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A view to the future

Interview with Joe Kaeser and Siegfried Russwurm

Digitalization is changing the world. And it is changing Siemens, too. Whether it’s smart factories, decentralized energy systems or tomorrow’s mobility systems, Siemens engineers are increasingly closing the gap that once separated hardware from software. Cloud technologies and data analytics are helping in this process. So are agile start-ups – and our legendary entrepreneurship. Joe Kaeser and Siegfried Russwurm discuss Siemens’ innovative power and our ideas for the future.

Is Siemens still innovative?

Joe Kaeser Of course. The Company has been living from good ideas that have earned us money for almost 170 years. We have only stayed profitable because we have reinvented ourselves several times. We can’t afford to slacken when it comes to our innovative power, and won’t! That is why we invested an extra of about 500 million euros in research into our core lines of business – electrification, automation and digitalization – in the past fiscal year.

Siegfried Russwurm Pioneering technologies and the business models that build on them are the foundation of our success. Without a doubt, the speed of innovation has increased dramatically. That affects the way we develop new things. Our innovation processes are much more open nowadays. Instead of hatching ideas behind locked doors, we are now collaborating with external partners, including small start-ups that have little money but good ideas.


Siemens matured in a world of hardware, in other words of tangible products. However, today, exciting growth business is increasingly arising in the digital world.

Joe Kaeser That’s right. We have therefore devised our own digitalization strategy and are implementing it consistently. At seven to nine percent, we expect the greatest growth potential for Siemens to be in the field of digitalization. And we want to achieve that over our entire portfolio, for example with our digital services for remote maintenance of a wide range of systems. Our software for design, prototyping and simulation in the virtual world was even used successfully in the development of the Mars rover Curiosity, and also helped the Italian car manufacturer Maserati to bring a new vehicle to market in just 16 months.

Siegfried Russwurm As a broad-based technology group, we have a key advantage: we can leverage our size, for instance by investing once and building uniform platforms for our Divisions and Business Units. This includes an extensive IT security concept, a plan for using cloud technologies and with Sinalytics a platform for industrial data analytics that everyone at Siemens will be able to use. And our customers will be the primary beneficiaries of these steps.


Our energy business, in particular, has been subject to major changes all over the world. What are the innovations with which you want to bring Siemens forward here?

Joe Kaeser The market has indeed changed dramatically in recent years. Energy systems are becoming decentralized. We must be self-critical and recognize that we did not always keep up with these developments in the past. We have learned from that. We want to become a leading player in the area of decentralized energy supply. The acquisition of Dresser-Rand and Rolls-Royce’s turbine business is a significant step. We have set our sights on optimum interplay between various energy sources in a multimodal energy system. This includes new ways of generating electricity as well as new chemical energy storage systems for surplus green power, innovative transmission technologies, smart grid concepts and information and communication technologies. After all, digitalization is also gaining ground in the energy sector.


Siemens has a strong position in the industry automation business. Can this lead be extended?

Siegfried Russwurm We are the only company in the world that already unites the real and virtual manufacturing worlds under one roof – one of the key aspects of Industrie 4.0. We began to orchestrate all components and closely integrate software and hardware 20 years ago, the buzzword being “smart factory.” At our Amberg Electronics Plant, products and machines communicate with each other and all processes are optimized and controlled in terms of IT. The plant has achieved a quality rating of 99.99885 percent. And at the Electronics Manufacturing Plant in Erlangen, we have devised new concepts for highly flexible manufacturing systems using lightweight robots and 3D printers.


Is it sufficient to expand existing business? Shouldn’t Siemens also be experimenting with disruptive innovations?

Joe Kaeser We not only need disruptive ideas but also the courage to realize them. But here, too, we have made considerable progress. We are more daring. And we are actively looking around. Many concepts for new technologies originate at start-up companies. And they, in turn, are often looking for financially strong partners with expertise in extensive development work – partners like Siemens. That is why we deploy specially trained technology scouts in Silicon Valley, Shanghai, Munich and soon in Tel Aviv.

Siegfried Russwurm At present, we have intensified our search for very young companies working on 3D printing and robotics. We have a specific support program for this. For example, one of the companies is developing software that optimizes 3D designs. By supporting such companies, we get very early access to new technologies in return. But we also found start-ups ourselves, make use of the entrepreneurship of external managers and later bring applications of strategic interest into the Group.


Should Siemens act more like a start-up itself?

Siegfried Russwurm We can certainly learn a lot about innovative power, inventive spirit and speed from start-ups, and we do. We are working on making the Group faster and more open – both internally and externally. But we can’t pretend to be a start-up company. We have customers all over the world and some 350,000 employees. We need processes and an organization that are in line with this and underpin it. Incidentally, that is what makes us a sought-after partner for start-ups. And that is precisely where I see our role.

Joe Kaeser Many start-ups want to become as big as Siemens; they don’t want to stay small. But no matter whether big or small, it is important for a company to act in an entrepreneurial manner. I keep telling our employees to act as if Siemens were their own company. We call it Ownership Culture. Siemens itself began as a start-up in a backyard in Berlin. A piece of this entrepreneurship is inside all of us. And in the future, we will be even more focused in terms of putting it into effect.

Thank you very much for this interview.