“Siemens stands for innovative strength and sustainability – this is why outstanding achievements by our suppliers in these categories are particularly important,” said Barbara Kux, member of the Managing Board of Siemens AG. Texas Instruments (TI), the winner in the overall ranking, has been supplying Siemens with semiconductors for more than 30 years. In addition to good sustainability, productivity, reliability, technology, innovation and quality, the jurors emphasized TI’s particular ability to respond to Siemens AG’s very wide range of requirements. TI has some 27,000 employees and in fiscal 2009 generated revenue of about $10 billion. The company’s headquarters are in Dallas, Texas, U.S.

The Trips Group has been manufacturing protection and control systems for switchgear for Siemens since 2003. The company, headquartered in Grafenrheinfeld, Germany, and Singapore was selected by the jury in the Innovation category for a novel manufacturing process. This reduced manufacturing costs and errors and increased customer satisfaction and the competitiveness of Trips. This mid-sized company has 160 employees and posted revenue of €20 million in fiscal 2009.

The winner in the Global Value Sourcing category was Franke GmbH. The company manufactures components for Siemens computer tomographs. Franke impressed the jury with its successful transfer of a particular technology to a local partner in China – which led to a noticeable improvement in the supplies for the manufacturing plant at Siemens in Shanghai. The mid-sized company with headquarters in Aalen employs 210 people and has annual revenue of €30 million.

With its programs in the areas of climate protection, disaster relief and education, the logistics services provider Deutsche Post DHL focused in particular on sustainability and social responsibility. This company thus came first in the Sustainability category. With some 500,000 employees, Deutsche Post DHL generated revenue of over €46 billion in fiscal 2009.

Also announced was the completion of Siemens’ contract renewal for SAP maintenance support services for all SAP solutions based on SAP’s maintenance standards for large customers for a duration of three years.

In addition to the selection of SAP SRM, Siemens renewed its service relationship with SAP for global maintenance support for all SAP solutions. Siemens also requested SAP assume support for some of Siemens’ in-house developed solutions that connect to SAP solutions. Further, recognizing the criticality of the business processes running on SAP software, including finance, payroll and more, Siemens extended its service relationship to include SAP MaxAttention support – SAP’s support option that provides onsite customized support services.

“Siemens and SAP enjoy a long-standing business relationship in which Siemens is one of SAP’s premier customers, and we are pleased to be able to continue providing complete systems service and support to Siemens’ global organization,” said Erwin Gunst, chief operating officer, SAP. “Coupling its maintenance support renewal with selection of our SRM solution is a clear indication that Siemens trusts in the ability of SAP to provide global services for its enterprises. SAP has been, and will continue to be, a strong strategic supplier to Siemens.”

The SAP Supplier Relationship Management (SAP SRM) application automates, simplifies and accelerates procure-to-pay processes for goods and services. With SAP SRM, companies can reduce procurement costs, build collaborative supplier relationships, better manage supply bases and improve bottom line with innovative offerings and a faster time to market. SAP SRM is part of SAP Business Suite software, the integrated business application of SAP.

Siemens also presented awards in particularly important subcategories to its best suppliers in the areas Innovation and Global Value Sourcing. These awards went to the Swiss semiconductor producer STMicroelectronics and the U.S. developer of hearing aid components Knowles Electronics Holding Inc., respectively. “In presenting these awards, we want to honor the partners who have helped us reach the market better and faster,” said Barbara Kux, Member of the Managing Board of Siemens AG, at the awards ceremony near Munich, Germany on Thursday.

The awards presentation took place for the first time at the newly established Supplier Forum, to which Siemens invites its 30 most important suppliers in order to develop joint strategies for even more effective cooperation. The Supplier Forum is part of the Supplier Initiative, which was set up by Barbara Kux in January 2009 and with which the company intends to help ensure its long-term profitability. As part of the initiative, purchasing will be bundled more tightly in the future in order to get better prices via volume discounts. In fiscal 2008, slightly less than €12 billion of Siemens’ worldwide procurement volume of some €40 billion was centrally negotiated. By 2010, Siemens intends to increase this share by 60 percent to €19 billion. In the medium term, Siemens also wants to reduce the number of its suppliers, which totaled over 100,000 in fiscal 2008, by 20 percent and to work even more closely with its most important suppliers. Third, Siemens wants to increase the proportion of value added it generates in emerging markets from some 20 percent in 2008 to over 25 percent in the medium term.

