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  • 1. Department of Management School of Business, Economics and Communication MKTG 524 Presented by: Aida Zakaria Alexander Guindy Baher Abdel Nour Khaled Omar Mohamed Ragab Mostafa Mazen Rania Maghawri Presented to: Dr. Ibrahim Hegazy
  • 2. Outline
    • History and Background
    • Branding Strategy
    • Entry Modes and Established Relationships
    • Product and service innovation
    • B.C.G Analysis
    • GE Multi Factorial Analysis or GE Matrix    
    • Product Portfolio Analysis
  • 3. COMPANY BACKGROUND AND HISTORY
  • 4.
    • After two world wars they re structured specifically to meet the requirements of the technology sector and its target markets .
    • October 1847 Werner von Siemens and Johann George Halske set up “Telegraphen-Bauanstalt von Siemens & Halske ”.
    • 1990’s reorganized and restructured large business units into smaller entities to be better equipped to operate.
    • Fi rst patented product the “pointer telegraph”.
    • Mergers and acquisitions to expand its product lines and increase production capacity .
    • 1914 Siemens had a worldwide workforce of 82,000 employees.
    Company Background and History
    • Recent years, they have taken targeted steps to optimize its business portfolio through disinvestments, acquisitions, the formation of new companies, and the founding of joint ventures .
  • 5. BRANDING STRATEGY
  • 6.
    • A leading international company in the field of electrical engineering and electronics.
    • Established around 160 years ago and currently operating in 190 countries worldwide.
    • Siemens 5 core business principles: Customer, Innovation, People, Value and Responsibility.
    Branding Strategy Siemens in Brief
  • 7. Branding Strategy Fit 4 More: Siemens Basis for a Successful Future Operational Excellence People Excellence Corporate Responsibility
    • Performance and Portfolio:
    • Leading Market Position
    • Sustainable growth and profit
    • Strategic Reorientation of Business Units
    Drivers Goals
  • 8. Branding Strategy Siemens Portfolio
    • Automation & Control:
    • Automation & Drives
    • Industrial Solutions & Services
    • Siemens Dematic
    • Siemens Building Technologies
    Medical Solutions Fin. Services
    • Power:
    • Power Generation
    • Power Transmission & Distribution
    • Information & Communication:
    • Info & Com. Networks
    • Info & Com. Mobiles
    • Siemens Business Services
    Lighting
    • Transportation:
    • Transportation Systems
    • VDO Automotive
  • 9.
    • The acquisition of Diagnostic Products Corporation and Bayer Diagnostics to widen the focus of Siemens Medical Solutions group and qualify it to be the world’s first healthcare supplier.
    • The establishment of the joint venture Nokia Siemens Networks: Siemens best way to remain a leading supplier of telecommunications infrastructure.
    Branding Strategy 2 Major Portfolio Adjustments:
  • 10.
    • An international company since its establishment adopting a global strategy: Its market is the global market.
    • The Siemens name is used as a blanket family name for the wide range of Siemens portfolio products.
    • D iversified, well-balanced product portfolio based on electronics and electrical engineering. Continuous innovation.
    • The brand is linked to a high level of innovation and technological sophistication in consumer minds
    • I nnovation strategy is that of a Trendsetter that sets new technology that is indispensable for the market.
    Branding Strategy Siemens Brand
  • 11.
    • Siemens global experience (operating in over 190 countries) provides it with strength, diversity and innovation.
    • Europe: "Siemens is part of the culture“.
    • USA: has become Siemens largest market in 2006.
    • Canada: Increasingly recognized as a brand of great products due to strong marketing efforts.
    • Japan: Providing high-end products and services with Japanese partnerships.
    Branding Strategy Siemens Brand
    • China: Increasingly important region for Siemens operations. Sales amounted to 4.4 billion Euros in fiscal year 2006.
  • 12. PRODUCT PORTFOLIO ANALYSIS
  • 13. Product Portfolio Analysis Product Portfolio At-A-Glance Automation and Control Power Information and Communication Medical Services Transportation Key Operating Groups
  • 14. Product Portfolio Analysis BCG Analysis – Basic Description
  • 15. Product Portfolio Analysis BCG Analysis – Automation and Control Market Growth Rate Market Share Low High Low High I&S SBT A&D
    • GW: Acquisition in metallurgy sector.
