The Siemens UK Journey to Excellence using the EFQM Excellence Model

1. The Siemens UK Journey to Excellence using the EFQM Excellence Model Dr Ian May Business Excellence Consultant, Siemens UK

2. Agenda • The EFQM Excellence Model • The Progress of Change – The Wild West • The Explorer Years: 1995 – 2002 • The Pioneer Years: 2002 – 2008 • The Settler Years: 2008 – Present • The Future

3. Agenda • The EFQM Excellence Model • The Progress of Change – The Wild West • The Explorer Years: 1995 – 2002 • The Pioneer Years: 2002 – 2008 • The Settler Years: 2008 – Present • The Future

4. Our journey uses this map… Enablers Results Leadership People Processes, Products & Services People Results Business Results Strategy Customer Results Partnerships & Resources Society Results Learning, Creativity and Innovation

5. Agenda • The EFQM Excellence Model • The Progress of Change – The Wild West • The Explorer Years: 1995 – 2002 • The Pioneer Years: 2002 – 2008 • The Settler Years: 2008 – Present • The Future

6. THE CHANGE TO ANYTHING FOLLOWS A SYSTEMATIC PATH 5 3 2 4 1 Analogy: The Wild West

7. nobody's been there before EXPLORERS Go with the change because its new

8. Need to know it’s good, will enjoy the challengeof the bears and the Indians PIONEERS

9. Need to know it’s safe, Bears dead Indians civilised SETTLERS

10. Take the place of the bears and the Indians OUTLAWS

11. Agenda • The EFQM Excellence Model • The Progress of Change – The Wild West • The Explorer Years: 1995 – 2002 • The Pioneer Years: 2002 – 2008 • The Settler Years: 2008 – Present • The Future

12. Early Adoption of the EFQM Excellence Model EXCELLENCE Sustainability Increased Profitability ContinuousImprovement 2002: Communications won UK EE Siemens UK engage with BQF & NoEE Assessment Output Used – Little Publicity Given to Model Implementation Congleton Communications, Healthcare and Transmissions & Distribution Next Stage on from Quality Management Philosophy Interest Gained

13. Agenda • The EFQM Excellence Model • The Progress of Change – The Wild West • The Explorer Years: 1995 – 2002 • The Pioneer Years: 2002 – 2008 • The Settler Years: 2008 – Present • The Future

14. 2002 – 2008 Business Excellence becomes a driver of business improvement Regional & National Awards Annual Strategic Review Assessment made Mandatory Excellence Model Pinch with Pride Recognised Benefits Fully Embraced?

15. The British Disease: There are five frogs on a log

16. Agenda • The EFQM Excellence Model • The Progress of Change – The Wild West • The Explorer Years: 1995 – 2002 • The Pioneer Years: 2002 – 2008 • The Settler Years: 2008 – Present • The Future

17. Business Excellence Framework for sustainable value creation One The integrated technology company Financial target system Outperformingrevenue growth Capital efficiency / ROCE Capital structure Growth (nominal) > most relevant competitors Siemens M&A hurdle rates SFS ROE Dividend payout ratio Sectors Top EBITDA margins of respective markets throughout business cycles Continuous Improvement in relation to market & competitors Page 17 Page 17

18. Business improvement opportunities through EFQMwere gaining approval EFQM Assessment was no longer mandatory… ..but most businesses then use it as a key input to strategy review!! Clear framework of assessment progression Lite Qualification File Internal Significant value add through improvement suggestions UKEA Active support of our improvement community EEA Pinch with Pride R4E

19. This was supported by our top+Business Excellence Board Aim Business Excellence Making business improvement ‘business as usual’for every Siemens employeein the UK

20. And we achieve this aim through….. The “pull” approach – we are a signpost to best practice Through EFQM assessment & benchmarking Through our top+ BE Community of over 200 people And through our National and regional external best practice events and seminars Through“Ask a question”

