Philips, a global leader in medical devices and diagnostics, has been making the world healthier and more sustainable through innovation for over a century. It aims to improve the lives of 3 billion people by 2025. How? Building on its innovative healthcare products and services, Philips is also innovating new financial solutions by focusing on circular economy ideas and leveraging its strong collaboration with financial partner DLL.
Philips and DLL have built a healthy synergy that spans several decades (see sidebar). They share many core values, including a strong commitment to the circular economy – developing sustainable models, like service based models and refurbished equipment that combine profitability with social benefits – and ultimately meet the needs of end customers.
$4 billion in medical equipment
Nestor Coronado Palma, Philips Program Manager Circular Economy says, “Although many hospitals are still focused on owning new equipment, we are seeing a growing interest in leasing equipment, refurbished equipment and in service based models.” DLL and Philips have been very successful in leasing. “In the past 12 years, DLL has funded over $4 billion worth of equipment from Philips in the USA under the Philips Medical Capital brand,” says David McCoubrie, DLL Global Account Manager.
Scaling up to service based contracts
From leasing it’s a logical step to service based models that sell the performance of an asset rather than the asset itself. Coronado says, “Hospitals are accustomed to thinking they must own the asset to save money in the long term. We need to refocus the conversation on the customer’s requirements and shift to an approach where the best solution depends on the performance and outcome at a service level. These new models are gaining traction.”