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Leadership style and entrepreneurial change
The Centurion operation at Philips Electronics
Luchien Karsten
University of Groningen, Groningen, The Netherlands

Leadership style

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Sjoerd Keulen
University of Amsterdam, Amsterdam, The Netherlands

Ronald Kroeze
FreeUniversity of Amsterdam, Amsterdam, The Netherlands, and

Rik Peters
University of Groningen, Groningen, The Netherlands
Abstract
Purpose – This paper aims to look at the role of the top and middle management of the Philips organization during the transition from one type of organizational change to another in the 1990s and the role the history of the organisation played in this process.Design/methodology/approach – The paper analysis is based on historical records, literature and interviews with former Philips top managers. Findings – The paper shows that Philips’ leaders used different styles of leadership to create a deliberate atmosphere and willingness to change. The final emergent transformation, however, could only sufficiently materialise while it rejuvenated existing managementconcepts like Quality Management. The success was partly based on the fact that these concepts played a historical role in the Philips organisation. Originality/value – The paper adds the historical style approach to leadership research and pays attention to the important role of the organization’s history during processes of organizational change. Keywords Change management, Business history,Leadership styles, Organizational change Paper type Case study

Introduction On October 25th 1990 the president of Philips Jan Timmer announced a reorganisation operation, called Centurion, which included a lay-off of 45.000 jobs. The Netherlands was shocked. Philips ushered a reduction of personnel at an unheard scale in Europe. The FNV, the biggest Dutch trade union, remarked that strikes werepointless because Philips stood at “death’s door”. Despite the job cutting, the union was impressed by the style of the new leader who in an undisguised, brief and concise manner announced that “the bleeding” had to stop.
The authors are grateful to Robert R. Locke for his valuable comments on an earlier draft. They are also grateful to two anonymous reviewers of this journal for their helpfulcomments. The usual disclaimer applies.

Journal of Organizational Change Management Vol. 22 No. 1, 2009 pp. 73-91 q Emerald Group Publishing Limited 0953-4814 DOI 10.1108/09534810910933915

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Almost instantly Timmer became a public figure in The Netherlands. His style became famous and the Centurion operation soon served as an example for business and government agencies alike.Moreover, the (Dutch) media has paid ample attention to the impact of the Philips reorganisation (Metze, 1992; 1997). In spite of this renown, however, international management literature has, apart from a few exceptions, barely noticed the turn-around that ook place at Philips. Nigel Freedman, deputy-director of Philips company-training, reported in Long Range Planning (1996) about the Centurionframework. Lewis Pinault (2000) provided a rather cynical autobiographical account on the role of consultants during Centurion. Harvard Business School used Philips’ transformation as case material. However, these publications did not explore to what extent the turn-around could be attributed to the new leadership style and to what extent the new language that transferred the change had been embeddedin existing company routines. The issue of a new leadership style had been around since “In Search of Excellence” (1982) had appeared. In this book Peters and Waterman argued that America’s most successful companies had gained success through respect for their company cultures, close linkages with customers, and new leadership. The concept of excellence provided both the state of the art of...