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Siemens -- the e-company: in its quest to become an e-business company, Siemens is pursuing a comprehensive approach that goes far beyond the mere selling of products over the Internet.

Rather, it is concentrating on making all business processes within the organization as well as with customers, suppliers, and partners Internet-capable. But as the company has learned, even the best systems cannot guarantee a smooth e-company transformation. For that, it needed a plan, a model, and a change management culture. (Siemens)

"SIEMENS HAS A RADICAL PLAN and all the resources for completely transforming the company. And implementation is in full swing." That was how Manager Magazin, one of the leading German business magazines, last March described the ongoing transformation of Siemens into an e-business company.

As a result of this transformation, the company is placing its entire business on a new foundation. In the coming months, all of the company's business processes, both internally as well as with customers, suppliers, and partners--the entire supply chain--will be made Internet-capable.

The dimensions of such a task becomes apparent when you look at several key Siemens facts and figures. One of the world's leading electrical engineering and electronics companies, it employs 450,000 workers and maintains a presence in 190 countries. In the past fiscal year, the company enjoyed sales of more than 82 billion euros (approximately U.S.$72.5 billion) from a product portfolio ranging from power plants, cellular networks, and automation systems to computers, mobile phones, and light bulbs. In the words of President and CEO Heinrich yon Pierer, Siemens is the largest "e-business building site in the world."

Launched in May 2000, Siemens' enterprise-wide e-business initiative was designed to achieve a sustained increase in the company's value through the electronic networking of all business processes. Each of Siemens' 14 operating groups is responsible for reorganizing its business to help the company reach its goal. These efforts are supported by the Siemens Center of E-Excellence, which was founded at the start of the e-business initiative to coordinate the transition to electronic business. Its primary tasks include developing cross-unit standards both for the harmonized digitization of processes and for the software used within the company, supporting the operating groups in introducing e-business, and promoting the creation of an e-business culture among employees. (For a look at the Center of E-Excellence's goals and strategies, see Exhibits 1 and 2.)

EXHIBIT 1

Goals of Center of E-Excellence

* Define the e-business framework

* Define and implement governance and standards

* Create and facilitate the e-business community

* Set up the implementation method

* Introduce corporatewide services

EXHIBIT 2

Strategy of Center of E-Excellence

* Align Siemens' top-down goals with groups' and regions' planning

* Check existing e-business solutions prior to any new development

* Develop new solutions only jointly with groups and regions

* Establish a collaborative relationship between selected groups and regions and utilize them as a guiding coalition

* Build "Transformation Management Office" as a lean, partner-based organization for fast and effective implementation support

* Establish most efficient corporate services to enforce standardization and to reduce overall costs

Why e-Business?

As part of the transformation process, Siemens is pursuing a comprehensive approach that goes far beyond the mere selling of products over the Internet--what is called e-commerce. Plans call for new information and communications technologies to be integrated into all existing structures.

Of course, such a fundamental reconstruction carries a cost. Siemens intends to invest a total of around one billion euros. (approximately US$860 million) in the transformation over the next few years. Granted, this is an enormous investment. However, Siemens is convinced that this is the only way to exploit the full potential of e-business, increase productivity, and achieve a better cost position and optimal customer orientation. In the medium term, Siemens has set itself the goal of achieving significant savings through faster and improved electronic processes.

To effect the sweeping transformation within Siemens, managers have divided the task into five sub-areas: purchasing, sales, the internal value chain, the transfer of knowledge within the company and, finally, the marketing of Siemens' own e-business know-how. Though the initiative is not even two years old, the company already has made significant progress in the following areas:

* Electronic procurement and sales. Siemens made solid headway in the past fiscal year in automating electronic purchasing activities (including transactions completed via electronic data interchange). The company raised the percentage of transactions completed online by 50 percent to more than five billion euros (approximately US$4.3 billion).

