Enterprise Agility in Action: Philips EMR Transformation

This case study reflects work led by Michael Renna, Founder of Alacient, during his full-time tenure as Agile Transformation Business Leader at Philips EMR. The transformation was executed in partnership with Philips leadership and a team of SPCs, and showcases the strategic and operational impact of Scaled Agile practices when applied at enterprise scale.

Executive Summary

Philips EMR faced a critical inflection point: over fifty simultaneous initiatives—many unprofitable—were draining resources, while legacy practices and cultural inertia stifled innovation. A prior SAFe® transformation had failed to take root. In 2023, a renewed transformation effort began with strong executive sponsorship and the onboarding of Agile Transformation Business Leader Michael Renna, supported by several SPCs and coalition of cross-functional leaders. Over 18 months, the organization underwent a sweeping Scaled Agile transformation, culminating in a 23-point EBITDA improvement and a revitalized operating model built for speed, transparency, and strategic alignment.

Initial Landscape

Fragmented Initiative Landscape: 50+ active projects, many lacking ROI clarity
Delayed & Unpredictable Releases: Delivery timelines were inconsistent and opaque
Project List Masquerading as Strategy: No clear linkage between strategic goals and execution
Legacy Culture: Resistance to change, anchored in a 135-year history of “this is how we’ve always done it”
Failed SAFe® Attempt: A prior transformation that lacked traction and sustainability

Transformation Approach

Leadership & Change Enablement

Committed Executive Sponsorship providing strategic direction and essential mandates for organizational change
Compelling Change Narrative to align teams and provided motivation toward achieving a shared vision and transformation goals
Michael Renna (SPC) onboarded as Agile Transformation Business Leader
Lean Agile-Center of Excellence (LACE) established to guide implementation and coaching
Cross-functional change champions trained to drive adoption across disciplines
Philips University support for SAI Training and Certification licensing.

Structural Overhaul

Value Stream Identification Workshops: Reorganized twelve Agile Release Trains (ARTs) around value delivery
SAFe® Training for ~1000 employees: Role-specific curricula delivered across the enterprise
Product Management as a discrete discipline: Build out of a fully formed Product Organization

Practice Modernization

Measure & Grow Assessments: Identified competency gaps and targeted coaching needs
Azure DevOps Customization: Enhanced to support SAFe® workflows, KPIs, and visibility
Cadence-Based Ceremonies: Introduced across all levels for feedback loops and transparency

Lean Portfolio Management: The Game Changer

The most transformative element was the implementation of Lean Portfolio Management (LPM)—absent in the previous SAFe® attempt. This directly challenged Philips’ entrenched project-centric mindset.

Key LPM Actions

Value Stream Funding: Portfolio management shifted from project-centric budgeting to funding value streams, aligning investments with overall strategy for better outcomes.
Simplified Strategy: Strategic plans were simplified and put into action using epics and lean-startup practices, creating clearer and more actionable goals.
Economic Sequencing: Economic sequencing with WSJF prioritized initiatives for the greatest value, ensuring resources were used where they mattered most.
Epic Evaluation: Unprofitable epics were paused or terminated
Flow Distribution & Capacity Allocation: Flow distribution and capacity allocation balanced investments, optimizing throughput and ensuring only viable ideas advanced.
Agile Cost Accounting: Cost accounting using story points and total cost of ownership for teams provided a better understanding of investment and return.

Outcomes & Impact

Sales and Order Intake Improvement

Sales and Order Intake increased by 25% from 2021 to 2023 by focusing on Lean Portfolio Management and high-value priorities.

EBITA Growth

EBITA grew by 21% due to strong revenue growth and effective cost control strategies.

Improved Portfolio Health

Portfolio health rose 5–10%, reflected by higher throughput and enhanced quality behaviors.

Metric	Before Transformation	After Transformation (18 Months)
Active Initiatives	50+	~20 strategically aligned
Release Predictability	Low	High cadence and transparency
Strategic Clarity	Fragmented	Unified vision and execution
EBITDA Improvement	—	+23 points
Team Engagement	Sporadic	Broad participation and ownership
Agile Maturity	Nascent	Embedded across roles and levels

Conclusion

Michael Renna’s leadership catalyzed a transformation that not only revived a previously failed SAFe® initiative but redefined how Philips EMR delivers value. By embedding Lean Portfolio Management, aligning around value streams, and empowering teams through training and transparency, the organization achieved measurable financial and operational gains. This case stands as a blueprint for enterprise-scale agility done right.