Siemens - Knowledge Management

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Siemens AG is a German based company founded in 1847, employs over 416,000 people in 190 countries, and has over 60.1 billion Euros in sales worldwide. Siemens became the electronics, telecommunications, and electrical engineering powerhouse that it is today by consistently innovating and discovering new technologies. After starting out as a small precision-engineering workshop making wire insulation and warning bells for railroads, the company discovered the dynamoelectric principle, built the first electrical railway and developed the first electrical elevator. Siemens currently makes a plethora of products such as light bulbs, X-ray machines, telecommunication equipment, and high speed trains.

Increased competition, deregulation, and a surge in data traffic drastically changed the business structure of the telecom Industry. An economic wave of new competitors arrived at the table while the pace of innovation increased by the introduction of new technology such as IP networks. Due to these economic changes, Siemens underwent a restructuring phase and as a result of this, a new business group, Information and Communication Networks (ICN) was formed. In addition, there was an increase in customer purchasing power because new and old customers became less interested in the practice of “buying boxes” from Siemens and became more focused on purchasing business solutions to fit their specific needs. Customers were searching for more value based business solutions such as consulting, financing, systems integration, and other solution based services. This shift from a pure product business to a service focus and solutions approach increased the complexity and knowledge intensity of Siemens’ business. As Joachim Döring, ICN manger recalls: “Suddenly, our salespeople were facing the challenge of having to offer solutions rather than precisely defined products. That significantly increased our influence on the value-added chain as far as customers were concerned.” (Heading for Knowledge-Guided Networks, Sabine Saphörster

In the new market setting, the sales force at Siemens had to redirect their learning curve in order to broaden their skill set within the knowledge of business analysis, business development, and network planning. It was no longer to their benefit to only understand the specifications of a “box” in order to seal a deal. Since Siemens had a worldwide sales force, there was a fundamental need to find a way to make the knowledge available to everyone within the organization and better equip them with the tools they needed to produce results. Andreas Manuth acknowledged: “In the past, ICN relied on centralized flows of information to and from units. We wanted to dramatically shift from that approach to globally networked flows of knowledge.” ICN understood that they had poor re-use of knowledge and wanted to build a best practices model that would change their global strategy. This brought forth the development of the ShareNet knowledge management/sharing system.

ICN initially developed ShareNet as a knowledge sharing tool for the Sales and Marketing group, which had the greatest need and opportunity during that time. ICN’s goal was to develop a platform in order for their business units to create and share both explicit and tacit knowledge on a global scale. Once Siemens successfully implemented their global knowledge network for Sales & Marketing, they proceeded to develop the program in their R&D department. By 2002 the application had over 19,000 users in more than 80 countries that were submitting, storing, and utilizing the knowledge based tool. As the telecommunications industry went through a massive transformation, restructuring activities reduced the ICN group to a handful of resources, and the economic downturn forced Siemens to cutback on major expenses. Since the KM system was not fully understood at the time, it was in danger of losing its corporate funding. In addition, questions were...
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