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(RITU KANDPAL)
Disclaimer This document contains statements related to our future business and financial performance and future events or to developments involving Siemens that may constitute forward-looking statements. These statements may be identified by words such as “expect,” “look forward to,” “anticipate,” “intend,” “plan,” “believe,” “seek,” “estimate,” “will,” “project” or words of similar meaning. We may also make forward-looking statements in other reports, in presentations, in material delivered to shareholders and in press releases. In addition, our representatives may from time to time make oral forward-looking statements. Such statements are based on the current expectations and certain assumptions of Siemens’ management, of which many are beyond Siemens’ control. These are subject to a number of risks, uncertainties and factors, including, but not limited to, those described in disclosures, in particular in the chapter Risks in Siemens’ Annual Report. Should one or more of these risks or uncertainties materialize, or should underlying expectations not occur or assumptions prove incorrect, actual results, performance or achievements of Siemens may (negatively or positively) vary materially from those described explicitly or implicitly in the relevant forward-looking statement. Siemens neither intends, nor assumes any obligation, to update or revise these forward-looking statements in light of developments which differ from those anticipated. This document includes supplemental financial measures – not clearly defined in IFRS – that are or may be non-GAAP financial measures. These supplemental financial measures should not be viewed in isolation or as alternatives to measures of Siemens’ net assets and financial positions or to the results of operations as presented in accordance with IFRS in its Consolidated Financial Statements. Other companies that report or describe similarly titled financial measures may calculate them differently. Due to rounding, numbers presented throughout this and other documents may not add up precisely to the totals provided, and percentages may not precisely reflect the absolute figures.
© Siemens AG 2016. All rights reserved. Page 2
August 2016
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Siemens is the engineering group that is behind many of the products and services people take for granted in their daily lives. The list of products designed and manufactured by Siemens is almost endless. It includes traffic lights, gas turbines, superconducting magnets in medical scanners, wind generators, self motivation enquiring mind logical thought Skills necessary for an engineer eye for detail automated factories as well as domestic appliances like kettles and fridges. It generates about 40% of the UK’s wind energy and it hosts, supports and maintains the BBC’s website including the development of the BBC iPlayer. The company has been operating in the UK since 1843 and employs more than 18,000 people. Across the world Siemens employs over 427,000 people.
Engineers use scientific principles to develop products or systems to solve real life problems. Much of engineering is about innovation rather than invention. This means that engineers transform creative ideas into improved products, services, technologies or processes. A career within the field of engineering is exciting and varied as the work is constantly changing. Becoming an engineer at Siemens is about using energy, ideas and passion. It requires a range of skills and abilities that are needed across the whole business. Siemens provides opportunities for young people at all levels to enter the world of engineering. It recruits at a number of different levels. For example, it offers apprenticeships for those entering People can enter a career in engineering at many levels. Professional engineers usually enter after a three-or four-year university degree. Others may enter as apprentice technicians following studies at school or college. However, regardless of entry level Siemens employees enjoy wideranging opportunities for further education and training.
© Siemens AG 2016. All rights reserved. Page 3
August 2016
logical thought
enquiring mind
eye for detail
Skills necessary for an engineer
Teamworking skills.
Organized approach
Interpersonal skills.
Creativity
siemens.com
Third quarter of fiscal 2016 – Key figures Key figures Siemens (Q3 2016 | Q3 2015) (Continuing operations; in millions of € except where otherwise stated)
Q3 2016
Q3 2015
Change in %
Volume
Q3 2016
Q3 2015
1,822
684
Liquidity 21,060 19,804
Orders Revenue
19,858 18,844
6% 5%
Free cash flow1
Employees (in thousands ) Profitability and capital efficiency Net income Return on capital employed (ROCE)1
Sep. 30, 2015
348 114 234
Total (continuing operations)
1,372 13.7%
1,376 14.9%
0%
Germany Outside Germany
1 Continuing and discontinued operations
Results of operations (Q3 2016)
(in millions of €)
Orders Revenue Profit Profit margin
Industrial Business Power Wind Power and and Gas Renewables 4,512 4,321 480 11.1%
2,729 1,722 143 8.3%
Energy Management 3,102 2,894 240 8.3%
Building Technologies 1,658 1,536 140 9.1%
Mobility
Digital Factory 1,112 1,795 158 8.8%
Process Industries and Drives 2,563 2,519 395 15.7%
2,117 2,247 101 4.5%
Healthineers
Financial Services (SFS)
3,382 3,230 534 16.5%
238 238 139 17.4%2
2 Return on equity (RoE)
© Siemens AG 2016. All rights reserved. Page 4
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Fiscal 2015 – Key figures Key figures Siemens FY 2015 (Continuing operations; in millions of € except where otherwise stated)
FY 2015
Revenue by industrial business FY 2014
Change in
%
Volume 82,340 75,636
Orders Revenue
77,657 71,227
6% 6%
Healthineers 17% Process Industries and Drives 13% Digital Factory 13%
Profitability and capital efficiency Net income1 Return on capital employed (ROCE)1
7,380 19.6%
5,507 17.2%
34%
Mobility 10%
Power and Gas 17% Wind Power and Renewables 7% Energy Management 16% Building Technologies 8% Not included: Financial Services (SFS)
Liquidity Free cash flow1
4,674
5,201
Revenue by Region Asia, Australia 20%
Employees (in thousands) Total (continuing operations) Germany Outside Germany
Sep. 30, 2015
Sep. 30, 2014
348 114 234
338 114 224
Europe, CIS2, Africa, Middle East (without Germany) 36%
Americas 29% Germany 15%
1 Continuing and discontinued operations
© Siemens AG 2016. All rights reserved. Page 5
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2 Commonwealth of Independent States
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Global presence – Close to customers all over the world Germany €11.2 billion 114,000
15% 33%
Europe (excluding Germany), CIS, Africa, Middle East Share of total worldwide
€27.6 billion 98,800
36% 28%
Share of total worldwide
Americas €21.7 illion b 73,500
29% 21%
Share of total worldwide
Asia, Australia Revenue by customer location
Employees as of September 30, 2015
All figures refer to continuing operations. CIS: Commonwealth of Independent States
© Siemens AG 2016. All rights reserved. Page 5
August 2016
€15.1 billion
20%
61,500
18%
Share of total worldwide
siemens.com
Celebrating the bicentennial birthday of Werner von Siemens
Werner von Siemens: At a glance 1816 – 1892 Werner von Siemens was a responsible entrepreneur and far-sighted inventor whose name soon became a household word around the world. Far ahead of his time, he recognized and fostered the link between science and technology.
“In my youth, I dreamed of founding an enterprise of world standing comparable to that of the Fugger dynasty …” Werner von Siemens, 1887
© Siemens AG 2016. All rights reserved. Page 6
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Milestones of a 170-year history
1816 – 1892 Company founder, visionary and inventor
1959
1983
2012
The dynamo makes electricity part of everyday life
SIMATIC makes Siemens a leader in automation technology
First magnetic resonance imaging scanner goes into operation
Test operation of the world’s largest rotor for offshore wind turbines
1847
1925
1975
2010
2015
Pointer telegraph lays the foundation of Siemens as a global company
Siemens electrifies the Irish Free State with a hydroelectric power plant.
Breakthrough of high-voltage directcurrent (HVDC) transmission
TIA Portal takes automation a stage further
Sinalytics puts digital services for industry on a new footing
© Siemens AG 2016. All rights reserved. Page 7
1866
August 2016
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Our new claim
© Siemens AG 2016. All rights reserved. Page 8
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What our new claim stands for
"Ingenuity" stands for innovation, engineering and genius. For us, it also includes unity: We are united in our efforts, and we are committed to partnering with our customers. "For life" relates to our role in society: to make real what matters. "Ingenuity for life" is therefore our unrelenting drive and promise to create value for customers, employees and society.
