Analysis of Siemens: Structure, Factors, and Business Risks

This essay provides a comprehensive analysis of Siemens, a major global industrial manufacturing firm. It begins by outlining Siemens' hierarchical organizational structure, detailing the roles of the supervisory board, managing board, various departments, and regional units. The essay then examines the internal factors impacting Siemens, such as its financial strength and the importance of employee relations, as well as external factors like political and economic instability, technological changes, and increasing competition. Furthermore, the essay identifies various risks faced by Siemens, including economic downturns, shifting energy needs, technological advancements, and competition. It also discusses Siemens' strategies for mitigating these risks, including adopting best practices, fostering employee relations, utilizing management tools, and implementing effective supply chain and innovation strategies, and the importance of corporate social responsibility and performance monitoring. The conclusion emphasizes the critical role of leadership and management in navigating these challenges and ensuring the company's success.

MANAGEMENT
AND
BUSINESS CONTEXT

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In the modern global business it has become essential for organisations to make sure
that they have an effective business structure for facing all the challenges that are coming to
them (Wheelen & Hunger, 2011). There are many internal and external factors that are posing
threats for the bigger firms. One of other major factor that is making it difficult for the big
firms to operate is Globalisation. This has made considerable increase in the competition
which has become dangerous for most of the companies. Siemens is a Germen conglomerate
firm having it’s headquarter in Munich and Berlin. It is the largest industrial manufacturing
firm in Europe with its branch offices in abroad. It is in the business of healthcare, industry,
energy and infrastructure. This essay highlights the organisational structure of Siemens as
well as the internal and external factors that impact their business. It also showcases the risk
that is currently confronting the business of the organisation.
Every company makes their organisational structure in a way so as to bring
smoothness in the work process (Carroll & Buchholtz, 2014). There structure is hierarchical
and has important persons at each levels of their organisation. Siemens has adopted
organisational structure in a way that information can be easily communicated at each level.
This helps them in making decisions at a quick pace.
At the top of their organisational structure there is supervisory board that are responsible for
making all the final corporate level decisions as well as the decisions that are of strategic
importance. Under them is the managing board who work as an assistant for the supervisory
board in the process of making decisions. In this management board there are CEO’s of their
different sectors. Under them are the various departments having different executives. Other
cross sector services are present at this level only. Under them is the cross sector business
which is at the second last level of the organisational structure consisting of services like IT
solutions and finance. At the last level of the organisational structure are the regional units of
the company. Only the supervisory board and the management boards are present at the head
offices and rest others are present in various reasons of the world.
There are many internal and external factors that are related to the company and tend
to impact the business of the cited firm. It is crucial for the company to make sure that they
have an effective plan for reducing the negative impact of these factors (Yang, Hong & Modi,
2011).

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Internal factors Plays a very crucial role in this. The financial strength of the company helps
to make sure that they can implement any strategy or decisions for their operations (Geppert,
Matten & Williams, 2016). A good cash flow also helps in bringing smoothness to the firm.
Siemens has good financial assets with them which will help them in their growth. Siemens
needs to make sure that they have effective relations with their employees as they are the
valuable assets of a company. Any type of mismanagement in human resource can lead to
loses due to the conditions like strikes or lockouts.
Siemens has a good management and leadership at the top. Management and leadership have
the greater impact on their business. This is also due to the fact that they are in the business of
many things and hence they need to be properly managed.
Apart from these internal issues the external environment also plays a crucial role in it. The
political environment in the Europe is changing and hence it has greater impact on the
business of the firms (Maylor, Blackmon & Huemann, 2016). This is due to the fact that any
change in the government policies directly affects the business of the organisation.
In many countries of Europe there is economic instability (Bharadwaj, El Sawy, Pavlou &
Venkatraman, 2013). This has made it difficult for the companies like Siemens to ensure high
profits. Any investments in the new business have to be done after the proper analysis in
every sense.
The demands of the society are changing especially in terms of technology Siemens is
producing. These changes can also be noticed in the energy sector. This has forced the
company to transform its business accordingly. Apart from this the speed with which
technology is changing is very fast and hence Siemens also need to make sure that it does a
business which is more research based. There are lot of companies that are in the market who
are giving Siemens direct or indirect competition. This has forced the company to make sure
that they have an effective plan for tackling such situation. A fairly new competitive strategy
is required by the company. Due to globalisation the competition has become cut throat.
There are several types of risks that are present in front of the Siemens. All these risks
have to be properly handled so as to reduce their negative impact on their business (Cui,
Loch, Grossmann & He, 2012). In many parts of the world there has been economic
breakdown. The slowdown in the American market and the decline of the European economy
has become a problem for the Siemens as these two were the major market for them. There

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have been change in the energy needs of the people and hence Siemens need to make sure
that they have planned for the future renewable energy needs of the society.
Even when the Siemens have a greater brand name then also they have to make sure that they
have new strategies for making growth in a sustainable manner. Competition is increasing at
such a faster rate that it is becoming riskier to invest into new business. There have been
changes in terms of technology at a much faster rate. This has created risk in the market. It is
due to the fact that if the company is unable to match the global standards then new
companies might take over their market share (Benta, Podean & Mircean, 2011). In the
existing financial burden, shifting of technology will requires a lot of money to be invested
especially in the training of employees.
The choice of the people is changing at much faster rate this has made it difficult for the
company to fulfil the demands of the consumers they are serving. It has made difficult for the
company to make sure that they are producing products as per the demand of the market
(Epstein & Buhovac, 2014). Due to this fast shift in choices any big plan is also at risk of
getting failed. Its bribery scandal revealed in the year 2006 has risked its trust in the minds of
the shareholders. This scandal was a blot on the image of the company which can be
dangerous for them in their future operations.
It is essential for the company of the scale of Siemens to make sure that there
performance does not degrade. To ensure this they need to adopt best practices in the industry
(Li, 2014). In order to avoid any kinds of strike offs and lock outs Siemens has to make sure
that they understand the needs of their workers. It helps them in fostering healthy employee
relation which is essential for the growth of the company.
Siemens takes use of the management tools such as TQM and Six Sigma to make sure that
they are producing products as per the demand of the market. It also helps them in finding
gaps in their operations and filling them to ensure long term growth in the market. Siemens
has adopted good supply chain management strategies that help them in making sure that they
are fulfilling the demands on time. This company has healthy relations with their suppliers
which helps them in available raw material at lower prices. This Company is known for its
innovative products (Trimi & Park, 2013). It has invested a lot in the innovations which is
again due to the market demand. It helps them in achieving higher growth rates.

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Most important function that will help company in achieving is strategies. This is the
requirement of the industry as in the globalised business it is the only thing that differentiates
them form other competitor’s products. They need to invest more on the innovation and
hence need to pump a lot of cash in the R & D function. Company needs to make sure that
they have an effective corporate social responsibility strategy (The Guardian, 2018). This will
help in brand management of the company. It is the function of the top leadership and
management to apply.
This Company needs to have an effective performance monitoring and control system. It will
help in making changes as per the requirement of the company and provides more control on
the operations of the firm.
On the concluding remark it can be said that the organisational structure of the Siemens is
designed in hierarchical manner so that every level understands their set of responsibility.
There are many internal and external factors that are impacting the business of the firm.
Company also needs to deal with the risks that are posed in front of the company. They need
to adopt best practices in the industry so as to improve their performance. Apart from this
they can adopt various functions to implement all the planned strategies for them. In all these
the role of the leadership and management becomes very important.
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