21. And through our Siemens Social Network group

22. We like to Pinch with Pride!!! We have many sharing mechanisms: Contact Ian! Top+ BE intranet Siemens Social Media top+ BE Group Corporate top+ and Lean sites NoEE, BQF and EFQM Intranet Sites Best Practice Sharing Events Awards assessors experiences – NoEEA, BQF UKEA, EFQM EEA

23. The top+ BE Board has representation from all areas of Siemens UK Chair – Gordon Wakeford Energy – Dan McGrail IC – David McIntosh, Sharon Wallace , Chris Beadsworth Industry – Sue Bagguley Healthcare – Ian Clarke, Ralf Seidler, Shaun Knights Corporate – Jane Hart, Jennifer Newton Cross Sector – Steve Ashton, Graham Jones,Marcus Hall, Jane HArt Ireland - Aine Higgins Secretary – Ian May

24. Industry Healthcare Infrastructure & Cities Energy We are still climbing the mountain KEY: Summit (1000 points / 29,035 ft) Bosch Drives Congleton Healthcare Sales & Service Industry Automation & Drives In sight of the summit Traffic Solutions, Metering, Communications and Services, Service Fossil Transmission On Oxygen GSS Operations Magnet Technology Diagnostics Sudbury Rail Systems Renewables Onshore Protection Devices Past 21,000 ft Well on their way Water Technologies Medium Voltage, Service Smart Grid Fossil Instrumentation & Electrical Industrial Power Lincoln, Renewables Offshore Fossil Energy Services Building Technologies Rail Automation Mobile Communications Left Base Camp Service Renewables, Metal Technologies, Corporate Comms, Legal, Business Development, HR, Low voltage Base Camp, 100 points, 17000 ft SRE, Logistics and Airport Solutions, Rail Automation Control and Information Diagnostics Llanberis IndustrySoftware, Invensys, Tronic CorporateFinance Off piste: Oil & Gas UK Financial Services

25. ….and what has been the benefit?

26. Case Study A: Employee Engagement & EFQM Journey North of England Excellence BQF UK Excellence UK Excellence Achievement Award Leadership 700 North of England Achievement award People & People Results 600 500 400 83% EFQM Score 300 71% 68% 68% 200 62% 100 EFQM Score Employee Engagement

27. Case Study: Business B and C show a clear relationship between profit and assessment score UKExcellence Winner UKExcellence Winner UKExcellence Winner EFQMExcellence Winner UKExcellence Finalist UKExcellence Finalist UKExcellence Finalist MidlandsExcellence Winner Award Year Comms Healthcare Profit

28. Case Study D Recognition Selected Key Performance Indicators 2007 Awarded Committed to Excellence status 2008 Internal Won BQF Achievement Award for Process Improvement & Highly Commended Best Electronics Plant& Assessor training Profit in % +23% Sales 2009 Won Southern England Excellence award +31% 2010 Won Best Factory Award & won Best Electronics and Electrical Plant AwardHighly Commended for People Management & Skills development. Sales per employee -10% Manufacturing Overhead Costs Produced hours per head increased from 1213 to 1314 per year (8% increase) 2007 2008 2009 2010 2011 2012 3i suggestions per head increased from 4 to 8.8 per year.

29. Agenda • The EFQM Excellence Model • The Progress of Change – The Wild West • The Explorer Years: 1995 – 2002 • The Pioneer Years: 2002 – 2008 • The Settler Years: 2008 – Present • The Future

30. Business Excellence is gaining momentum thanks to Awards & financial performance improvements • Our business excellence/business improvement/quality priorities and activities will be: • More BE assessment, • More assessors, • More sharing, • Greater benchmarking, • More involvement in benchmarking in Europe Systematic benchmarking with the BQF & EFQM The tools and techniqueswe will be using are: EM Assessment, Lean, Pinch with pride • (supported by strategically identified benchmarking needs)