Posts Tagged ‘siemens’

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German M&A specialist on complex projects

Tuesday 18 August, 2009

I caught Kai Lucks presentation on the complexity of M&A @ the Alliance of Merger & Acquisition Advisors summer conference.  Kai was in charge of mergers & acquistions for Siemens AG for many years & is now the president of the German Federal M&A Association & CEO of the Merger Management Institute.  He declined my offer to post his presentation, so I’ll summarize:

Siemens invested 32B Euros in acquiring companies in energy/environment, health systems, & automation/control of industrial/public infrastructure over the last 10 years.

With the acquisitions of Dade Behring, Bayer Diagnostics, & DPC, Siemens created a world-leading medical diagnostics company.

Siemens has a structured/phased integration process:

  1. preparation/id key positions
  2. set goals
  3. integrate/transfer to line management
  4. benchmarking

Mechanical & control design will converge in the next 10 years.

Integration success is measured in 3 dimensions:

  1. customer financials
  2. milestones
  3. attrition rates

The acquisition of the Danish firm Bonus wind power offered superproportional growth by expanding to international markets.

M&A performance is the key challenge-big M&A performance is even weaker.

Siemens’ closed loop approach works like this:

  • strategic planning makes the business case in the preparatory phase
  • deal details & integration preparation are worked out during the transaction phase
  • contract management & implementation/controlling are installed in the implementation phase
  • business management transfers know-how back to strategic planning

Professional management can strongly improve results.

Knowledge/experience management of 12 drivers based on volume, complexity, & restructuring, is key to success:

  1. Sales volume-own unit
  2. sales volume-candidate
  3. own employees
  4. candidate employees
  5. countries
  6. locations
  7. businesses
  8. value chain
  9. improvement
  10. manufacturing heads reduction
  11. locations reduction
  12. cultural change

There are 4 M&A project types:

  1. acquisition only
  2. cost cutting
  3. complementary technology
  4. integrated acquisition/re-engineering

Acquisitions of Sylvania lamps, Westinghouse power generation systems, & Huntsville automotive components provided different examples of experience management.

Utilities & power generation are in opposite phases of the merger endgame (opening, scale, focus, balance/alliance).

In 2007:

  • Europe bought $35.8B in America
  • America bought $27B in Europe
  • Asia bought $9.6B in America
  • America bought $5B in Asia
  • Europe bought $.5B in Asia

My take:  it’s a shame Dr. Lucks chose not to allow his presentation to be published because he puts together some of the best presentations I’ve seen.  In some ways they are typically German, i.e. very structured & organized, but in many ways that’s a very good thing.

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German gender wage gap

Tuesday 30 September, 2008

I caught this article by Sarah Plass in the Chicago Tribune Wage gaps frustrate German women which illustrates the plight of female workers in Germany.  In some ways, it’s little different from other countries, but for such a highly developed economy, it is still a bit of a surprise.  Women earn 24 % less than men who do the same work, a gap exceeded only in Cyprus, Estonia, & Slovakia, company Germans are not used to keeping.  The European average is 15.9%.  US & European statistics are not comparable because the Americans count only full-time workers while the Europeans include part-time workers.

When I lived/worked in Germany @ Deutsche Bank & Siemens, I could see that women were not treated as equals in the workplace & apparently that has not changed.  I kept in touch with a colleague from the bank & she left shortly after I did.  A colleague of mine from Siemens fairly consistently bemoaned the opportunities for women there.  I believe she had a child & left the company.  I’m surprised that the German government hasn’t done more to assure equality.  In many ways German society tends more towards the middle, so it’s inconsistent that the government doesn’t do more to that end.  Given the low birth rates in Germany, it’s even more startling that they don’t do more to encourage bigger families.  It still surprises me that in some ways, both professional & personal relationships are still quite old world in the old country, despite all of the advances in technology, business culture, etc.

Their neighbors to the north seem to be doing a much better job in this area.  I was involved with a woman in Denmark & it was easy to see women were equals to men when they held some jobs we typically associate with men, simply because of the worker shortage, they have to.  1 of the things I liked when I spent about 6 months in Sweden was that women were on par with men @ work.  Again, market circumstances dictate there.