Siemens: Building a Structure to Drive Performance and Responsibility (A) Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

Peter L Scher became CEO of Siemens in July, 2007. This was one of the most turbulent times in the history of the author, since the company was reeling from the observance of a scandal involving hundreds of millions of euros in suspected bribes, and had to pay billions of euros in fines and fees to clear his name. Further, the operating company of the group were ineffective their peers in terms of profitability, and have been for some time. Adding to the challenges,, L Scher was the first outsider to run Siemens since the company's website in 1847. After his arrival, L Scher moved quickly to assess the organization, global, multi-line technology and engineering company with more than 475,000 employees and more than 66 487 million of revenue and 3,345 million of net income. Klaus Kleinfeld, the previous CEO, has been improved by the performance, driven by the company to become more globally focused, and sold off underperforming and non-core assets. However, his tenure was cut short by the bribery scandal. When L Scher arrived, he felt the company was overly complex, individuals lacked accountability and significant tensions existed between headquarters and the regions. L Scher took advantage of the crisis to reorganize the company from 10 groups of operating up to three sectors, to introduce regional clusters to enable smaller markets to focus on sales, establish the "right of way" of the global business, simplify financial reporting, and improve sales efforts to market verticals. In addition to the changes that L Scher, made to the structure of the company, he transformed the attitude of employees' and renewed the entrepreneurial and innovative spirit among managers in the organization. "Hide
by Jesper Sorensen, Sara Gaviser Leslie Source: Stanford Graduate School of Business 21 pages. Publication Date: 07 October 2010. Prod. #: SM181A-PDF-ENG