Based on the information provided, Peter Löscher's project to lead the evolution of Siemens following the scandals can be considered a success. He was able to restructure the organization, improve culture and compliance, and get the business back to growth while positioning it for long term competitiveness and sustainability.
3. Siemens History
History
• Foundation of Siemens & Halske Telegraph
Company.
Löscher 1847
Project: Evolution
• Many successful Subsidiaries (e.g. Russia and
Implementation & England).
Deployment
1885 • Halske leaves.
Siemens Today
Future • First Transatlantic Cable.
• First dynamo generator.
Löscher
Leadership
1866
Conclusion
• Many Breakthroughs, 82,000 Employees.
• Expansion to Shanghai.
1924
4. Siemens History
History
• Several Breakthroughs, more advanced
Löscher technologies.
Project: Evolution
1930-70 • Business expansion and subsidiaries everywhere.
Implementation &
Deployment
• Foreign sales exceeds domestic sales.
Siemens Today
1976
Future
Löscher
Leadership
• Heinrich von Pierer as new CEO
Conclusion
• Major Restructure.
1992
5. Supervisory Board
Managing Board
Corporate Executive Committee
( CEC )
Automation & Information &
Power Transportation Medical Lighting
Control Communications
Divisions & Subdivisions
Regional companies, Representatives & Agencies
( Regional Units )
6. Main Items of Siemens Structure
History
Solution-Focused Technology Firm.
Löscher
Local Responsiveness.
Project: Evolution
Mr/Mrs. Siemens
Implementation &
Deployment Team Based Decision.
Siemens Today
decision based on mutual agreement and shared
responsibility between CEO & CFO (Four Eyes
Future
Principle).
Löscher
Leadership
Conclusion
7. Klaus Kleinfeld
History
Started on 2005.
Löscher
“We commit to do something, and we deliver.”
Project: Evolution
Target: improving profit margin by doubling ROI
Implementation &
Deployment ( S: 273% GE: 423% )
Siemens Today
Initiatives: Fit4More
Future
Divest unprofitable
Löscher
Leadership businesses e.g. mobiles
Conclusion Focus on megatrends
Siemens One Project
8. The Fall of Kleinfeld
History
Most hated corporate boss, despite aggressive
Löscher
internal earning targets
Project: Evolution
Siemens Bribe Scandal Nov. 2006
Implementation &
Deployment
- 1.6 billion $ fees and fines in EU & US
Siemens Today
- Kleinfeld didn’t make himself available for
Future
extension on April 2007
Löscher “In times like these, the company must needs
Leadership
clarity about its leadership”.
Conclusion
9. Background on Peter Löscher
History
Löscher
Peter Löscher President and Chief Executive Officer
of SiemensAG
Project: • born on 1957, Austria.
Evolution • married to a Spanish.
Implementation • Has 3 children born in the US and Spain.
& Deployment
Education
Siemens Today
Studied economics atVienna University of Economics and Business at the
Future Chinese University of Hong Kong
Löscher
Leadership Vienna University of Economics and Business, MBA
Conclusion
Harvard Business School,AMP
Michigan State University,Honorary Doctorate of Engineering
10. Professional History
History
1985 Kienbaum und Partner
Löscher Senior Management Consultant
1988 Hoechst Group (merged with Rhone Poulenc Rohrer)
Project: Various management positions in Spain, the U.S., Germany, the UK and
Evolution Japan
2000 Aventis Pharma Ltd., Japan
Implementation
& Deployment Chairman, President and CEO
2002 Amersham plc, UK (acquired by General Electric)
Siemens Today
President of Amersham Health and Member of the Board of Directors (UK)
Future Chief Operating Officer and Member of the Board of Directors (UK)
2004 General Electric Company (GE)
Löscher
Leadership President and CEO of GE Healthcare Bio-Sciences. GE Healthcare (UK)
Member of the Executive Board
Conclusion 2006 Merck & Co., Inc.
President of Global Human Health
July 2007 Siemens AG
President and Chief Executive Officer
11. Project: Siemens' Evolution
History
Löscher Definition of the Goals by Löscher:
Löscher knew, defined and prioritized his goals as CEOs:
Project:
Evolution
Highest Priority and Main goal was to tackle down the scandal.
