Environmental Analysis Siemens Ltd-India
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Transcript of Environmental Analysis Siemens Ltd-India
ENVIRONMENTAL ANALYSIS
SIEMENS LTD-INDIA
Done by: S. Sasi Rekha (DI 9027)
CONTENTS
SIEMENS HISTORY
STRATEGIC ANALYSIS
Vision statement
Mission statement
Quality policy
SIEMENS –INDIA
Energy sector
Industry sector
Health care
PESTEL ANALYSIS
Political factors
Economic factors
Social-cultural factors
Technological factors
Environmental factors
Legal factors
IMPACTS OF ECONOMY AND MARKET TRENDS AFFECTING THE COMPANY
SWOT ANALYSIS
Strengths
Weakness
Opportunities
Threats
RECOMMENDATIONS
SIEMENS HISTORY
Siemens was founded in Berlin by Werner Von Siemen in 1847. As an ordinary
inventor, engineer and entrepreneur, Werner Von Siemen made the world’s first pointer
Telegraph and electric dynamo, the inventions that helped put the spin in the Industrial
revolution. As Werner envisioned, the company he started from strength to strength in
every field of electrical engineering. Siemens is today a technology giant in more than
190 countries. Our work in the fields of industry, energy, communications,
information, transportation, health care, components and lighting have become
essential parts of everyday life.
FROM WORK SHOP TO GLOBAL PLAYER – (1847-1918)
A PERIOD OF CHANGE – (1918-1947)
THE AGE OF GLOBALIZATION – (1947-2003)
STRATEGIC ANALYSIS
VISION STATEMENT:
“To remain market leader and technology pace setter in the engineering and electronics
industry by utilizing the high tech expertise in Siemens group worldwide to maintain our
strong and prominent local presence.
MISSION STATEMENT:
It is our goal to set the benchmark by being the “best in class ” in our fields and to create
value for our customers, wealth for our stake-holders and a future for our employees
while giving back graciously to society a piece of our success.
QUALITY POLICY:
For Siemens, quality is a driving factor which strengthens our ambition to assume a
world-leading role in our environment of logistics automation and material handling
technology. Our Quality Policy is: "Customer Satisfaction through Continuous
Improvement." Help us to get nearer to our goal, and to become better in our efforts to
achieve top quality in all the products and services that we supply — push us to the limit!
SIEMENS IN INDIA
For over 50 years, Siemens has been active in India, where it holds leading positions in its
Energy, Industry and Healthcare Sectors, while Siemens IT Solutions and Services
functions across all three Sectors. In 2008, Siemens India was the top ranked company by
Business Week in its annual rating of Asia’s 50 companies. Siemens was also ranked No. 1
in the Corporate Reputation by The Wall Street Journal in its survey of Asia’s 200 most
admired companies. In fiscal 2008 sales to customers in India amounted to almost EUR 1.9
billion. Siemens currently has over 17,200 employees in India.
Energy Sector:
Siemens consolidates its innovative offerings in the Energy sector by combining its full range
expertise in the areas of Power Generation (PG) and Power Transmission & Distribution
(PTD). Utilizing the most advanced plant diagnostics and systems technologies, Siemens
provides comprehensive services for complete power plants and for rotating machines such
as gas and steam turbines, generators and compressors.
Healthcare Sector:
By combining the most advanced laboratory diagnostics, imaging systems and healthcare
information technology, Siemens Healthcare division enables clinicians to diagnose disease
earlier and more accurately, making a decisive contribution to improving the quality of
healthcare.
Industry:
At Siemens, end-to-end products, systems and solutions for industrial and building
automation as well as infrastructure installations are provided. These turnkey solutions cover
project management, engineering and software, installation, commissioning, after-sales
service, plant maintenance and training.
ENVIRONMENTAL ANALYSIS
Environment analysis is a comprehensive analysis of the internal and external
environmental factors affecting an organization. A wide range of influences
surrounding businesses can affect organizational decision making powers, strategies,
process and performance.
Political factors: These refer to government policy such as the degree of
intervention in the economy. Political decisions can impact on many vital areas for
business such as the education of the workforce, the health of the nation and the
quality of the infrastructure of the economy.
Siemens stands out to be a beacon of political strength even in these
times of uncertainty and turmoil.
The reduction in tariffs on capital goods, the correction of the inverted
duty structures and the lowering of tariffs on non-ferrous metals are
bound to be an across-the-board positive for the engineering sector in
2009.
Tax holiday under section 80 IA extended up to 2010 and reduction in
import duties of naphtha from 10% to 5% was largely positive for the
power sector.