    • MS:
    • Leader in airport solutions.
    • No.1 in parcel sorting systems.
    • Biggest supplier of water treatment systems.
    • GW: Investments for Distribution in major growth markets.
    • MS:
    • No.1 Supplier of Automation Technology Worldwide.
    • Leader in innovation.
    • GW: Demand for increased safety, security and efficiency in large-scale buildings.
    • MS:
    • Increased penetration of their installed base
    • Success in services
    1.1. Automation and Drives (A&D) 1.2. Industrial Solutions and Services (I&S) 1.3. Siemens Building Technologies (SBT)
  • 16. Product Portfolio Analysis BCG Analysis – Information and Communication Market Growth Rate Market Share Low High Low High COM
    • GW:
    • Planned partnership for enterprise networks.
    • Network division faced problems and recovered.
    • Plans to restructure the COM division.
    • MS:
    • Third biggest handset producer in Europe.
    • Nokia Siemens Networks for added market share in mobile and fixed networks.
    2.1. Communication (COM)
  • 17. Product Portfolio Analysis BCG Analysis – Power and Lighting Market Growth Rate Market Share Low High Low High PG Pessimism for Fossil Power 75% of sales but limited future Wind Power potential Increasing demand for wind power PTD Osram GW: Fastest growing regional market MS: Expansion in Asia-Pacific Region GW: Expanding operation in Russia, China, India, and USA MS: Ranks First or Second worldwide 3.1. Power Generation (PG) 3.2. Power Transmission and Distribution (PTD) 3.3. Osram
  • 18. Product Portfolio Analysis BCG Analysis – Medical Market Growth Rate Market Share Low High High Medical Established Business for Expansion e.g. Current CT scanners
    • GW:
    • Increasing demand due to:
    • Growing and aging world population.
    • Breakthroughs in the field of early diagnosis and intervention (untapped areas) combined with high performance IT solutions and technologies
    New Untapped Diagnostic Areas e.g. Molecular Diagnostic Low
  • 19. Product Portfolio Analysis BCG Analysis - Transportation Market Growth Rate Market Share Low High High Low
    • Uncertainties
    • GW:
    • Risk of niching
    • MS
    • Competition developments?
    TS
    • GW:
    • Increase in number and size of mega cities (need for energy saving)
    • Networking different modes of transport
    • High speed transportation
    • MS:
    • Full range supplier and system integrator
    • Leader in the Int’l rail industry
    SV 5.1. Transportation Systems (TS) 5.2. Siemens VDO Automotive (SV)
  • 20. Product Portfolio Analysis BCG Analysis – Services Market Growth Rate Market Share Low High Low High
    • Questionable GW
    • Questionable ability to penetrate and gain leadership positions
    • GW:
    • The overall IT industry is booming
    • MS:
    • Among to ten in a huge industry
    • Leading e-government provider in Europe
    SFS & SRE SBS 5.1. Siemens Business Services (SBS) 5.2. Siemens Financial Services (SFS) 5.3. Siemens Real Estate (SRE)
  • 21. Market Growth Rate Market Share Low High Low High SFS & SRE SV Medical SBS PG PTD Osram COM SBT A&D TS I&S Product Portfolio Analysis BCG Analysis – All Units
  • 22.
    • The GE matrix is a model to perform a business portfolio analysis on the Strategic Business Units (SBU’s) of a corporation
    • It is a later and more advanced form of the BCG Matrix.
    Product Portfolio Analysis GE Matrix - Analysis GE Matrix vs BCG Matrix
    • Market growth replaced with market attractiveness.
    • Market share is replaced with competitive strength.
    • GE / McKinsey Matrix works with a 3*3 grid, while the BCG Matrix has only 2*2. Allows for more sophistication.
  • 23.
    • Some important limitations of the GE matrix / McKinsey Matrix are:
        • Valuation of the various factors
        • Aggregation of the indicators is difficult
        • Core competencies are not represented
        • Interactions between Strategic Business Units are not considered
    Product Portfolio Analysis GE Matrix Limitations Market Attractiveness Competitive Strength Low Medium High Low Medium High - At best, cash management - At worst, divestment
    • Problem:
    • Redouble effort?