The company took the first important step in achieving this more than a year ago by creating a companywide virtual procurement marketplace on the Internet, called click2procure. Particularly well suited to procuring highly standardized goods and materials such as office equipment, electronic components, and computers, click2procure provides all the functions necessary for handling purchasing transactions on an entirely electronic basis. Suppliers to Siemens can store their catalogs on the site, issue quotations electronically, receive orders, send invoices, and selectively obtain information on demand on the part of their Siemens customers.

Some 3,000 professional Siemens buyers and another 30,000 internal users worldwide currently have access to this purchasing platform. By the end of 2001, more than 3,000 strategic vendors were scheduled to be linked into the marketplace. The volume of purchases handled via click2procure was on track to far exceed one billion euros (approximately US$860 million) by year's end.

In addition, Siemens is setting up a collaborative procurement system that electronically processes information relating to the procurement of more specialized goods within a business unit. The goal here is to reduce purchasing prices by pooling demand and to cooperate with preferred suppliers throughout a unit.

A similar effort is under way with the sales operation, which is charged with collaboration with and connection to the company's customer base. It is important to note that the buy side (procurement), internal value chain, and the sell side are covered by the same architectural framework.

* Transparent process chains. Today, Siemens is aggressively expanding its supply chain management capabilities, which it considers a key component of its e-business. As a result, all logistics processes from suppliers to internal functions, and on to dealers or end customers, are to be electronically linked, synchronized, and made transparent. The objective is to increase significantly the quality of planning along the entire value chain.

For example, the company is improving its ability to match production plans to demand, in order to fully exploit its capacities, optimize inventories, and maximize on-time deliveries to its customers. If there is a sudden surge in demand for a product, electronic networking ensures quick access to the necessary information on which suppliers can meet the demand and on what production sites have additional capacity.

In the past, business units tended to exchange such information in a somewhat uncoordinated fashion. Now, the Internet makes it possible to deploy resources in the context of the overall planning process and optimize the whole supply chain at the same time. Siemens' mobile phone and communications network units have already installed such electronic planning systems.

At the same time, various support processes within the company are being transferred to the Web. For instance, one in 10 employees now uses the company's own electronic booking system for ordering airplane or rail tickets online.

* Networking knowledge. With its 450,000 employees, Siemens represents one of the world's largest knowledge networks. But modern communications technology means that this network can be made even more effective than it is today. To achieve this goal, Siemens is installing an enterprisewide electronic platform that employees can use to retrieve relevant knowledge and to make their own knowledge available to others.

Such knowledge management already is a reality in Siemens' Information & Communications business segment. Here, more than 20,000 employees use the ShareNet knowledge management system to exchange know-how, solve problems together, and create winning bids. The primary purpose is to make repeated use of successful solutions.

* Marketing its own know-how. Siemens also markets its e-business know-how to other companies, particularly through Siemens Business Services (SBS). Nearly 30 percent of SBS revenues in the past fiscal year came from the sale of e-business solutions.

For instance, SBS and the software company SAP have worked together in running Bay-net.de, the "Virtual Marketplace of Bavaria," for the state of Bavaria for some months now. Among other things, this online forum offers citizens services such as a guide to government offices and official forms for downloading, as well as an Internet marketplace for trading by and with small and medium-sized companies.

These transformation efforts will succeed only if the employees are convinced that electronic business can benefit both themselves and the company. Before this can happen, they must all become familiar with the Internet and work with it.

To prepare employees for e-business, the company has launched an "E-Readiness" program. As a first step, Siemens is giving every employee access to the Internet. In addition, the company is developing an extensive range of Internet-based training courses to allow employees and management to become familiar with the basics of e-business at their computers. (See Exhibit 3.)

[ILLUSTRATION OMITTED]

The key element of the program is the employee portal, which is intended to become the central point of entry to Siemens' e-business world for all employees. Information, access to services, and standard applications can all be found quickly and easily on these Web pages. The portal will provide company news, offer aids for the workplace such as search engines or forms, and permit employees to order shares or settle travel expenses electronically.

