PreMortem: Again, no expert but those numbers sound good. No where does it say they are in the red.

They aren't in the red. Thing is sales are down, so profits are down, so to raise profits, they're cutting employees. And sales are down because people have less money to spend, so naturally the best thing to do is create more people without money to spend.

FTFA: having notched up almost a billion euros in losses since the beginning of 2007, when competition with lower cost Asian rivals began to intensify.

Also, the CEO and Chairman are both new to the company and their stock grants will be set over the next year or so. There is a major incentive to tank a company in the first year you take over, to blame the outgoing management and get a good target price for your options. Three years from now they should be reporting record profits just in time to exercise.

WhyteRaven74: PreMortem: Again, no expert but those numbers sound good. No where does it say they are in the red.

They aren't in the red. Thing is sales are down, so profits are down, so to raise profits, they're cutting employees. And sales are down because people have less money to spend, so naturally the best thing to do is create more people without money to spend.

I would imagine a big reason is that most of the market has now made the shift from 4:3 CRTs to flat widescreens and 3D is a little too gimmicky to take off yet.

thisispete: 3D is a little too gimmicky to take off yet.

That would explain their TV troubles.

WhyteRaven74: PreMortem: Again, no expert but those numbers sound good. No where does it say they are in the red.

They aren't in the red. Thing is sales are down, so profits are down, so to raise profits, they're cutting employees. And sales are down because people have less money to spend, so naturally the best thing to do is create more people without money to spend.

Most economies aren't small enough for that to work anymore. And, there's no proof that what Henry Ford was yapping about worked in the first place. U.S. GDP was about 30 billion in 1908 when the Model T came out. Ford was a huge company at the time. GDP now is about 450 times that, and Ford doesn't take up nearly the percentage it did. IF it ever worked that way, it doesn't now. And only does for certain generalist type companies; i.e. very large and diverse products. For specialized companies, they'd simply be shooting themselves in the foot keeping extra people employed. And, this is a great opportunity to get rid of the ones that are pains in the ass and hurt productivity more than the rest of them. So remaining employees benefit.

In other words, the premise that keeping people employed helps the company itself, is likely a lie. The idea that a puny fraction company like Phillips would benefit is just stupid. Not only that, they are not Wal-Mart that touches the flow of many types of consumer goods. Phillips in general, sells LUXURY goods, not bread. Guess what people do when they are uncertain about their future? They don't spend so much on luxuries.

Yes, being employed revs up the economy, and in general helps. However the supposed association between any given employee staying employed and the success of his or her employer is simply not there.

If you want to biatch about stuff like that, you need to focus on industry-wide or government incentives to get the economy going. You'll sound less like a jealous commie that way.

WhyteRaven74: PreMortem: Again, no expert but those numbers sound good. No where does it say they are in the red.

They aren't in the red. Thing is sales are down, so profits are down, so to raise profits, they're cutting employees. And sales are down because people have less money to spend, so naturally the best thing to do is create more people without money to spend.

If sales are down they don't need as many employees. This is plainly obvious and logical. Unless they anticipate demand returning soon, why should they pay for unneeded resources?

Cubansaltyballs: WhyteRaven74: They aren't in the red. Thing is sales are down, so profits are down, so to raise profits, they're cutting employees. And sales are down because people have less money to spend, so naturally the best thing to do is create more people without money to spend.

A smart company would divert the excess employees to new ventures, or to improve existing ventures.

As an example, when I was in high school I worked at a restaurant. Things started to slow down more than normal. The manager decided that sending half the staff home early every night wasn't going to work long-term, so he printed a bunch of fliers that offered "specials", and sent people out to drum up business. The special was basically the normal menu, but it dragged a few people in, which got more people in. No one wants to eat in an empty restaurant.

The point is, if business is down, you can utilize employees in different ways to bring business in, or make existing business better for the consumer. In the end, your profitability won't be where shareholders want it, but you'll have a stronger company when the slump is over.

