Cornelis Van der Klugt, Who Led Philips Electronics, Dies at 86
January 17, 2012, 7:56 AM ESTBy Laurence Arnold
Jan. 6 (Bloomberg) -- Cornelis van der Klugt, who led Royal Philips Electronics NV from 1986 to 1990 and was pushed out a year before his scheduled retirement because of a drop in earnings, has died. He was 86.
The company announced his death in a news release today, recalling him as “a driven manager” who “made a great contribution.” No details were given on the cause or when he died.
Van der Klugt was president and chairman of Philips, which today is the world’s biggest maker of light bulbs and Europe’s largest consumer-electronics company.
During his tenure leading what was then known as Philips NV, he carried out a multiyear plan to cut costs and reduce the workforce. The company, then based in Eindhoven, Netherlands, spun off its heavy-appliances division into a venture with Whirlpool Corp. and sold some of its military-electronics business to Thomson-CSF SA of France, according to a 1990 story in the New York Times.
Van der Klugt’s troubles began on May 3, 1990, when Philips surprised investors by saying its earnings on normal operations had fallen by 97.3 percent in the first quarter, the Times said. Three weeks earlier, at the company’s annual shareholders meeting, he had said earnings in 1990 would rise from the previous year.
Early Retirement
At a news conference on May 15, 1990, Philips said van der Klugt would resign effective July 1 and be replaced by Jan D. Timmer, director of the consumer-electronics division since 1987. The transition to Timmer had already been planned, but not until July 1, 1991, when van der Klugt would have retired at age 65, the Times said.
Timmer led Philips, which is now based in Amsterdam, until 1996. An article that year in the Harvard Business Review credited Timmer with imposing a “shock treatment” that succeeded in changing the mindset of employees, something van der Klugt had not done. Among other steps, Timmer had division managers attest in writing to being personally committed to targeted reductions in staff and operating costs, according to the article.
Van Der Klugt joined Philips in 1950 and held various positions in South America before returning to the company’s headquarters in 1978, the Times reported in 1985, when he was named as the company’s next president and chairman. Until then he was vice president and deputy chairman under Wisse Dekker.
--With assistance from John Buckley in Amsterdam. Editors: Charles W. Stevens, Steven Gittelson
To contact the reporter on this story: Laurence Arnold in Washington at larnold4@bloomberg.net.
To contact the editor responsible for this story: Charles W. Stevens at cstevens@bloomberg.net
