Siemens 2005 Annual Report Download - page 20

20
Letter to our Shareholders Managing Board Fit4More
Operational Excellence
Investments in research and development
Maintaining traditional strengths while driving progress –
that’s the way to ensure sustainable and profitable growth at
a global company like Siemens. In fiscal 2005 – true to our
motto of “continuity and change” – we invested €5.2 billion
in research and development (R&D) to lay the foundation for
successful innovations. We were once again a world leader in
R&D outlays in the electronics and electrical engineering
industry. Well over half of this investment flowed into soft-
ware and information and communications technology.
Innovative materials and material systems – ranging from
nanotechnology and biochips to intelligent sensors and
actuators – continue to be top priorities.
Our R&D activities are focused not only on customer needs
and market requirements but also on long-term mega-
trends. The world’s population is growing, driving ever-
greater urbanization. In industrialized countries in particu-
lar, average life expectancy is rising, and natural resources
like water and fossil fuels are becoming scarcer. All over the
world, traffic volumes are increasing, the number of mega-
cities is growing, and security needs are becoming harder
and harder to satisfy. These are the challenges that our broad
technology portfolio and our innovations are designed to meet. The integration of cutting-
edge technologies – a process effectively supported by our top+innovation programs – is
enabling us to offer unique solutions with high customer benefit, while setting the pace in
all our business areas. As innovation cycles become shorter and shorter, it is critical to get
new products to the market quickly and, above all, at just the right time. We have acted on
this realization: more than 75 percent of our sales today are generated by products and
solutions less than five years old.
Now spanning the globe, our R&D activities are increasingly concentrated in regions with
strong market growth, dynamic innovation and highly qualified people. This has further
intensified internationalization: Slightly more than 50 percent of our 47,000 researchers
work outside Germany – mainly in other European countries, the Americas and Asia-Pacific.
www.siemens.com/research_and_development
Information and
Communications
Automation
and Control
Power
Transportation
Medical
Lighting
Other
in billions of euros
2005
3%
4%
14%
21%
9%
19%
30%
2004
5%
13%
19%
9%
19%
32%
3%
5.2
4.7