Verified Document

Global Strategic Management Research Paper

Global Strategic Management Strengths

Siemens has a number of key strengths that have allowed them to become one of the largest industrial conglomerates in the world. The first key strength is their focus on innovation. Siemens has always been driven be engineering, and their ability to produce not only better products but to continuously improve those products is one of the reasons for their continued success. The company has utilized innovation to spur significant organic growth in recent years (Siemens, 2008).

To support their engineering competency, Siemens has developed an extensive in-house training program (2008 Annual Report). This helps the firm to develop the talent it needs to remain at the fore of the innovation curve. The company trains workers through a formal facility in Bavaria, where the company is headquartered. Training, however, has long been a fundamental strength of Siemens because it helps to attract talent as well as develop it.

Talent is also attracted by the company's solid reputation. As one of the oldest technology and engineering firms, Siemens has established a reputation for excellence in the field. This attracts innovators, and it also helps to attract business. The long record of success contributes to the company's reputation and helps to secure business deals as a result.

For Siemens another strength is its profits. Although profit projections for the upcoming year are generally soft, the company has remained profitable even during the downturn, when rivals such as General Electric and Philips NV have struggled (Schafer, 2009). This provides Siemens with a foundation of strength.

Weaknesses

Despite its numerous strengths, Siemens faces some internal obstacles that are hindering its ability to fully leverage those strengths. The first major weakness is the company's size and structure. The matrix structure is notoriously difficult to manage. The result is that the company often fails to identify opportunities to improve. Additionally, it takes longer for areas of weakness to be identified and dealt with. One recent example of this is with the enterprise product unit,...

The firm's debt-to-equity ratio is a relatively unhealthy 89.66 (Reuters, 2009) meaning that they firm has very little equity. For a firm founded over 150 years ago to have so little equity is a symptom of operational weakness, but the leverage itself limits the firm's financial flexibility.
The company has in recent years demonstrated ethical lapses, including a bribery scandal that rocked the firm's executive suite (Taub, 2007). They have attempted to address this issue by implementing stricter governance regulations but the taint of questionable ethics remains with the company.

Another weakness is the focus on technology. Siemens has traded on its technological leadership for most of its history. Unfortunately, this has led to a weakness in service. With most technology products becoming commoditized at increasingly early points in their lifecycles, service is an important means by which firms can extend products and drive greater revenues. Siemens has not developed a service culture and lags many smaller firms in the provision of effective customer service.

On balance, Siemens ranks 2.7 on internal measures, just below average. Despite many strengths, the firm is saddles with a range of weaknesses, each of which threatens to limit organizational effectiveness. The fact that the company has grown revenues organically of late is encouraging, but equity growth has been limited and earnings per share have steadily declined as a result of the myriad weaknesses. The firm has underperformed its potential significantly and needs to address some of these weaknesses to restore operational excellence.

Opportunities

The focus on innovation creates a wide-ranging set of opportunities for Siemens. That they have their fingers in so many different pies means that there will always be strong opportunities with respect to new or improved products.

The impact of recent stimulus packages provides significant opportunity for Siemens. This is because many such…

Sources used in this document:
Works Cited:

2008 Siemens Annual Report. Retrieved June 21, 2009 from http://w1.siemens.com/annual/08/pool/downloads/pdf/en/pdf_e08_00_gb2008.pdf

Siemens website. Retrieved June 21, 2009 from http://w1.siemens.com/investor/en/index.htm

Some financial information from Reuters. Retrieved June 21, 2009 from http://www.reuters.com/finance/stocks/incomeStatement?symbol=SI.N

