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Philips Continues To Realign, Downsize

Philips Consumer Electronics North America announced the next phase of its business renewal plan, which will split sales and marketing responsibilities for the company’s products into two separate business segments.

Going forward, Philips will address its “go-to-market” strategy using a premier and a mainstream business segment, the company said.

Premier products will consist of Philips’ newer and most innovative technologies, including FlatTV and Philips-Nike personal electronics. The mainstream model, which will build upon the current Magnavox product group, will encompass products with more mature lifecycles, such as CRT picture-tube TVs and DVD players.

The mainstream group will utilize “small and focused teams to bring products to market in a fast, simplified and more direct approach,” Philips said in prepared statement.

Philips said the approach will create a more “focused and flexible” organization that will better serve the customer requirements within each product segment.

The company said it expects to build new CE partnerships “requiring optimal marketing support to drive success in all aspects of business development, customer and product support, advertising and flexible logistics.”

The new market approach will be reviewed with retailers in time for 2005 placement discussions this fall. The full transition is expected to be completed by the second quarter next year.

Overseeing each group will be Des Power, who becomes premier sales and marketing senior VP, and Andy Mintz, who becomes mainstream sales and marketing senior VP.

The company said approximately 95 positions, most of which are located in Atlanta, “will be affected” by the change. The company currently employs 290 associates in its Atlanta headquarters.

Additionally, as part of the recent transformation of its service activities in Knoxville, Tenn., approximately 55 positions will be transferred to the Atlanta facility.

This latest move follows the reorganization of the central offices in Atlanta at the end of 2003, the restructuring and relocation of the business solutions activities to Colorado Springs, and the agreement with IBM to transform and manage the service activities of Philips Consumer Electronics North America.

Following its agreement with IBM, Philips announced in May that it would close its Knoxville and Greenville, Tenn., facilities in 2005.