Download - Hrp Final Ppt
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Building a structure todrive
Performance &Responsibility
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Case revolves around the most turbulent
times in the companys history.
Charges of rampant corruption, briberybrought negative publicity for the company.
Protability and employee satisfaction was atan all time low.
Under this critical situation, Peter Loscherbecame the CE in !uly,"##$, replacing theincumbent %laus %leinfeld.
&ntroduction
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'ounded in ()*$ by +erner von iemens and
his partner, !ohann -eorg als/e in 0erlin.
iemens grew rapidly, operating on a globalscale, with presence in almost all nations.
1ransitioned from a functional reportingstructure to a divisional structure in (2)2.
1his new structure placed greater emphasis onlocal responsiveness and enabled iemens tobenchmar/ against its peers.
Company 0ac/ground
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'unctional vs 3ivisional
tructure 0usiness departmentali4es
according according to the
activities performed byindividual groups
5 clear chain6of6command
Communication 7owsfreely within departments,
but less so betweendepartments
8ight complicate strategicdecision6ma/ing
0usiness
departmentali4es
according to geographicalareas, mar/ets, orproducts and services
3ivision heads havedecision6ma/ing power
3uplication of e9orts andincrease in costs
&ntra division among
divisions
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Corporate 8anagement
tructure
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Corporate -overnance
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'eatures of iemensstructure
Coordination among iemens businesses and
corporate technology :C1; for a solutionfocused rm
Local 8s iemens
1eam based 8anagement by the 'our eyes
principle 'our eyes principle = a two person team
consisting of technical head and commercialhead
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1wo year restructuring programme called
'it*8ore.
iemens ne, a program to simplify largescale pro?ects for global customers.
'ocus on global developments.
5uthoritative
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0ribery scandal led to low condence among
clients and employees.
'riction between head@uarters and localregions.
low and time consuming decision ma/ingprocess.
eartless management by %leinfeld.
&ne9ectiveness of four eyed principle.
Problems at iemens
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Replaced 4 eyes principle with CEO principle
Emphasis on transparency
Corporate
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Consensus and group decision ma/ing was
abolished.
Established one individual for onemanagement team.
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Before Loscher After Loscher
rgani4ationstructure
compleA impler:cleardelegation ofauthority;
8anagement style 5ggressive targetoriented management
-oal driven /eepingfuture in mind
Culture 3emotivatedemployees only
driven by target
8otivated employeeswhere their feedbac/
was appreciated
3ecision ma/ingprocess
* eyed principle CE principle
Comparison between the twoeras
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Consolidation of the businessB (# operating
groups to sectors
rgani4ation of the (2# countries into ($regional clusters
8inimi4ation of the administrative andcoordination activities within individualcountries
Establishment of Competence centers
Corporate
reorgani4ation
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(st dimensionB -lobal business6 ectors,
3ivisions and 0usiness units
"nd dimensionB
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'ocus on local customi4ation
3eveloping a spirit of entrepreneurship DisionB iemens6the pioneerF
Establishment of 8ar/et 3evelopment 0oards:803s;
iemens ne approach to customers
iemens
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8iddle 8anagers as the /ey vehicle to get to all
organi4ational levels
5n open door policy and strong internal communications Encouragement in the form of appraisals and
recognition to enhance employee productivity
PGL targets to be shared by global business andregional units
Elimination of the two6dimensional to reducebureaucracy and redundancy in sales and supportactivities and eliminate con7icts and boost collaboration
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1han/ Iou