Schafer, Daniel. (2009). Siemens Cuts Outlook Despite Second-Quarter Boost. Financial Times. Retrieved June 21, 2009 from http://www.ft.com/cms/s/0/cd667ff6-3487-11de-940a-00144feabdc0.html?nclick_check=1
Schafer, Daniel. (2009). Siemens Expects Boost to Green Sales. Financial Times. Retrieved June 21, 2009 from http://www.ft.com/cms/s/3ebee616-17d7-11de-8c9d-0000779fd2ac,Authorised=false.html?_i_location=http%3A%2F%2Fwww.ft.com%2Fcms%2Fs%2F0%2F3ebee616-17d7-11de-8c9d-0000779fd2ac.html&_i_referer=http%3A%2F%2Fwww.ft.com%2Fcms%2Fs%2F0%2Fcd667ff6-3487-11de-940a-00144feabdc0.html%3Fnclick_check%3D1
Taub, Stephen. (2007). Former Siemens Finance Chief Convicted. CFO Magazine. Retrieved June 21, 2009 from http://www.cfo.com/article.cfm/9175778?f=related
No author. (2008). Siemens Proves Operational Performance in First Quarter. Siemens. Retrieved June 21, 2009 from http://www.siemens.co.uk/en/news_press/index/news_archive/jan_24_2008.htm
Gohring, Nancy. (2006). Siemens to sell Enterprise Business Unit. Network World. Retrieved June 21, 2009 from http://www.networkworld.com/news/2006/062006-siemens-to-sell-enterprise-business-unit.html
Kennedy, Simon. (2009). Siemens Tops Forecast, cuts Outlook. Marketwatch. Retrieved June 21, 2009 from http://www.marketwatch.com/story/siemens-profit-tops-expectations-as-outlook-cut
Cite this Document:
Copy Bibliography Citation

Related Documents

International Strategy: Global Strategic Management Plan for
Words: 603 Length: 2 Document Type: Essay

International strategy: Global strategic management plan for Subway The need for a global management plan for your organization Few items are more regional in terms of consumer tastes than food preferences. Sweetness, saltiness, the concept of what flavors should be paired with one another -- all vary depending upon custom and culture. To establish an inroad in India was a considerable challenge for Subway, the sandwich retailer which originated in North

Global Operations Management
Words: 2547 Length: 8 Document Type: Term Paper

Global Operations Management: A Discussion When an entrepreneur first launches a company, most of the labor and materials can be covered domestically and in-house. However, as the business expands, it makes more and more sense financially to move the production overseas. For many companies, using a foreign supplier is the answer to absorbing the bulk of the burgeoning sales and administrative expenses. There are both marked benefits in the development of

Strategic Management Plan Anheuser-Busch Inbev Strategic Management...
Words: 2557 Length: 10 Document Type: Essay

Strategic Management Plan Anheuser-Busch Inbev Strategic Management Plan for Anheuser-Busch Inbev Division For North America Faced with increasing price competition on their mid- and low-end brands globally combined with consolidation occurring at a quickening pace across the larger brands and breweries, the Anheuser-Busch Inbev Division needs to move quickly to stabilize its market position. Doing nothing will lead to the company falling quickly behind smaller, more agile competitors who have unique supply chains

Strategic Management Case Analysis the Business Environment
Words: 3282 Length: 10 Document Type: Essay

Strategic Management Case Analysis The business environment brings a number of challenges and issues for organizations. In order to operate profitably and competitively in the presence of uncertainties and threats in the external environment, business organizations have to formulate effective corporate, business, and international level strategies for the short run and the long run (Hitt, Ireland, & Hoskisson, 2007). The case discussed in this research paper highlights the major strategic issues

Global Strategic Planning Process
Words: 351 Length: 1 Document Type: Term Paper

Global Strategic Planning Process Eestjohn STEPS IN THE GLOBAL STRATEGIC PLANNING PROCESS AND REASONS FOR PLANNING GLOBALLY Following are detailed steps for the global strategic planning process: Analyze the company's external environments: Examine the political, economic and cultural environments of the proposed country for strategic investment. Ensure these are compatible with the company's proposed international direction (portability and conversion of earnings, conducive to foreign investment). Analyze the company's internal environment: Make sure that the internal

Strategic Management and New Managers'
Words: 910 Length: 3 Document Type: Research Proposal

Alen Badal (2005) then promotes the belief that it is imperative for the success of a modern day manager that he be able to understand and implement interdisciplinary thinking in order to enhance the quality of an organizational strategy, and as such the success rates of the entire organization. These three studies, alongside with several others, will constitute the literary background, as well as the starting point and the

Sign Up for Unlimited Study Help

Our semester plans gives you unlimited, unrestricted access to our entire library of resources —writing tools, guides, example essays, tutorials, class notes, and more.

Get Started Now