Siemens Case Essay

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ORGANIZATIONAL DEVELOPMENT | “EVALUATING THE CHANGE AGENT PROGRAM AT SIEMENS NIXDORF” | EVALUATING THE CHANGE AGENT PROGRAM AT SIEMENS NIXDORF SUMMARY: Siemens Nixdorf Information system (SNI) was the largest European-owned computer manufacturer and information technology vendor in 1994. The company was created by a merger between Nixdorf Computer; an entrepreneurial minicomputer firm, and the mainframe computer division of Siemens AG; the German electronics Giant in 1990. The company offered a broad range of computer product, from personal computers and mainframes to software and support services. The company posted $8 billion in revenues and employed 39,000 people worldwide in 1994. Despite its strong market and size in Europe, SNI had not posted a profitable quarter since the merger takes place. In 1994, the company faced the loss over $350 million. Company had a weak base in emerging Asian and North American market and 65% of its products were sold in Germany. SNI was slow to respond to market changes requiring more customer responsiveness and market shifts away from large mainframe systems, whereas the company had a strong technological focus. The company had experienced the strong union pressure and strict Government layoff regulation on putting efforts to trim high labor costs. Industry analyst observed that the company was constraint by a rigid corporate culture established during the merger. The organizational structure was considered as too bureaucratic in its approach to decision making for the rapidly emerging market. In mid-1994, the chairman of SNI in search for profitability bought new CEO Gerhard Schulmeyer, President and CEO of American division of Asea Brown Boveri (ABB), a Swedish – Swiss engineering company. Schulmeyer set goals for the profitability. He wanted SNI to become more customers driven and responsive to the market and for
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