Soon nothing will work at Siemens without the Internet. Even though the transformation into an e-business company will take some time to complete, people everywhere in the company are committed to achieving the goal President and CEO von Pierer proclaimed at the start of the initiative: "With e-business, we will create a new economy with substance."

The Need to Standardize Business Processes

For Siemens' e-transformation effort to succeed, the company must not only prepare its employees but also standardize its business process. In planning the company's e-transformation, Siemens relied heavily on the Supply-Chain Operations Reference (SCOR) model from the Pittsburgh-based Supply-Chain Council. The SCOR principles are nothing new to the company. Siemens has applied SCOR methodology for several years in various business process reengineering and continuous process improvement initiatives to standardize, optimize, integrate, and finally automate end-to-end business processes. These initiatives reflect the company's conviction that obtaining a clear organizational view of all its disparate processes was essential to its efforts to integrate these functions as it transitioned to an e-company.

As it standardizes and integrates processes, Siemens will concentrate on transforming key physical processes from the brick-and-mortar environment into e-business capabilities. This requires a holistic approach, an alignment of business and supply chain strategy, best-in-class process performance, organizational change, fully integrated measurement systems, new leadership qualities, and leading-edge information and communication technologies.

Competing in today's business environment also demands significantly improved levels of customer service and corporate flexibility, as well as time and cost improvements across an end-to-end supply network. That, in turn, brings an expectation that supply network management strategies throughout the corporation will be integrated.

Customers today are asking their product and service providers, including many of Siemens' business units, to help them improve their decision making. This encompasses decisions on the design, building, and operation of supply network architectures; on business processes; and on applications and technologies driving improved economic value and profitability not only for the manufacturers themselves but also for their customers and suppliers.

More and more enterprises have begun evaluating the potential opportunities and business benefits of moving their physical, brick-and-mortar-based relationships to more virtual, online networks. Those networks are built on information-and knowledge-sharing capabilities, mutual trust, and enabling technologies both inside the corporate boundaries and between trading partners. Although these technologies are already available, they typically are not yet integrated or used to their full potential.

In Siemens' view, network models need to combine business process standardization, automation and integration, collaborative target-setting, and performance management alignment among different partners. This means integrating disparate information and communication infrastructures to allow different departments and organizations to function in an interrelated manner--and to make decisions on an integrated set of balanced performance scorecards.

Following and implementing such an enterprise vision could easily become a complicated and time-consuming process. It requires major changes to management practices, business processes, organizational structure, cultural behavior, and information- and communication-technology infrastructure.

At the same time, the complexity of modern supply networks is increasing enormously. Sales, offerings, service portfolios, and production and distribution concepts must be adapted continuously and integrated seamlessly.

Consider that opportunities for saving several billion euros currently lie fallow in inefficient enterprise processes within a single large company like Siemens. Information-based decision making along the entire corporate value chain, therefore, is a prerequisite for expanding market share and increasing cash flow and profits.

Siemens' belief that it needed to standardize, integrate, and automate its end-to-end business processes was driven by several general trends in the industry. The following are some of the underlying "new economy" principles that shaped Siemens' e-transformation strategies:

* More and more companies from the so-called old economy are now turning to the World Wide Web to standardize, integrate, and automate their business processes. These processes cover all business interactions from product, solution, and service design through purchasing, manufacturing, and order management to distribution, invoicing, and cash management. The cycle begins with a customer requirement or order, often triggered by the click of a mouse, but then requires on-time and full-scale delivery of real products and services.

* Interenterprise collaboration is becoming a competitive asset. Siemens, like other companies, has realized it will be able to meet customer requirements in the future only by collaborative relationships with trading partners based on joint planning and execution.

