Case Study

Siemens Company Research

Student Name




  • Mission and vision statement of the company
  • Industry of the company
  • Core competencies
  • Value chain of Siemens
  • The business model
  • The internal governance of the company
  • Inconsistency in Vision/Mission Statement
  • Organizational Strategy for Siemens
  • Core Drivers of the Firm
  • Cradle-to-cradle: Rethinking sustainability relevancies
  • Relationship between Democracy, Growth, and Development
  • Strategy Development Process
  • Maximization of the Shareholder Value

Siemens Company Research

  • Mission and vision statement of the company

The vision of Siemens is to innovate and come up with services that will be beneficial to the clients. The other vision declaration of Siemens is to revolutionize the information era. This entails looking at the strategic method to improve information technology. On the other hand, the mission statement of Siemens is to give solutions as well as products and services that are of high quality. These services are entitled to be enjoyed by customers (Kumar, 2012). Siemens indulges in activities that strive in meeting the expectations of the customers. In the end, the company attempts to achieve ROI (Return on Investment) in the process of accomplishing the demands of the clients. The other mission statement of the organization is to sustain a competitive advantage in technological position. This competitive benefit makes the firm become focused on the accomplishment of the future expectations of the employees and clients. The third mission statement reads that the company projects to establish and sustain profitable and long-term correlations with its customers grounded on mutual trust.

  • Industry of the company

Siemens is not only focused on a particular activity, but it majors in numerous activities. In simpler terms, Siemens functions in multiple areas. Thus, Siemens can be comprehended in the industry of multinationals (Kumar, 2012). The industry in which Siemens operates is comprisedof various firms that provide substitutes. These companies deal with making goods and services available to the consumers and industrial marketplaces. Therefore, there is high competition in the industry. Additionally, the competition is based on products, hence quality and prices of the commodities become the basis of competition in the market.

  • Core competencies

One competence of the company is that it is the leading global firm in the field of electrical engineering and electronics. The brand image of Siemens is irrefutable in the market. Many businesses have admired the powerful image. This trend has made the company enter into ventures with various firms. One of such ventures is Nokia Siemens Networks (Haggar, 2007). One importance of such investment is that it makes the enterprise remain the leading supplier of telecommunications infrastructure. The other notable competence of the firm is that it is diversified. Diversification, in this, case, implies that the business has a well-balanced product portfolio grounded on electronics and electrical engineering. In simpler terms, the business indulges itself in continuous innovation (Kumar, 2012). Therefore, Siemens’s brand journey is correlated to a high level of innovation and industrial sophistication in consumer’s minds. The company has a unique innovation strategy. The firm uses a change technique that resembles that of Trendsetter. Trendsetter has an approach that sets new technology that is obligatory for the market. Constant engagement in research and development enables the company to experience favorable trends in the market.

It has been observed that the research and development aspects of Siemens have been increasing as the years goes. In addition, records show that the number of workers being engaged in research and development keeps on escalating. The importance of the centrifuged engagements with investigation and development enables the company to develop new products. The engagements also enable Siemens to improve the existing products. Altogether, engaging in research and development allows the company maintain its strong market position as well as to serve an emerging customer segment (Kumar, 2012). Siemens has a balanced financial performance. Recently, the company has recorded a steady increase in profits. The pertinence of the consistent financial results implies that it enable the enterprise to leverage its operations effectively. Furthermore, a stable financial performance makes the company improve its financial flexibility.

  • Value chain of Siemens

A value chain has a series of activities for a company operating in a particular industry. Michael Porter gave that a value chain comprises of limited inbound logistics, outbound distribution, and after-sale services. At Siemens, the value chain is reinforced by research and development (R&D), corporate culture, and HRM (human resource management). Siemens strives to use the value chain to offer the maximum customer satisfaction levels. The motive would be to accrue many profits in the process of achieving the expectations of the clients (Kumar, 2012). Regarding inbound logistics, it involves activities such as receiving, inventory management, and transportation scheduling at Siemens. Most of the stocks at Siemens have high safety levels. The firms ensure that the security of the workers and employees is given priority. Operations at the Siemens comprise machining, assembling, and equipment conservation. The clients are advised on the best machine to buy by the company. These consultations depend on the expectations of the customers. The firm satisfies the customer service contracts via the SLA (service level agreements), which is made in association with the clients.

Outbound activities at Siemens, on the other hand, comprise warehousing, distribution, and transportation leveraging. Reflectively, the company had problems with making products and services available to the market on time. However, the trend has been reversed, and the company focuses on meeting the market expectations. Flexibility and responsiveness have increased within Siemens. The firm has been able to work in cooperation with US, UK, and Germany to meet the demand of the clients. The company makes forecasts to their suppliers to enable them to plan their capacity. The suppliers are informed of the market trends such as fall in prices to plan how they will sell their products (Haggar, 2007). Commendably, the firm has been using the Delphi method as well as the Delta forecasting to compare its failure rates.