How ever 4% CVD was imposed on special projects in power sector.
Siemens was adversely affected when the government imposed an
additional duty in 2002 on LDO which is the fuel used by power
plants.
The Export control policy of Siemens prohibits from participating,
directly or indirectly, in the development, manufacturing and
distribution of weapons of mass destruction and missiles capable of
delivering these weapons.
Government’s thrust care would benefit siemens since it is well
established in the health care segment
Economic factors: These include interest rates, taxation changes, economic
growth, inflation and exchange rates and these can have a major influence on the
firm’s behavior.
The slowing global economy resulted in a decline in investments,
which impacted Germany, the head quarters for Siemens, as an
export nation in particular. The inflation rate moved in line with
energy prices. The gross domestic product (GDP) was up 1.3% in
2008.
In the third quarter of 2009, Siemens’ strong order backlog
softened the impact of the global recession on the company’s
revenue and profit. Siemens continues to expect Total Sectors
profit for fiscal 2009 to exceed the prior-year level of €6.6 billion.
The company cut roughly four percent of its workforce as part of
an overhaul resulting from recent economic woes. These planned
cuts helped the company to achieve a savings target of 1.2 billion
euros.
These internal changes are expected to regain investor
confidence. Siemens anticipates new orders of about €15 billion
over 3years. The decline is decelerating and there’s hope that the
company is now approaching the low point.
Social factors: Changes in social trends can impact on the demand for a firm's
products and the increasing urbanization changes. These mega trends are exerting an
ever-greater impact on the world in current times. availability and willingness of
individuals to work.
Increasing urbanization changes are exerting an ever-greater impact
on the company in current times. More people are moving to urban
areas in search of better jobs, better education and a better life.
Indian customers are highly discerning, educated and well informed.
Thus emphasis is on the value for money.
Customer Inspired Solutions – to design breakthrough products.
Preference for energy efficient vehicles with low running costs
Social corporate responsibility of Siemens is:
Member of Association of Advanced Research, Innovations and
Entrepreneurship
National Committee under the World Energy Council.
“Caring Hands” sums up the many programs, projects and initiatives
that Siemens has installed for promoting social activities throughout
the world.
Siemens traditionally supports various charity activities and humane
projects throughout the world.
Technological factors: New technologies create new products and new processes.
Technology can reduce costs, improve quality and lead to innovation. These
developments can benefit consumers as well as the organizations providing the products.
High tech and electronics companies like Siemens face a variety of
challenging business imperatives due to developing technology.
Siemens must develop and deliver products that are highly innovative
and cost sensitive while competing in the distributed global
market.
The company is continued to being squeezed by aggressive price
points, product design complexities, regulatory requirements and
continually changing technology.
In turn these pressures threaten to erode profit margins, contribute
to commoditization, complicate the manufacturing process and
slow the take-market cycle.
Siemens being today’s most forward-thinking company has built
Global Innovation Networks that enables them to continuously
improve their products and processes – and organize their value chain
so that innovation can flourish. These networks empower the
organization to meet the following business imperatives.
Increasing the yield of innovation
Compressing time-market
Meeting business and regulatory requirements for healthy
competition with competitors
Optimizing resources
Maximizing globalization advantages
In this kind of sophisticated market the opportunity and competition
will exist together.
Implementation of Product Lifecycle Management (PLM) to
succeed and grow in a demanding global market. The goals are to
bring profitable new ideas to market ahead of the competition while
increasing both revenue and market share.
Environmental factors: Environmental factors include the weather and climate
change. With major climate changes occurring due to global warming, there is a
growing desire to protect the environment. This is having an impact on many
industries to move towards more environmentally friendly products and processes.
Siemens is the green infrastructure giant.
Siemens is facing a challenge in meeting rising needs of customers in ways
that are cost efficient, sustainable and environmentally compatible.
Customer demands as in energy are,
Reduced energy consumption
Reduced electrification costs
Solutions are,
1. Siemens proves to be the trend setter by innovating the
world’s first tram without overhead power lines and with
energy storage system. The new system allows up to 30%
less energy consumption and up to 80 tons less co2
emissions a year/tram.
2. The conversion of all traffic lights in Germany to LED
technology saves up to 1.4 billion kWh/year and savings of
approx € 170 million /year. Propane gas supply for repair
services is no longer required.
The customer demands as in Mobility are,
Lower emissions
High possible efficiency
Solutions are,
1. Intensive research into the subject of electro mobility. An
electric car made of recycled material can simultaneously
be both, a means of transport with less emission and a
mobile energy-storage device.