© Siemens AG 2016. All rights reserved. Page 9
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Megatrends – Challenges that are transforming our world Digitalization
Urbanization
By 2020, the digital universe will reach 44 zettabytes – a tenfold increase from 2013.1
By 2050, 70 percent of the world's population will live in cities (today it’s 54 percent).3
Demographic change
Globalization
The earth’s population will increase from 7.3 billion2 people today to 9.7 billion2 in 2050. Average life expectancy will then be 83 years.2
The volume of world trade nearly doubled between 2005 and 2014.5
Sources:
Climate change According to scientists, in the summer of 2016, the Earth's atmosphere had the highest CO2 concentration in 800,000 years.4 © Siemens AG 2016. All rights reserved. Page 10
August 2016
1. IDC, The Digital Universe of Opportunities: Rich Data and the Increasing Value of the Internet of Things, April 2014 2. United Nations, Department of Economic and Social Affairs, Population Division (2015). World Population Prospects: The 2015 Revision, Key Findings and Advance Tables. Working Paper No. ESA/P/WP.241 3. United Nations, World Urbanization Prospects. The 2014 Revision, New York, published 2015 4. SCRIPPS INSTITUTE OF OCEANOGRAPHY, “The Keeling Curve”, July 30th, 2016 5. UNCTAD Statistics, Values and shares of merchandise exports and imports from 1948 to 2014, November 10, 2015
siemens.com
Digitalization at Siemens – Productivity lever for our customers Improved productivity, shorter time-to-market Cooperation and mobile IT
Greater flexibility and stability
Design and engineering
operation
Higher availability and efficiency
services
Smart data and analytics Cloud technologies Linking the virtual and real worlds along the entire value chain of customers Connectivity and Web of Systems
Vertical software Revenue, FY 2015
Cyber security
Profitability Market growth
© Siemens AG 2016. All rights reserved. Page 11
August 2016
Digital services
€3.1 billion
€0.6 billion
++ +9%
+++ +15% siemens.com
Vision 2020 – A consistent company concept
E-A-D – a complete system With our positioning along the electrification value chain, we have know-how that extends from power generation to power transmission, from power distribution and smart grids to the efficient application of electrical energy. With our outstanding strengths in automation, we’re well equipped for the future and the age of digitalization.
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Vision 2020 – Electrification, automation and digitalization Global trends
Market development (illustrative)
Digital transformation
~7–9%
A world connected by complex and heterogeneous systems
Market growth
Digitalization
Globalization
~4–6%
Global competition impacts productivity and production locations
Automation
Urbanization
Electrification
Market growth
~2–3% Market growth
Cities intensify investment in infrastructure
Demographic change Needs increase as populations grow and age
Climate change Greater resource efficiency in an electrified world
© Siemens AG 2016. All rights reserved. Page 13
August 2016
2014
Power generation
Medium-term – 2020 Power transmission, power distribution and smart grids
Efficient use of energy
Efficient healthcare delivery
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Vision 2020 – Seven goals Implement stringent corporate governance Goal: Cut costs by
~1
Goal: ROCE of
Goal: Growth
20%
>
to billion € by 2016
15%
Create value sustainably Goal: Tap growth fields and get underperforming businesses back on track
most relevant competitors
Expand global management
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August 2016
1
Goal:
Goal:
≥ 20%
≥ 50%
improvement in Net Promoter Score
increase in the number of employee shareholders
Be an employer of choice
Goal:
Goal:
> 30%
> 75%
of Division and Business Unit management outside Germany © Siemens AG 2016. All rights reserved.
Foster ownership culture
Be a partner of choice for customers
Execute financial target system
approval rating in the categories “Leadership” and “Diversity” in the Siemens Global Engagement Survey siemens.com
Vision 2020 – Selected growth fields
Flexible and small gas turbines
Digital-twin software
Key sectors in process industries Image-guided therapy and molecular diagnostics Offshore wind power Distribution grid automation and software Urban and interurban mobility Business analytics and data-driven services, software, and IT solutions
© Siemens AG 2016. All rights reserved. Page 15
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Vision 2020 – Five elements create Ownership Culture Equity
Values
Supports a sense of long-term-, output- and profit-orientation.
– our foundation: • Responsible • Excellent • Innovative
Ownership culture People orientation
Behaviors
• Empowerment & trust • Honesty, openness & collaboration
• Respect • Focus • Initiative & execution
Leadership • Be bold, decisive & courageous • Siemens matters • Motivate & engage © Siemens AG 2016. All rights reserved. Page 16
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Vision 2020 – Milestones for the implementation of our company concept Value
Scale up Strengthen core Drive performance Foster ownership culture and leadership based on common values 2015
Operational consolidation
Strategic direction
© Siemens AG 2016. All rights reserved. Page 17
August 2016
2016
2017
Optimization
2018
2019
2020
Accelerated growth and outperformance siemens.com
Vision 2020 – Innovation is our lifeblood Investment in research and development – the basis for growth and competitiveness
€
€
€4.5 billion
32,100 17,500
R&D expenditures1
R&D employees1
Inventions and patents – securing the future
7,650
3,700
Inventions1
Patent first filings1
© Siemens AG 2016. All rights reserved. Page 18
August 2016
Software engineers1 University partnerships – our edge in knowledge
9 Center of Knowledge Interchange (CKI) universities
16 Principal partner universities
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The next generation of innovation – next47 Selected innovation fields Distributed electrification
Approx.
€1 billion
in funds over 5 years
© Siemens AG 2016. All rights reserved. Page 20
August 2016
Connected (e-)mobility
Artificial intelligence
Block-chain applications eAircraft
Autonomous machines
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Vision 2020 – Being an employer of choice Siemens’ “Europeans@Siemens” program enables more than 100 young people from EU countries as well as Turkey and Egypt to participate in work-study programs in Germany in the fields of electronics and mechatronics.
153,000 Siemens employees own company shares and are thus coowners of the company.
© Siemens AG 2016. All rights reserved. Page 21
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Siemens invests over €250 million each year in the training and education of employees.
In FY 2015, around 7,000 young Siemens employees were enrolled in work-study programs that combine academic learning with practical experience.
siemens.com
Corporate social responsibility – Embracing our responsibility to society Supporting refugees is part of our responsibility to society. For example, we offer professional orientation through internships, provide accommodations, make donations and hold preparatory classes for young refugees.
We train employees locally. In India, for example, we plan to train 108 apprentices a year. In Egypt, we are building a training center for employees and customers. In South Africa, we built and equipped the Mandela School of Science & Technology. © Siemens AG 2016. All rights reserved. Page 22
August 2016
Our social commitment takes many forms, including donations, foundations, disaster relief, employee volunteering activities, sponsorships, educational programs, etc.
Since 2008, we have reserved 10 percent of our apprenticeships in Germany for disadvantaged young people. About 90 percent of these trainees complete their courses successfully. Vocational training and integration are key enablers for overcoming social exclusion.
siemens.com
Sustainability – Siemens aims to be net-carbon neutral by 2030 2.2 Mt CO2
-50%
-100%
We are investing over €100 million in measures to reduce our carbon footprint Drive energy efficiency program Increase energy efficiency in factories, employ sustainable technologies in new buildings Leverage distributed energy systems Reduce energy costs and CO2 emissions Reduce fleet emissions Utilize potential of low-emission cars in fleet, including electro mobility
2014
2020
2030
Purchase green energy Move toward a significantly cleaner power mix with a strong focus on renewable energy and highly efficient gas
Electricity Heating / Process heat Fleet Other
© Siemens AG 2016. All rights reserved. Page 23
August 2016
Independent auditors will monitor and report on progress of implementation.