    • Manage Cash
    • Cut losses and divest
  • 24. Product Portfolio Analysis The Approach
    • D etermined the drivers of each dimension:
    • Weight given to each of the drivers.
    • Scored each of the Strategic Business Units (SBU's).
    • Weights x SBU Scores.
    • Defined the range for each of the Low, Med, and High categories.
    • Depicted the GE Matrix based on the previous steps
    Competitive Strength Dimension Market Attractiveness Dimension Market Attractiveness Dimension
      • Market Size
      • Market Growth Rate
      • Market Profitability
      • Technology Development
      • Market Share
      • Market Share Growth
      • Customer Loyalty
      • Quality
    For Market Attractiveness For Competitive Strength H 120 30 10 30 10 30 10 30 10 Communications (Com) H 96 27 9 24 8 18 6 27 9 Transpiration Systems (TS) M 87 24 8 21 7 18 6 24 8 Siemens Financial Services (SFS) H 96 21 7 24 8 30 10 21 7 Power Generation (PG) H 102 27 9 27 9 24 8 24 8 Automation and Drivers (A&D) H 93 24 8 21 7 21 7 27 9 Lighting Industry (OSRAM) H 102 30 10 24 8 24 8 24 8 Medical Solutions (Med)   120 30 3 30 3 30 3 30 3   Score Technology Develop. Market Profitability Market Growth Rate Market Size   Market Attractiveness SBU's H 104 27 9 20 10 30 10 27 9 Communications (Com) H 102 30 10 18 9 30 10 24 8 Transportation Systems (TS) M 68 21 7 14 7 18 6 15 5 Siemens Financial Services (SFS) H 85 24 8 16 8 27 9 18 6 Power Generation (PG) H 100 27 9 16 8 27 9 30 10 Automation and Drivers (A&D) M 83 27 9 14 7 21 7 21 7 Lighting Industry (OSRAM) H 92 27 9 14 7 30 10 21 7 Medical Solutions (Med)   110 30 3 20 2 30 3 30 3   Score Quality Customer Loyalty Market Share Growth Market Share Competitive Strength SBU's
  • 25. Product Portfolio Analysis Siemens’ GE Matrix Market Attractiveness Competitive Strength Low Medium High Low Medium High Osram SFS Com, Med A&D, PG, TS
  • 26.
    • Siemens is operating in a highly attractive/growing market for all of its business units except for the financial services market which is considered a medium attractive market.
    • Siemens is highly competitive with a relative leadership position in the medical industry, automation and control industry, power industry, transportation industry, and the information technology industry. Therefore, continuous investments and development is recommended to keep its competitive edge and to cope with its competitors.
    • Siemens need to enhance its competitive strength in the lighting industry.
    • In the financial services, Siemens has to make a strategic decision whether to 'redouble its efforts' in the hopes of achieving market leadership, manage them for cash, or cut its losses and divest.
    Product Portfolio Analysis Conclusion
  • 27. ENTRY MODES AND ESTABLISHED RELATIONSHIPS
  • 28.
    • Contribution by funds, technology, or equipment.
    • Examples:
        • Nebraska Heart Institute partnership
        • Fujitsu-Siemens Computers JV
        • Nokia Siemens Networks JV
    • Efficient Networks.
    • Vai Ingdesi Automation (Argentine – 2007).
    Entry Modes Acquisitions Partnerships and Joint Ventures
  • 29. Entry Modes Objectives Access to innovative managerial practices Economies of scale and advantages of size Increasing Market share Reducing taxes paid Access to new technologies. Diversification Improved agility Improving access to financial resources Transfer of skills Entering new markets Spreading risks Synergies Eliminating competition Cost Efficiency
  • 30. PRODUCT SERVICE AND INNOVATION
  • 31.
    • Trendsetter.
    • “ Inventing the Future”.
    • Research & Development:
    • 50,000 people
    • 5.7 Billion Euros
    • Innovation Management:
    • 1)Product
    • 2)Process
    • 3)Culture
    • Patent Initiative.
    • Pictures of the Future.
    Innovation
  • 32.
    • 62,000 Patents.
    • One of the most innovative companies in the world.
    Innovation Result
  • 33. QUESTIONS?