allocate experts to segment and market teams - Embed new processes/guidelines in PD organization

Marketing Competence Centers (by Expertise) Bran

d Iden tityMa rcom Ma rket Intellig ence Insigh t & VP H GOAL IK AM Co mpe tence O rganisa tional Ca pab ility (HR) MARKET

Other

COMPETENCY

d Iden tityMa rcom Ma rket Intellig ence Insigh t & VP H GOAL IK AM Co mpe tence O rganisa tional Ca pab ility (HR)

Foresight

&

Strategy

WHAT WHO • PD Market Intelligence • PD Strategic Segment Marketing

and:

• Regional Marketing • Global Product Marketing • Marketing Competency areas

• Market sizing • Market segmentation • Trend studies • Scenarios analyses • Segment strategies • Define focus growth areas

MARKET

Other

COMPETENCY

Other

COMPETENCY

Insights

&

Concepts

• PD/Regional Market Intelligence • PD/Regional Strat. Segment Mrktg

• Mining & validating insights • Formulating & validating VPHs • Develop feature specifications • Identify possible Marcom

themes per segment

MARKET

EMEANorth AmericaAPR LATAM

PRODUCT Lam ps Lum ina ires LE SS L Au tom o tive SL A

Product Marketing (by BG) SEGMENT Of fices Indus try Shop s Ho sp ita lity He a lthca re Ou tdoor Autom oti ve D ig. P roject ion Ho m es

Ot

her

COMPETENCY

Marketing Competence Centers (by Expertise) Br

and Identity Ma rcom Ma rke t Intellig ence Ins ight & VP H GO AL IKAM Co mpe tence O rgan isa tional Capability (HR ) MARKET

Ot

her

COMPETENCY

and Identity Ma rcom Ma rke t Intellig ence Ins ight & VP H GO AL IKAM Co mpe tence O rgan isa tional Capability (HR )

Insights

&

Concepts

• PD/Regional Market Intelligence • PD/Regional Strat. Segment Mrktg

• Mining & validating insights • Formulating & validating VPHs • Develop feature specifications • Identify possible Marcom

themes per segment

MARKET

Ot

her

COMPETENCY

Ot

her

COMPETENCY

Application

&

Solutions

• BG Product Marketing • PD Pre-development / GOAL • Translate feature specs

in technical specification

• Define what technology

platforms to explore/exploit

• Product portfolio management

(including pruning)

• Assess costprices • Address quality issues • PCP

MARKET

Ot

her

COMPETENCY

Ot

her

COMPETENCY

Application

&

Solutions

• BG Product Marketing • PD Pre-development / GOAL • Translate feature specs

in technical specification

• Define what technology

platforms to explore/exploit

• Product portfolio management

(including pruning)

• Assess costprices • Address quality issues • PCP

MARKET

Ot

her

COMPETENCY

Ot

her

COMPETENCY

Go

to

Market

• Regional Marketing: - Segment Marketing - Trade Marketing - Marcom management

• Marketing launch plans • Defining and executing product

mix (incl. list pricing)

• Channel de velopment • Sales support • (I)KAM • Marcom development • MIP MARKET

Other

COMPETENCY

Other

COMPETENCY

Go

to

Market

• Regional Marketing: - Segment Marketing - Trade Marketing - Marcom management

• Marketing launch plans • Defining and executing product

mix (incl. list pricing)

• Channel de velopment • Sales support • (I)KAM • Marcom development • MIP MARKET

Other

COMPETENCY

Other

COMPETENCY

(21)

FIGURE E3: Advisable format for roadmap consolidation marketing / technology and product

roadmaps, to be incorporated in the new product strategy.

(22)

(23)

(24)

(25)

TABLE E1: Proposed function profile innovation program manager.

FUNCTION PROFILE

Innovation Program Manager

0. General

The Innovation Program Manager is responsible for assuring proper execution of the tactical innovation planning processes. Preparing decision-making in the innovation portfolio reviews is essential.

K. Full responsibility for innovation portfolio assessment process. Providing up-to-date list of all running projects including assessments of projects (via scorecards) and project status & planning. Provides proposed project prioritisation list as result of collected project assessments;

L. Full responsibility central resource management apart from Portfolio Review & Programming meetings by communicating project shifts and delays to all involved departments. Shifts in project prioritisation resulting from portfolio

M. Drives new product strategy consolidation and assures strategic plans incorporate the required strategic objectives, strategic buckets and roadmaps;

N. Checks on proper execution of the key innovation portfolio management processes as defined in the ITM-process (new product strategy formulation, idea management, proposition development, product concept development,central resource management, innovation portfolio assessment, and innovation portfolio review) O. Checks project assessments, collected project data for correctness and completeness.

Contacts project team members is data appears incorrect / incomplete. P. Assuring that portfolio reviews, milestone decisions and product ID-screening

meetings are held as intended by providing facilitation and structure.

Q. Is owner of the portfolio management process and supporting tools and thereby expert in the field. Is coach/trainer for all players in the portfolio management process and provides communication and training. Is allowed to modify the process if discussed with key stakeholders.

2. Desired experience / know-how / skills

1. Has at least 3 years experience in Luminaires

2. Is aware of market and technology developments in the Lighting

3. Is capable to handle sophisticated tools and software packages used for analysis of the project portfolio.

3. Required personal characteristics

• Entrepreneurial; • Team player;

• Strong interpersonal skills; • Coach;

• Process, Result & Milestone driven; • High personal output and effectiveness;

• Proven ability to work in a network environment; • Strong and open Communicator;

• Convincing; • Decision taker;

(26)