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Vision 2020 – The leadership team
Roland Busch
Lisa Davis
Klaus Helmrich
Asia Australia Energy Management
Americas Power and Gas Wind Power and Renewables
Africa Europe Digital Factory
Building Technologies Mobility
Power Generation Services
Process Industries and Drives
and Chief Executive Officer (CEO) Corporate Development Governance and Markets
Communications Legal and Compliance
Willi Meixner CEO
Markus Tacke CEO
Randy Zwirn CEO
Ralf Christian CEO
Matthias Rebellius CEO
Power and Gas
Wind Power and Renewables
Power Generation Services
Energy Management
Building Technologies
Janina Kugel Labor Director, Chief Diversity Officer
Human Resources
Jochen Eickholt CEO
Mobility
Siegfried Russwurm Chief Technology Officer (CTO)
Ralf P. Thomas Chief Financial Officer (CFO)
Corporate Technology CIS1
Controlling and Finance
Middle East Healthineers
Global Services Financial Services
Jan Mrosik CEO
Jürgen Brandes CEO
Bernd Montag CEO
Digital Factory
Process Industries and Drives
Healthineers
Roland Chalons-Browne CEO Financial Services
1 Commonwealth of Independent States
© Siemens AG 2016. All rights reserved. Page 24
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Power and Gas – Powerhouse in power generation The Power and Gas Division offers utilities, independent power producers, engineering, procurement and construction companies (EPCs), and oil and gas customers a broad spectrum of products and solutions for the environmentally compatible and resource-saving generation of power from fossil fuels and renewable sources of energy and for the reliable transportation of oil and gas. siemens.com/ar/power-gas
© Siemens AG 2016. All rights reserved. Page 25
August 2016
FY 2015
FY 2014
Orders
in millions of €
15,666
13,996
Revenue
in millions of €
13,193
12,720
Employees (as of September 30, 2015)
in thousands
50
42
siemens.com
Wind Power and Renewables – World market leader in offshore wind power The Wind Power and Renewables Division is a leading supplier of reliable, environmentally friendly, and cost-efficient renewable energy solutions. Driving down the cost of wind power is the key target as Siemens strives to make renewable energy fully competitive with conventional energy sources. Since they are especially reliable and cost-efficient, the wind turbines offered by Siemens Wind Power and Renewables are a worthwhile investment both from a financial and an environmental perspective. With over 31,000 megawatts of wind power installed, the Division delivers clean, renewable energy from onshore and offshore installations all over the world. siemens.com/ar/wind-renewables
© Siemens AG 2016. All rights reserved. Page 26
August 2016
FY 2015
FY 2014
Orders
in millions of €
6,136
7,759
Revenue
in millions of €
5,660
5,567
Employees (as of September 30, 2015)
in thousands
13
12
siemens.com
Energy Management – Partner for efficient power infrastructure The Energy Management Division is one of the leading global suppliers of products, systems, solutions and services for the economical, reliable and intelligent transmission and distribution of electrical power. As the trusted partner for the construction and expansion of an efficient and reliable power infrastructure, the Energy Management Division provides utility companies and industrial customers with a portfolio that meets their needs. The portfolio ranges from systems for the low-voltage and distribution power grid level to smart grids and energy automation solutions to power supplies for industrial plants and high-voltage transmission systems. siemens.com/ar/energy-management
© Siemens AG 2016. All rights reserved. Page 27
August 2016
FY 2015
FY 2014
Orders
in millions of €
12,956
11,210
Revenue
in millions of €
11,922
10,708
Employees (as of September 30, 2015)
in thousands
52
53
siemens.com
Building Technologies – World leader for building tech Technologies The Building Technologies Division is a leading global provider of safe, energy-efficient and environmentally friendly building and infrastructure technologies. As a technology partner, consultant, service provider, system integrator and supplier, the Division offers solutions for fire safety, security, building automation, heating, ventilation and air conditioning (HVAC) as well as energy management. siemens.com/ar/building-technologies
© Siemens AG 2016. All rights reserved. Page 27
August 2016
FY 2015
FY 2014
Orders
in millions of €
6,099
5,587
Revenue
in millions of €
5,999
5,569
Employees (as of September 30, 2015)
in thousands
27
27 siemens.com
Mobility – Transportation solutions for the future The efficient and integrated transportation of people and goods by rail and road – the Mobility Division bundles all of Siemens’ transportation-related products, solutions and services. The Division’s five business units – Mobility Management, Turnkey Projects & Electrification, Mainline Transport, Urban Transport and Customer Services – provide modern, interconnected and IT-based mobility. They have the knowhow to make road traffic flow more smoothly and quickly, to make trains more environmentally friendly and efficient and to make train schedules and freight shipments more reliable. siemens.com/ar/mobility
© Siemens AG 2016. All rights reserved. Page 28
August 2016
Orders
in millions of €
Revenue
in millions of €
Employees (as of September 30, 2015)
in thousands
FY 2015
FY 2014
10,262
9,280
7,508
7,249
26
26
siemens.com
Digital Factory – Partner of the manufacturing industry worldwide The Digital Factory (DF) Division offers a comprehensive portfolio of seamlessly integrated hardware, software and technology-based services to support manufacturing companies worldwide in enhancing the flexibility and efficiency of their production processes and in reducing the time to market of their products. The Division‘s objective is to provide a hardware and software portfolio that seamlessly links product development, production and suppliers so that ultimately a complete digital representation of the entire physical value chain is achieved. The platform for this is called “Digital Enterprise.“ siemens.com/ar/digital-factory
© Siemens AG 2016. All rights reserved. Page 29
August 2016
Orders
in millions of €
Revenue
in millions of €
Employees (as of September 30, 2015)
in thousands
FY 2015
FY 2014
10,014
9,233
9,956
9,201
44
43
siemens.com
Process Industries and Drives – Increased productivity, shorter time to market With innovative, integrated technologies for the entire lifecycle, the Process Industries and Drives (PD) Division helps customers measurably increase productivity, shorten time to market, and improve the reliability, safety, and efficiency of products, processes and plants. All over the world, customers benefit from future-proof automation, drive technology, industrial software, and services based on best-in-class technology platforms – such as Totally Integrated Automation (TIA) and Integrated Drive Systems (IDS). siemens.com/ar/process-industries
© Siemens AG 2016. All rights reserved. Page 30
August 2016
FY 2015
FY 2014
Orders
in millions of €
9,337
9,968
Revenue
in millions of €
9,894
9,645
Employees (as of September 30, 2015)
in thousands
47
48
siemens.com
Financial Services – Financial solutions for business customers The Financial Services Division (SFS) provides business-to-business financial solutions. Around the globe, we support customer investments with project and structured financing as well as leasing and equipment finance. The success of Financial Services is built on a unique combination of risk competence, technological expertise and reliable financial resources. Through our international network of SFS companies, we provide – subject to the legal requirements in the respective country – a great variety of financial solutions. siemens.com/ar/sfs
in millions of €
24,970
21,970
Allocated equity
in millions of €
2,417
2,148
3
3
Employees (as of September 30, 2015)
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FY 2014
Orders (as of September 30, 2015)
© Siemens AG 2016. All rights reserved.
FY 2015
in thousands
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Healthcare – Next-generation medical technology Siemens Healthineers is one of the world's largest suppliers of technology for the healthcare industry and a leader in medical imaging, laboratory diagnostics and advanced image-guided therapy applications. The company is also active in the field of digital and enterprise services as well as molecular diagnostics. Siemens Healthineers aims to blaze new trails for healthcare providers worldwide – as their partner in the quest to improve medical outcomes and cut costs. siemens.com/ar/healthcare
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FY 2014 12,126
Orders
in millions of €
13,349
Revenue
in millions of €
12,930
Employees (as of September 30, 2015) in thousands
© Siemens AG 2016. All rights reserved.
FY 2015
44
11,736 43
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A strong partner all over the world – Germany − The Airbus Group and Siemens have reached a long-term collaboration agreement in the area of hybrid-electric propulsion systems. A team of about 200 employees has been set up to develop electric aviation technologies. Siemens will be bundling the team’s activities in its new next47 unit. − Siemens has received an order from E.ON to supply, install, and commission 60 direct-drive offshore wind turbines with a capacity of about six megawatts each. The Arkona wind farm in the Baltic Sea, which will supply electricity for up to 400,000 households in Germany, is scheduled to go into operation in 2019. − In April 2016, Siemens’ gas turbine facility in Berlin delivered its 1,000th gas turbine. More than 90 percent of the turbines have been exported. The total capacity of the turbines produced at the plant amounts to some 220 gigawatts – enough power to supply about one billion people with electricity. Revenue (from customers in Germany)
in millions of €
FY 2015
FY 2014
11,244
10,781
114
114
Employees (As of September 30, 2015; continuing operations) in thousands © Siemens AG 2016. All rights reserved. Page 33
August 2016
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A strong partner all over the world – Europe, CIS, Africa, Middle East − United Kingdom: For the East Anglia ONE project, Siemens will supply, install, and commission 102 seven-megawatt offshore wind turbines. With a total installed capacity of 714 megawatts, this is Siemens’ largest project of its kind to date. The wind farm, which is scheduled to go online in 2020, will supply power for about 500,000 households in the UK. − Israel: Siemens has received a contract for the turnkey installation of two industrial combined cycle power plants, each with a capacity of 70 megawatts – the first order of its kind from Israel. − Egypt: Siemens is modernizing Cairo’s rail network. Interlockings along some 260 kilometers of track will be replaced by modern, centrally controlled electronic systems. Commissioning is planned for 2020. Revenue (from customers in Europe, CIS, Africa, Middle East)
in millions of €
FY 2015
FY 2014
38,799
38,449
Employees (As of September 30, 2015; continuing operations) in thousands © Siemens AG 2016. All rights reserved. Page 34
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213
211 siemens.com
A strong partner all over the world – The Americas ‒ U.S.: Siemens is building a combined cycle power plant in Lordstown, Ohio, on a turnkey basis. When completed in 2018, the plant will have a total capacity of 940 megawatts and supply electricity to more than 800,000 households. The order is worth more than $800 million and includes a long-term service contract. ‒ Con Edison (the power utility for the greater New York City area) is using six mobile resilience transformers from Siemens, the first in the world. Developed in a collaborative project, these transformers cut the time required to replace transformers – due to weather damage or other unforeseen events, for instance – from months to days. ‒ Bolivia: Siemens has signed binding agreements to expand three thermal power plants belonging to the state utility Ende Andina SAM (planned increase: one gigawatt). FY 2015 FY 2014 Revenue (from customers in the Americas)
in millions of €
21,702
18,494
73.5
70
Employees (As of September 30, 2015; continuing operations) in thousands © Siemens AG 2016. All rights reserved. Page 35
August 2016
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A Strong partner all over the world – Asia, Australia ‒ Indonesia: During Indonesian President Joko Widodo’s visit to Germany in April 2016, Siemens signed two memoranda of understanding with the state energy company PLN that call for jointly installing 500 megawatts of distributed power generation capacity and expanding Indonesia’s power grid. ‒ Thailand: Bangkok’s Mass Transit System Public Company has commissioned a consortium comprising Siemens and Bozankaya (Turkey) to supply 22 four-unit metro trains. Siemens will also be responsible for the service and maintenance of the trains for 16 years. ‒ Japan: Siemens is supplying 16 wind turbines with a total capacity of 50 megawatts for the Setana Osato wind farm on the Japanese island of Hokkaido. Revenue (from customers in Asia, Australia) in millions of €
FY 2015
FY 2014
15,135
14,283
62
62
Employees (as of September 30, 2015; continuing operations) in thousands
siemens.com August 2016
A Strong partner all over the world – Asia, Australia Siemens’ heritage in India dates right back to 1867 when it began laying the world’s first undersea cable from London to Kolkata.