  • The business model

Siemens’ business model can be divided into products, services, and other major segments. The company’s products comprise of automation systems and equipment. These products are used in various fields such as transport, manufacturing, and security fields. One significant segment is the energy division. This sector comprises of operations that deal with the provision of energy services to the clients. This area hires approximately 83,500 workers. One of the competitors challenging the industry is GE energy. Various rivals exist for product lines such as ABB for smart grids. The energy sector provides products such as wind power turbines and wind farms. Drawbacks influencing the respective industry comprise of climate protection and problems with reliable power supply (Kumar, 2012). Siemens’ business model also include the healthcare industry. This sector comprises of the clinical product, customer solutions divisions, and imaging systems. The major rivals to this area include the GE Healthcare, and Toshiba. However, Siemens shows domination in the healthcare fields. The business model indicates that Siemens competes to the greatest extent in healthcare with innovations. This sector has a considerably high number of patents. The company is also engaged in centrifuged R&D. This is indispensable in meeting and anticipating the needs of the customers. Concerning service delivery, the healthcare sector employs expert local service to affect. In addition, the firm applies training and logistics for the provision of services (Haggar, 2007). All these processes are brought in to combine personalized care and improved services that may be located locally/remotely. The Siemens’ healthcare sector is customer focused. This gives it a competitive advantage over Toshiba, as it focuses on continuous improvement, clients, and quality. The sector has formulated consumer outreach programs to communicate with them.

The final major division of the Siemens is the infrastructure and cities sector. This area comprehensively has the rail systems, smart grid, and mobility as well as logistics. Competitors in this industry are not limited to CAF, Alstom, and Bombardier. The infrastructure and cities sector give products such as infrastructure, logistics, rail automation, and electric mobility support. The uniqueness of this respective industry is that it is indulged in constant innovation. The company strives to innovate new products to the market (Kumar, 2012). In addition, the firm engage in innovation to improve the quality of the existing products. The sector is customer-focused, ensuring that the clients get the value of their money.

  • The internal governance of the company

It has been the norm at Siemens for the Supervisory Board to have 20 members. Of the 20 members, the Shareholders elect 10 members during Meeting while the other ten membersare elected in alignment with the provisions of the German Codetermination Act. The Supervisory Board works with the top executives in the company. The senior leaders include Joe Kaeser, who is the CEO (chief executive officer) and the president of Siemens AG. Below him is the managing board that is comprised of Lisa Davis, JaninaKugel, Siegfried Russwurm, Rooland Busch, Klaus Helmrich, and Ralf Thomas. Chairperson of the Supervisory Board is Dr. Gerhard Cromme (Kumar, 2012). The 10 members include:

  • Josef Ackermann (Frankfurt am Main) – Chairperson of the Board of Managing Leaders of Deutsche Bank, AG.
  • Michael Diekamnn (Munich) – Chairman of the Board of Management of Alianza SE.
  • Gerd von Brandenstein (Berlin) – Diplom-Volkswirt.
  • Hakan Samuelsson (Munich) – Chairman of the Executive Board of MAN AG.
  • Hans Michael Gaul (Dussekdorf) – Supervisory Board Member .
  • Peter Gruss (Munich) – President of the Max Planck Society for the Advancement of Science.
  • Nicola Leibinger-Kammuller (Gerlinen) –Chairperson of the TRUMPF’s Managing Board of Leaders .
  • Gerhard Cromme (Dusseldorf) – Chairman of the Board of Directors of Siemens and ThyssenKrupp AG .
  • Jean-Louis Beffa (Paris, France) – Chairman of the Board of Directors of Compagnie de Saint-Gobain, S.A.
  • Lord lain Vallance of Tummel (Kent) – Chairman, Amsphere limited. .

There are various committees of the Supervisory Board at Siemens. The chairperson committee consist of the Chairman and Deputy Chairman of the respective Supervisory Board and an additional worker elected by the board. This committee is in charge of making proposals about the appointment and discharge of the non-performing managing board members. The panel also looks for solutions to queries revolving around company’s corporate governance (Tung, 2001). The other panel found in the Supervisory Board at Siemens is the compensation committee. The committee is mandated to prepare proposals revolving around compensation. The activities revolve around the implementation of the system in the managing board contracts as well as determination and analysis of the appropriateness of the total compensation of individual managing board members (Kumar, 2012). In the end, the committee approves the annual compensation report of the board.

The audit committee, on the other hand, runs the accounting processes and has a preliminary evaluation of the annual monetary statements of Siemens. Finally, the committee advises the board about the selection of independent auditors. The consultation enables the firm to hire effectual auditors who enables the realization of the firm’s objectives.

  • Inconsistency in vision/mission statement

It can be correlated that Siemens has a mission to offer quality services through innovation. The innovation is spearheaded by engaging in research and development. However, there is inconsistency in this mission statement since the company is less innovative. This is mostly observed in the low-cost new technology (Tung, 2001). Siemens has been defeated in innovation by smaller firms such as First Solar (FSLR). Regarding governance, Siemens’ internal monitoring mode is not functional. The company has rampant corruption due to the failure of the internal control. Thus, there is the need to reconsider the strengthening the internal management of the firm to affects its control functions.

