Editorial

Johannes Feldmayer is a member of the Siemens AG Corporate Executive Committee. He is responsible for the business region Europe, as well as for several Siemens Groups and corporate departments (L&A, SBT, CIO, GPL)

In recent months, Europe has laid the groundwork for future development. The extension of the European Union in May 2004 created the world’s largest single market, which has the economic power of the U.S. but more inhabitants than the U.S. and Japan put together. The election of a new European Parliament in June was soon followed by a breakthrough when the leaders of the EU states agreed on the text of the future EU constitution. All of this brings Europe an important step closer to its declared goal of becoming the most dynamic economic region in the world—even though much remains to be done in terms of economic reforms.

For companies like Siemens, the new Europe offers tremendous opportunity. This is where we generate 57 % of our sales and employ two-thirds of our workforce. After the opening of the Iron Curtain, we’ve also been able to revive contacts that go back for more than a century, and today Siemens employs about 25,000 men and women in central and eastern Europe. That brings us closer to customers who demand many infrastructure services and a pool of well-qualified workers whose labor costs are in some cases only one-sixth of those of their colleagues in Germany.

But in terms of costs alone, neither Germany nor Europe will be able to compete with other business locations, for example, those in Asia. The EU’s strengths must be sought elsewhere: in its socially stable economies, and, above all, in its people’s high level of creativity, thanks to which we have a good chance of taking the lead in innovation. And that will be the key to our competitiveness in the future. Siemens too has set its sights high. We want to be the trendsetter in everything we do.

And that’s why we’ve chosen innovation, along with customer orientation and global competitiveness, as the focus of our top⁺ business excellence program. A major aspect of this program is the synergy between the Siemens Groups—for example, the development of platforms such as a uniform architecture for control systems of every kind, or wireless LAN for use in applications ranging from cell phones to data transmission in factories (see "Real Time"). Well thought-out platforms not only help to save costs but also permit more flexibility and higher quality, thanks to reusable modules—and that means more benefits for our customers. An additional focus of our innovation program is on areas where we intend to set trends—whether it’s the rise of the mobile office (see ("Mobile Office"), the smart home (see "Two-Way Street") or the real-time enterprise (see "Real Time").

This issue of Pictures of the Future also demonstrates the high percentage of cross-sectional technologies at Siemens—for example, sensor technology (see  articles on sensor technology) and software (see Scenario Software). Most of the added value in almost all of our business areas is based on software, even if it’s not immediately visible in the products. Our 30,000 software developers—that’s more than at many leading software houses—basically make us one of the leading software companies in the world.

I am convinced that Siemens is well on the way to becoming the leader in innovation and achieving a significant competitive edge. But the question remains: What will Europe look like in 2020? We recently commissioned TNS Infratest to conduct a study on this intriguing issue. The article  "A Glimpse of Things to Come" reports on the future scenario we will publish as "Horizons2020."