The emergence of global markets, increasingly rapid change, rising customer expectations, new markets, and flexible competitors ... all of these require the formation of a new organizational model. That model rests upon so-called core competencies, key skills, and knowledge assets that, if used correctly, can provide decisive competitive advantages. In a supply network, partnering is used primarily to optimize the use of joint resources and, thus, to distinguish oneself from competitors in the market as an interenterprise network. Optimum allocation of the capabilities of all partners and service providers in a network increases customer value, employee satisfaction, and shareholder value simultaneously. Our goal, therefore, is to optimize costs, sales, and asset management in a win-win environment.

* Integrated networks will benefit all partners involved. Professionally designed and integrated networks of suppliers and customers form synergistic business communities that provide competitive speed and cost advantages that go far beyond those of traditional approaches.

The "magic" formula, therefore, is integration. Integration, however, is a multidimensional challenge. For integration to work, the four interdependent business layers of enterprise strategy, business processes, applications, and technologies have to be permanently aligned.

The design, implementation, and operation of these four business layers, therefore, need to be addressed as a closed-loop approach, which Siemens is doing. By following a closed-loop approach, an improvement project can be started at any point in the value chain; for example:

--In designing corporate strategies (for example, worldwide production and logistics concepts after a merger or acquisition).

--In analyzing the current situation and then aligning business processes toward best-in-class management practices in combination with benchmarks.

--In implementing and providing technical support for integrated solutions.

To accomplish these and related goals, partners must coordinate their activities, using joint process control parameters and compatible software and management tools.

Some Lessons Learned

Even the best information sharing and knowledge management systems, however, cannot guarantee a smooth e-company transformation. Success, we found, does not depend so much on information and communication technology as on a paradigm shift to partnerships and actions based on mutual trust. This applies within a single plant just as it does to collaborations among corporate groups or partner networks. In our experience, at least half the time the so-called "soft" side of integration is the make or break factor.

Some observations on this. from the Siemens effort so far:

* Implementing best-of-breed software is not enough to gain competitive advantage. Instead, organizational structure and business strategy must be sufficiently communicated from the top down within the organization and aligned with bottom-up process improvements. Also, enterprise performance must be measured consistently and benchmarked against that of the leaders. It is important for best management practices to be known and well understood by the organization. Only then can a single enterprise or business community achieve competitive advantage, or even leadership.

* Any challenge that confronts a single department, a small company, or an international enterprise today will be a challenge for the whole supply chain or trading partner network tomorrow. The game is basically the same, only on a much wider international scale. Players in such a network may work together for specific business goals for a limited time but remain competitors in all other fields.

* Win-win relationships can be achieved only if strategies are aligned between partners and business processes are connected across enterprises. Common business goals should be mutually agreed upon and implemented. Measurement systems also should be used from end to end. The supply chain should have in place balanced metrics that are consistently used and enabled by world-class information and communications technologies. Siemens has found the SCOR model to be very valuable as we seek to confirm that these principles are in place.

* In connecting with e-business solutions, scalability across many partners in a network is achievable. Increasingly, supply chains or trading-partner networks are competing against other trading-partner networks and replacing traditional company-to-company competition. These networks tend to span the entire supply chain, starting with the final customer. The members have common business interests, but they play and share different roles according to best-in-class dynamics and target specific market segments.

* Trading partner networks redefine traditional one-to-one relationships into many-to-many value-creating networks. Transforming physical order-to-cash processes, product and solution engineering, manufacturing, subcontracting, order management, and delivery into e-business capabilities can be seen as an e-enabled strategy to align and integrate business processes, technologies, and systems. Siemens is using its e-transformation strategy to support collaboration inside the enterprise and, increasingly, between trading partner networks.

This strategy covers:

--The synchronization of manufacturing processes with the overall supply chain.

--The streamlining and automation of processes and workflows within the enterprise and across supply chain partners.

--The integration of product, material, information, and workflows upstream and downstream.

--The alignment of process and system design between all collaborating partners.

--The enablement of decision processes on the shop floor through information visibility and analysis tools.

--The support of collaborative maintenance and of an information and communication infrastructure.