Implementation “Making it really Clear that Siemens doesn't have a cultural issue”
& Deployment
“Needed someone from the outside and to really trust”
Siemens Today
Future
Deal with the Outsider normal reaction within the company.
“Siemens will continue with an Evolution not a Revolution”
Löscher
Leadership Understanding Siemens and the needs for a change.
Conclusion
Changing the attitude of the employees toward the company.
12. Project: Siemens' Evolution
History
Löscher Assessment and planning by Löscher:
Löscher spent his first 100 days in Siemens visiting the company’s locations
Project: around the world.
Evolution
• Understanding the culture in Siemens, the company’s structure and the major
Implementation
markets they operated in
& Deployment • Meeting customers
• Obtaining feedback and Input as a result
Siemens Today
He assessed the company’s major strength and leveraged on them.
Future
Löscher • A proud company
Leadership • Great engineering culture
• Great innovation culture
Conclusion • Right strategy
• Global presence
• Excellent Competitor in the market
• Pioneers in all the fields they operated in
13. Project: Siemens' Evolution
History
Löscher Assessment and planning by Löscher:
Project:
Evolution He also Evaluated the company’s weaknesses :
Implementation
A company in shock and a leadership crisis due to scandal
& Deployment
Highly segmented structure with over 12 operating groups
Siemens Today
Future
in 6 different business areas.
Löscher No coordination between operating groups (global business
Leadership
Conclusion
units) and regional units, and no clear guidelines for
decision making.
14. Project: Siemens' Evolution
History
Löscher Four eye principle (CEO +CFO reporting to same CEC
Project: member)
Evolution
Previous management style that created an aggressive
Implementation
& Deployment
target oriented culture but with minimal value for
Siemens Today employees. Which mainly led to Kleinfeld earning title of
Future “most hated corporate boss” by financial times
Löscher Deutschland.
Leadership
Conclusion Low morale and low control and aggressiveness to achieve
goals may have led to the bribery scandal.
15. Project: Siemens' Evolution
History
Löscher needed to act fast, to overcome the shock that overtook
Löscher
the company from the bribery scandal which was mainly the most
Project:
Evolution
prioritized of his goal.
Other Important Goals
Implementation
& Deployment Building up his a team he trusted that will be able to assist him
achieve his goals efficiently.
Siemens Today
Future
Creating a new managing board that understands the changes that
need to be done.
Löscher
Leadership
Enabling defined goals setting using the “True North” concept
Empowerment, Motivation and Confidence of Employees
Conclusion
Complete Company Structure change
16. Project: Siemens' Evolution
History
Löscher
Implementation and deployment by Löscher
Project:
Evolution Established an organization with a dedicated member of
the board for legal and compliance.
Implementation
& Deployment
Assigned Peter Solssmen who worked closely with him in
GE as general counsel to lead future compliance programs.
Siemens Today
Future The main objectives were transparency to reestablish trust
from the community and clear Siemens name.
Löscher
Leadership
An appraisal of all executive management personnel was
Conclusion
done and all but two Managing board members were
replaced.
19. Implementation and deployment by Löscher
History
Löscher A lot of the heads of operating group and divisions
Project:
Evolution were replaced
Implementation
& Deployment
CEOs for each sector were assigned.
He removed the four eye principle and introduced the
Siemens Today
Future
CEO principle
Löscher Changing the culture of the company, along with the
Leadership
Conclusion corporate structure
20. Implementation and deployment by Löscher
History
Löscher Introduced clusters, grouping 190 countries Siemens
Project:
Evolution operated in into 17 regional units.
Implementation
& Deployment
Simplified reporting
Introducing the right of way concept including the
Siemens Today
Future
global business and regional units, to enable easier
Löscher decision making.
Leadership
Conclusion Enabled the company to set clear goals and objectives
more efficiently.
