Philips vs Matsushita (Summary)

Philips was founded by Gerard Philips and his father in 1892 in Eindhoven, Holland . Then, they recruited Anton Philips (Herard 's brother), an excellent salesman and manager, and soon after they became the third largest light-bulb producer in Europe. However from its beginning on it always took care for his workers. As an example in Eindhoven it built company houses, bolstered education, and paid its employees so well that other local employers complained. When larger electrical product companies were trying to diversify Philips only focused on one product, light-bulbs which enabled the company to create significant innovations.
They scraped old plants and after advances were made they used new machines or factories. They also became a leader in industrial research, creating physics and chemistry labs to address production problems as well as more abstract scientific ones. After developing the tungsten metal filament bulb, which was a great commercial success, Philips had the financial strength to compete against its giants rivals. Because of Holland 's small size Philips was soon forced to expand to other countries for having enough volume to mass produce. So it started building sales organizations in the United States, Canada, and France. All other functions remained highly centralized in Eindhoven. Philips created also local joint ventures to gain more market acceptance.
After entering into an agreement with General Electrics in 1919, giving each company the use of the others patents, Philips began evolving to a decentralized sales organization. It founded independent marketing companies in 14 countries in Europe, China, Brazil and Australia and also broadened its product line significantly. However the great depression which brought trade barriers and high tariffs with it, forced Philips to build local production facilities to protect its foreign sales of these products. Philips had a shared but competitive leadership by commercial and technical