Do you think that is some sort of revelation to big businesses? If there was some alternative activity to which these 4,500 people could be assigned that would be profitable to the company, they would do it.

Companies do layoffs when business activity and opportunity diminishes to the point where utilizing those resources would not be profitable going forward.

Actually...

If they aren't making any money in this field is does make sense to bail out to FOCUS ON THEIR COMPETENCIES.

They'll create more jobs in their competencies than they cut. The problem is that most of these people won't be transitioned into other divisions.

Obviously what they need is more recovery money from Uncle Sam. $887 billion USD wasn't enough, I don't think that includes the $2.1B USD lost when we airdropped palettes of it into iraq and walked away from it.

/it's illusory

Local Man: So I shouldn't run right out and score a $40 LED flood light from them?

I'll tell you what: huge, ivy league universities regularly renovate offices and labs out of historic buildings; become friends with the recurring crews/labor unions who gut granite sink tops, florescent light fixtures galore, old-style desks and chairs...

/get it for free

.ihasacentrifuge.jpg

So Philips is going to cut like .001% of their incredibly bloated product line?

Cubansaltyballs: Job Creators.

Bears Repeating.

They're cutting jobs as the products they make go to another company. It may be assumed that at least some of the Philips employees in that line would go with the deal. Therefore, a 4500 job cut doesn't actually mean 4500 more unemployed workers. On the other hand those workers might have to relocate to keep their jobs, and many people balk at that...

PreMortem: FTFA: "Philips said it would aim to cut 4,500 jobs as part of an 800 million euros cost-cutting scheme to boost profits and meet its financial targets."

No MBA,,, not an economist of any sort, however why is it ALWAYS jobs cuts to raise profits?
If it's anything like the company I work for, customer service, quality, worker morale, etc.. will all decrease and they will lose more customers because of it. Just don't get it.

Despite reiterating the firm's 2013 financial targets of 4-6 percent sales growth, and a margin on earnings before interest, tax, and amortization (EBITA) of 10-12 percent, Van Houten said Philips had a long way to go.

Again, no expert but those numbers sound good. No where does it say they are in the red.
But hey, they can cut the jobs then sell it off to be hacked apart ala Gecko.

Quarterly profits, yo. Shareholders don't give one shiat if Philips is healthy next quarter. They're invested for this one and they'll sell their shares high after the nicer looking financial statements are released.

And companies still think with short term, quarterly brains. I would stop buying their TVs if I was in the market for one. No matter how well or poorly they did in the past, this kind of event will worsen their quality.

Archie Goodwin: PreMortem: FTFA: "Philips said it would aim to cut 4,500 jobs as part of an 800 million euros cost-cutting scheme to boost profits and meet its financial targets."

No MBA,,, not an economist of any sort, however why is it ALWAYS jobs cuts to raise profits?
If it's anything like the company I work for, customer service, quality, worker morale, etc.. will all decrease and they will lose more customers because of it. Just don't get it.

I'm with you on this, but the one thing you missed is, when a company does this, they always take a massive hit in the next quarter to cover all the firing costs. So instead of boosting profits they actually do the reverse. Crazy!

Because they know over the long term it is beneficial for profits to not pay for unneeded resources. The immediate hit is due to severance pay or other transition costs paid to cushion the blow to the laid-off employees.

The job creators have no obligation to create jobs. Get off their dick, you farking hippies.

IrateShadow: The job creators have no obligation to create jobs. Get off their dick, you farking hippies.

True, and we have no obligations to give them any more special treatment. Get off my country's legislation farking lobbyists.

rev. dave: IrateShadow: The job creators have no obligation to create jobs. Get off their dick, you farking hippies.

True, and we have no obligations to give them any more special treatment. Get off my country's legislation farking lobbyists.

The real job creators are small business.. they don't lobby or get much from the government.

Debeo Summa Credo: Because they know over the long term it is beneficial for profits to not pay for unneeded resources. The immediate hit is due to severance pay or other transition costs paid to cushion the blow to the laid-off employees.

