Philips-Indal: The Deal from Heaven? (A) Harvard Case Solution & Analysis

Philips' new venture integration (NVI) section is fully aware of intentions that many procurements turned into “deal from the hell” as a replacement for “deal from heaven”. It’s after-merger integration specialists have experienced that cost synergies are much easier to understand than sales (or increase) synergies. Excited by the urge to grow, the NVI department has developed a new methodology called the "sales integration strategy" to realize sales (or growth) synergies.

It tries to execute this approach during the acquisition integration a Spanish lighting firm, of Indal. The shift in acquisition presents the principal challenge -integration capacity following Philips' developed corporate strategy. Philip’s new CEO stressed the need for the organic growth and set out a stage for a consortium of small and medium acquisitions while historically Philips had a substantive acquisition program. Philips needs to become more customer-centric to increase corporate growth. It has demanded a focus not just on price synergies (e.g., economies of scale and increased efficiency), but also on catching sales (or increase) synergies. Philips-Indal must elect to defend areas in which it's in powerful position or goal areas where it features a poorer standing.

Moreover, Philips' post-merger integration leader must choose an organizational structure for Philips Indal and convince Indal's executive team to embrace the NVI department's sales integration strategy. This case can be utilized with Lighting Up Philips' Asian Entertainment Activities (B) 9B14M019. Writer Koen H. Heimeriks is connected with Tilburg University.

Philips-Indal The Deal from Heaven (A) case study solution

PUBLICATION DATE: April 16, 2014 PRODUCT #: W14092-HCB-ENG

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