University Assignment: Siemens Case Study Analysis

This case study examines the corruption scandal within Siemens, a prominent German company, highlighting issues of bribery, unethical practices, and their impact on the organization's culture and reputation. The analysis explores the normalization of corruption within Siemens, the suppression of dissent, and the adverse effects on the company's market value and competitive standing. It investigates the damage to Siemens' reputation and the erosion of trust among competitors and stakeholders. The study also proposes potential solutions and strategies a manager could implement to combat corruption, including fostering a democratic and transparent organizational culture and enforcing anti-corruption measures. The assignment covers the impact of corruption on the company's market value, relationships with competitors, and the importance of ethical leadership in preventing such issues.

Running head: SEIMENS: CASE STUDY
SEIMENS: CASE STUDY
Name of the student
Name of the university
Author Note

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Question 1
Corruption has been a part of culture in the German company Siemens. Bribery and
corruption have been the part and parcel of the respective company. The customary reasons of
corruption in companies and corporate houses are greed and excessive desire of money and
culture of dishonesty. Siemens, which is considered to be one of the best corporate houses that
has its effects throughout the world, has undemocratic organizational culture and taking bribes
have become one of their “strategic business operations” to earn more money quickly. As
Siemens has quite a lot of monopoly in the market when it comes to technology and gadgets,
therefore, the company enjoys a higher degree of respect and power in the corporate world.
Power brings corruption and absolute power brings absolute corruption, as stated popularly in
proverbs. To justify the unprecedented growth of bribery and corrupt practices within the
organization, a manager- employee of Siemens normalized and trivialized the issue by stating
that bribes were taken by them in order to keep the business “alive” and “get going” without
jeopardizing the employment of thousands of people who have been making career through
Siemens. However, such statement is blunt and cynical as the practice of bribery and corruption
would harm the reputation and goodwill of the firm in the long run.
Question 2
If a manager or an executive took a stand against the corruption that happened in
Siemens, he/ she would be hackled and he/ she might have been forced to sign the required
mandatory documents that stated no illegal payments were made in the organization. The
employees who showed dissent towards the impending corrupt practices in the respective
company would have been compelled, or rather, forced to sign the compliance form stating that

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they had not engaged in any such corrupt practices while knowing well that it was not the case.
Siemens has been too much authoritative towards its employees and professionals. Since the
organizational culture of Siemens is not that democratic in nature as it seems to be, therefore,
such coercive and authoritative practices are very much common within the organization. With
its corporate power and financial funds, the company has been able to keep itself upright even
after getting the obnoxious allegations of bribery, corruption and practices of dishonesty within
and outside the organization as stated.
Question 3
The dishonest, corrupt practices carried out by Siemens throughout the world have left
the competitors of the company, angry and perturbed. Such action has resulted in a trend of shut
down of contacts between the different business with that of Siemens. As the competitors from
all around the world started a trend of boycotting Siemens, therefore, the company has the
tendency to suffer a distortion when it comes to competition. Corruption is a big allegation
which, if imposed in any organization, big or small, can bring out adverse effects in the market.
By the allegations of corruption that was put on Siemens actually made the company drop its
market value. People from all over the world started watching Siemens as a dubious
organization. It has not only hampered the goodwill and reputation of the company, but also the
different competitors who actively competed with the company and assisted the same have also
lost faith and trust on the company and its business operations. Such actions have led to a
complete distortion of competition where the company has once survived and thrived. It has
given an unfair advantage to the company giving bribes. As long as Siemens views the act of
taking bribery as a cost of carrying out business, competitors who do not like giving bribes are

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not taken into account by the company, are phased out with many customers willing to be paid
off.
Question 4
Before the corruption scandal actually happened in Siemens, the reputation of the
company was extremely good. However, with the spread of the corruption scandal, the company
has suffered loss, both financial and reputational. It takes nearly a lifetime to build reputation,
which in the case of Siemens was also true. However, as the years passed, the company became
too influential in its dealings and business operations. The company gained a monopoly in the
hands of the constricted market of technology and gadgets. Nobody can deny the product
superiority and customer satisfaction of Siemens and no other companies can match it. However,
as corruption entered into the company, it was observed that the Siemens compliance program
only existed on paper and not in reality. The countries where they have taken bribes, such as
Bangladesh, Nigeria, Greece and Spain, have possessed restriction and certain laws that go
against Siemens and its business operations. Such actions have resulted in a considerable
disruption of its business throughout the world.
Question 5
If I had been a manager of Siemens and I had become aware of the dishonest and corrupt
practices happening all across the company, I would make sure that the anti corruption measures
of the company is not only restricted to the papers, but also try to implement them in real life. As
a manager, I would take up the different anti corruption initiatives within and outside the
organization. As a manager, I would have made the organization more democratic and
transparent as an organization should be. As a manager, I would have changed the organizational

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culture of the company and made it more democratic and less coercive. As a manager, I would
not have kept any kind of responsibility or task that is circulating in the organization in secret.
All kinds of tasks and happenings would have been transferred and transmitted to all the
employees of the company and no secrecy regarding any issue was to be kept (Markopoulos &
Vanharanta, 2014). The communication channels that would have been put by me in the
organization would have been as open as it could. Results of all the employees as well as the
company in different sectors and fields would have been shared with all the professionals present
in the company.

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References:
Markopoulos, E., & Vanharanta, H. (2014). Democratic culture paradigm for organizational
management and leadership strategies-the company democracy model. Adv. Hum.
Factors Sustain. Infrastruct, 2, 12.