I've watched companies lay off huge swaths of a product team, pay them severance, realize that they can't make plan with the reduced headcount and either hire back a set of the old employees at a higher rate or bring on new people and eat training and ramp up costs.

In general, business is far too focused on next quarter and not sufficiently focused on where they will be five years down to road.

bhcompy:
The real job creators are small business.. they don't lobby or get much from the government.

I agree with this. But in our public discourse "job Creators" translates into top earners. Small businesses do not make a large share of the income and also have few lobbying options so that is why they don't get special favors. Just asking for an end to the corruption and if the small businesses were to get some aid, it would really help. Especially if they could get credit access at pre-recession levels.

LouDobbsAwaaaay: If we stop giving away tax breaks to the corporate elite, they might stop showering us with gifts of layoffs like this.

No, they'll lay off more people or move jobs to another country

jafiwam: WhyteRaven74: PreMortem: Again, no expert but those numbers sound good. No where does it say they are in the red.

They aren't in the red. Thing is sales are down, so profits are down, so to raise profits, they're cutting employees. And sales are down because people have less money to spend, so naturally the best thing to do is create more people without money to spend.

Most economies aren't small enough for that to work anymore. And, there's no proof that what Henry Ford was yapping about worked in the first place. U.S. GDP was about 30 billion in 1908 when the Model T came out. Ford was a huge company at the time. GDP now is about 450 times that, and Ford doesn't take up nearly the percentage it did. IF it ever worked that way, it doesn't now. And only does for certain generalist type companies; i.e. very large and diverse products. For specialized companies, they'd simply be shooting themselves in the foot keeping extra people employed. And, this is a great opportunity to get rid of the ones that are pains in the ass and hurt productivity more than the rest of them. So remaining employees benefit.



Remaining employees end up doing more work for the same pay, how do they benefit? Chances of advancement don't improve, either, as the positions themselves are eliminated.

In other words, the premise that keeping people employed helps the company itself, is likely a lie. The idea that a puny fraction company like Phillips would benefit is just stupid. Not only that, they are not Wal-Mart that touches the flow of many types of consumer goods. Phillips in general, sells LUXURY goods, not bread. Guess what people do when they are uncertain about their future? They don't spend so much on luxuries.

Isn't this contradictory? You just indicated exactly why causing further uncertainty in the economy directly effects Philips bottom line.

Yes, being employed revs up the economy, and in general helps. However the supposed association between any given employee staying employed and the success of his or her employer is simply not there.

There's a cumulative effect when every company looks at it this way, which is what WhyteRaven seems to have been getting at.

Well, good thing we didn't raise their taxes.

Cubansaltyballs: whipbambucket: LouDobbsAwaaaay: If we stop giving away tax breaks to the corporate elite, they might stop showering us with gifts of layoffs like this.

No, they'll lay off more people or move jobs to another country

I get it. We're helpless creatures compared to the power of omnipotent Creators. We shouldn't question their actions, or penalize them for it.... all we can do is bestow lavish gifts upon them in the hopes they will spare us.

Nice religion you got there.

I never claimed that endorse it dumbass, I just call it like I see it.

WhyteRaven74: thisispete: 3D is a little too gimmicky to take off yet.

That would explain their TV troubles.

That, and their tv quality is utter shiat. Both build quality and image quality.

When other brands focused on improving resolution, contrast and refresh rates, they decided to put glowing lights on the edges to make your wall glow.

They need to concentrate on their core business. Milk of magnesia.

pelzo63: When other brands focused on improving resolution, contrast and refresh rates, they decided to put glowing lights on the edges to make your wall glow.

Yeah, what's up with that? I'm barely okay with a tiny green power light - I tend to put electrical tape over lights. BTW, it's not just Philips - we have a couple JVC TVs with giant blue lights under them at work.

Checking into it a bit more, it seems to be an 'ambiance' thing with some people. Probably the same types who like clear screens on their computers to display the blue LEDs on the motherboard(and any cards). Personally, I want my computer to be unnoticable once I've got it built and installed - quiet, just a simple green light to show power(and not a very bright one either). Same with the TV - show the picture, nothing else.

