Philips 2006 Annual Report Download - page 59

Philips Annual Report 2006 59
impact Medical Systems in 2007 and beyond. The Defi cit
Reduction
Act of 2006 came into effect in January 2007
and included
substantial reductions in Medicare payments
for imaging services performed in non-hospital settings.
Commercial payers are also implementing several types
of utilization management strategies designed to curb
growth. Philips will continue to work closely with legislators,
payers and providers to ensure a more rational approach
to payment for innovative technologies, particularly
advanced imaging services.
Strategy and 2007 objectives
Philips Medical Systems aims for sustainable profi table
growth by:
securing a return on previous investments through
continuous improvement in customer relationships,
talent, innovation and operations
strengthening its solutions portfolio through targeted
allocation of resources toward products, applications
and markets with highest value-creation potential
expanding selectively into care cycles today and in
the future, aiming for sustainable differentiation
from the competition.
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Looking ahead to 2007, Medical Systems’ key business
objectives include:
Growth
Continue to grow faster than the market by acquiring
companies, focusing on partnerships and alliances,
intensifying the focus on emerging market growth,
increasing value-segment product sales in established
markets, maintaining the high innovation rate, and
further increasing service-contract penetration
Achieve 14-15% EBITA
Support care providers throughout the entire cycle
of patient care by developing disease-based product
and service solutions
Increase customer loyalty by further improving
product quality, reliability and serviceability
Talent
Cultivate leadership talent to meet changing market
needs and business demands
Recognize and reward successful and
passionate performers
Improve the ability to recruit, develop and retain
top talent
Simplicity
Continue to focus on operational excellence
by streamlining the quote-to-cash process and
accelerating low-cost sourcing initiatives
Improve service satisfaction by designing-in
serviceability requirements and increasing the
interoperability of Medical Systems’ products.
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Philips Annual Report 2006 59
in
b
illi
o
n
so
f
eu
r
os
Sa
l
es
NOC
8
6
4
2
0
6.8
4.9
2002
6.0
3.7
2003
5.9
2.9
2004
6.3
3.4
2005
6.7
4.3
2006
Sales and net operating capital Earnings before interest and tax (EBIT)
i
n milli
o
n
so
f
eu
r
os
EBIT
as a % of sale
s
1,000
750
500
250
0
309
4.5
2002
431
7.2
2003
35
0.6
2004
679
10.7
2005
79
5
11.8
2006
54 The Philips sectors
Medical Systems
86 Risk management 100 Report of the Supervisory Board 110 Financial Statements