- INDIA
Siemens set up a branch in India as early as 1922, in Mumbai and Kolkata. Though the company’s assets were confiscated during World War II as enemy property forcing it to shut operations, Siemens re-entered India after the war. It started operations as the “Siemens Division” of “Protos Engineering", a local contracting company. Siemens was engaged in sales and service of our own brand of switchgear and switchboards. Its first workshop was located under the bridge of, what is today, the Mahalaxmi Railway Station in Mumbai.
In 1957, Siemens was incorporated as a company under the Indian Companies Act as Siemens Engineering & Manufacturing Co. of India Pvt. Ltd. In 1961, Siemens became a public limited company with restricted external shareholding and was listed in the Bombay Stock Exchange a decade later.
siemens.com August 2016
A Strong partner all over the world – Asia, Australia
Curriculum Topic 1.MOTIVATION Motivation stimulates people and encourages them willingly to put more effort into doing something. Well-motivated employees will feel fulfilled and happy in the workplace. Additionally, they are likely to be more productive and produce work of a higher quality. This case study focuses upon three different theories of motivation and uses these to illustrate how employees are motivated within an engineering environment at Siemens. Motivated individuals are influenced by a number of different factors. Initially, everybody has basic needs, such as for food or accommodation, which pay can provide. However, there are many other different factors that motivate individuals. A creative environment, such as that provided by engineering, can be very stimulating. Some staff at Siemens thrive on the problem-solving aspect of their roles and respond to challenges. Other employees find the varied nature of the work motivating – having the opportunity to try different roles. Siemens employees also value the fact that they are allowed to be imaginative and can influence their own work. The structure of Siemens motivates individuals by empowering them to improve processes. Siemens provides the sort of environment where workers can learn new things and are given the opportunity to progress within the business. This culture demonstrates that Siemens values its employees and helps to recruit the next generation of engineers. siemens.com August 2016
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2. Scientific management Frederick Taylor looked at work within a production setting. He was one of the earliest advocates of professional management and believed that the relationship between task and workers’ co- operation could be standardised. Taylor’s scientific management theory involved observing workers to see how they carried out tasks. As a result of his work tasks were broken down into smaller scale units of work, requiring little understanding from employees of what they were doing. This job specialisation meant that workers undertook tasks with a narrowly defined range, for which they were rewarded according to how much they produced. Payment systems rewarded those who produced the most. Taylor’s way of working is very different from the needs of the modern working environment. However his work has helped form a scientific understanding of how work is organised. Today, engineering needs people with greater capability and flexibility. Engineering staff at all levels need to use their knowledge and skills in many different situations. At Siemens, the culture encourages employees to become more involved in their work, suggesting and implementing improvements. Control as originally suggested by Taylor, which removed personal responsibility, is not what modern engineering is about. Controls still exist but the person doing the job is encouraged to work as part of a team and become involved in deciding the best way to do or improve a task. This is because in engineering there is a continuous need to develop new and better products and processes. They cannot be confined to one way of doing things. For example, a new product or process may open the way to new markets. siemens.com August 2016
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3.Hierarchy of needs. One of the most famous theorists on motivation is Abraham Maslow. In 1954 he developed a ‘hierarchy of needs’. This he represented as a triangle. The most basic needs are at the bottom. The more complex needs are at the top. S e l f f u l f i m e n t (
Self-fulfiment (selfactualisation) Self-esteem needs Social needs Safety/security needs Physiological needs
s e l f a
At the bottom of the hierarchy are the basic needs which drive people to work. This includes the need for food, water, warmth, shelter and clothing. Once these needs are met, individuals then want safety and security. This includes physical security at work. It also includes safe working practices, job security and financial security. Social needs are all about groups and belonging. Socialising with a group of friends or with work colleagues fulfils social considerations. In addition, employees like to feel part of an organisation. Self-esteem needs might include the rewards from a workplace. It might include a benefits package or even status within the workplace. Self-fulfilment is about working to one’s full potential. This would involve doing something challenging, creative or interesting.
c t u a l
August 2016
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Siemens provides the opportunity for employees to fulfil their higher-order needs. For skilled, creative workers, like engineers, these are likely to be of great importance. Esteem is about having self-respect and the respect of others. Feeling that one’s work is making a difference can improve self-esteem. Recognition of an employee’s achievements by the employer also helps to meet esteem needs. For example, Siemens runs schemes in which suggestions and projects for improvements are rewarded. This could be financially, either individually or as part of a team, or in terms of peer or management recognition of their achievements. Self-actualisation is concerned with workers fulfilling their potential. Engineering work allows employees to do this by enabling them to get involved and take responsibility for their own jobs. Individuals can seek to make improvements and changes. An engineering environment generates excitement and challenges. Original solutions and ideas are required to solve problems on a regular basis. These appeal to the higher needs of employees. It is also possible to use technology to identify new ways of working and new processes. Siemens offers engineering staff training and development opportunities. This links with self-actualisation as it helps engineers to extend their capabilities which may lead to a progression up the career ladder. Training and development also helps individuals to meet the changing demands of the business’ global markets. siemens.com August 2016
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4. Satisfiers/dissatisfiers Frederick Herzberg also believed that people have needs that should be satisfied within the workplace. He felt that if people had their needs satisfied they would be productive employees. Herzberg’s research focused upon the activities of engineers and accountants. It resulted in his two-factor theory. Herzberg theorised that there were two influences that affected how people felt about their job. 1. Motivators (or satisfiers) There are a number of aspects of any workplace that give individuals job satisfaction. The nature of the work itself is very important. Some individuals just love what they do. Things that satisfy people in the workplace and make them happy are: • The opportunity for personal development • Achievement • Recognition • Promotion • Responsibility • Levels of responsibility.
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2. Hygiene factors (dissatisfiers) Hygiene factors are things that can upset employees in the workplace. They are outside the control of the individual but have a huge influence on the roles of each worker. For example: • Company policy may frustrate some employees and be viewed to some as a hindrance • Bureaucracy or needless paperwork may be considered to be a barrier to getting a job completed • Sometimes working conditions are not thought of to be suitable Other factors may be poor salary or staff feeling they are not valued nor consulted.
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5.CONCLUSION Motivating employees is an important role for managers. In the past, as the work of Frederick Taylor illustrated, motivation theory linked very closely to pay and output. Individuals now need to be motivated in a completely different way. They have higher order needs. This was illustrated through the work of Abraham Maslow. Frederick Herzberg discovered there are also elements within the workplace that both satisfy and dissatisfy employees. This case study illustrates how the work of Maslow and Herzberg applies in a modern engineering environment like Siemens more than Taylor’s. Lower order needs are met by the organisation providing good pay and a safe working environment. Higher order needs are also provided for its engineers through training and development, as well as the opportunity to undertake creative and challenging work. Siemens employees are motivated by being recognised for their achievements and by having opportunities for progression, regardless of the level at which they started working for Siemens.
