Siemens 2009 Annual Report Download - page 146

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 Reports Supervisory Board /
Managing Board  Corporate Governance  Management’s discussion and analysis  Consolidated Financial Statements
44 Business and operating environment 63 Fiscal 2009 – Financial summary 66 Results of operations 84 Financial position
the prior fiscal year. Overall we spent around €228 million on
continuing education in the past fiscal year (without travel
expenses), systematically developing our managers’ and em-
ployees’ hard and soft skills, on average €562 per employee.
The Performance Management Process (PMP) implemented
worldwide is the backbone of our personnel management. The
globally uniform instrument helps leaders and employees de-
termine clear personal goals and share the open, practical
feedback necessary to achieve them. The process also sup-
ports us in setting compensation, providing professional de-
velopment opportunities and identifying both Top Talents and
Key Experts.
Closely associated with developing People Excellence is giving
them strategic and challenging businesses to work in. Our
Portfolio management is therefore based on two principles:
we invest in sustainable growth markets associated with our
megatrend strategy, and we aim for leading positions in all our
businesses.
Overall we aim for a stringent capital allocation, so we have
defined three portfolio priorities to focus our investments:
▪ Our top priority is businesses with organic growth. In re-
cent fiscal years we have made a number of major acquisi-
tions that fueled our growth. We now aim to achieve or-
ganic growth based on providing innovative products and
solutions in our existing businesses.
▪ Our second priority is to streamline our portfolio accord-
ing to our Sector structure. From this perspective, we ex-
amine all our businesses with regard to their strategic and
financial fit for their respective Sectors and for Siemens.
▪ Thirdly we focus on selective investments that can en-
hance our competitiveness and augment our portfolio.
Each such investment must meet rigorous financial criteria
and support our overall strategy.
To achieve organic growth, we strive for Operational Excel-
lence including world-class innovation and supply chain man-
agement.
Open innovations is our program for intensifying our focus on
trendsetting technologies; identifying technology and applica-
tion trends; and translating innovative ideas into marketable
products and services. One measure of our performance in in-
novation is our patent position in trendsetting technologies.
Siemens holds approximately 56,000 patents, a number that
ranks us among the world’s leaders. In fiscal 2009, our re-
searchers submitted approximately 7,700 invention reports
and we filed approximately 4,200 patent applications. A year
earlier, the number of submitted invention reports was 8,200
and we filed approximately 5,000 patent applications. The
average number of employees engaged in R&D in fiscal 2009
was 31.8 thousand, compared to 32.2 thousand in fiscal 2008.
Global Supply Chain Management is our program for further
expanding our global market presence. Excellence in supply
chain management is particularly important in penetrating
new markets, especially in fast-growing regions such as Asia,
because it enables us to effectively move production close to
our customers. Supply chain management is also a vital capa-
bility for increasing the efficiency of our overall global value
chain, which includes R&D, product development, sourcing
and production. A key initiative in all these regards is known as
SMART (Simple, Maintenance friendly, Affordable, Reliable,
Timely to market). This initiative focuses on strengthening lo-
cal procurement, engineering, and manufacturing so that we
can provide products in large volumes with good quality and
competitive prices. In particular, we aim to develop SMART
products and solutions to meet specific customer require-
ments, including at the low end of the market.
Corporate Responsibility expresses our commitment to soci-
ety. This includes Corporate Governance, which is the basis of
all our decision-making and monitoring process, Compliance,
Climate protection and Corporate citizenship.