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2 - Profitable growth at Siemens Medical Solutions

Published online by Cambridge University Press:  03 December 2009

Erich R. Reinhardt
Affiliation:
President and Chief Executive Officer, Siemens Medical Solutions
Edward D. Hess
Affiliation:
Emory University, Atlanta
Robert K. Kazanjian
Affiliation:
Emory University, Atlanta
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Summary

Benjamin franklin once said: “Drive thy business or it will drive thee.” This statement is true for any business in any industry and it is vital to understanding the concept of business growth. No business wants to go stale or get into a rut. Executives want to continually drive business growth, optimize profits, and ultimately be the best.

Webster's Dictionary defines growth as “an increase in size, number, value or strength.” The next entry, for a growth company, is: “a company whose rate of growth markedly exceeds that of the average in its field or the overall rate of economic growth.” Many believe that growth at large companies is difficult and more often than not these organizations “hit the growth wall” or become victims of their own size. While some companies do meet such a demise, Siemens Medical Solutions (MED) has been able to transform its business strategy, processes, and culture to overcome financial and industry downturns and drive sustained profitable growth (Knowledge@Emory, 2003).

Company background

MED is part of the global electronics leader, Siemens AG, which ranks first among the world's electronics and electrical equipment companies, with €74 billion in sales and more than 425,000 employees.

MED has a long history in the healthcare industry that dates back to 1877 when Erwin Mortiz Reiniger started manufacturing medical devices at the company's headquarters in Erlangen, Germany.

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Chapter
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Publisher: Cambridge University Press
Print publication year: 2006

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References

Birk, D. & Muller, M. 2002. KnowledgeSharing@Med – turning knowledge into business. In Davenport, T. H., Gilber, J. B., & Probst, J. (eds.), Knowledge Management Case Book, 2nd edn. Hoboken, NJ: WileyGoogle Scholar
Birk, D. & Muller, M. 2001. Crossing the Quality Chasm: A New Health System for the 21st Century. Washington, DCGoogle Scholar
Institute of Medicine 1999. To Err is Human: Building a Safer Health System. Washington, DC
Knowledge@Emory 2003. Can large companies be entrepreneurial? Emory University (October). http://knowledge.emory.edu/index.cfm?fa= viewArticle&id=720
Mills, D. Q. & Kurz, J. 2003. Siemens Medical Solutions: strategic turnaround. Harvard Business School Case
Siemens Medical Solutions 1995. Analysis result of a Boston Consulting Group Study. Unpublished report

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