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References Siemens AG . https://www.mimeo.com/ case-studies/siemenscost-savings/ https://new.siemens.com /global/en/company/abo ut.html siemens.com/about siemens.com/press siemens.com/investors siemens.com/innovation siemens.com/careers
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Disclaimer This document contains statements related to our future business and financial performance and future events or to developments involving Siemens that may constitute forward-looking statements. These statements may be identified by words such as “expect,” “look forward to,” “anticipate,” “intend,” “plan,” “believe,” “seek,” “estimate,” “will,” “project” or words of similar meaning. We may also make forward-looking statements in other reports, in presentations, in material delivered to shareholders and in press releases. In addition, our representatives may from time to time make oral forward-looking statements. Such statements are based on the current expectations and certain assumptions of Siemens’ management, of which many are beyond Siemens’ control. These are subject to a number of risks, uncertainties and factors, including, but not limited to, those described in disclosures, in particular in the chapter Risks in Siemens’ Annual Report. Should one or more of these risks or uncertainties materialize, or should underlying expectations not occur or assumptions prove incorrect, actual results, performance or achievements of Siemens may (negatively or positively) vary materially from those described explicitly or implicitly in the relevant forward-looking statement. Siemens neither intends, nor assumes any obligation, to update or revise these forward-looking statements in light of developments which differ from those anticipated. This document includes supplemental financial measures – not clearly defined in IFRS – that are or may be non-GAAP financial measures. These supplemental financial measures should not be viewed in isolation or as alternatives to measures of Siemens’ net assets and financial positions or to the results of operations as presented in accordance with IFRS in its Consolidated Financial Statements. Other companies that report or describe similarly titled financial measures may calculate them differently. Due to rounding, numbers presented throughout this and other documents may not add up precisely to the totals provided, and percentages may not precisely reflect the absolute figures.
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Siemens is the engineering group that is behind many of the products and services people take for granted in their daily lives. The list of products designed and manufactured by Siemens is almost endless. It includes traffic lights, gas turbines, superconducting magnets in medical scanners, wind generators, self motivation enquiring mind logical thought Skills necessary for an engineer eye for detail automated factories as well as domestic appliances like kettles and fridges. It generates about 40% of the UK’s wind energy and it hosts, supports and maintains the BBC’s website including the development of the BBC iPlayer. The company has been operating in the UK since 1843 and employs more than 18,000 people. Across the world Siemens employs over 427,000 people.
Engineers use scientific principles to develop products or systems to solve real life problems. Much of engineering is about innovation rather than invention. This means that engineers transform creative ideas into improved products, services, technologies or processes. A career within the field of engineering is exciting and varied as the work is constantly changing. Becoming an engineer at Siemens is about using energy, ideas and passion. It requires a range of skills and abilities that are needed across the whole business. Siemens provides opportunities for young people at all levels to enter the world of engineering. It recruits at a number of different levels. For example, it offers apprenticeships for those entering People can enter a career in engineering at many levels. Professional engineers usually enter after a three-or four-year university degree. Others may enter as apprentice technicians following studies at school or college. However, regardless of entry level Siemens employees enjoy wideranging opportunities for further education and training.
© Siemens AG 2016. All rights reserved. Page 3
August 2016
logical thought
enquiring mind
eye for detail
Skills necessary for an engineer
Teamworking skills.
Organized approach
Interpersonal skills.
Creativity
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Third quarter of fiscal 2016 – Key figures Key figures Siemens (Q3 2016 | Q3 2015) (Continuing operations; in millions of € except where otherwise stated)
Q3 2016
Q3 2015
Change in %
Volume
Q3 2016
Q3 2015
1,822
684
Liquidity 21,060 19,804
Orders Revenue
19,858 18,844
6% 5%
Free cash flow1
Employees (in thousands ) Profitability and capital efficiency Net income Return on capital employed (ROCE)1
Sep. 30, 2015
348 114 234
Total (continuing operations)
1,372 13.7%
1,376 14.9%
0%
Germany Outside Germany
1 Continuing and discontinued operations
Results of operations (Q3 2016)
(in millions of €)
Orders Revenue Profit Profit margin
Industrial Business Power Wind Power and and Gas Renewables 4,512 4,321 480 11.1%
2,729 1,722 143 8.3%
Energy Management 3,102 2,894 240 8.3%
Building Technologies 1,658 1,536 140 9.1%
Mobility
Digital Factory 1,112 1,795 158 8.8%
Process Industries and Drives 2,563 2,519 395 15.7%
2,117 2,247 101 4.5%
Healthineers
Financial Services (SFS)
3,382 3,230 534 16.5%
238 238 139 17.4%2
2 Return on equity (RoE)
© Siemens AG 2016. All rights reserved. Page 4
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Fiscal 2015 – Key figures Key figures Siemens FY 2015 (Continuing operations; in millions of € except where otherwise stated)
FY 2015
Revenue by industrial business FY 2014
Change in
%
Volume 82,340 75,636
Orders Revenue
77,657 71,227
6% 6%
Healthineers 17% Process Industries and Drives 13% Digital Factory 13%
Profitability and capital efficiency Net income1 Return on capital employed (ROCE)1
7,380 19.6%
5,507 17.2%
34%
Mobility 10%
Power and Gas 17% Wind Power and Renewables 7% Energy Management 16% Building Technologies 8% Not included: Financial Services (SFS)
Liquidity Free cash flow1
4,674
5,201
Revenue by Region Asia, Australia 20%
Employees (in thousands) Total (continuing operations) Germany Outside Germany
Sep. 30, 2015
Sep. 30, 2014
348 114 234
338 114 224
Europe, CIS2, Africa, Middle East (without Germany) 36%
Americas 29% Germany 15%
1 Continuing and discontinued operations
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2 Commonwealth of Independent States
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Global presence – Close to customers all over the world Germany €11.2 billion 114,000
15% 33%
Europe (excluding Germany), CIS, Africa, Middle East Share of total worldwide
€27.6 billion 98,800
36% 28%
Share of total worldwide
Americas €21.7 illion b 73,500
29% 21%
Share of total worldwide
Asia, Australia Revenue by customer location
Employees as of September 30, 2015
All figures refer to continuing operations. CIS: Commonwealth of Independent States
© Siemens AG 2016. All rights reserved. Page 5
August 2016
€15.1 billion
20%
61,500
18%
Share of total worldwide
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Celebrating the bicentennial birthday of Werner von Siemens
Werner von Siemens: At a glance 1816 – 1892 Werner von Siemens was a responsible entrepreneur and far-sighted inventor whose name soon became a household word around the world. Far ahead of his time, he recognized and fostered the link between science and technology.
“In my youth, I dreamed of founding an enterprise of world standing comparable to that of the Fugger dynasty …” Werner von Siemens, 1887
© Siemens AG 2016. All rights reserved. Page 6
August 2016
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Milestones of a 170-year history
1816 – 1892 Company founder, visionary and inventor
1959
1983
2012
The dynamo makes electricity part of everyday life
SIMATIC makes Siemens a leader in automation technology
First magnetic resonance imaging scanner goes into operation
Test operation of the world’s largest rotor for offshore wind turbines
1847
1925
1975
2010
2015
Pointer telegraph lays the foundation of Siemens as a global company
Siemens electrifies the Irish Free State with a hydroelectric power plant.
Breakthrough of high-voltage directcurrent (HVDC) transmission
TIA Portal takes automation a stage further
Sinalytics puts digital services for industry on a new footing
© Siemens AG 2016. All rights reserved. Page 7
1866
August 2016
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Our new claim
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What our new claim stands for
"Ingenuity" stands for innovation, engineering and genius. For us, it also includes unity: We are united in our efforts, and we are committed to partnering with our customers. "For life" relates to our role in society: to make real what matters. "Ingenuity for life" is therefore our unrelenting drive and promise to create value for customers, employees and society.
