Siemens plans to invest €1billion over the next 18 months to integrate its businesses electronically. Making the announcement on the occasion of the opening of the company’s first ‘Center of E-Excellence’ at Munich airport, Heinrich von Pierer, president and CEO (pictured) commented: ‘We intend to transform ourselves into an e-driven company in record time.’ The restructuring will include the company’s marketing, development, recruitment and logistics departments.
The move involves the use of auctions in the procurement process so that over the next two to three years, the company plans to raise the volume of electronic procurements from 10 to 50%. Siemens believes the move to e-business will create savings of between 3 and 5% in annual sales volume in the medium term. IBM has been enlisted to help manage the restructuring process.
The use of e-procurement to expand electronic purchasing must be a key company priority. However, the transformation of the company’s business processes must extend far beyond conventional applications such as e-procurement and on-line sales into areas such as training, recruitment and logistics. Providing Internet access to all 440,000 employees worldwide presents a massive task in itself.