  • Organizational strategy for Siemens

Management strategy at Siemens is unique. This uniqueness is because it nurtures open communication, sharing, and collaboration in the organization. The employees, as well as the employers at Siemens, can combine forces for a common goal. This strategy is also effective at Siemens as it enables the workers to develop a sense of responsibility. The next plan involves strengthening product portfolio that boosts the profitability of the firm. The advantage of this strategy is that it enables Siemens to benefit from the economies of scale. This enables the company to produce effectively. Furthermore, the approach enables the firm to continue making profits (Kumar, 2012). The third strategy used by Siemens is the use of innovation to decrease costs, boost production capacities, and foster investments. However, this strategy has not been effective. This ineffectiveness is because the products offered by Siemens are still expensive compared to other firms that do not engage in innovations.

  • Core drivers of the firm

The company has various drivers that make it survive in the competitive market. Concerning accessibility to raw materials, the firm enjoys the least bargaining power of the suppliers. Technologically, the firm enjoys supremacy in the electrical equipment field. The firm is known to dominate the field of automation, healthcare, and lightening. Thus, being ahead of competitors technologically has enabled the firm to maintain its core competence in the market. However, this driver is negatively affected since some clients want solar energy (Tung, 2001). Thus, the firm can reverse this trend by focusing on solar energy to serve the segment that wants solar energy. Politically, the firm is mostly affected by stringent government policies relating to environment and subsidies. For instance, the firm can encounter an environment where the government controls or intervene in the market. This situation can affect how the firm functions as compared to settings where there is no government intervention in the market. The processes at Siemens are affected by currency fluctuations, availability of local human resources, as well as the predisposition of local clients. The other factor that affects processes at the firm is the credit system. A tightened credit system, for instance, brings troubles to the firm’s processes. Therefore, the company can avert this situation in the next five years by loosening the credit system. In the field of expertise, the firm hires the best professional in its fields. However, this is a problem since it is hard to get such personnel in the market (Kumar, 2012). Thus, the company can deal with this issue by training its workforce than relying on getting professionals from schools.

  • Cradle-to-cradle: Rethinking sustainability relevancies

Some of the problematic concepts at Siemens can be dealt with by drawing relevancies from the Cradle-to-Cradle methodology. Recently, there have been new regulations affecting producers of electrical and electronic items such as companies need to be financially responsible for the collection, recycling, and treatment, as well as disposal of past and future covered issues. One strategy that Siemens can use is material recycling (Haggar, 2007). This will involve identifying the component streams that can be reutilized when the item is taken back after the client has used it. For instance, the firm can take back the metal parts that can be molded into other objects. These activities would achieve sustainability since there will be minimal environmental degradation. In addition, there will be minimal costs to be used in the environmental control. Regarding competitive position, the company would have a strong brand image to the clients that are correlated to environmental sustainability. The other strategy to apply is to engage in social responsibility. Siemens will have to demonstrate that it lives up to the maximum principles of responsibilities. Siemens should act as a guide to other companies such as Toshiba in following these principles (Haggar, 2007). Social responsibility involves taking the welfare of the employees. These activities will increase the satisfaction levels of workers increasing productivity in the process. Thus, Siemens would record more profits from the motivated workforce. In addition, the firm will maintain its competitive edge due to the accomplishment of the targets on time.

  • Relationship between Democracy, growth, and development

It can be seen that most countries are advocating for democracy. This is because there are benefits such as the increase in growth and development in the country’s economy due to democracy. One importance of democracy is that it promotes free trade. The role of government intervention decreases in democratic states than in authoritarian states. Therefore, firms in the market control the prices (Feng, 2003). In the end, the prices are kept down, which encouraging free movement of goods and services among regions. The importance of democracy can be correlated to the Washington Consensus. The respective consensus gave that there should be the abolishment of government regulations that discourage competition. Democracy encourages competition since anybody has the right to air out the concern. Therefore, there is competition in a democratic environment from firms trying to outdo each other. Therefore, the trade would be fostered since innovations will be centrifuged in the economy bringing new products (Kumar, 2012).

Financialization has been the concept that is currently being witnessed in the most world economies. The role of the state has become diminished, allowing the financial institutions to gain greater influence over economic outcomes and policy. The financial sector gives freedom to improve banking, venture capital, and insurance (Feng, 2003). Thus, there has been growth in other sectors that depends on the financial sector for assistance. This is because the financial sector funds investment and growth. The sector also protects purchases and investments via insurance. Therefore, a company can take advantage of the fair trade, financialization, and Washington Consensus by formulating a strategy that promotes development. This development is aided by getting financial assistance from the financial sector and enable firms compete in the market freely (Kumar, 2012). The company can introduce a new product or create substitutes to the already existing products in the market. Therefore, there would be diversification in operations with the implementation of the three concepts.


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Kumar, B. (2012). Mega Mergers and Acquisitions: Case Studies from Key Industries.Basingstoke: Palgrave Macmillan.

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