SIEMENS: DIGITAL TRANSFORMATION

About Siemens

Siemens AG is a German conglomerate founded in the year 1847. It is one of the largest manufacturing and
electronics company in the world. Industry, Energy, Healthcare, and Infrastructure & Cities represent the main
activities of the company. The company has nine divisions i.e. Process Industries and Drives, Digital Factory, Energy
Management, Healthcare, Mobility, Power and Gas, Power Generation Services, Wind Power and Renewable,
Building Technologies.

Siemens Building Technologies

Siemens Building Technologies, an Operating Division of Siemens AG (hereinafter referred to as "Siemens Building
Technologies" and/or "SBT"), is a global electronics and information technology company. Siemens Building
Technologies is active in the field of Building automation systems, HVAC Products, fire safety and building security.
For more details on their portfolio of products/services, visit the official website of Siemens Building Technologies.

(https://www.siemens.com/global/en/home/company/about/businesses/building-technologies.html)

Introduction to the case

Digital is upending the existing processes and disrupting the way businesses are being done. Digital Transformation
(through SMAC - social, mobility, analytics and cloud) is expected to shape the strategy and growth of organizations
across business segments. We are on the threshold of a dramatic digital disintermediation driving the operating
model for growth and sustainability.
Siemens has been a leader in adopting digital and has undertaken a journey towards convergence of its business,
people, & all stake holders.

Overview of Business Operations

Building Technologies Division:

Typical value chain of BT business:

Project Operation
Project Detailed Purchasing Project
opening & & Dispatch Execution Commissioning Acceptance closure
planning
clarification manufacturi Warranty
ng

Start of Order Approval Dispatch Materials Installation Release Customer Project End of
project receipt of approval and completed for acceptance closure warranty
clarified detailed resources customer
planning at site acceptanc
e
 As part of the project execution process the project-planning process covers the following key activities.

Coordinate via Project Schedule

and delegate Work package
Document deviations from plan

Update Project Schedule according to

agreed deviations
In form of stake holder, execute agreed
corrective actions with Project team

Most of the projects are undertaken on turnkey basis, constituting activities such as:
Site/route/area survey and assessment
Engineering design (Siemens-BT has an in-house engineering team)
Strategic Sourcing (Vendor On-Board, Components)
Logistics of component items (e.g. conductor, hardware etc) to project sites
Execution
Project Management
Key Pain points:
Siemens BT is the business unit of Siemens that delivers end-to-end solutions in building automation. There tends to
be a very high number of small value projects carrying sharp deadlines resulting in inconsistent information flows
between multiple stakeholders involved. The typical project hierarchy is Regional Manager Operations>Project
Manager>Engineers>Supervisors(Vendor). Project manager(PM) is the SPOC for communication with client about
regular updates on man power, resource deployment, work progress etc. He coordinates with site engineers from
multiple project sites for the same. Different vendors supply manpower to Siemens on a contract basis and they
work under the guidance of Siemens engineers.
In the current scenario, the number of PMs available per project is low. This typically leads to one PM handling 6 -7
projects simultaneously, resulting in high human intervention in project coordination and ad-hoc reporting
practices. It also leads to gaps in information transfer between the client and internal Siemens stakeholders,
creating delay in obtaining work clearances. Siemens has its own customized project tracking tool (PTM), but there
are often issues such as lack of compatibility with client systems in small value projects. Other significant site level
problems include non-user-friendly nature of PTM tool, manual documentation, and delayed deployment of
resources (man, machine, material, equipment).
Another area of concern is vendor management. Vendors in this case are third-party contractors who supply
manpower. High area of project spread makes manual manpower tracking untenable. Also, manpower vendors
typically belong to the unorganized sector and are generally technology averse. This results in lack of proper
communication between the vendor and Engineer/PM about manpower deployment and performance.
Areas where Siemens BT plans to drive improvements in small value projects by leveraging digital solutions are:
Stage Area Possible use cases
Project Execution Site productivity improvement Manpower tracking, Manpower
(Leveraging IoT solutions/sensors) productivity improvement etc
Project Control Efficient management of Reducing human intervention in
information flows between all the monitoring, controlling and tracking
stakeholders involved (Client, of project deliverables, Automated
Siemens, and Third-party vendors) periodic reporting mechanisms etc

Deliverables

Part A
Competitive Benchmarking and Gap-Analysis of digital initiatives and best practices adopted by leading
players in the Building Technology automation industry, with specific focus on the improvement areas
highlighted above.
Part B

Suggest one digital proposal which could help Siemens BT disrupt the business.

The final proposal should contain following information in detail.

Problem Statement
Root Cause Analysis of the problem
Competitor Benchmarking & Gap- analysis
Suggested Solution (Recommendations such as Dashboards/Excel Tools need to feature well-defined KPIs)
Suggestive Implementation method
Cost implication
Impact Both Financial & Non-Financial
Make assumptions wherever necessary. Assumptions, if any, are to be mentioned in the presentation clearly.