New Business Models Emerge

The vision of a collaborative trading partner network implies a switch from vertical integration to increased partnerships in engineering, purchasing, manufacturing, and trading communities. In the vertically integrated corporation, the classical organizational form of many brick-and-mortar companies meant that all business functions tended to operate as silos--that is, even though they may have been run inside the same enterprise, they very often were not integrated. Relationships with business partners were based on independence and covered suppliers, mainly managed by price, on the buy side and retailers or end customers on the sell side. Under this system, products, solutions, and services were "pushed" into markets.

As enterprises matured and business processes became more complex, customer requirements no longer could be covered by a single enterprise. The role of the value chain coordinator or integrator emerged. In this business model, enterprises started to focus on core processes, while they outsourced other functions, such as the assembly of subsystems, to partners. Along with the need to maintain customer and supplier relationships, companies found that they also had to cooperate with contract manufacturers or logistics providers.

The next level of maturity in trading partner networks turns out to be business "community" integration, or what is often called the virtual enterprise. Here, only strategic core competencies are retained in-house, while all other functions are outsourced. Nevertheless, trading partners continue to be legal entities in a virtual enterprise. Each company controls those functions of an end-to-end supply chain in which it is best in class while working jointly with its partners to best serve the end-customer requirements.

Under this model, integrated business processes cross company boundaries, and legal entities collaborate much more often than was the case in the classic, vertically integrated enterprise. Sometimes this collaboration occurs in the middle of a process (as in manufacturing).

Collaborative business processes, especially when propelled by e-enablement, cover different aspects, including:

* Transformation of a customer forecast requirement or order directly and electronically to the production plants.

* Dynamic scheduling of customer demands into production lines.

* Collaborative engineering of new products and services early on with suppliers.

* Alignment of enterprisewide cross-functional teams to support new product introduction.

* Collaboration with downstream logistics providers to deliver products and services on time.

* Tight integration of subcontractors with electronic manufacturing services to execute outsourcing strategies.

* Real-time order-to-delivery, order-to-cash (OTD/OTC) information sharing with suppliers, customers, and partners.

* Integration and optimization of the entire OTD/OTC value chain as well as of the enabling and support processes.

As a result, the model of a linear, even end-to-end, supply chain is rapidly shifting into a dynamic digital supply network. This new model shows the paradigm shift from stable one-to-one relationships with suppliers and customers into flexible, project management-related, many-to-many networks. It also dramatizes the transition from an environment marked by boundaries between independent companies to a virtual network of capabilities.

The final winners in this new digital world will be those enterprises with direct access to information and knowledge for faster and better decision making, as well as the appropriate capabilities and resources to understand and fulfill the new customer requirements.

The Siemens "Business Unit" Approach--From the Bottom Up

Siemens' implementation projects started as early as 1995 in our high-tech computing business and used one of the very first releases of the SCOR model. At that time, the challenge was to transform the company from a high-technology, low-volume mainframe business to a high-volume, customer-responsive personal computer (PC) business.

SCOR, as a cross-industry, standardized supply chain reference model, delivered to us the business methodology and the management tools to analyze, measure, and improve the key processes in our business segments. These key processes were, as we called them then: idea to product, offer to order, order to cash, and complaint to solution.

Besides facilitating business process reengineering and best practice analysis, this approach provided valuable benchmarking information through the Integrated Supply Chain Performance Benchmarking Study (conducted by Pittiglio Rabin Todd & McGrath (1)). This study was based on the same enterprise models and process and performance data sets as the SCOR model.

By benchmarking against the SCOR model, we found we could identify innovative business architectures and process models from other industries and other countries. We could analyze these models, adapt them to our specific business requirements, and then implement them relatively quickly and easily. Access to these models helped guide our performance improvements and best-practice adoption while helping us maintain our competitiveness.

Based on these early successes of the SCOR model approach in the Siemens computing business group, other business areas within Siemens--such as medical systems, communication networks, and mobile telephones--followed with successful business improvement projects in different factories around the world.

