Siemens 2008 Annual Report Download - page 172

76 Management’s discussion and analysis
Financial performance measures
Our Fit42010 strategic program includes both nancial and non-nancial performance measures. We believe
that our nancial performance measures will help us increase the value and competitiveness of our company
and thereby strengthen our leadership positions or close the gap to our top competitors by 2010. For informa-
tion about non-nancial measures included within Fit42010, see “Non-Financial performance measures” later
in this Report.
Several of our nancial measures were added in scal 2008. These new measures complement nancial targets,
particularly including the protability targets we have used previously in our operations. The new nancial
measures focus on growth, capital efciency, cash generation, and optimization of our capital structure.
Fit42010 also denes targets for certain corporate projects, particularly including our global program to reduce
selling, general and administrative expenses (SG&A program).
Operational performance measures: growth, profitability, capital efficiency, and cash conversion
The rst of our operational performance measures focuses on growth, in order to ensure the revenue develop-
ment required to produce income growth. Our goal is to grow annual organic revenue at twice the rate of global
GDP growth by 2010.
Growth
Value
Generation
Liquidity
Profitability/
Capital
efficiency
Revenue growth
Formula:
Revenue current period*
= – 1 × 100%
Revenue prior-year period
* According to Global Insight inc. as of November 14, 2008, for
calendar year 2008 global GDP is expected to grow by 2.7%,
for calendar year 2007 global GDP grew by 3.9%.
* excluding currency translation
and portfolio effects
10%
Fiscal year 2007
9%
Fiscal year 2008
Target:
2 × global
GDP*