At one time Phillips stood for quality. Somewhere in recent years they seem to have lost their way big time. Their consumer electronics are generally mediocre. When I bought some of their holiday LED lights the bulbs were burning out faster than I could replace them. They seem to have cheapened the products of most company's they buy - i.e. Sonicare. Their customer service has gone down the tubs. The last Norelco shaver I bought years ago was outperformed by one 5 years older. When I called Customer Service about it they told me to buy the next version. I brought a Braun instead and have been very happy with it. It's a good thing I did too. Replacement blades for the Norelco used to cost around $20. Now they cost $50 or around 1/4 the cost of a one of their new electric razors. Given their trend towards mediocrity I have replaced most of my Philips and Norelco products with Braun and others that perform as advertised and last. That goes for a CPAP (Respironics) machine as well. I replaced it with a Resmed and could not be happier with it and it makes a mere fraction of the noise.

If Phillips really wants to save money they should fire everyone, including the CEO and management team and go out of business. That way their competitors could hire the good qualified works to meet the demand for similar products after Phillips is gone. In my opinion at this point, that the World would be a better place without them.

ChrisDe: They need to concentrate on their core business. Milk of magnesia.

Snort.

Cubansaltyballs: WhyteRaven74: They aren't in the red. Thing is sales are down, so profits are down, so to raise profits, they're cutting employees. And sales are down because people have less money to spend, so naturally the best thing to do is create more people without money to spend.

A smart company would divert the excess employees to new ventures, or to improve existing ventures.

As an example, when I was in high school I worked at a restaurant. Things started to slow down more than normal. The manager decided that sending half the staff home early every night wasn't going to work long-term, so he printed a bunch of fliers that offered "specials", and sent people out to drum up business. The special was basically the normal menu, but it dragged a few people in, which got more people in. No one wants to eat in an empty restaurant.

The point is, if business is down, you can utilize employees in different ways to bring business in, or make existing business better for the consumer. In the end, your profitability won't be where shareholders want it, but you'll have a stronger company when the slump is over.

The restaurant I worked at in high school ended up being ran intentionally on a loss, to offset the silent partner's much more profitable ventures. The manager nonetheless managed to turn a profit every year for five years and the restaurant was closed because of that.

What a shame.

They make such nice screwdrivers.

jimw: At one time Phillips stood for quality. Somewhere in recent years they seem to have lost their way big time. Their consumer electronics are generally mediocre. When I bought some of their holiday LED lights the bulbs were burning out faster than I could replace them. They seem to have cheapened the products of most company's they buy - i.e. Sonicare. Their customer service has gone down the tubs. The last Norelco shaver I bought years ago was outperformed by one 5 years older. When I called Customer Service about it they told me to buy the next version. I brought a Braun instead and have been very happy with it. It's a good thing I did too. Replacement blades for the Norelco used to cost around $20. Now they cost $50 or around 1/4 the cost of a one of their new electric razors. Given their trend towards mediocrity I have replaced most of my Philips and Norelco products with Braun and others that perform as advertised and last. That goes for a CPAP (Respironics) machine as well. I replaced it with a Resmed and could not be happier with it and it makes a mere fraction of the noise.

If Phillips really wants to save money they should fire everyone, including the CEO and management team and go out of business. That way their competitors could hire the good qualified works to meet the demand for similar products after Phillips is gone. In my opinion at this point, that the World would be a better place without them.

You can add their medical division to that as well. They bought out the absolute leader in Nuclear Medicine (ADAC had a 50% market share at the time of acquisition), and in less than 10 years are down to ~11%. They cut the camera line up down from 5 distinct camera families to 2 cameras total. And only one of those is worth anything. They completely destroyed Picker/Marconi, as well. From what I understand, ultrasound is still strong, but that's because they left management in place, and let it run like it always had in the past.

/purely anecdotal. Take it for what it's worth...