Philips 2005 Annual Report Download - page 13

Philips Annual Report 2005 13
2006 Management Agenda
We have compiled a management agenda with clear
goals and actions under the themes of Growth, Talent
and Simplicity:
Realize 5-6% top-line growth and attain a 7-10% EBIT
margin as from the end of 2006
Continue to grow healthcare as part of the portfolio
Accelerate movement to become a simpler, market-
oriented organization
Set up a separate legal structure for Semiconductors
and create value by pursuing strategic options
Increase the number of entrepreneurial business
leaders with broad-based experience
Exceed our EUR 500 million overall cost reduction
target within two to three years.
This agenda reaffi rms our One Philips way of working
and is intended to create an inspiring program that can
rally the whole organization to achieve success. Now we
have to deliver – through rigorous and consistent execution
of our plans, ensuring “sense and simplicity” in everything
we do, and displaying the winning spirit at every level of
the organization.
I am delighted with the proposal to appoint the current
heads of our fi ve operating divisions to the Board of
Management, bringing us as a board even nearer to our
business and our customers. I look forward to working
together with them even more closely to meet the long-
term strategic goals we have set for the company.
As we look to the future of our company, I would like to
take a moment, before I conclude, to honor a man who
did so much to shape its past. Frits Philips passed away on
December 5, 2005. Frits was a warm-hearted, caring man
and spirited entrepreneur, whose long life was marked by
a strong commitment to Philips and close involvement
with the world around him. It is impossible to overstate
what Frits did for our company, and we shall always
remember him with gratitude.
I would also like to thank Ad Huijser, our Chief Technology
Offi cer, who will be retiring in April 2006, for his signifi cant
contribution during his 35 years with the company.
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Finally, let me thank you, our shareholders, for your
continued support in 2005. It is gratifying that we have been
able to increase the value of your company, also with our
share repurchase programs, and to increase the dividend
once again. I would also like to express my thanks to our
other stakeholders, and in particular our customers, for
the confi dence they have shown in us, as well as our
employees, who worked hard to achieve our goals over
the past 12 months.
Gerard Kleisterlee
President
“ We have identifi ed three important themes that we need to work on
together to achieve our ambitions: Growth, Talent and Simplicity. ”