21. Comparison between before and after Löscher
History
Löscher Before Loescher After Loescher
Project: Evolution Organization structure •Very complex •Simpler
•Lacks proper •Clear chain of
Implementation & delegation command
Deployment
•Clear delegation of
Siemens Today authority
Management style Aggressive target Goal driven
oriented management Future oriented
Future
more on the “X”
Löscher management style
Leadership Culture De motivated Siemens became a
Conclusion
employees driven only place where
by targets employees’ feedback is
appreciated
22. Comparison between before and after Löscher
History
Löscher Before Loescher After Loescher
Project: Evolution
Decision making Very complex “ the Simple and clear “The
process Four eye concept” CEO Concept”
Implementation & Planning Harsh financial targets Very future oriented
Deployment
were set as the main and based on feedback
Siemens Today priority. from the market,
employees and
customers
Future
Customer involvement Satisfactory Customer was
Löscher integrated into Siemens
Leadership priorities , whereby
Siemens became more
Conclusion
of a partner to their
customer rather than a
supplier or service
provider.
23. Siemens and the Future
History
Löscher Siemens' understanding of sustainability:
Project:
Evolution •Cornerstone of their value
•Focused Entrepreneurial Responsibility “Key Pillar of Strategy”
Implementation •Profitable Long Term
& Deployment
•Responsible value creation
Siemens Today
Future Siemens' sustainability Definition
Löscher
“For us, sustainability means acting responsibly on behalf of future
Leadership generations to achieve economic, environmental and social
progress”
Conclusion
24. Siemens and the Future
History
Löscher Siemens's sustainability Program
Project:
Evolution Driving the Siemens Environmental Portfolio to minimize their
Implementation
carbon footprint (analyzing energy efficiency)
& Deployment
Siemens Today
Future
The Sustainability Advisory Board
Löscher
Leadership Leading international representatives from the political, scientific
and business areas.
Conclusion
26. Siemens and the Future
History
Löscher Key Goals Current 2010 Targeted
Fiscal year
Project:
Evolution Help customers reduce 270 million tons 300 million tons
their CO2 emissions Annually By 2011
Implementation
& Deployment
Siemens Today Grow Environmental € 28 billion € 40 billion
Portfolio revenue By 2014
Future
Improve CO2 efficiency 17% 20 %
(Increased from 9%) By 2011
Löscher
Leadership
Increase water 29% 20%
Conclusion
consumption efficiency (Compared to 2009) By 2011
27. Löscher´s Leadership
History
A little story he says
Löscher Löscher leadership career started with a golden piece of advice he uses
ever since: ".... have fun, enjoy the things you do, and make sure that
Project: people are working with is equally enjoyable and things will happen
Evolution automatically ..."
Implementation
& Deployment Another anecdote he remembers and Shares:
Löscher remembers the one line of advised he requested from Jack
Siemens Today
Welsch “Give It All”.
Future
Löscher
He advises to new Talented and Potential Leaders:
Leadership Recognize how privileged a leader is, no matter whether/how young or
old he/she is.
“Live your dreams and make them real. However impact positively on
Conclusion others life”
28. Löscher´s Leadership
History Therefore we define Löschers leadership as:
Löscher
Cross-Cultural understanding
Project:
Quick Decision Making
Evolution
Strategy
Implementation Face to Face Contact
& Deployment
Customer Management
Siemens Today Capacity to restructure
Simplifying Reporting
Future
Empowerment of Regional Leadership
Löscher Motivator
Leadership
Mentor
Excellent Political Skills
Conclusion
Excellent Social + Soft skills
Performance and Responsibility Driver
Visionary “Crisis => opportunity for huge changes”
29. Was Löscher Successful !
History
Gross Profit
Löscher 22.000
21.500 21.647
Project: Traditional View:
Evolution Löscher did his homework,
21.000 21.043
he increased Business results.
Implementation 20.710
20.500
& Deployment
20.000
Siemens Today
Income from 2008 2009 2010
Future Operations Earnings per share
8000 5
Löscher 4,54
Leadership 6000 5811 4
4000 3891 3
2874 2,6
Conclusion 2000 2 1,91
0 1
2008 2009 2010 0
2008 2009 2010
30. Project Success Evaluation
History • The project was finalized in an appropriate time
Project efficiency frame, based on the urgency of the situation
Löscher without damaging financial performance.
Project:
Evolution
• Customer became more integrated into Siemens
Impact on customer .
Implementation
& Deployment
Siemens Today • A better working environment was created.
Impact on team • Leadership skills
Future • The culture change definitely benefited employees
Löscher
Leadership
• Siemens remains to be a very profitable business
Business results and a viable player in the market
Conclusion
• Future competitiveness in the market with plans
Preparation for the future that cover 10-20 years ahead