Siemens 2007 Annual Report Download - page 34

34 Fit42010
Fit42010: Performance
Fit42010 defi nes the targets and metrics that measure our performance.
Our overarching aim remains the same: to achieve profi table growth and
further increase the value of our Company as a whole. In addition to
pushing sales growth and profi tability at our individual Groups, we’re also
focusing on increasing our return on capital employed, improving our
long-term cash position and optimizing our capital structure.
The challenges posed by the two megatrends urbanization and demographic change are driving
customer demand. Siemens is tapping the resulting business opportunities – something we’re
better positioned to do than virtually any other company in the world – in order to continue
growing twice as fast as the global economy.
To be sustainable, growth must be profi table. That’s why we’re aiming to match or exceed the
profi tability of our best competitors in all our operations. Although achieving our Fit4More
target margin ranges by the second quarter of fi scal 2007 was a key step in this direction, some
of our businesses still have potential for further improvement. As a result, we’ve raised the
target margin ranges for the seven Groups Automation and Drives (A&D), Industrial Solutions
and Services (I&S), Power Generation (PG), Power Transmission and Distribution (PTD), Medical
Solutions (Med), OSRAM and Siemens Financial Services (SFS). Some of these Groups are profi t-
ing from very positive market environments and the successful integration of recent acquisi-
tions. We’ve also raised the target margin range for an eighth Group: Siemens IT Solutions and
Services (SIS), whose restructuring is now complete.
(1) The Fit4More margin range was for Siemens Business Services.
(2) The margin range was raised to 14 - 17% from 13 - 15% in November 2007.
(3) Return on equity at SFS is calculated by dividing income before income taxes by equity assigned.
Groups
Siemens IT Solutions and Services (SIS)(1) 5 – 6% 5.2% 5 – 7%
Automation and Drives (A&D) 11 – 13% 14.2% 12 – 15%
Industrial Solutions and Services (I&S) 4 – 6% 4.6% 5 – 7%
Siemens Building Technologies (SBT) 7 – 9% 7.5% 7 – 9%
Power Generation (PG) 10 – 13% 10.7% 10 – 14%
Power Transmission and Distribution (PTD) 5 – 7% 8.1% 7 – 10%
Transportation Systems (TS) 5 – 7% 5.0% 5 – 7%
Medical Solutions (Med)(2) 11 – 13% 13.4% 14 – 17%
OSRAM 10 – 11% 10.5% 10 – 12%
Siemens Financial Services (SFS)(3) 18 – 22% 52.6% 20 – 23%
Fit4More
margin ranges
Targets achieved
in Q2 2007
New Fit42010
margin ranges
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