Getting the Big Picture

The SCOR model (now in Release 5.0, with 6.0 due out soon) was developed to describe the business activities associated with all phases of satisfying a customer's demand. The model is organized around the five primary management processes of plan, source, make, deliver, and return.

The model can be used to describe supply chains that are very simple or very complex because it uses a common set of definitions. As a result, disparate industries can be linked to describe the depth and breadth of virtually any supply chain. The model has been able to describe and provide a basis for supply chain improvement for both global and site-specific projects.

SCOR spans all customer interactions (order entry through paid invoice), all physical material transactions (from the supplier's supplier to the customer's customer, including transactions involving equipment, supplies, spare parts, bulk products, and software), and all market interactions (from the understanding of aggregate demand to the fulfillment of each order). Nevertheless, it is important to understand that the model does not attempt to describe every business process or activity. Specifically, the model, as published by the council, does not address:

* Sales and marketing (demand generation).

* Product development, or research and development (R&D).

* Some elements of post-delivery customer support.

Those limitations offer an example of one area where Siemens enhanced--or as we say, "Siemenized"--the original model from the Supply-Chain Council (as described below). It should be noted here that in general, the scope (or at least, the applied interpretation) of the model is open to permanent change. In fact, it is expected to change based upon council members' requirements. With 2001's introduction of the "return" element, for example, the model has been extended into the area of post-delivery customer support (although it does not yet reflect all activities in that area).

Significantly, too, in each company's use of SCOR, an enterprise-specific model needs to be designed, implemented, and maintained to support supply chains of various complexities and across multiple industries.

The council does not attempt to prescribe how a particular organization should conduct its business or design its system and information flow. In fact, in a company-specific adoption and implementation, as in Siemens Corp.'s initiative, the goal is a different one. Within Siemens, for instance, the SCOR model serves as a reference or a blueprint to be used for implementing any process or technology throughout the enterprise. Siemens has enhanced the model by providing real-life implementation business cases for internal use. A cross-business-unit quality-assurance group collects these cases, benchmarks them against intra- or extra-enterprise best practices, and then files them in a central repository. From there, they can be downloaded as reusable design modules for process optimization or technology implementation.

The SCOR model contains levels that describe business processes for various areas. These cover everything from high-level, end-to-end material flows down to activities on the shop floor. Levels 1 to 3 are public; company-specific implementations start at Level 4. Every organization that implements supply chain improvements using the SCOR model needs to extend the model details down to at least Level 4 (the implementation level), using organization-specific processes, systems, and practices. Siemens went down to Level 6 detail in some areas--which is where, for example, ERP or APS (advanced planning and scheduling) specifications were defined.

The SCOR model is, then, a business process reference model. It links process elements, metrics, best practices, and the features associated with the execution of a supply chain in a unique format. Significantly, the uniqueness and power of the model and its successful implementation are chiefly derived from using these four elements together.

It is also important to recognize that an enterprise model describes processes, not functions. In other words, the SCOR model focuses on the activity involved, not the person or organizational element that performs the activity.

Besides describing the five basic management processes (plan, source, make, deliver, return) that provide the SCOR model's organizational structure, the model also includes three distinct "process types": planning, execution, and enablement. These three types can be explained as follows:

* A planning process aligns expected resources to meet expected demand requirements. Ideally, planning will take place at regular intervals and be factored into supply chain response time.

* Execution processes are triggered by planned or actual demand. They include scheduling and sequencing, transforming materials and services, and moving product.

* Enable processes prepare, maintain, and manage information or relationships upon which planning and execution processes rely.

Like the process elements themselves, the metrics employed are intended to be hierarchical and used in conjunction with "performance attributes." Some examples of these performance attributes include supply chain reliability, supply chain responsiveness, supply chain flexibility, supply chain cost, and supply chain asset management.