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August 2016
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Megatrends – Challenges that are transforming our world Digitalization
Urbanization
By 2020, the digital universe will reach 44 zettabytes – a tenfold increase from 2013.1
By 2050, 70 percent of the world's population will live in cities (today it’s 54 percent).3
Demographic change
Globalization
The earth’s population will increase from 7.3 billion2 people today to 9.7 billion2 in 2050. Average life expectancy will then be 83 years.2
The volume of world trade nearly doubled between 2005 and 2014.5
Sources:
Climate change According to scientists, in the summer of 2016, the Earth's atmosphere had the highest CO2 concentration in 800,000 years.4 © Siemens AG 2016. All rights reserved. Page 10
August 2016
1. IDC, The Digital Universe of Opportunities: Rich Data and the Increasing Value of the Internet of Things, April 2014 2. United Nations, Department of Economic and Social Affairs, Population Division (2015). World Population Prospects: The 2015 Revision, Key Findings and Advance Tables. Working Paper No. ESA/P/WP.241 3. United Nations, World Urbanization Prospects. The 2014 Revision, New York, published 2015 4. SCRIPPS INSTITUTE OF OCEANOGRAPHY, “The Keeling Curve”, July 30th, 2016 5. UNCTAD Statistics, Values and shares of merchandise exports and imports from 1948 to 2014, November 10, 2015
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Digitalization at Siemens – Productivity lever for our customers Improved productivity, shorter time-to-market Cooperation and mobile IT
Greater flexibility and stability
Design and engineering
operation
Higher availability and efficiency
services
Smart data and analytics Cloud technologies Linking the virtual and real worlds along the entire value chain of customers Connectivity and Web of Systems
Vertical software Revenue, FY 2015
Cyber security
Profitability Market growth
© Siemens AG 2016. All rights reserved. Page 11
August 2016
Digital services
€3.1 billion
€0.6 billion
++ +9%
+++ +15% siemens.com
Vision 2020 – A consistent company concept
E-A-D – a complete system With our positioning along the electrification value chain, we have know-how that extends from power generation to power transmission, from power distribution and smart grids to the efficient application of electrical energy. With our outstanding strengths in automation, we’re well equipped for the future and the age of digitalization.
© Siemens AG 2016. All rights reserved. Page 12
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Vision 2020 – Electrification, automation and digitalization Global trends
Market development (illustrative)
Digital transformation
~7–9%
A world connected by complex and heterogeneous systems
Market growth
Digitalization
Globalization
~4–6%
Global competition impacts productivity and production locations
Automation
Urbanization
Electrification
Market growth
~2–3% Market growth
Cities intensify investment in infrastructure
Demographic change Needs increase as populations grow and age
Climate change Greater resource efficiency in an electrified world
© Siemens AG 2016. All rights reserved. Page 13
August 2016
2014
Power generation
Medium-term – 2020 Power transmission, power distribution and smart grids
Efficient use of energy
Efficient healthcare delivery
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Vision 2020 – Seven goals Implement stringent corporate governance Goal: Cut costs by
~1
Goal: ROCE of
Goal: Growth
20%
>
to billion € by 2016
15%
Create value sustainably Goal: Tap growth fields and get underperforming businesses back on track
most relevant competitors
Expand global management
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August 2016
1
Goal:
Goal:
≥ 20%
≥ 50%
improvement in Net Promoter Score
increase in the number of employee shareholders
Be an employer of choice
Goal:
Goal:
> 30%
> 75%
of Division and Business Unit management outside Germany © Siemens AG 2016. All rights reserved.
Foster ownership culture
Be a partner of choice for customers
Execute financial target system
approval rating in the categories “Leadership” and “Diversity” in the Siemens Global Engagement Survey siemens.com
Vision 2020 – Selected growth fields
Flexible and small gas turbines
Digital-twin software
Key sectors in process industries Image-guided therapy and molecular diagnostics Offshore wind power Distribution grid automation and software Urban and interurban mobility Business analytics and data-driven services, software, and IT solutions
© Siemens AG 2016. All rights reserved. Page 15
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Vision 2020 – Five elements create Ownership Culture Equity
Values
Supports a sense of long-term-, output- and profit-orientation.
– our foundation: • Responsible • Excellent • Innovative
Ownership culture People orientation
Behaviors
• Empowerment & trust • Honesty, openness & collaboration
• Respect • Focus • Initiative & execution
Leadership • Be bold, decisive & courageous • Siemens matters • Motivate & engage © Siemens AG 2016. All rights reserved. Page 16
August 2016
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Vision 2020 – Milestones for the implementation of our company concept Value
Scale up Strengthen core Drive performance Foster ownership culture and leadership based on common values 2015
Operational consolidation
Strategic direction
© Siemens AG 2016. All rights reserved. Page 17
August 2016
2016
2017
Optimization
2018
2019
2020
Accelerated growth and outperformance siemens.com
Vision 2020 – Innovation is our lifeblood Investment in research and development – the basis for growth and competitiveness
€
€
€4.5 billion
32,100 17,500
R&D expenditures1
R&D employees1
Inventions and patents – securing the future
7,650
3,700
Inventions1
Patent first filings1
© Siemens AG 2016. All rights reserved. Page 18
August 2016
Software engineers1 University partnerships – our edge in knowledge
9 Center of Knowledge Interchange (CKI) universities
16 Principal partner universities
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The next generation of innovation – next47 Selected innovation fields Distributed electrification
Approx.
€1 billion
in funds over 5 years
© Siemens AG 2016. All rights reserved. Page 20
August 2016
Connected (e-)mobility
Artificial intelligence
Block-chain applications eAircraft
Autonomous machines
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Vision 2020 – Being an employer of choice Siemens’ “Europeans@Siemens” program enables more than 100 young people from EU countries as well as Turkey and Egypt to participate in work-study programs in Germany in the fields of electronics and mechatronics.
153,000 Siemens employees own company shares and are thus coowners of the company.
© Siemens AG 2016. All rights reserved. Page 21
August 2016
Siemens invests over €250 million each year in the training and education of employees.
In FY 2015, around 7,000 young Siemens employees were enrolled in work-study programs that combine academic learning with practical experience.
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Corporate social responsibility – Embracing our responsibility to society Supporting refugees is part of our responsibility to society. For example, we offer professional orientation through internships, provide accommodations, make donations and hold preparatory classes for young refugees.
We train employees locally. In India, for example, we plan to train 108 apprentices a year. In Egypt, we are building a training center for employees and customers. In South Africa, we built and equipped the Mandela School of Science & Technology. © Siemens AG 2016. All rights reserved. Page 22
August 2016
Our social commitment takes many forms, including donations, foundations, disaster relief, employee volunteering activities, sponsorships, educational programs, etc.
Since 2008, we have reserved 10 percent of our apprenticeships in Germany for disadvantaged young people. About 90 percent of these trainees complete their courses successfully. Vocational training and integration are key enablers for overcoming social exclusion.
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Sustainability – Siemens aims to be net-carbon neutral by 2030 2.2 Mt CO2
-50%
-100%
We are investing over €100 million in measures to reduce our carbon footprint Drive energy efficiency program Increase energy efficiency in factories, employ sustainable technologies in new buildings Leverage distributed energy systems Reduce energy costs and CO2 emissions Reduce fleet emissions Utilize potential of low-emission cars in fleet, including electro mobility
2014
2020
2030
Purchase green energy Move toward a significantly cleaner power mix with a strong focus on renewable energy and highly efficient gas
Electricity Heating / Process heat Fleet Other
© Siemens AG 2016. All rights reserved. Page 23
August 2016
Independent auditors will monitor and report on progress of implementation.