BIS Gas Turbine Systems, the winner in the overall ranking, has supported the Siemens Energy Sector since 2002 in the worldwide processing of project businesses with gas turbines. In addition to the criteria quality, reliability and price, the Bremen company convinced the jurors, in particular, by its ability to respond to the specific needs of customers in the various countries. In addition, the company has a regional network of suppliers with which it is supporting Siemens in increasing its proportion of value added in emerging markets over the long term. With some 20 employees, BIS Gas Turbine Systems, a company of Bilfinger Berger Industrial Services AG (BIS AG), generated revenue of about €70 million in fiscal 2008.

STMicroelectronics was honored as Siemens’ most innovative supplier, in particular, due to its technological leadership in the semiconductor business and its close cooperation with Siemens in the development of components for industry automation. Located in Geneva, Switzerland, the company has been an important supplier to Siemens’ Industry Sector and a market leader in its segment for more than 30 years. With some 50,000 employees, STMicroelectronics generated revenue of about €6.5 billion in fiscal 2008. 

Knowles Electronics, Inc., winner in the category Global Value Sourcing, has developed and produced hearing aid components for the Siemens Healthcare Sector for over 60 years. Located in Chicago, U.S., the company impressed the jury with its economical value added in emerging markets and its outstanding on-time delivery. The company has some 5,000 employees in seven countries. Knowles Electronics does not publish its revenue figures.

As a vendor of plant technology for the aluminum industry, Siemens VAI has references from all over the world, including compact aluminum, reversing warm rolling, tandem rolling, cold rolling and foil roll mills. Its industry-specific know-how encompasses process control and electrical engineering as well as fluid technology and mechanics.

Based on process-oriented consulting packages, Siemens VAI checks operational processes or workflow and production planning. Suggestions are then put forward for improving productivity or quality. “In addition, an analysis of the factory and existing production facilities provides a decision-making basis for pending investments in modernization or expansion projects and yields information about options for extending the product portfolio,” they say at the Munich headquarters .

Depending on the plant, the potential for improvements can be considerable. Thus, in a high-speed foil rolling mill in China, it was possible to boost productivity by up to 25% by reducing pre-stress levels in relation to the rolling speed. The process consultancy services are provided by an interdisciplinary team of technical specialists for all kinds of systems, manufacturing facilities and production processes.

Further information on solutions for the aluminum industry can be found at: http://www.siemens.com/metals

“We’ve been forcefully driving the company’s transformation in order to make Siemens fit for the future. Customers are already seeing the benefits. Now, we intend to improve long-term cooperation with our suppliers,” said Peter Löscher, Siemens President and CEO. As Barbara Kux, head of Supply Chain Management and member of Siemens’ Managing Board, explained, “The internal targets set by our supply chain management initiative are ambitious. But our approach is different from that of our competitors. Our purchasing managers will be measured against the savings targets – this doesn’t have to take place in public. In price poker, you don’t want anyone to see your cards.”

The main aim of the Siemens supply chain management initiative is to safeguard profitability. The company intends to bundle and focus procurement more intensively in the future in order to obtain lower prices through bulk purchasing. By 2010, Siemens’ approximately 4,000 purchasing managers are expected to have negotiated conditions on a cross-Sector basis for products and services with a value of some €19 billion. This target volume corresponds to an increase of 60 percent in comparison to fiscal 2008. In the medium term, Siemens also intends to reduce the total number of its suppliers by 20 percent and intensify cooperation with its key suppliers. 

“We want to sit at the table with the best players in the market. The best suppliers also have the best sub-suppliers. An international network of this kind is indispensable,” said Barbara Kux. In addition, Siemens wants to procure more products in target markets that are generating high growth and in which the company already has a high level of production knowhow. The aim is to develop local value chains encompassing procurement, development, production and service and to increase the share of global value sourcing in emerging countries in the medium term from the current level of 20 percent to over 25 percent in order to achieve a better balance between revenue volume and procurement volume. According to Siemens, the company has defined more than 1,000 measures for improving its supply chain. These measures are to be implemented by 2010.

In fiscal 2008, Siemens’ procurement volume totaled roughly €40 billion. Production material purchased decentrally by the three Siemens Sectors Energy, Industry and Healthcare accounted for about €21.2 billion of this amount. Production material that was negotiated and procured on a cross-Sector basis accounted for some €6.8 billion. These materials include, for example, steel and steel components. Roughly €12 billion went for materials and services – such as office supplies, power supplies, travel services, PCs and software – that were only indirectly connected with production.