The Siemens Corporate Approach--From the Top Down

In the summer of 2000, the Siemens Central Board launched its worldwide e-transformation initiative with the following qualitative goals:

* To develop a worldwide Siemens e-business culture.

* To build, together with our partners and suppliers, customer value-focused supply chains.

* To implement a business demand-driven information and knowledge flow.

* To standardize Siemens' worldwide IT network and ensure that it is state of the art.

Accordingly, three Centers of E-Excellence were founded in Munich, Germany; Atlanta, Ga.; and Singapore. The centers were assigned the following charter:

* Transform the existing business.

* Create new business.

* Sell self-experienced e-business solutions.

* Apply e-business solutions from best-in-class e-business companies.

e-Transformation at Siemens is globally directed and locally implemented. It is strategy-fed and line-of-business driven.

An enterprise process model now defines all key business processes. It extends from strategy to procurement, to supply chain management, to sales and marketing, and to e-business enabling and support processes, all based on a transaction layer of ERP and legacy systems. (See Exhibit 4 for a look at the transformation framework.)

[ILLUSTRATION OMITTED]

Buy-side e-procurement and sell-side e-commerce modules integrate our own intra-enterprise business processes with our upstream and downstream supply chain partners. All of them leverage negotiation power across operating business units to maximize savings and to drive shared development of reusable needs-based solutions.

Indicative of the scope and depth of its commitment to a first-class global e-business system, Siemens is integrating premier internally and externally facing applications with its SAP R/3 enterprise systems. Application software systems include i2 Technologies for scheduling and forecasting, Commerce One for buy-side operations, and IBM's WebSphere on the sell side.

Interenterprise process standardization, integration, and automation enable fast and flexible linking and decoupling of different business partners in the following processes (note their consistency with the five SCOR process elements): collaborative planning (e.g., demand forecasting), sourcing (e.g., requests triggered by exceptional customer demand), make (e.g., short-term outsourcing of a production line to an electronic manufacturing services provider), deliver (e.g., sales auction based on excess inventory), or return (e.g., optimization of maintenance, repair, and overhaul processes).

The supply chain management decision layer of the Siemens architecture also is based on the SCOR model and its high-level plan, source, make, deliver, and return process types. Maximizing operational efficiencies across all operating business units requires the standardization of business processes and technologies.

To align with and to support our heterogeneous business portfolio, which covers products, solutions, and services, we adapted and enhanced the SCOR model to support various business types: product businesses, system businesses, project businesses, and service businesses. Our enhancements should enable the model to apply to our wide range of businesses, which include semiconductors; information and communication networks, products, and services; automotive, transportation, and industrial products and services; and power generation, transmissions, and distribution systems, products, and projects.

The Intranet Dimension

Today, the Siemens model is housed on our company intranet. Users worldwide can select a business type, one of the 29 process types (consolidated from hundreds of process definitions in use before this project was launched) from the SCOR toolbox, and then receive back a standardized process description in the form of a subprocess chain. The data repository delivers the sequence and the input and output variables for the various subprocesses.

The entire Siemens e-excellence transformation strategy is becoming an actuality--built on a solid foundation that includes a plan, a model (SCOR and our adaptation), and a change management culture to effect a "new" Siemens.

Footnote

(1) Pittiglio Rabin Todd & McGrath (PRTM) and AMR Research, together with about 70 manufacturing companies, were founders of the SCOR model in 1996 and of the Supply-Chain Council, which today spans more than 800 enterprises around the globe.

Albert Goller is head of the corporate office for e-business, Siemens AG, and president of the company's Centers of E-Excellence. Herbert Heinzel was an original member of the Siemens e-company transition team and is now a consultant to the company. Heinzel is also chairman of the European Chapter of the Supply-Chain Council.
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Author:Goller, Albert; Heinzel, Herbert
Publication:Supply Chain Management Review
Article Type:Company Profile
Geographic Code:4EUGE
Date:Mar 1, 2002
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