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Vision 2020 – The leadership team
Roland Busch
Lisa Davis
Klaus Helmrich
Asia Australia Energy Management
Americas Power and Gas Wind Power and Renewables
Africa Europe Digital Factory
Building Technologies Mobility
Power Generation Services
Process Industries and Drives
and Chief Executive Officer (CEO) Corporate Development Governance and Markets
Communications Legal and Compliance
Willi Meixner CEO
Markus Tacke CEO
Randy Zwirn CEO
Ralf Christian CEO
Matthias Rebellius CEO
Power and Gas
Wind Power and Renewables
Power Generation Services
Energy Management
Building Technologies
Janina Kugel Labor Director, Chief Diversity Officer
Human Resources
Jochen Eickholt CEO
Mobility
Siegfried Russwurm Chief Technology Officer (CTO)
Ralf P. Thomas Chief Financial Officer (CFO)
Corporate Technology CIS1
Controlling and Finance
Middle East Healthineers
Global Services Financial Services
Jan Mrosik CEO
Jürgen Brandes CEO
Bernd Montag CEO
Digital Factory
Process Industries and Drives
Healthineers
Roland Chalons-Browne CEO Financial Services
1 Commonwealth of Independent States
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Power and Gas – Powerhouse in power generation The Power and Gas Division offers utilities, independent power producers, engineering, procurement and construction companies (EPCs), and oil and gas customers a broad spectrum of products and solutions for the environmentally compatible and resource-saving generation of power from fossil fuels and renewable sources of energy and for the reliable transportation of oil and gas. siemens.com/ar/power-gas
© Siemens AG 2016. All rights reserved. Page 25
August 2016
FY 2015
FY 2014
Orders
in millions of €
15,666
13,996
Revenue
in millions of €
13,193
12,720
Employees (as of September 30, 2015)
in thousands
50
42
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Wind Power and Renewables – World market leader in offshore wind power The Wind Power and Renewables Division is a leading supplier of reliable, environmentally friendly, and cost-efficient renewable energy solutions. Driving down the cost of wind power is the key target as Siemens strives to make renewable energy fully competitive with conventional energy sources. Since they are especially reliable and cost-efficient, the wind turbines offered by Siemens Wind Power and Renewables are a worthwhile investment both from a financial and an environmental perspective. With over 31,000 megawatts of wind power installed, the Division delivers clean, renewable energy from onshore and offshore installations all over the world. siemens.com/ar/wind-renewables
© Siemens AG 2016. All rights reserved. Page 26
August 2016
FY 2015
FY 2014
Orders
in millions of €
6,136
7,759
Revenue
in millions of €
5,660
5,567
Employees (as of September 30, 2015)
in thousands
13
12
siemens.com
Energy Management – Partner for efficient power infrastructure The Energy Management Division is one of the leading global suppliers of products, systems, solutions and services for the economical, reliable and intelligent transmission and distribution of electrical power. As the trusted partner for the construction and expansion of an efficient and reliable power infrastructure, the Energy Management Division provides utility companies and industrial customers with a portfolio that meets their needs. The portfolio ranges from systems for the low-voltage and distribution power grid level to smart grids and energy automation solutions to power supplies for industrial plants and high-voltage transmission systems. siemens.com/ar/energy-management
© Siemens AG 2016. All rights reserved. Page 27
August 2016
FY 2015
FY 2014
Orders
in millions of €
12,956
11,210
Revenue
in millions of €
11,922
10,708
Employees (as of September 30, 2015)
in thousands
52
53
siemens.com
Building Technologies – World leader for building tech Technologies The Building Technologies Division is a leading global provider of safe, energy-efficient and environmentally friendly building and infrastructure technologies. As a technology partner, consultant, service provider, system integrator and supplier, the Division offers solutions for fire safety, security, building automation, heating, ventilation and air conditioning (HVAC) as well as energy management. siemens.com/ar/building-technologies
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August 2016
FY 2015
FY 2014
Orders
in millions of €
6,099
5,587
Revenue
in millions of €
5,999
5,569
Employees (as of September 30, 2015)
in thousands
27
27 siemens.com
Mobility – Transportation solutions for the future The efficient and integrated transportation of people and goods by rail and road – the Mobility Division bundles all of Siemens’ transportation-related products, solutions and services. The Division’s five business units – Mobility Management, Turnkey Projects & Electrification, Mainline Transport, Urban Transport and Customer Services – provide modern, interconnected and IT-based mobility. They have the knowhow to make road traffic flow more smoothly and quickly, to make trains more environmentally friendly and efficient and to make train schedules and freight shipments more reliable. siemens.com/ar/mobility
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August 2016
Orders
in millions of €
Revenue
in millions of €
Employees (as of September 30, 2015)
in thousands
FY 2015
FY 2014
10,262
9,280
7,508
7,249
26
26
siemens.com
Digital Factory – Partner of the manufacturing industry worldwide The Digital Factory (DF) Division offers a comprehensive portfolio of seamlessly integrated hardware, software and technology-based services to support manufacturing companies worldwide in enhancing the flexibility and efficiency of their production processes and in reducing the time to market of their products. The Division‘s objective is to provide a hardware and software portfolio that seamlessly links product development, production and suppliers so that ultimately a complete digital representation of the entire physical value chain is achieved. The platform for this is called “Digital Enterprise.“ siemens.com/ar/digital-factory
© Siemens AG 2016. All rights reserved. Page 29
August 2016
Orders
in millions of €
Revenue
in millions of €
Employees (as of September 30, 2015)
in thousands
FY 2015
FY 2014
10,014
9,233
9,956
9,201
44
43
siemens.com
Process Industries and Drives – Increased productivity, shorter time to market With innovative, integrated technologies for the entire lifecycle, the Process Industries and Drives (PD) Division helps customers measurably increase productivity, shorten time to market, and improve the reliability, safety, and efficiency of products, processes and plants. All over the world, customers benefit from future-proof automation, drive technology, industrial software, and services based on best-in-class technology platforms – such as Totally Integrated Automation (TIA) and Integrated Drive Systems (IDS). siemens.com/ar/process-industries
© Siemens AG 2016. All rights reserved. Page 30
August 2016
FY 2015
FY 2014
Orders
in millions of €
9,337
9,968
Revenue
in millions of €
9,894
9,645
Employees (as of September 30, 2015)
in thousands
47
48
siemens.com
Financial Services – Financial solutions for business customers The Financial Services Division (SFS) provides business-to-business financial solutions. Around the globe, we support customer investments with project and structured financing as well as leasing and equipment finance. The success of Financial Services is built on a unique combination of risk competence, technological expertise and reliable financial resources. Through our international network of SFS companies, we provide – subject to the legal requirements in the respective country – a great variety of financial solutions. siemens.com/ar/sfs
in millions of €
24,970
21,970
Allocated equity
in millions of €
2,417
2,148
3
3
Employees (as of September 30, 2015)
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FY 2014
Orders (as of September 30, 2015)
© Siemens AG 2016. All rights reserved.
FY 2015
in thousands
siemens.com
Healthcare – Next-generation medical technology Siemens Healthineers is one of the world's largest suppliers of technology for the healthcare industry and a leader in medical imaging, laboratory diagnostics and advanced image-guided therapy applications. The company is also active in the field of digital and enterprise services as well as molecular diagnostics. Siemens Healthineers aims to blaze new trails for healthcare providers worldwide – as their partner in the quest to improve medical outcomes and cut costs. siemens.com/ar/healthcare
Page 32
August 2016
FY 2014 12,126
Orders
in millions of €
13,349
Revenue
in millions of €
12,930
Employees (as of September 30, 2015) in thousands
© Siemens AG 2016. All rights reserved.
FY 2015
44
11,736 43
siemens.com
A strong partner all over the world – Germany − The Airbus Group and Siemens have reached a long-term collaboration agreement in the area of hybrid-electric propulsion systems. A team of about 200 employees has been set up to develop electric aviation technologies. Siemens will be bundling the team’s activities in its new next47 unit. − Siemens has received an order from E.ON to supply, install, and commission 60 direct-drive offshore wind turbines with a capacity of about six megawatts each. The Arkona wind farm in the Baltic Sea, which will supply electricity for up to 400,000 households in Germany, is scheduled to go into operation in 2019. − In April 2016, Siemens’ gas turbine facility in Berlin delivered its 1,000th gas turbine. More than 90 percent of the turbines have been exported. The total capacity of the turbines produced at the plant amounts to some 220 gigawatts – enough power to supply about one billion people with electricity. Revenue (from customers in Germany)
in millions of €
FY 2015
FY 2014
11,244
10,781
114
114
Employees (As of September 30, 2015; continuing operations) in thousands © Siemens AG 2016. All rights reserved. Page 33
August 2016
siemens.com
A strong partner all over the world – Europe, CIS, Africa, Middle East − United Kingdom: For the East Anglia ONE project, Siemens will supply, install, and commission 102 seven-megawatt offshore wind turbines. With a total installed capacity of 714 megawatts, this is Siemens’ largest project of its kind to date. The wind farm, which is scheduled to go online in 2020, will supply power for about 500,000 households in the UK. − Israel: Siemens has received a contract for the turnkey installation of two industrial combined cycle power plants, each with a capacity of 70 megawatts – the first order of its kind from Israel. − Egypt: Siemens is modernizing Cairo’s rail network. Interlockings along some 260 kilometers of track will be replaced by modern, centrally controlled electronic systems. Commissioning is planned for 2020. Revenue (from customers in Europe, CIS, Africa, Middle East)
in millions of €
FY 2015
FY 2014
38,799
38,449
Employees (As of September 30, 2015; continuing operations) in thousands © Siemens AG 2016. All rights reserved. Page 34
August 2016
213
211 siemens.com
A strong partner all over the world – The Americas ‒ U.S.: Siemens is building a combined cycle power plant in Lordstown, Ohio, on a turnkey basis. When completed in 2018, the plant will have a total capacity of 940 megawatts and supply electricity to more than 800,000 households. The order is worth more than $800 million and includes a long-term service contract. ‒ Con Edison (the power utility for the greater New York City area) is using six mobile resilience transformers from Siemens, the first in the world. Developed in a collaborative project, these transformers cut the time required to replace transformers – due to weather damage or other unforeseen events, for instance – from months to days. ‒ Bolivia: Siemens has signed binding agreements to expand three thermal power plants belonging to the state utility Ende Andina SAM (planned increase: one gigawatt). FY 2015 FY 2014 Revenue (from customers in the Americas)
in millions of €
21,702
18,494
73.5
70
Employees (As of September 30, 2015; continuing operations) in thousands © Siemens AG 2016. All rights reserved. Page 35
August 2016
siemens.com
A Strong partner all over the world – Asia, Australia ‒ Indonesia: During Indonesian President Joko Widodo’s visit to Germany in April 2016, Siemens signed two memoranda of understanding with the state energy company PLN that call for jointly installing 500 megawatts of distributed power generation capacity and expanding Indonesia’s power grid. ‒ Thailand: Bangkok’s Mass Transit System Public Company has commissioned a consortium comprising Siemens and Bozankaya (Turkey) to supply 22 four-unit metro trains. Siemens will also be responsible for the service and maintenance of the trains for 16 years. ‒ Japan: Siemens is supplying 16 wind turbines with a total capacity of 50 megawatts for the Setana Osato wind farm on the Japanese island of Hokkaido. Revenue (from customers in Asia, Australia) in millions of €
FY 2015
FY 2014
15,135
14,283
62
62
Employees (as of September 30, 2015; continuing operations) in thousands
siemens.com August 2016
A Strong partner all over the world – Asia, Australia Siemens’ heritage in India dates right back to 1867 when it began laying the world’s first undersea cable from London to Kolkata.
