Siemens 2011 Annual Report Download - page 64

20 Siemens – A pioneer of our time 50 Get closer to our customers 46 Focus on innovation-driven growth markets
51 Grow in emerging markets
52 Expand our service business
54 Intensify our customer focus
52
For the emerging countries, increasing power consump-
tion poses a long-term challenge. In India, for example,
medium-voltage switchgear is in very short supply.
Competition on this market, which is characterized by
regionally specific technical requirements, is fierce. Pro-
ceeding on the basis of our globally standardized prod-
uct platform, our employees in India have developed
switchgear that’s winning new orders. In fiscal , our
new plant in India will begin producing medium-voltage
switchgear that meets our worldwide quality standards.
Our portfolio currently boasts more than  SMART
products and product families for emerging markets –
ranging from X-ray devices to steam turbines to railway
signaling systems – with dozens more now poised for
market launch. But SMART products don’t only increase
our revenue and strengthen our market positions; they
also demonstrate what we’re doing to strengthen our
local presence and expand local value creation. To main-
tain our leading positions in emerging countries over
the long term, we’re not just localizing production;
we’re also giving our regional organizations more
decision-making authority and greater entrepreneurial
responsibility. Likewise, we’re establishing entire value
chains in those markets, since the procurement of raw
materials, finished products and services in one and the
same currency zone enables us to achieve competi-
tive cost positions while reducing the currency-related
risks to which a global company like ours is necessarily
exposed.
We’re also setting up additional R&D centers in regions
with above-average growth in order to be a more attrac-
tive employer for local managerial talent and highly
qualified university graduates – thus strengthening our
position in growth markets over the long term.
e. Expand our service business
To get closer to our customers – for us, this means pro-
viding outstanding services that increase customer
value. With our comprehensive service offerings, we
want to achieve the kind of long-lasting customer satis-
faction that makes us the first choice for follow-up
investment. It’s not only our sales organization that nur-
tures close relationships with our customers and fosters
their loyalty; above all, it’s our local service employees,
who – in some instances building on relationships that
go back decades – have detailed knowledge of our cus-
tomers’ needs and requirements. This knowledge,
which is indispensable for providing excellent service,
sets us apart from many of our competitors. And with
product standardization increasing, services will be an
important strategic factor that gives us an edge over our
competitors.
For these reasons, services are a key component of our
growth strategy, making major contributions to our
profitability. Leveraging our worldwide installed base,
they ’re a reliable source of high-margin revenue – and
they ’re less capital-intensive than other types of busi-
ness. What’s more, because long-term agreements are
the rule, services are less vulnerable to fluctuating busi-
ness cycles. As part of our One Siemens framework,
we’re aiming to rigorously expand our service business
in order to tap additional potential for sustainable
growth.
Recent organizational measures underscore the impor-
tance we attach to our service business. We’ve already
set up dedicated units to bundle the solutions-oriented
services provided by our Energy and Healthcare Sectors.
At the beginning of fiscal , we’ll go a step further
e