This system is said to be unique throughout the world and distinguishes itself by its extreme speed.  The new generation of sorting machines is the first that is capable of handling up to 50,000 flats per hour. The order calls for delivery to begin in 2010 and to end by 2012. Recently Deutsche Post had placed an order with Siemens Mobility for 288 standard and compact letter sorting systems intended for 82 mail centers in Germany. The volume for both orders invested by German postal service totals 420 million euros over the next years.

This Open Mail Handling System is characterized by its ability to integrate the latest postal automation technologies. An item of mail is identified through digital detection of its physical appearance, a method referred to in expert circles as fingerprint technology. Each letter comprises an individual combination of stamps, sender and address; all of these taken together constitute a kind of electronic fingerprint that clearly identifies the item and accompanies it through the entire mail delivery process.

Sorting can be extended to the carrier route sequence of the mailman and is achieved in one run. The machine also postmarks each item of mail to invalidate the postal stamps. Integration of the new technologies into a single overall system makes the new flats sorting machines the fastest in the world according to Siemens. Deutsche Post will benefit from higher productivity, lower operating costs, greater user friendliness and, last but not least, more careful handling aimed at minimizing damage to mail items. The flats sorting systems can cope with all sorting tasks for items with a thickness of up to 32 millimeters and a maximum weight of two kilograms.

The wind turbines, which Siemens will deliver under the supply agreement, have a capacity of 3.6 megawatts, like those in operation at Dong Energy’s Burbo Banks offshore wind farm in Great Britain. These wind turbines are also being installed by Siemens at Dong Energy’s Gunfleet Sands I+II project. Wind turbines with a total capacity of up to 1,800 megawatts are planned for future Dong Energy offshore projects in Northern Europe.

In 1991 the two companies Siemens and Dong Energy constructed the world’s first offshore wind farm at Vindeby in Denmark and have since then worked together on many offshore projects including, for example, Middelgrunden near Copenhagen (Denmark), Nysted in Southern Denmark, Burbo Bank in Liverpool Bay (UK) and the soon to be installed Gunfleet Sands I+II (UK) and Horns Rev 2 (Denmark).

Photo:  The strongest Siemens wind turbine has a capacity of 3.6 megawatts, increasing capacity by 1.3 megawatt compared to the strongest model so far and – about 100 times the capacity of the first wind turbine 25 years ago. This is the strongest machine built in series for offshore parks, and thus for the use on the high seas. With Burbo wind farm Siemens installed the first offshore park with 3.6 megawatt turbines and a total capacity of 90 megawatts – in just one and a half months. Since the end of 2007 the wind farm has been supplying more than 80,000 households with clean power.

Today, Siemens AG has appointed Barbara Kux to the Managing Board of the newly established Supply Chain Management Division.

For the first time in more than 160 years of company history, a woman has been appointed to the top management board of Siemens AG. Out of the DAX-30 listed companies, only Siemens has a female Member on the Managing Board. The 54-year-old Swiss executive, who has held the position of Chief Procurement Officer at the Dutch Philips Group since 2003, will be heading the newly established Supply Chain Management Division as Member of the Siemens Managing Board. Her responsibilities include managing the global corporate purchasing volume of 42 billion euros. In her additional function as Chief Sustainability Officer she will be in charge of marketing the cross-sector environmental portfolio.

At its meeting on 12 November 2008, Barbara Kux was appointed by the Siemens Supervisory Board as a new Member of the Siemens AG Managing Board. She will take up her post on 17 November 2008. Before, the 54-year-old Swiss was heading Purchasing and Sustainability as Member of the Philips Group Board. Her former employers were Ford, ABB, Nestle and McKinsey. Barbara Kux studied in Europe as well as in the United States and she received her M.B.A. from INSEAD, in Fontainebleau. In 1995 she was selected by the World Economic Forum in Davos to join the group of “Global Leader of Tomorrow”.

Gerhard Cromme, Chairman of the Siemens AG Supervisory Board, welcomed Ms Kux as an outstanding personality with a broad international background, particularly in the field of Supply Chain Management. “I am glad to have won Ms Kux as a new Member of the top management,” Cromme said. Peter Löscher, Chairman of the Siemens AG Managing Board, said:”With view to the global economic challenges, the timing of Ms Kux’s appointment has been perfect.” He stressed that by being in charge of the Siemens global purchasing volume, Ms Kux would be in a crucial position to further raise corporate efficiency. “This first appointment of a woman to the Managing Board shows that we want more women to take up executive posts at Siemens, and we offer them excellent opportunities in our company.”