Driving Innovation and Profits: The Philips Octagon Program

The Challenge

How can a well-established global company increase profitable innovation and collaborative leadership when market conditions are uncertain and past success patterns have discouraged leaders from taking risks?

That was the challenge facing Royal Philips Electronics (Philips), a $38 billion global company and pioneer in health care, lifestyle and lighting solutions.

The Goals

Philips envisioned a leadership development program that delivered on three key goals:

  • Equip its senior leadership potentials with the most advanced skills in innovation, value creation, and leadership.
  • Instill a new leadership mindset that promotes innovation, collaboration and calculated risk taking.
  • Create a cohesive pool of strong, like-minded leaders to fill Philips' succession pipeline.

The Solution

After an extensive search, Philips partnered with Wharton and the Center for Creative Leadership to create a program for its senior leadership potentials. The program included:

  • Innovation, Strategy and Business Acumen — A customized set of tools and practices to improve the "innovation DNA" throughout Philips
  • Leadership, Team-Building, and Influence — A practical approach for creating teams to establish the new innovation processes and culture
  • Three Global Modules — A facilitated immersion experience to prepare leaders for global growth roles
  • Six-Month Action Learning Projects — Projects that modeled the actual process of launching successful innovation initiatives within Philips — from start to finish — giving the participants a repeatable process for launching future innovations

The Impact

  • More Innovation: The 60+ projects over the past six years have driven innovation across multiple business units, geographies and product lines.
  • Successful Innovation: More than 50% of the Octagon Projects are integrated into the Philips Innovation Pipeline.
  • Profitable Innovation: Financial returns from the innovation projects have exceeded the costs of the program, increasing its value as a strategic investment.
  • Excellent ROI: One project alone contributed more than 25 million euros in profits the first year, and the project model was replicated in several other markets.
  • Strong Leadership Pipeline: Many Philips Octagon Program graduates were promoted into Executive Global Leadership roles.

The Philips Octagon Solution

Each Wharton Executive Education Custom Engagement is designed to address the specific needs and challenges of our clients. Every Custom Engagement program design is different. The following is a snapshot of the Philips Octagon Program design.

  • One to two cohorts of 32 senior leadership potentials per year
  • Three Global Modules:
    • Wharton's US Campus — For depth and variety of faculty
    • An emerging market (China, India or Russia) — To deepen customer experience through home visits, market visits, and meetings with global leaders
    • Amsterdam headquarters — For action learning team reports to the top management team
  • Leadership Insight Tools — Participants received leadership assessments, executive coaching and peer feedback to broaden their self-knowledge.
  • Collaboration Simplified — Bi-weekly conference calls ensured seamless collaboration; single contract with Wharton simplified the process for Philips.

The Philips Octagon Solution Graphic

Key Session Topics


  • Global Trends
  • Leadership Competencies
  • Innovation Strategy and Value Creation
  • Team Dynamics and Virtual Team Leadership
  • Critical Thinking and Decision Making
  • Marketing New Products and Services
  • Managing Uncertainty
  • Leading Profitable Innovation


  • How to Do Business in Emerging Markets
  • Emerging Market Home Visits and Shop Visits
  • International Trade Simulation
  • Building Stakeholder Commitment
  • Meetings with Emerging Market Management Team
  • Assessing the Corporate Portfolio
  • Mergers and Acquisitions
  • Building the Business Case: Key Performance Indicators


  • CEO Forum
  • Leadership Brand Statements
  • Mentoring Sessions with Senior Leaders
  • Team Project Presentations and Debriefs

Would you like to learn more?

To find out how Wharton Executive Education can help your company achieve its own customized solution, please contact Alyssa Greco, Associate Director, Client Relations — Custom Programs, +1.215.746.8093 or customprograms@wharton.upenn.edu.