Israeli Businessman Uzi de Haan Speaks to MBA Global Strategy Class

Students in management and organization lecturer Paulo Prochno’s Global Strategy class received a special guest lecture from Israeli professor and former Philips Israel CEO Dr. Uzi de Haan, on Thursday, October 2, 2008. De Haan discussed his experiences at Philips and provided an overview of the current business climate in Israel.

De Haan’s rich educational background began at the University of Delft, Holland, where he studied aeronautical engineering. He received his Masters of Science and Doctorate of Science at the Technion – Israel Institute of Technology in industrial engineering and behavioral sciences, respectively.

De Haan worked at Philips Israel for 27 years and worked his way up to CEO, building a $350 million company and research and development (R&D) base through acquisitions, venture investments, and organic growth. He returned to the Technion in 2003 as professor at the William Davidson School of Industrial Engineering and Management, where his main research focus is Entrepreneurship and Strategic Management

In his remarks, de Haan noted that Philips is a truly multinational company – somewhat surprisingly, the most-spoken language inside Philips is Chinese. According to de Haan, the major challenge facing multinational corporations is that they must manage and change weaknesses on one hand, while leveraging path-dependent core competencies on the other.

Philips, founded and headquartered in the Netherlands, is one of the largest electronic companies in the world, with over 128,000 employees in 60 countries. Philips’ mission is to improve the quality of people’s lives through timely introduction of meaningful innovations. “At Philips, people, culture, and governance are the key enablers for success,” said de Haan.

De Haan discussed the major changes Philips had undergone in recent years. An annual price erosion of 7% has led to restructuring of Philips’ key businesses. Additionally, the scope of Philips’ operational focus and customer base has shifted from local to global.

In addition to his overview of Philips, de Haan also provided a macro assessment of the business environment in Israel. Since the 1990s, growth of Israel’s GDP has been driven by the high-tech sector. Though the total dollar amount spent on R&D nationally in Israel is low in absolute terms, R&D makes up 4.8% of Israel’s total GDP – the highest per capita figure in the world. “I was surprised to learn that Israel is second to only the Silicon Valley area in terms of venture capital start-ups invested in,” said second-year MBA student Asma Mirza.

De Haan concluded his remarks by citing two key takeaways about doing business in Israel. The first is that informality and risk taking are endemic to Israeli culture. The second is that globalization is central to success in Israel, as businesses have no choice but to go global from their inception due to the small size of Israel.

Pete Baird, MBA Candidate 2009, Smith Media Group