- INDIA
Siemens set up a branch in India as early as 1922, in Mumbai and Kolkata. Though the company’s assets were confiscated during World War II as enemy property forcing it to shut operations, Siemens re-entered India after the war. It started operations as the “Siemens Division” of “Protos Engineering", a local contracting company. Siemens was engaged in sales and service of our own brand of switchgear and switchboards. Its first workshop was located under the bridge of, what is today, the Mahalaxmi Railway Station in Mumbai.
In 1957, Siemens was incorporated as a company under the Indian Companies Act as Siemens Engineering & Manufacturing Co. of India Pvt. Ltd. In 1961, Siemens became a public limited company with restricted external shareholding and was listed in the Bombay Stock Exchange a decade later.
siemens.com August 2016
A Strong partner all over the world – Asia, Australia
Curriculum Topic 1.MOTIVATION Motivation stimulates people and encourages them willingly to put more effort into doing something. Well-motivated employees will feel fulfilled and happy in the workplace. Additionally, they are likely to be more productive and produce work of a higher quality. This case study focuses upon three different theories of motivation and uses these to illustrate how employees are motivated within an engineering environment at Siemens. Motivated individuals are influenced by a number of different factors. Initially, everybody has basic needs, such as for food or accommodation, which pay can provide. However, there are many other different factors that motivate individuals. A creative environment, such as that provided by engineering, can be very stimulating. Some staff at Siemens thrive on the problem-solving aspect of their roles and respond to challenges. Other employees find the varied nature of the work motivating – having the opportunity to try different roles. Siemens employees also value the fact that they are allowed to be imaginative and can influence their own work. The structure of Siemens motivates individuals by empowering them to improve processes. Siemens provides the sort of environment where workers can learn new things and are given the opportunity to progress within the business. This culture demonstrates that Siemens values its employees and helps to recruit the next generation of engineers. siemens.com August 2016
A Strong partner all over the world – Asia, Australia
2. Scientific management Frederick Taylor looked at work within a production setting. He was one of the earliest advocates of professional management and believed that the relationship between task and workers’ co- operation could be standardised. Taylor’s scientific management theory involved observing workers to see how they carried out tasks. As a result of his work tasks were broken down into smaller scale units of work, requiring little understanding from employees of what they were doing. This job specialisation meant that workers undertook tasks with a narrowly defined range, for which they were rewarded according to how much they produced. Payment systems rewarded those who produced the most. Taylor’s way of working is very different from the needs of the modern working environment. However his work has helped form a scientific understanding of how work is organised. Today, engineering needs people with greater capability and flexibility. Engineering staff at all levels need to use their knowledge and skills in many different situations. At Siemens, the culture encourages employees to become more involved in their work, suggesting and implementing improvements. Control as originally suggested by Taylor, which removed personal responsibility, is not what modern engineering is about. Controls still exist but the person doing the job is encouraged to work as part of a team and become involved in deciding the best way to do or improve a task. This is because in engineering there is a continuous need to develop new and better products and processes. They cannot be confined to one way of doing things. For example, a new product or process may open the way to new markets. siemens.com August 2016
A Strong partner all over the world – Asia, Australia
3.Hierarchy of needs. One of the most famous theorists on motivation is Abraham Maslow. In 1954 he developed a ‘hierarchy of needs’. This he represented as a triangle. The most basic needs are at the bottom. The more complex needs are at the top. S e l f f u l f i m e n t (
Self-fulfiment (selfactualisation) Self-esteem needs Social needs Safety/security needs Physiological needs
s e l f a
At the bottom of the hierarchy are the basic needs which drive people to work. This includes the need for food, water, warmth, shelter and clothing. Once these needs are met, individuals then want safety and security. This includes physical security at work. It also includes safe working practices, job security and financial security. Social needs are all about groups and belonging. Socialising with a group of friends or with work colleagues fulfils social considerations. In addition, employees like to feel part of an organisation. Self-esteem needs might include the rewards from a workplace. It might include a benefits package or even status within the workplace. Self-fulfilment is about working to one’s full potential. This would involve doing something challenging, creative or interesting.
c t u a l
August 2016
i
siemens.com
A Strong partner all over the world – Asia, Australia
Siemens provides the opportunity for employees to fulfil their higher-order needs. For skilled, creative workers, like engineers, these are likely to be of great importance. Esteem is about having self-respect and the respect of others. Feeling that one’s work is making a difference can improve self-esteem. Recognition of an employee’s achievements by the employer also helps to meet esteem needs. For example, Siemens runs schemes in which suggestions and projects for improvements are rewarded. This could be financially, either individually or as part of a team, or in terms of peer or management recognition of their achievements. Self-actualisation is concerned with workers fulfilling their potential. Engineering work allows employees to do this by enabling them to get involved and take responsibility for their own jobs. Individuals can seek to make improvements and changes. An engineering environment generates excitement and challenges. Original solutions and ideas are required to solve problems on a regular basis. These appeal to the higher needs of employees. It is also possible to use technology to identify new ways of working and new processes. Siemens offers engineering staff training and development opportunities. This links with self-actualisation as it helps engineers to extend their capabilities which may lead to a progression up the career ladder. Training and development also helps individuals to meet the changing demands of the business’ global markets. siemens.com August 2016
A Strong partner all over the world – Asia, Australia
4. Satisfiers/dissatisfiers Frederick Herzberg also believed that people have needs that should be satisfied within the workplace. He felt that if people had their needs satisfied they would be productive employees. Herzberg’s research focused upon the activities of engineers and accountants. It resulted in his two-factor theory. Herzberg theorised that there were two influences that affected how people felt about their job. 1. Motivators (or satisfiers) There are a number of aspects of any workplace that give individuals job satisfaction. The nature of the work itself is very important. Some individuals just love what they do. Things that satisfy people in the workplace and make them happy are: • The opportunity for personal development • Achievement • Recognition • Promotion • Responsibility • Levels of responsibility.
siemens.com August 2016
2. Hygiene factors (dissatisfiers) Hygiene factors are things that can upset employees in the workplace. They are outside the control of the individual but have a huge influence on the roles of each worker. For example: • Company policy may frustrate some employees and be viewed to some as a hindrance • Bureaucracy or needless paperwork may be considered to be a barrier to getting a job completed • Sometimes working conditions are not thought of to be suitable Other factors may be poor salary or staff feeling they are not valued nor consulted.
siemens.com August 2016
5.CONCLUSION Motivating employees is an important role for managers. In the past, as the work of Frederick Taylor illustrated, motivation theory linked very closely to pay and output. Individuals now need to be motivated in a completely different way. They have higher order needs. This was illustrated through the work of Abraham Maslow. Frederick Herzberg discovered there are also elements within the workplace that both satisfy and dissatisfy employees. This case study illustrates how the work of Maslow and Herzberg applies in a modern engineering environment like Siemens more than Taylor’s. Lower order needs are met by the organisation providing good pay and a safe working environment. Higher order needs are also provided for its engineers through training and development, as well as the opportunity to undertake creative and challenging work. Siemens employees are motivated by being recognised for their achievements and by having opportunities for progression, regardless of the level at which they started working for Siemens.
siemens.com August 2016
References Siemens AG . https://www.mimeo.com/ case-studies/siemenscost-savings/ https://new.siemens.com /global/en/company/abo ut.html siemens.com/about siemens.com/press siemens.com/investors siemens.com/innovation siemens.com/careers
siemens.com August 2016
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