2. Sea going traffic presents ample opportunities for energy
consumption and innovation. Siemens manufactures
electric booster drives for ships which cut diesel
consumption by much as 10%. The best of these also
incorporate generators that capture waste heat from fuel
exhaust to provide additional electric power.
Siemens is ahead of investing in the environmental portfolio. Of € 15 billion
orders expected, about € 6 billion is earmarked for green infrastructure.
Products and solutions enables their customers to become more energy
efficient, eco-friendly and competitive.
Legal factors: These are related to the legal environment in which firms
operate. Legal changes can affect a firm's costs (e.g. if new systems and
procedures have to be developed) and demand (e.g. if the law affects the
likelihood of customers buying the good or using the service).
Power Sector will bear burden for reducing Green house gases
Foreign trade regulations and labor legislations.
Siemens IT Solutions industry, together with Greenpeace, are pushing
for changes in India’s environmental laws to better reflect the
complexities of managing and handling electronic waste.
Implementation of Impact 360 Workforce Management, Siemens
business services has realized a significant return on investments.
A member of United Nations Global Compact.
Suppliers to respect Fundamental employment rights formed by the
international labor organization.
Regulatory Framework under the Ministry of Shipping, Road
Transport and Highways which provides guidelines.
Siemens PLM Software has publicly traded securities; it is subject to
the securities laws in many countries. These laws govern the
dissemination or use of information about the affairs of Siemens PLM
Software. Violations of the securities laws could subject you and the
Company to severe criminal and civil penalties.
IMPACTS OF THE ECONOMY AND THE MARKET TRENDS ON THE
WORKING OF THE COMPANY
Business operations:
The Company has recorded a strong growth during the Financial Year ended on 30th
September, 2007. Turnover increased sharply by 71% and stood at Rs.77, 268 million as
compared to Rs.45, 103 million in the previous year 2005-06. While all the businesses
contributed to the growth, the key drivers were Power, Automation & Drives and
Industrial Solutions and Services businesses. New Orders received by the Company
during the Financial Year ended on 30th September, 2007, were valued at Rs.101, 070
million as compared to Rs.82, 025 million during 2005-06, registering a rise of 23%. The
major contributor and volume driver was the Power business. The Profit after Tax
increased by 66% to Rs.5, 965 million from Rs.3, 601 million as in 2005-06.
Robust economic growth of over 9%
Currency fluctuation gains
Forayed into newer market segments & penetrated into B & C cities
Increased the export business to more than 30% of the total business
Research and Development, Technology Absorption, Energy Conservation, etc.
Siemens has been increasing its spend on Research and Development activities. The
increased infrastructural and financial support reflects the Company’s resolve to stay
ahead of competition by delivering innovative quality products and its commitment to
total customer satisfaction.
Global expansion
Expansion of solar business to Italy
Turkmenistan chooses Siemens as technology partner for infrastructure expansion
Siemens Healthcare collaborates with Dr. Naresh Trehan’s Medanta-The Medicity
to provide affordable high-end healthcare delivery solutions
SWOT ANALYSIS
Internal factors
Positive Negative
External factors
STRE
NGHTS
WEA
KNESS
OPPORTUNITIES
THRE
ATS
Internal Strengths are the core competencies, corporate capabilities and
resources that provide the basis for a company’s strategy.
STRENGHTS OF SIEMENS ARE:
Diversity – A success factor for Siemens
Strategic focus
Sustainable success through diversity
Think globally and act locally strategy
High quality and Vast range of products
Brand image and own production
Customized products and ISO certification
After sale service and online service
Decentralization
Internal weakness is the unsuccessful application of a competency or the non-
exploitation of a critical factor that diminishes company competitiveness.
WEAKNESSES OF SIEMENS ARE:
Low price products.
Mixed cultures and a complex organizational culture.
Low employee satisfaction level and weak appraisal system
Less promotion.
External Opportunities are the benefits that are likely to accrue from
pursuing the vision and available external opportunities.
OPPORTUNITIES FOR SIEMENS ARE:
IT expansion
Technology change
Overseas projects
Market integration opening up
Strong position and growing opportunities in other countries
External Threats are the pitfalls and the dangers, the variations and
exceptions possible.
THREATS FOR SIEMENS ARE:
Low product pricing by competitors
Slowdown in global economy.
Less market share
The policies and promotional programs adopted by other brands.
RECOMMENDATIONS:
A better coordination should be developed between the top-level management
and lower level employees.
Pay scale of lower level employees should increase as compared to competitors.
Siemens should retain their good employees by giving them incentives.
Proper training should be given to the employees.
Employee satisfaction level should increase by appraising them at spot and by
giving them different incentives like bonuses.