Siemens France : A Perfect Integration

1. Yvan Moreau, Huang Bin, Andrei Rotaru, Feargal Brady Siemens France : A Perfect Integration Best In France - Group ES2D

2. Thanks We are very grateful to Mr G. Maisondieu, Chief Financial Officer of Siemens France, to have accepted to spend time answering our questions, particularly at this period of the year Best In France - Group ES2D

3. Agenda • Background • Key Figures • Product Lines • The Values of Siemens • The HR Policy • Did Siemens encounter hurdles? • How is Siemens France managed? • Development Strategy • Recommendations Best In France - Group ES2D

4. Siemens is not at all a newcomer in France: its first patent was deposited in France in 1850 In 1851, Werner Siemens presented a thesis at the French Scientific Institute In 1878, the company “Siemens Frères Ingénieurs électriciens” was founded in Paris Then, the story of Siemens in France has been a very rich path of innovations, acquisitions partnerships and creations of numerous companies Background Best In France - Group ES2D

5. In the last years, Siemens reinforced its landmark on the French territory by: Creating R&D centres (commutation systems in Lannion and Design of Integrated Circuits in Nice) Opening production plants Creating new profit centres: Siemens Business Services, Siemens Energy Buying the Turbines activity from Alstom Launching innovative products (medical systems and telecommunication) Background Best In France - Group ES2D

6. Turnover: 3.4 billion euros in 2003 (+12% vs. 2002) 12 000 employees: average age of 39, 30% of women and 70% of men 40% employees in the Paris area 60% outside Paris Key Figures Best In France - Group ES2D

7. Siemens France offers a very wide range of products, from the nuclear power industry to microchips. The products are split into five categories: Telecommunications Industry Medical Systems Transportation systems Automobile Equipments Product Lines Best In France - Group ES2D

8. Since Siemens is becoming increasingly multicultural, it is trying to keep the core values of Siemens but also to adapt to the countries if necessary Since the quotation of Siemens on the New York Stock Exchange, some American values are beginning to influence Siemens’ “way of life” (influence of short term financial ratios). The Values of Siemens Trust and confidence values Importance of quality work Importance of Family Long term investment in personnel and in fixed assets Best In France - Group ES2D

9. The CEO should be native from the country* Siemens HR policy: the CEO and the CFO must be appointed by the Headquarters Currently, on the Executive Committee of Siemens France, 3 persons out of 10 come from Siemens Germany or have been appointed by the Headquarters. The policy is therefore to help people from the middle management to increase their potential (eventually via training courses) to become future Siemens managers in their home countries The Human Resources Policy *Philippe Carli, a French person, is currently the CEO at Siemens France Best In France - Group ES2D

10. Siemens did not encounter many hurdles to pursue its integration: Employees are more and more mobile within and outside the company Employees are aware of culture differences, what makes the integration easier. Misunderstandings between the Headquarters and France are less and less frequent No real cultural, structural or fiscal problems Siemens France adapted to the 35 h / week rule without any problem: Siemens’ policy is to adapt and tackle problems, and not to find ways to avoid them Did Siemens encounter hurdles in France? Best In France - Group ES2D

11. Siemens France is managed locally, and not as a “satellite” of the Headquarters. Siemens France reports on a regular basis (monthly reportings, budgets and forecasts) to Siemens AG, as a subsidiary would report to its main shareholder Siemens France therefore has a very independent management. Its duty is to respect the commercial and financial objectives that have been agreed upon. How is Siemens France managed ? Best In France - Group ES2D

12. The activities of Siemens have changed a lot. They now require high innovations and investments: 70% of the products are less than 5 years old Siemens has become the 5th Group worldwide for R&D investments This is why Siemens tries to develop around the following core activities: telecommunication, industry, medical systems, transportation systems, equipment for automobiles All the activities of Siemens are present in France, and it has always been so Development Strategy in France Best In France - Group ES2D

13. For the Siemens products, the situation of the French market is very specific : It is the the home market of many international groups (Alcatel, Alstom, Schneider…) The competition is therefore very strong In addition, The French companies tend to consider the French market as their “chasse gardée” This is why the strategy of Siemens is to be considered as a French company of German origins, instead of being seen as a German company in France. The creation of the “Fondation Siemens” is a way to settle Siemens in the French economic landscape and to increase the visibility of the brand on the French market Development Strategy in France Goal : to be the first international Industrial Company in France Best In France - Group ES2D

14. France is a very competitive market: Do not invest in France without quality ready- to- launch products Bring innovative products Invest in R&D Differentiate from your competitors Recommendations to a future investor in France Best In France - Group ES2D